Key Energy CEO Robert Drummond leaves abruptly

  • Push-out Score suggests push-out forces
  • After less than a year and a half in the position
  • Praise, thanks and good wishes for Drummond
  • Marshall Dodson taking over in the interim
  • Search for a successor
  • Drummond said 66 words

(exechange) — Houston, Texas, May 14, 2018 — Robert Drummond, chief executive of Key Energy, leaves. It is an abrupt change. As announced by Key Energy Services, Inc. in a news release on Monday, May 14, 2018, Robert Drummond has left his post as Chief Executive Officer at the well servicing contractor after less than a year and a half in the position, effective May 11, 2018.

No company wants a CEO to flame out in the first years.

Among the 3,000 largest publicly held companies incorporated in the U.S. based on market capitalization, the average tenure of the CEOs who departed over the past 12 months was 9.7 years, according to data compiled by exechange. Only 10 percent of the CEOs who departed over the past 12 months left the position within two years, and 20 percent left the position within three years.

Key Energy will undertake a search for a successor.

Drummond’s duties were taken over in the interim by Marshall Dodson, currently Chief Financial Officer of Key Energy Services, Inc.

“To pursue another opportunity”

Drummond’s sudden departure from the CEO post is explained as follows. Key Energy said: “President and Chief Executive Officer Robert Drummond notified the Company of his decision to resign from his role as CEO to pursue another opportunity effective May 11, 2018.”

The phrase “to pursue another opportunity” opens the door to speculation.

Precise information about Drummond’s future plans was not immediately available.

Wake-up call

Generally speaking, it is often an alarm signal for stockholders when a CEO leaves the position abruptly and without a reasonable explanation.

Share price decline

The change follows a decline in the share price of Key Energy Services, Inc. since May 2017.

Chaired by Philip E. Norment

Key Energy Services, Inc. is chaired by Philip E. Norment.

Philip E. Norment is a partner at Platinum Equity and a member of Platinum Equity’s Investment Committee and is a senior advisor on specific operational initiatives throughout the portfolio.

In the position of CEO since 2016

Robert Wayne Drummond, Jr. has been the Chief Executive Officer of Key Energy Services Inc. since December 31, 2016.

Drummond was previously employed for 31 years by Schlumberger Limited (NYSE: SLB), where he served in multiple engineering, marketing, operations, and leadership positions throughout North America.

His positions at Schlumberger included President of North America from January 2011 to June 2015; President of North America Offshore & Alaska from May 2010 to December 2010; Vice President and General Manager for the US Gulf of Mexico from May 2009 to May 2010; Vice President of Global Sales from July 2007 to April 2009; Vice President and General Manager for US Land from February 2004 to June 2007; Wireline Operations Manager from October 2003 to January 2004; Vice President and General Manager for Atlantic and Eastern Canada from July 2000 to September 2003; and Oilfield Services Sales Manager from January 1998 to June 2000.

Drummond began his career in 1984 with Schlumberger.

Drummond is a member of the Society of Petroleum Engineers and serves as a Director of the National Ocean Industries Association and is a member of its Executive Committee.

In addition, he serves on the Advisory Board for the Petroleum Equipment Suppliers Association and the University of Alabama College of Engineering Board.

Formerly, he served on the Board of Directors for the Greater Houston Partnership and on the Board of Trustees for the Hibernia Platform Employees Organization – Newfoundland; and as an advisory board member for each of the University of Houston Global Energy Management Institute, the Texas Tech University Petroleum Engineers and Memorial University’s Oil and Gas Development Partnership.

Drummond received his Bachelors of Science in Mineral Engineering/Petroleum from the University of Alabama in 1983.

Drummond will continue to remain on Key’s Board of Directors.

Unexpected

As a general rule, when a top manager announces to step down with no permanent successor in place, it is a signal that the move was unexpected and too early.

Push-out Score suggests push-out forces

It is not completely certain what forces eventually triggered Robert Drummond’s sudden move.

The Push-out Score™ determined by exechange suggests that push-out forces may have contributed to the change.

Read the full story in the exechange report 21.2018 ($).