By the numbers: Why the Greene King CEO calls time

  • Dry goodbye
  • Push-out Score of 7 indicates pressure

It’s a dry goodbye. For Rooney Anand, CEO of Greene King Plc, the time bell is ringing. The Push-out Score of 7, which was determined by the research firm exechange, shows many indications of a forced change.

On the surface, everything seems smooth. The UK’s largest pub retailer and brewer announced on November 6, 2018, that after 14 years as CEO, Rooney Anand will step down at the end of the fiscal year on April 30.

The lead time of 175 days is comfortable, and Anand receives thanks and exuberant praise in the announcement from Bury St Edmunds-based Greene King. Chairman Philip Yea says that Anand is “one of the most successful and longest serving business leaders our industry has seen.”

That’s certainly correct. Under Anand’s leadership, Greene King has grown strongly.

At the same time, it is hard to overlook that Anand’s star is sinking. The Push-out Score shows strong warning signals.

Of the ten red lamps provided by the model, seven light up.

First, at the age of 54, the outgoing CEO seems quite young to say goodbye, and his precise plans for the future remain in the dark.

Second, the share price development is a sign of pressure on him because the stock has lost approximately half of its value since November 2015.

Third, the company does not give any reason for his departure. The explanation provided by Anand himself is of little help. “With a strong team and business culture firmly in place, the time is now right for me to hand over the baton,” he says.

That’s his view. From an investor’s point of view, the facts tend to suggest that his resignation is overdue, because fourth, Greene King has recently faced strong headwinds.

The pub operator, which owns ale brands such as Greene King IPA, Old Speckled Hen and Abbot Ale, has been battling rising costs from the government’s minimum living wage increase, unfavorable currency exchange rates and higher property prices.

Fifth, it speaks for a forced change that Greene King cannot yet name a successor.

Sixth and seventh, the form and language of the announcement provide two more points to the final Push-out Score of 7.

Anand himself exudes complacency. “As we announced recently, the business is performing in line with our expectations and ahead of the market,” he says. Meanwhile, words of regret about his apparently premature departure or good wishes for his future cannot be found in the announcement.