Tag Archives: CFO

US Physical Therapy hires new CFO

US Physical Therapy has appointed Carey Hendrickson as its new CFO. He replaces Larry McAfee, who is retiring.

The company operates 551 outpatient physical therapy clinics in 39 states as well as managing 32 physical therapy facilities for third parties. It also has a industrial injury prevention division. The company has its head office in west Houston and has a market capitalization of $1 billion.



In March and April, many of its clinics were closed. At the lowest point in mid-April, visits were about 45% of pre-pandemic levels. By August, they were at 85%, The company cut costs aggressively through salary reductions, furloughs and rent deferrals. It increased its EBITDA in Q2 over Q1, despite revenues being down nearly 30%.

Mr Hendrickson joins from Capital Senior Living Corporation, a publicly-traded company based in Dallas (market cap $20 million), where he was CFO. Prior to joining them in 2014, he was the CFO at Belo Corp, the operator of television stations. Mr Hendrickson will receive a base salary of $450,000. He also received a grant of stock worth $400,000 that will vest over four years.

Mr McAfee has been CFO since joining the company in 2003. He originally announced his intention to retire back in January 2020 but later deferred the intended retirement date because of the pandemic. He will stay on until the Annual Meeting in December, at which point he will resign from the Board. Mr McAfee will then enter into a six month consulting agreement where he will be paid an hourly rate, on an as-needed basis.

SEC filing – US Physical Therapy new CFO

Helicopter company appoints new CFO

Jennifer Whalen has been appointed the CFO of Bristow Group, the helicopter company that has its head office in west Houston.



Bristow merged with ERA Group in June, in an all-stock transaction. Although Bristow shareholders ended up with 77% of the combined company, it was mostly ERA management that took the senior roles in the combined group.

Ms Whalen joined ERA in 2012 and was appointed interim CFO in June 2017. The interim tag was removed in February 2018. After the Bristow/ERA merger, she was again named interim CFO. The company stated that a permanent CFO would be named later.

Ms Whalen is rewarded for her patience with a pay raise of $70,000 to $380,000. She also received a one-time equity award of 11,667 shares of performance-vested restricted stock and 11,667 stock options.

At the time of the merger, the company said it expected to achieve annualized cost savings of at least $35 million. This would occur through the elimination of duplicate corporate expenses and greater operational efficiencies. Last month, the company increased that amount to $45 million. It said it had already realized $16 million of annualized savings.

SEC filing – Bristow Whalen CFO appointment

Centerpoint Energy appoints new CFO

Jason Wells has been appointed the new CFO of Centerpoint Energy. He replaces Xia Liu, who bolted in May, after less than a year to become the CFO at WEC Energy. Kristie Colvin, the interim CFO, reverts to her previous role of Chief Accounting Officer.



Mr Wells joins from PG&E Corporation, the embattled California utility. He joined PG&E in 2007 and became CFO in January 2016. PG&E filed for bankruptcy in January 2019 and exited in July 2020, with a newly-reconstituted board. 11 of the 14 directors are new. The CEO, Bill Johnson, stepped down on June 30, having been in the role for only 15 months. The company had also announced plans to move its head office from San Francisco to Oakland.

Mr Wells will receive a base salary of $650,000 and a sign-on equity award of restricted stock units worth $1 million, that will fully vest in two years. The company will also buy his residence in San Francisco and pay for relocation expenses.

Centerpoint appointed Dave Lesar, the former Halliburton CEO, as its new CEO on July 1. Under pressure from activist investor, Elliott Management, the company is slimming down to become more of pure-play utility company.

SEC Filing – Centerpoint Wells appointment

 

Hospitality Group appoints new CFO

RCI Hospitality has promoted Bradley Chhay to CFO, replacing Philip Marshall, who is retiring from that role. Mr Chhay joined the company in November 2015 as Controller. He had previously worked for Live Nation and RigNet.

Mr Chhay, age 36, will have a base salary of $400,000. Mr Marshall, age 70, had been the CFO since May 2007. He will stay on at the company, focusing on income tax matters.

RCI operates adult nightclubs such as Rick’s Cabaret and restaurants and sports bars under the Bombshells brand name. It has 48 units in total, though only 34 were open at the beginning of September. The company’s head office is in NW Houston.

Like other hospitality businesses, it has been hit hard by the pandemic. Revenue for the three months to June 2020 were only a third of revenues from the comparable period, though the company states that business has somewhat recovered since. It managed to generate a positive cash flow in the quarter as a result of deferring payments that are real estate related.

