New Zealand's biggest listed company is in for a shakeup as its new boss settles in.
Mark Adamson, appointed Fletcher Building's chief executive last month, told yesterday's annual shareholder meeting of some changes he had already made and afterwards vowed more.
Nearly 550 people gathered at Eden Park to hear chairman Ralph Waters issue a bullish outlook, predicting operating earnings to grow by as much as 22 per cent in the year to June, 2013 on the back of new home construction figures improving and the business making cost cuts.
Adamson talked tough for the year ahead.
"I want to shake up the culture, but not the head count," said the UK-born chief, telling how mass redundancies would be avoided in favour of other methods of change.
"You won't be reading articles about 10,000 or 1000 people [going], but there will be efficiency improvements," he said.
"This is not small beer. I've only been in the job six weeks but we're talking tens of millions of dollars saved."
People thought Fletcher was run as one big business but it was actually a group or collection of businesses which did not necessarily co-operate as much as they could, he said, and he planned to change that.
"I want to utilise more of the Fletcher Building footprint and have more coordination between businesses, predominantly in Australia and New Zealand," Adamson said, citing efficiencies he already sees for a two-year-old Penrose Laminex distribution centre.
"There will be a lot of unhappy landlords around New Zealand but that's not my problem," he said.
"The culture has been to focus on individual business units but I've seen already how people are starting to co-operate more."
Fletcher subsidiary distribution and logistics centres on both sides of the Tasman will be in the spotlight as he looks to save money and he told shareholders how the business had an extensive network of owned and leased properties.
"We will be exploring opportunities to reduce the costs associated with this network through sharing retail outlets and regional distribution centres, site rationalisation as well as addressing supporting costs such as logistics," he said, adding that customer service would not suffer.
Adamson has already appointed ex-Formica executive Gerry Bollman to New Zealand from the United States, creating the new role as chief executive of business strategy and performance and he did not rule out making further new appointments.
Instead of a painting on his Penrose office wall, Adamson said he had a signed photograph from the North American Formica management team, thanking him for his support as chief executive of the business where he made about 400 people redundant between 2008 and this year.
Adamson's wife, Hazel, and their children Holly, 15, and George, 13, will not live here until next July when the United States school year finishes because he said the family had shifted enough and he wanted them to stay settled until mid-2013.
But he predicts his son will enjoy soccer here and his daughter is a keen rower.
He is renting a house in an eastern suburb and is actively looking to buy in either St Heliers or Remuera.
Fletcher Building wants to grow earnings via:
* Logistics and distribution cost cuts.
* Rationalisation of subsidiary real estate.
* Reduction of capital expenditure.I want to shake up the culture, but not the head count.