Today after the close the following snippet of a press release was issued by ENER.
Energy Conversion Devices, Inc. (ECD) (Nasdaq: ENER - News), a leading global manufacturer of thin-film solar products, announced today it has appointed Harry W. Zike as Vice President and Chief Financial Officer effective September 1. Mr. Zike will replace Sanjeev Kumar who has decided to leave the company at the end of August to pursue other opportunities. As CFO, Mr. Zike will be responsible for all aspects of ECD's finance function, including accounting, financial planning and analysis, tax, treasury, audit, and information technology activities of ECD. He will report to Mark Morelli, ECD's President and Chief Executive Officer.
Prior to joining ECD, Mr. Zike served as Executive Vice President, Chief Financial Officer and Director with Siemens VDO Automotive Corporation where he headed the financial and business administration operations of the Americas region. Additionally, he was responsible for corporate governance, shared services, information technology/security, treasury and taxes, risk management, insurance, real estate and facilities, internal audit and procurement, and logistics.
While at Siemens Westinghouse Power Corporation, Mr. Zike was Vice President and Chief Financial Officer and Director. In this role, together with the executive management team, he integrated the acquisition of the approximate $1 billion fossil power generation business of Westinghouse into Siemens and managed a fourfold growth in revenue.
Here is the reason for this post. Generally replacing a CFO as long standing as Sanjeev Kumar with a code word for termination (seeking other employment opportunities), sends a panic over financial analysts. Generally replacement of a financial CFO prior to end of FY 10-K signals a missed quarter, an accounting issue, or a disagreement with auditors. Yet the stock went up over eight percent.
Second, look at the resume of the new CFO, a major international executive with multibillion revenue experience, acquisition/divestiture experience, strong knowledge in IT, internal audit, corporate compliance, etc. Much better resume than Sanjeev. Also, Kumar is the last senior management executive to hit the pavement. This signals to me that Morelli now has his team in place.
Morelli then went on to say strong sales were continuing, so no tempering of street expectations, so my guess he has enough stuff in the year end financials to demolish the rumor-mongers and shorts. Why would a senior guy like him take a role in a small, mid cap flier like ENER unless he sensed a real upside. Read outside confirmation of a successful transition to the new model. Looks like we have another senior member of the team in place.
I wish Kumar the best of success in his endeavors. He has held a steady tiller during our change in crew, we owe him thanks and respect for a job well done. Still, it seems an appropriate time for the new guard to take over the tiller and chart the new course.
Best wishes to all the new management team and to Kumar!
... it's ususally a bad sign. No one quits without a reason.
I don't know what it means in this case, but I'll just throw out a couple of questions about ENER's finances that have been nagging me:
- whatever happened to ENER's auction-rate securities? .....they''re probably illiquid. are they also impaired?
- who on earth lends money to a tech company at 3% ? .....where's the catch? from whom do the lenders expect to profit?
- why did the company facilitate the shorting of its own stock? .....did management act AGAINST shareholder interest?
The answers to some of these questions may or may not have something to do with the CFO's departure. As usual, I can only connect the dots and arrive at my own guess as to what's going on here. But I'm assuming the worst.
I'm still out btw. Neither long nor short. No shares, no options.
>>- who on earth lends money to a tech company at 3% ? .....where's the catch? from whom do the lenders expect to profit? << (post looks)
I think the answers to those Qs are suggested by your next two questions:
>>- why did the company facilitate the shorting of its own stock? <<
IMO, because a) that allowed them to get the low interest rate and b) the shorting manipulations will not affect ENER in the longer run.
>>.....did management act AGAINST shareholder interest?<<
No -- not actual investors, that is. The lenders, who got to borrow shares from ECD, will be in a good position to rip various short-term, chart-based "players" by way of easy manipulating. Longer-term investors will see more volatility, but they will win more the longer they hold.
This CFO was pushed out and replaced with someone that has more experience.It is a big improvement for sure.Morelli wanted his man and not the old fool Stan picked.By the way pushing Stan and Stemple out was the best thing that ever happened to ENER and its shareholders.Yes I undestand what Stan's wife did many years ago,but Stan and Stemple where a real Laurel and Hardy show.