Last year, the company came under fire from anonymous short sellers who alleged a series of related party transactions that were not disclosed in SEC filings. The company conducted an internal review that mostly vindicated ‘Big Rick’, the anonymous blogger. It also strengthened its related party transaction policy and vowed to appoint at least one independent director.

A formal SEC investigation into the company is still ongoing.

So, I find it amazing that the SEC filing announcing Mr Chhay’s appointment also disclosed that his brother holds a $100,000 promissory note from the company. It’s good that the company correctly disclosed it, but it shows the pervasive amount of related party transactions.

 

SEC filing – RCI Hospitality CFO appointment

CFO of publicly-traded midstream company departs

Michael Pearl, the CFO of Western Midstream Partners, will be leaving the company, although the company didn’t say when! Michael Ure, the current CEO, is taking over the CFO duties until a successor is identified.



Western Midstream is a master limited partnership that went public in 2008 as a subsidiary of Anadarko. It’s now owned by Occidental, following its takeover of Anadarko last year. It has its head office in The Woodlands.

Mr Pearl joined Anadarko in 2004. He was the CFO of the general partner of Western Midstream for two years straddling the IPO.  After that, he held senior financial roles in Anadarko until he became the CFO of Western Midstream in October 2019. His base salary was $455,000.

In August 2019, ahead of his proposed appointment, Mr Pearl entered into a retention agreement that provided for three cash payments of $261,000 each, to be paid in February 2020, August 2020 and February 2021. If he was terminated without cause, the unpaid amounts would vest. In signing the retention agreement, Mr Pearl waived his right to additional severance payments.

SEC filing – Pearl departure

 

New CFO appointed at Battalion Oil

Kevin Andrews has been appointed CFO at Battalion Oil Corporation. He replaces Ragan Altizer, who plans to retire.

The company is based in downtown Houston and has working interests in approximately 52,000 net acres in the Delaware Basin. Its market capitalization is currently $126 million.



The company was formerly known as Halcon Resources. It went into bankruptcy in August 2019. The company emerged in October 2019, having eliminated over $750 million of debt. In return, the debt holders got 91% of the newly reorganized equity.

The company changed its name to Battalion Oil Corporation in January 2019 and regained its listing on the NYSE American the following month.

Halcon hit the headlines in February 2019 when Floyd Wilson (then CEO), Mark Mize (CFO) and Steve Herod (Corporate Development) all left on the same day. This happened two weeks after an activist investor had criticized the excessive corporate overhead at the company. Under the terms of their contracts, the terminations were considered terminations without cause. Combined, the three executives got over $9 million in cash severance.

Quentin Hicks was promoted to CFO, following the departure of Mr Mize. However, he resigned in July 2019, after four months, to become CFO at Gulfport Energy.

Mr Altizer became CFO in August 2019. He and CEO Richard Little (appointed in June 2019) worked together at Ajax Resources, an E&P company whose assets were sold to Diamondback Energy in October 2018.

Mr Andrews has spent most of his career in investment banking. Most recently, he was the Head of Energy Investment Banking at Imperial Capital. He will receive a base salary of $350,000.

SEC filing – Battalion Oil CFO appointment

LNG company replaces CFO

https://www.flickr.com/photos/royluck/3628833456

Cheniere LNG – Sabine Pass – Roy Luck

Cheniere Energy has appointed Zach Davis as its new CFO. He replaces Michael Wortley, who steps down from the role, effective immediately. Mr Wortley will remain employed through the end of the month.

Cheniere is based in downtown Houston and was the pioneer in developing Liquified Natural Gas (LNG) for export. It currently has a market capitalization of $13 billion.



Mr Davis joined the company in 2016 as the VP of Finance and Planning and was promoted to Senior VP, Finance in February 2020. Prior to joining Cheniere, he held energy investment banking and finance roles at Credit Suisse, Marathon Capital and HSH Nordbank.

Mr Davis will receive a salary of $500,000. He also received a restricted stock grant for the same amount that vests over three years.

Mr Wortley, 43, has been CFO since January 2014 when the market cap of the company was about $10 billion. He joined Cheniere in 2005. He will receive:

  • a cash severance bonus of $2,857,000 when he leaves.
  • a cash payment of $1,946,000, payable in February 2021.
  • one year’s salary ($715,000) to be paid over the next year.
  • $75,000 transitional allowance for health insurance or other associated expenses.
  • Vesting of restricted stock and performance stock awards that were scheduled to vest in 2021 and 2022. At the current stock price, I think these are worth around $5.5 million.

SEC filing – Cheniere CFO change

Oilfield Services company appoints new CFO

Flotek Industries has appointed Mike Borton as its new CFO. He replaces Elizabeth Wilkinson, who left in June. The company, which has its head office in NW Houston, develops and supplies oilfield chemicals. The company recently acquired JP3, data analytics business for $34 million.

