Shares in Sage Group tumbled after the British tech firm announced that chief executive Stephen Kelly is stepping down.
The abrupt departure of the 54-year-old after four years at the firm marks the second scalp for chairman Donald Brydon in less than a year.
Brydon is also chairman of the London Stock Exchange where he got rid of chief executive Xavier Rolet last autumn, sparking a public row.
Shares in Sage, which makes accounting software for businesses, dropped 7.8 per cent, or 50.2p, to 595.4p – wiping £542million off the firm’s value.
Shock exit: Sage Group chief executive Stephen Kelly has announced he is stepping down sending the share price tumbling
For the second time in two weeks, Sage claimed the unenviable crown of being the FTSE 100’s biggest faller.
Brydon said of Kelly: ‘He energised the group, drove change with relentless focus on customers, and, under his leadership, the strategy to become a leading SaaS (software as a service) business has been defined.’
Broker AJ Bell pointed out that this year has seen the second-highest rate of change in FTSE 100 bosses since the year 2000, as 16 firms have announced a change of leader, including ITV and BT.
Only 2007 and 2013 saw more chief executives leave, at 17, and with four months of the year left these records could easily be topped. It’s a difficult time for Sage which axed 30 executives in May as part of plans to ‘simplify’ the business amid a sales slowdown.
Stock Watch – Midatech Pharma
A cure for cancer may have come a step closer for Midatech Pharma.
The small drugs company today announced positive results from its latest trial of MTD201, used to cure carcinoid cancer, which affects the hormone system, and acromegaly, where the body produces too much growth hormone.
The trial suggested the product was better than any on sale. The market for this type of treatment is worth around £1.5billion per year. Shares jumped 19.2 per cent, or 5p, to 31p.
The firm also revised down its forecast for annual sales a month earlier following a poor first half.
Sage said on Friday it has continued to trade in line with its guidance of 7 per cent organic revenue growth and a 27.5 per cent organic operating margin for the year to the end of September. However, the group said that achieving this guidance would be dependent on the closing of several enterprise management opportunities in September.
Last week, analysts at Deutsche Bank slapped the firm with a blistering criticism. They said it had failed to update and innovate with its products, allowing big players like Microsoft to steal its mid-market customers while new software firms were biting at its heels. Sage’s shares have plummeted 24.4pc over the year to date.
Only seven FTSE 100 companies made gains yesterday, as a fiery statement from President Trump late on Thursday night razed investor sentiment.
Trump rejected the EU’s olive branch of eliminating tariffs on cars, threatened to leave the World Trade Organisation and crept closer to rubber-stamping increased tariffs on £150billion of Chinese imports.
The UK’s blue-chip index slipped a relatively sizeable 1.11 per cent, or 83.61 points to end the week at 7432.4 points.
At the smaller end of the market there was little good news for vending machine company Uvenco, which has largely been supported in recent times by its largest shareholder, Russian business magnate Boris Belotserkovsky.
Uvenco has been struggling, and announced earlier this year that it was depending on a £100,000 cash injection from Belotserkovsky.
It has now said it may not be able to survive, and will no longer take Belotserkovsky’s lifeline, instead beginning ‘discussions’ with an insolvency firm.
Its stock market adviser, Stockdale Securities, resigned immediately. Shares were flat at 1.25p.
PCG Entertainment, which distributes Western films and TV shows in China, also had a dire day. Shares sank 26 per cent, or 0.03p, to 0.09p as it released full-year results for what chairman Richard Poulden called a ‘frustrating’ year.
Poulden added that ‘external influences and unforeseen delays have left the company in a holding pattern from which we are now able to move forward’.