Uranium miner Paladin Energy Ltd (ASX: PDN) has seen its share price rise 12.2% to 20.2 cents, after the company announced that founder and long-term CEO John Borshoff would step down.
Mr Borshoff founded Paladin more than 21 years ago, but his stay with the beleaguered miner was nearing its end. It seems the market likes the idea of a fresh set of eyes and a new head at the top of Paladin.
Mr Borshoff will be replaced by Alexander Molyneux while the company begins a search for a new CEO.
Just on that note, it's astonishing to think that some companies still don't have a succession plan in place for their key executives.
Mr Molyneux has been tasked with optimising Paladin's cash flow breakeven level, with the aim to become cash flow positive in the current uranium price. Previous management appeared to be more hopeful of uranium prices recovering rather than admitting the hard truth that it's likely to stay around the current level for much longer than many thought – as I wrote back in May 2013.
Good luck Mr Molyneux, you're going to need a lot of it. Investors should also note that cash flow positive doesn't actually mean they'll receive a return on their investment either.
Paladin is still one stock to avoid.
