Dear Friend,
Here’s a quick quiz.
Who said this in his 2006 annual report? (I have changed the company name to XYZ so as not to give it away):
“Dear shareholder,
For XYZ, 2006 was a pivotal year. It was a year of transformation—one in which we built a strong foundation to grow XYZ’s preeminent brands. We began to increase operating efficiencies, strengthen and leverage our market-leading knowledge and resources, and evolve our business model to increase revenues and profitability. We migrated toward greater standardization of business processes, better client-profitability metrics, and more effective compensation systems. We focused on improving the operations and financial performance of each operating company, simultaneously seizing opportunities to leverage XYZ as a whole
There remains a great deal of work to be done, but today we are more client-centric, efficient, and profitable.”
And here’s another clue, today that same company posted fourth-quarter earnings that were less than half of those a year earlier?
Give up? It’s Marsh’s former CEO Mr Cherkasky of course!
And guess what? Today’s filing also revealed that Cherkasky’s departure has cost Marsh $27m ($14m in the fourth quarter and $13m in the third quarter).
$14m is two cents a share, hence the title above.
So how about this for a re-write?
“Dear Shareholder, in less than a year’s time my personal departure is going to cost you just under 4 cents for every share you own in MMC. So long, and thanks!”
Signed M.C.