I started with KPMG in London and qualified as a chartered accountant. I then did three years post-qualification before moving into a strategic planning position with BICC. The group manufactured cables and also had Balfour Beatty as a division. Over time the cable activities were sold, leaving Balfour Beatty as the main business.
That strategic planning position was the first step in the company’s graduate training scheme and the next department along was treasury. So this was the beginning of my experience of treasury, where I worked for Stuart Siddall, who subsequently became the group treasurer.
I worked on a project with Stuart for about three months and we had got along well, so I thought he’d be a good person to work for and so it proved.
The project was complex reorganisation of the group involving around 10 transactions globally. These transactions were mostly internal, but the workload and the time differences meant Stuart and I worked on this project full-time. We had lawyers and advisers in the UK, Australia and New Zealand, but we were driving the programme of work. We’d get into the office early, have our conversations with our advisers in Australia, continue working through the day and then in the evening talk to our US advisers. Once we got back into work the following morning, our Australian advisers would have done a day’s work that we’d then follow up on.
After the reorganisation completed, I joined treasury full-time as assistant treasurer, effectively deputising for the group treasurer. The role was wide-ranging with a key focus on cash management, external funding, banking relationships and some currency management, carried out in London. I was in that role at BICC for three years, ending up as group treasurer of Balfour Beatty towards the end of that period.
I would say there were two in particular.
I left Balfour Beatty, still then a subsidiary of BICC, to become group treasurer of a listed company called Meyer International plc. I was their first group treasurer and I discovered in my first week that they were in breach of their revolving credit facility (RCF). Over the course of my first four months, I restructured the RCF such that we had either dealt with the defaults or had waivers in place that gave us time to sort the issues out. To give context, we were in breach of the RCF in 10 different ways, some relatively minor, some quite critical, and I subsequently wrote the experience up as a question that was used in the MCT examinations.
The discovery of these breaches and the need to deal with them immediately on arrival meant that I was having tricky conversations with the bank syndicate. In the meantime, the UK economy was sliding into a two-year recession. Meyer operated in the construction and housing sector, which was very badly hit from 1991-1993.
But the company emerged from that recession in a very positive and financially strong position, aided by a rights issue towards the end of that period. As a result, the chief executive and FD recommended I look at an FD role, and that paved the way for me to become a divisional FD. If you are a treasurer and want to develop a broader career in finance, then the move into a FD role is a regular next step.
Normally, this kind of move is going to be an internal promotion, providing you’ve done well in the business. By this point, I’d dealt significantly with the board on both refinancings and the rights issue, which was good for my profile.
The second significant transition was taking the role of CFO at Victrex in 1997. Victrex exported 90% of its product overseas, so it had very large FX exposures to manage and they wanted a CFO with currency management expertise. Again, I had an exciting start. Within three days of joining, I had to put out a profits warning, which meant on day four I was meeting investors, which was not part of the plan.
Victrex had been through an initial public offering about a year prior to this, and some of its internal disciplines were not up to scratch. That led to an overhaul of internal and financial controls, the company hedging policy and the way we reported compliance to the board – because FX issues were at the heart of the problem. I also had to initiate a company-wide strategic review to ensure we had an agreed-upon strategy going forward. Out of all of those activities, the strategic review was the exercise that subsequently proved the most important.
You go up a very steep learning curve. These are experiences you always have at the back of your mind, asking: could these things happen again? Having been through several challenges, however, it’s no longer a case of saying: this could never happen to me, because some already have. At an early stage in my career I learnt the importance of long-term relationships and sound business and internal control foundations.
I would say the MCT training in that it gave me the toolbox of treasury skills – but also the MCT exam, because it was based around questions that had real-life experience underpinning them, where there is not necessarily a right way of dealing with any situation, but you still have to find a way through. The exam questions mirror real life. I would say that my MCT training has probably proved more valuable to me in my finance career than my other qualifications.
The other experiences that stand out over the past 10 to 15 years stem from interim CFO roles I have held across a very broad range of industries and facing a wide range of issues and challenges. Consequently, I have quite a lot of scar tissue and that – strangely – is quite helpful. You tend to learn more when you’re faced with difficulties than you do when things are going well.
I am audit committee chair and member of the remuneration committee of an AIM-listed company, Scientific Digital Imaging plc (SDI) and I’m building a portfolio of non-executive roles. I already have six years’ prior experience as an audit committee chair with another listed plc.
I believe that I can leverage off my past experiences in a variety of different companies, particularly in the areas of managing corporate governance issues, risk management – where treasury comes in once again – and strategy and strategic development. I can use that experience to help the executive committee in making and executing the right decisions.
SDI designs and manufactures scientific and technology products for use in digital imaging that have applications across life sciences, healthcare, astronomy, manufacturing and art conservation. As well as developing its own technology, it looks to acquire small entrepreneurial companies where there might be synergy benefits. We’ve made three acquisitions while I’ve been on the board and have said recently we hope to make another before the end of our financial year.
My recent role at Northgate has also been interesting. I was interim CFO of Northgate plc from October 2017 to August 2018, primarily to allow them to recruit a new permanent CFO. Northgate is a commercial vehicle hire business with approximately 50,000 vehicles in the UK and a similar number in Spain.
During my time there, I had two unexpected issues to address. The first was when we announced our interim results – we had a level of leverage quite close to our covenant limits leading to investor concerns as to whether the tightness of the covenant would restrict the company’s ability to grow. To address this I refinanced our bank facilities and increased the leverage covenant at the same time.
Second, I developed and launched a fleet optimisation policy, using analysis I first picked up in the MCT qualification. We used net present value analysis to discover the optimum age at which we should dispose of vehicles. This new policy is projected to release over £50m of cash in the current year, significantly improving cash generation. Again, I’d regard that as applying financial skills picked up during my MCT training.
If you’ve faced one or two difficult situations that you have had to work your way through, you become more confident of your ability to find solutions. It comes back to the MCT training. There is no right answer in those examination questions, just as there is no right answer in real life; it’s your job to work through the issues and find the best solution you can.
In treasury, you are exposed to the dynamics of cash changing on a daily basis and currency markets moving on a continuous basis – and you take decisions against that backdrop. The dynamic aspect of treasury should not be overlooked. Even in cash management you’ve got to make sure you’ve got cash balances in the right place on a daily basis. There is an immediate dynamic in treasury that you don’t get in other finance disciplines.
Its public profile in promoting treasury as an important financial discipline.
Stuart Siddall, because of the amount I learnt from him when I first moved into treasury and saw what could be achieved.
The fact that it is real and immediate, as cash balances and FX rates are continually moving and you can take action to make a difference.
Shifting a higher proportion of my time towards strategy development and execution, which add value, whilst meeting corporate governance requirements as efficiently as possible.