Thursday 24th August 2017
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Critics of the Fletcher Building board of directors "don't know a lot about construction" if they think it's unusual for a building company to experience financial difficulty in a bull market, says former Fletcher senior executive Mark Binns.
Speaking to BusinessDesk after delivering his last earnings briefing as chief executive of Meridian Energy, Binns appealed for those criticising the Fletcher Building board to "cut them a bit of slack".
"They've acknowledged mistakes were made. The real test is what they do now to fix it. Let's move forward rather than pulling history apart."
It was not uncommon for construction companies to suffer financial difficulties at the height of a building boom because of the way escalating prices for sub-contractors and materials could swiftly change the economics of large projects.
Binns was widely tipped as a replacement for Mark Adamson, who was fired as Fletcher's chief executive last month after the company announced its second major earnings downgrade for the financial year ended June 30 and after the publication of an internal email that Fletcher's chair, Ralph Norris, said was "inappropriate" in its language. The email criticised the culture and managers in the company's troubled construction unit.
However, Binns ruled himself out during the Meridian briefing.
In what he described as a "read my lips" moment, Binns said: "There's been a lot of speculation that I might be going to Fletcher Building either as CEO or as a director. Read my lips: the answer is that I will not be," said Binns. "I am retiring. I will be taking some director positions and will have some outside business interests, but I agreed with my wife about six months ago what those were and Fletcher Building is not in the tea-leaves."
Now 60, Binns was a respected senior manager at Fletcher Building before he left to lead Meridian in January 2012 ahead of the state-controlled renewable electricity generator and retailer's partial privatisation in 2013.
Norris is one of the country's most successful former chief executives and the Fletcher board includes heavyweight directors such as Tony Carter, chair of the Air New Zealand board.
"Everyone wants Fletcher Building to survive," he said, describing it as a "proud company" with more than a century of history.
"Ït can survive. I'm confident that the directors will make the right decisions. Let's focus on the future, not the past."
Binns declined to discuss whether he had either been approached by Fletcher Building to replace Adamson or had considered applying.
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