ALEXANDER Russell, the Lanarkshire quarrying and building products group, yesterday appointed a new finance director and unveiled plans for an ambitious acquisition to restore profits growth.
The news immediately perked up the share price which hit a four-year low of 73.5p earlier this month.
Alexander Russell shares gained 3p to 81.5p, giving the Uddingston-based company a market capitalisation of just under #30m.
The new finance director is Brian Dougherty, a 43-year-old chartered accountant who takes up his post on June 1 after a brief stint as finance director of Clydesdale Bank.
He had previously worked for the Williams building products group.
Dougherty replaces Ross Belch, 58, who has been finance director for the past 29 years.
But Belch will stay on as executive director in charge of legal matters and business development for a further two years before retiring when he reaches the age of 60.
Announcing Dougherty's appointment at Alexander Russell's annual meeting in Glasgow, chairman James Blyth said that the company was keen to enter a new area of business following the shutdown of its loss-making open-cast coal mines over the last year.
The withdrawal from coals has left Alexander Russell relying on the depressed quarrying business to provide two-thirds of its trading profits and the cyclical building trade to provide the remainder.
It, therefore, needs to find a new branch of activity to achieve strong growth and long-term stability.
Speaking after the meeting, Belch said that the company hoped to make an ambitious acquisition before the end of this year.
It has no specific target in its sights yet, but several business areas of potential interest have been identified, he added.
Commenting on Dougherty's appointment, Belch said that more fresh faces might be drafted into Alexander Russell's top management soon to help shake up the the lacklustre company.
Its net profits have been flat at just under #2m for the last four years.
''The company has been fairly static in its performance for some time, and we do think that we need some new blood and some new people within the management team,'' Belch said.
But the outgoing finance director strenuously denied suggestions that he himself was being shunted aside as a result of his failure to detect the activities of a rogue manager who was fired last year after giving #240,000 of unauthorised discounts to key customers in the building trade.
''There is no connection whatsoever. The entire board accept responsibility for what happened,'' Belch said, noting that a subsequent probe by external accountants had shown that adequate internal controls were in place.
Belch said there was little prospect of Alexander Russell issuing paper to help finance acquisitions while the share price continued to languish at its current lows.
The company, therefore, plans to rely mainly on bank debt.
Alexander Russell has borrowings of #12m, equivalent to 38% of shareholder funds.
But insiders said that it might go to the bank for a further #10m or more to finance the right buy.
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