19/05/2020 - 11:35

New Decmil CEO, $29m Homeground write-down

19/05/2020 - 11:35

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Engineering and construction company Decmil has replaced Scott Criddle as chief executive, amid a $29 million write-down of its Homeground Gladstone accommodation village in Queensland and the launch of a $40 million capital raising.

New Decmil CEO, $29m Homeground write-down
Andries Dique will replace Scott Criddle as chief executive of Decmil.

Engineering and construction company Decmil has replaced Scott Criddle as chief executive, amid a $29 million write-down of its Homeground Gladstone accommodation village in Queensland and the launch of a $40 million capital raising.

Decmil today appointed board member Andries Dique to lead the Perth-based company. Mr Criddle, who has held the chief executive title since 2010, will remain on the board as an executive director.

Mr Dique joined Decmil in 2004 and worked in roles including general manager and chief operating officer, until 2011.

He was appointed to the board in July 2018 and became an executive director last February, with general management responsibility for Australia’s western and northern regions.

Decmil chairman David Saxelby today said it was the right time for the company to appoint a new CEO and continue its business turnaround strategy, and that Mr Dique’s expertise would bring a focus on project execution, delivery and risk management.

Mr Dique was involved with delivering projects valued at $1.8 billion between 2007 and 2011, Decmil said, while earnings within this period grew from $5.3 million to $58.2 million.

“We are extremely fortunate to have the depth of talent and experience within our business which will ensure this is a seamless transition,” Mr Saxelby said in an ASX announcement.

“[Mr Dique] is a proven executive performer having previously delivered and overseen a period of strong, profitable growth for the company.

“The board is confident that, under his leadership and with significant infrastructure spending in Australia over the next few years, Decmil will drive shareholder returns through an unwavering focus on profitable project delivery.”

Mr Dique's new remuneration comprises a base salary of $550,000, while Mr Criddle’s pay will be reduced to $450,000.

All other terms of both their employment remain unchanged.

Mr Saxelby thanked the former chief executive for his leadership during what he termed a difficult period for the company, which recently closed its New Zealand operations after terminating a major contract with the country’s prisons department, worth $185 million.

Decmil last month said, as a result, it expected a write-down of between $50 million and $60 million.

At the same time as Mr Dique’s appointment, Decmil has downgraded the carrying value of its Homeground Gladstone LNG workforce accommodation village, which the company is planning to sell.

Decmil said although it had begun sale discussions, falling oil prices and the coronavirus impact on tourism had led the company to reassess the value of the QLD asset.

"As a result of the review, the Decmil board has adopted a conservative view of the asset's carrying value and, supported by an external independent valuation, has revalued Homeground to $56.6 million," the company said.

“This will crystallise a $28.8 million non-cash impairment in the current financial year."

Decmil has gone into a trading halt ahead of a capital raising, understood to be a placement and rights issue worth up to $40 million.

Major shareholder Thorney is expected to take up its full entitlements while company directors and founder Denis Criddle will also participate in the offer.

Hartleys is acting as lead manager to the raising.

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