CRO giant INC Research ($INCR) has announced that its chief exec of three years, Jamie Macdonald, will be stepping down this fall as the company promotes current president and COO Alistair Macdonald to the exec’s chair.
Jamie Macdonald will give up his role as CEO on 1 Oct. to Alistair Macdonald, although the former Macdonald won’t be going anywhere in a hurry as he will continue as vice chairman to “assist in the transition of his CEO responsibilities” until 28 Feb. of next year, according to a statement from the Raleigh, NC-based CRO.
"Alistair Macdonald brings strong leadership, a proven track record of success and strategic vision that we believe will guide the future growth and success of INC Research," said David Norton, chairman of the board.
"As COO, Alistair has demonstrated outstanding leadership in strengthening INC's operations globally and we believe will drive increased opportunities for the Company. We’re delighted to have such a strong successor to Jamie.”
Norton also thanked Jamie Macdonald for leading INC Research as CEO since 2013. “Jamie has guided INC and been a strong partner to our board over the last five years. During that time, he led the company through its successful IPO in 2014 and subsequent strong operational and market performance, and has been a leader in every sense.
“Since Jamie became CEO in 2013, INC has delivered industry-leading growth and margins. We are delighted that Jamie will be working with Alistair and the board to ensure a smooth transition.”
Jamie Macdonald said that the decision comes after “re-evaluating his priorities at this time,” adding the he was “fortunate that INC has in place a strong internal leadership team and successor to allow me to do that.”
Alistair Macdonald, who is currently based at INC's U.K. base, said: “I am pleased to be appointed CEO of INC Research and look forward to working with Jamie and the Board over the transition period to support all of INC’s stakeholders moving forward. I want to personally thank Jamie for his leadership over the last five years.”
Analysts on its second-quarter call were miffed around the fairly sudden departure for J. Macdonald, with one asking whether his recent birthday was a factor in his “revaluation” of his role--and whether it was right to thrust the next CEO in front of investors so quickly.
J. Macdonald said: “Yeah, you're right, but I would say it wasn't really the sort of part of it, it was also my five-year anniversary at INC on July 12. So the timing came together pretty well.
“Maybe a couple of rooms that I will clear up. Alistair is not my brother I know we've had this discussion a number of times, and I'm not leaving to play Pokémon go full time so that's definitely not happening.
“For me, I want to make sure INC is in the best possible place on a go-forward basis. To do that you have to have a transition that allows somebody to take ownership of the business at a good time and then build the budget for next year. So the cycle is very similar to what I did with Jim Ogle back in 2012/2013. We have Investor Day coming up on August 16 and Alistair and I will both be there, so that is the plan. And obviously I will be here supporting Alistair really as much as he needs through February. So it's a long transition.”
INC also announced its second-quarter results, which saw the company grow its net service revenue by nearly 14% compared to the second quarter of 2015, and by nearly 16% on a year-to-date basis.
Its net new business awards for the quarter were marginally up to $302.1 million compared to $295.9 million during the second quarter of 2015, resulting in a net book-to-bill ratio of 1.2 for the second quarter and on a trailing 12-month basis.
However, the CRO said that its clients had a “slower decision-making” mentality in the quarter, which affected growth. In its second-quarter results call, J. Macdonald said that “Certainly during the quarter it was a little [choppier] than we thought in terms of decision-making. It was a little more back-ended than we thought and obviously as we sort of hustle did close out the quarter.”
INC, which has a market cap of $2.4 billion, was down by just over 1% at the end of trading on Friday, although its shares had been trading up throughout the week.
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