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Imtech Management Quits as Turnaround Stalls

May 12, 2015

CEO, CFO to step down, new CEO from inside company.

The CEO and finance chief of Dutch builder Imtech have resigned from the company, as a drop in sales and weaker profit margins showed plans to restore confidence following an accounting scandal were faltering.

Chief Executive Gerard van de Aast and Chief Financial Officer Hans Turkesteen were appointed in 2013 after the previous management quit over an accounting fraud in Germany and Poland that wiped millions off its balance sheet.

Board member Paul van Gelder will take over as CEO in 2015.

Van de Aast will retire, while Turkesteen will leave after 2015 results have been finalised.

The company was forced to make an emergency 500 million euro ($560 million) rights issue after taking write-downs of 370 million euros and had to slash its workforce.

Shares in Imtech, once a star player on the Amsterdam stock exchange before losing 97 percent of their value in the wake of the scandal, were down 6.5 percent at 0851, having fallen as much as 8 percent in early trade.

"Imtech reported a miss versus our estimates in nearly all divisions on all lines, with Germany, UK and Nordics standing out," said ABN Amro in a research note, adding that weakening margins had almost wiped out cost improvements.

"This highlights that Imtech is more than a story of simply fixing the balance sheet."

The builder, which is also battling a prolonged slump in the Netherlands and in Europe more widely, said revenue in the first quarter fell 11 percent to 873.1 million euros, although it narrowed its net loss to 49 million euros ($54.77 million), an improvement on last year's 77.3 million.

The 150-year old firm -- which put the first electric lighting in Dutch buildings in the 19th century -- said it still expects to make a profit for the full year.

ABN Amro said van de Aast's departure was "rather early in the change process", adding that it would have preferred him to stay another year.

"On the CFO departure, we are somewhat more puzzled as he is actually a turnaround manager and we continue to see high turn around needs at Imtech."
 
Reporting by Thomas Escritt

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