By William Trent, CFA of Stock Market Beat
Allied Defense Group says CFO resigns, names successor | Reuters.com
Allied Defense Group Inc. (ADG – Annual Report) said Chief Financial Officer Robert Dowski resigned, effective April 6, to pursue opportunities with a privately held, venture backed firm.
The departure of top officers (particularly financial officers) is always a topic of scrutiny. Did they leave for a better offer, or because something was wrong? The fact that the CFO of Allied Defense, which is one of the new Small Cap Watch List members, is leaving for another job would typically be a positive sign. However, the company has also had a good bit of turmoil lately, including having the “going concern” clause appended to their auditor’s note.
The company is pursuing steps to right the ship, as they detailed in a press release:
“We have also taken several important steps to enhance the Company’s liquidity, including the following:
- We anticipate receipt by MECAR of a substantial order from our principal customer in the very near term. Assuming that order is received, MECAR’s cash flow should be positive in 2007.
- We have developed and are implementing a plan to restructure MECAR’s operations to substantially reduce its fixed costs and break-even point for 2007. Additionally, we are developing contingency plans for MECAR if the order from their key customer is not received.
- VSK’s operations are expected to generate cash in 2007 and we anticipate improved performance by our other subsidiaries in 2007, which will generate additional cash.
- We are actively pursuing the sale of SeaSpace Corporation and anticipate that the business will be sold in the first half of 2007.
“Allied’s Board of Directors and management team are working very closely to explore our strategic options in order to resolve these issues and get this Company back on track,” concluded [CEO] Major General Marcello (Ret.).
Given that the company has just filed a very fresh annual report, we promise to make that our top priority for analysis.
For more information, see all articles on: Stock Market, ADG
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