Surf's up for Chellew as he departs Adelaide Brighton
Adelaide Brighton chief executive Mark Chellew says he is finished with full-time executive life and plans to spend time surfing and travelling after he steps down from the cement group he transformed from a battler into one of Australia's 100 biggest companies.
"After 13 years at the company, I feel I've achieved what I wanted to achieve and it's time to pass the baton on. At 57, I've still got time to do things and I've got my health," Mr Chellew said. "I've got a farm, we run cattle, and I've taken up surfing a lot more seriously. I think its time to get a portfolio of interests rather than be a full-time executive."
Chairman Les Hosking said Mr Chellew had been one of the most successful CEOs of an ASX-listed company in his 13-year tenure, generating an average total shareholder return of 100 per cent per annum over the period.
Adelaide Brighton shares were down 3 per cent to $3.51 following the announcement Mr Chellew would be leaving.
Looking back over his time in the top job, Mr Chellew said he was particularly proud of three things.
"We implemented a good strategy of being vertically integrated into concrete and quarries. We really strengthened our lime position in Western Australia and, thirdly, I think our cost reduction has been phenomenal. When I was appointed, the share price was around 40¢. It's now around $3.50. I'm happy with that scorecard."
Adelaide Brighton's successful push into the concrete and aggregates market and the solid position it has built in building materials in Western Australia have established its place in the highly competitive Australian building materials sector.
Exposure to engineering construction in the booming resources sector, was a boon for the company while competitors languished with weak residential housing markets through the financial crisis.
Mr Chellew leaves the former minnow with a market capitalisation of $2.3 billion. But he admits some things could have been done better. He says entry in the masonry business, which is leveraged to the residential housing cycle, was poorly timed.
"Masonry has been a tough business to be in. But do we have regrets? No, the acquisition is underwritten by the intrinsic asset value of the land we bought.
"Clearly, the cycle went against us but the cycle will turn."
He also laments Adelaide Brighton's lack of financial muscle to pursue acquisitions when Heidelberg was licking its wounds in the financial crisis. "We were trying to get a stake but we were probably too small to play at the table. We tried hard," he says.
Mr Chellew says he will not remain on the Adelaide Brighton board "as it is not always good practice and can hinder the new CEO". He is a non-executive director of Transpacific Industries and may pursue other non-executive directorships next year.
Mr Chellew will be succeeded by cement and lime executive general manager Martin Brydon.
Mr Brydon will become deputy chief executive from February 1 and will take on the CEO role from Mr Chellew after the company's general meeting in May.
Adelaide Brighton shares have risen 15.4 per cent to around $3.53 over the past 12 months. The S&P/ASX 200 Index has risen 10.5 per cent over the same period.