Diversified media and services company, Seven Group Holdings Ltd (ASX: SVW), today announced Ryan Stokes will take the reins as company CEO on 31 August 2015, when current CEO Don Voelte AO plans to retire.
Ryan Stokes is the company's current Chief Operating Officer (COO) and son of businessmen Kerry Stokes – current chairman and substantial shareholder of the group.
Mr Voelte has spent seven years as the company's CEO and will retire to spend more time with his U.S.-based family.
He will retire from all directorships but remain a consultant on an exclusive basis. "I am very pleased that I will have an ongoing involvement with this great company, and I'm looking forward to being able to continue to make a contribution," Mr Voelte said in an ASX announcement this morning.
He said Ryan Stokes is the "right choice" for the group and will be "an outstanding CEO."
In the past year, shares in Seven Group have fallen from over $8.30 to $7.30 today – equating to a fall of around 9%. Also in today's announcement, the group reiterated previous guidance for its financial year 2015 underlying EBIT (earnings before interest and tax) result to be down between 10% and 15% on financial year 2014 (subject to no further deterioration in market conditions).
Despite the tough conditions, incoming CEO Ryan Stokes says the group is in good shape and its core strategy will remain in place. "SGH is in very good shape in what are challenging times, and our focus will remain on effectively deploying our available capital to enhance shareholder returns," Mr Stokes said.
Mr Stokes is an accomplished businessmen and has spent the past 15 years with the group, including the past three years as COO.
Seven Group is diversified across a number of market groups which are under pressure. For example, it owns 35.3% of Seven West Media Ltd (ASX: SWM) – the owner of the Seven Network, West Australian Newspapers and more. Its shares are down around 90% since mid-2007.
It also owns WesTrac Group, the sole authorised distributor of Caterpillar in Western Australia, New South Wales and the ACT, in addition to North Eastern Chinese territories. Following a recent research trip to China, Motley Fool investment advisor, Joe Mayger, reported, "Caterpillar expects the Chinese market to shrink in 2015."
Seven Group has also started to expand into energy, developing oil and gas projects in Australia, and has a large stake in AllightSykes and Coates Hire. The recent rapid fall in oil prices has been well documented in the financial media.
Should you buy Seven Group shares?
Ryan Stokes is a very accomplished executive and appears to be a good fit for the company. However, across almost all business divisions the Seven Group appears to be facing a number of headwinds. Therefore, despite Seven Group shares trading on a fully franked dividend yield of 5.5%, it's probably best for investors to leave it on their watchlist and avoid buying in, for now.
