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Cardtronics Inc.'s recent return to profitability apparently has created problems for the ATM independent sales organization's efforts to find a new CEO to replace Jack M. Antonini, who left the company in March.
Many candidates want the job, but because the ISO's performance is on the upswing, the board of directors keeps raising the standards for a new CEO, Fred R. Lummis, Cardtronics chairman and acting chief executive, recently told analysts during the company's third-quarter conference call.
"Our existing management team keeps raising the bar through their own performance, and the board just won't settle for second best," Lummis says. "So it's taking longer than we expected to complete our work. It is something of our own doing."
Houston-based Cardtronics is the world's largest ATM ISO. As of Sept. 30, the company either owned or managed 32,995 transacting ATMs in the United States, United Kingdom, Mexico and Puerto Rico.
The company reported a $6.52 million profit for the third quarter ended Sept. 30, which followed a $2.6 million profit for the previous three month-period (ADN, 8/13). Before then, the last time Cardtronics reported a profit was for the fourth-quarter of 2006.
The quarterly losses affected the company's stock price on the Nasdaq Global Market. On Dec. 12, 2007, the company's first full day of trading following an initial public offering, the stock price closed at $10 per share, its asking price. Since then the company's stock price has had more downs than ups, dropping to as low as 92 cents on Dec. 12, 2008.
Financial losses and the decline in the company's stock price were contributing factors in Antonini's departure. "Jack and the board have mutually decided that it would be in the best interests of the company to bring in a new CEO," Lummis said in a statement at the time (ADN, 3/19).
Since Antonini's departure, Cardtronics has resembled the Phoenix rising from its ashes. On Wednesday, its stock closed at $11.27 per share, down 22 cents from the previous days close of $11.49. The company's improving stock price and overall performance have increased interest in the company, Lummis says. "As the company continues to perform well, and our profile is more enhanced within the payments industry, there is a lot more interest from the marketplace in our CEO position," he says.
Asked during the third quarter conference call what characteristics Cardtronics wants in its new CEO, Lummis cited payments experience and expertise. "We're looking for somebody who is managing a business at least the size of Cardtronics, and we are looking for someone who is ready to take the mantel of a public-growth company," he said. "I mean, we've got a great trajectory here. We have a strong outlook for next year, and we are looking for someone to grab the bull by the horns."
The company is really conducting its due diligence in finding a new CEO, says Kate Monahan, an analyst for Boston-based consultancy Aite Group LLC, who recently met with Cardtronics executives in Boston.
"They want someone who can continue to grow the company and to build Cardtronics' revenue," Monahan says.
Lummis wouldn't project when the company would name its new chief executive. "But I'd say we're very close, and I'd be very disappointed if we don't have somebody by the end of the year."
During the analysts' second-quarter conference call Aug. 5, Lummis, who has been with Cardtronics since 2001, said he wanted to have the new CEO in place by the third quarter. Company officials probably have someone in mind, and they will announce the new CEO at the same time Cardtronics announces its fourth-quarter and yearend earnings, Monahan speculates.
J. Christopher Brewster, Cardtronics chief financial officer, recently raised the company's 2009 revenue guidance to a range of $485 million to $490 million from its previous guidance of $470 million to $490 million. ATM