Mr Borton was recently the CFO at Dynasty Sports and Entertainment, a Boca Raton-based data analytics company from April 2019 to July 2020. Prior to that, he was the CFO at a couple of SaaS (Software-as-a-service) companies.



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Mr Borton will be relocating back to Houston. Earlier in his career, he spent five years as Group Controller at Landmark Graphics, during which the business was acquired by Halliburton. He will receive a one-time relocation allowance of $25,000.

The salary of Mr Borton will be $340,000, and he will eligible for a target annual bonus of 80% of base salary. If he is terminated without cause, he will receive a severance amount of 12 months’ worth of base salary.

The share price of the company (currently $1.38) has recently recovered such that the company has regained compliance with the listing standards of the New York Stock Exchange.

SEC Filing – Flotek Borton appointment

 

 

CFO leaves struggling retailer

[Update 08-02-20 Tailored Brands has now filed for bankruptcy]

Jack Calandra, CFO of Tailored Brands, is leaving the company in a cost-cutting move. The retailer, which has its head office in the Westchase area of Houston, operates 1,445 stores (mainly Men’s Wearhouse and Jos A Bank) and has been hit hard by global pandemic. All stores were shut between mid-March and early May. Sales are down substantially since most they reopened.



At the beginning of this month, the company announced it had elected not to pay interest on its 7% Senior Notes due 2022. Legally, the company has a 30-day grace period to make the payment before the non-payment is considered a default. In practice, it is negotiating with lenders on terms for a possible bankruptcy plan.

Mr Calandra will leave effective July 31, 2020. He will receive a lump sum payment of $600,000, which is the equivalent of one year’s base salary. The company has no immediate plans to replace Mr Calandra. Instead his duties will be divided up between CEO Dinesh Lathi and Holly Etlin, who has been appointed Chief Restructuring Officer. Ms Etlin is a Managing Director at AlixPartners.

The company has promoted John Vazquez to be the Chief Accounting Officer and Treasury. He was serving as the Vice President – Financial Reporting.

Layoffs and Store closures

The company will close up to 500 stores and reduce its corporate workforce by approximately 20%. It will record a $6 million charge for severance and other termination costs in the current quarter.

At the end of February 2020, the company had debt of $1.1 billion. In June it announced that it  had borrowed an additional $310 million from the credit facility. The company had $200 million of cash on hand. It’s market capitalization is currently just $34 million.

Disastrous Acquisition

As a reminder, back in September 2013, Jos A Bank made an unsolicited offer to buy Houston-based The Men’s Wearhouse for $2.3 billion (in cash at a 42% premium). Instead The Men’s Wearhouse ended up buying Jos A Bank for $1.8 billion in June 2014 (in cash at a 56% premium). The combined company was renamed Tailored Brands. Within 18 months, it had written off $1.3 billion of that. This is one of the most spectacular destructions of shareholder value in recent years!

The CEO in charge of that acquisition left in 2018 with a $10 million severance package. Mr Calandra was not part of that acquisition, having joined in December 2016.

SEC filing – Tailored Brands CFO to depart

 

 

Another Oilfield Services CFO steps down

Lyle Wiliams has been appointed CFO of Forum Energy Technologies, replacing Pablo Mercado, who has resigned.

[UPDATE 7-13-20 Mercado has been appointed the new CFO at Dallas-based Enlink Midstream].

Forum is based in NW Houston. It manufactures equipment servicing drilling and downhole, completions and production. The company currently has a market cap of $59 million and a share price of 51 cents.



At the end of March the company had $389 million of unsecured notes due in October 2021 and a $55 million credit facility due in July 2021. The company has since bought back $70 million of these notes for 38.5 cents on the dollar.

Mr Williams joined the company in 2007 from Cameron International (now part of Schlumberger) and has held various operational and financial roles. Most recently he was the Senior VP of Operations. No new compensation has been finalized.

Mr Mercado had been the CFO since February 2018. He joined the company in 2011 and was previously at Credit Suisse.

The company press release and the SEC filing didn’t spell out the financial terms of his departure. However, assuming that Mr Mercado will receive a severance, he is in line to receive a cash payment of $1.4 million dollars (2 times base salary of $410,000 plus 2 times target bonus of $307,500). [Update – it is clear now that Mr Mercado resigned to take the position at Enlink, so there will be no severance]

Mr Mercado’s predecessor, Jim Harris, recently stepped down as the CFO of Pacific Drilling.

SEC Filing – Forum Energy CFO change