The Fortescue Metals Group Limited (ASX: FMG) share price looks set to snap its three-day green streak today.
Shares in the Australian iron ore miner have rallied by 28% during the last six months. However, the company chaired by Andrew 'Twiggy' Forrest is losing steam on Monday despite a rather peachy performance across the materials generally.
As we head into the afternoon, the materials corner of the market is holding out as the best-performing sector. At present, the sector is 1.42% above its previous close. Meanwhile, the Fortescue share price is 0.8% underwater at $21.63.
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Management maketh the company
Today's Fortescue share price weakness could be explained by an announcement that the company made earlier today. According to the release, the company's chief financial officer (CFO), Ian Wells, has put forward his resignation.
Wells has served as group CFO since 2018, overseeing a period of significant earnings growth and shareholder returns. Between June 2018 and now, the Fortescue share price has increased by approximately 390% and earnings have grown by seven-fold.
Commenting on the departure of Wells, Fortescue chair Andrew Forrest said:
I recall fondly back in 2010 when Ian joined our team. The finance team at the time were charged with refinancing our original project finance bonds and the successful refinancing in 2010 enabled the company to make investments to expand capacity to 155mtpa.
Since then, we have seen the company's balance sheet and capital allocation change from debt repayment to reinvestment and delivering market-leading shareholder returns …
The respected member of the leadership team is stepping away from Fortescue to explore other opportunities. With a finish date of 31 January, the company is already underway with finding and selecting a successor to Wells.
Fortescue share price under scrutiny
Shareholders could be growing concerned about what appears to be a trend at this point. Ian Wells' exit is yet another in a series of senior outflows — joining Linda O'Farrell, Greg Lilleyman, Don Hyma, and former CEO Elizabeth Gaines to name a few.
At this point, only two out of the 13 executive leadership members displayed in Fortescue's 2021 annual report are still on board.
The company trades on a price-to-earnings (P/E) ratio of 7.4 based on the current Fortescue share price. For reference, this is roughly in line with peers like Rio Tinto Limited (ASX: RIO) and slightly below BHP Group Ltd's (ASX: BHP) 8.1 earnings multiple.
