Left: Anthony Holness, chief executive officer, Hardware and Lumber Limited, leaves the company at the end of July. Right: Deputy CEO of GK Investments, Joseph Taffe, will be the interim manager of Hardware and Lumber until Holness is replaced. - Peta-gaye clachar/staff reporter

Correction & Clarification

In the following article titled ‘Early retirment for H&L CEO’, published in the Financial Gleaner of June 5, 2009, a former chief financial officer of Hardware and Lumber Limited was incorrectly identified as Jacqueline Thompson. Her name is Jacqueline Johnson.

Four years into his tenure as chief executive officer of Hardware and Lumer Limited, Anthony Holness has called it quits and is heading into early retirement.

He leaves at a rocky period for the company, a GraceKennedy outfit that manages the Rapid TrueValue and Agro Grace chain of retail stores.

Holness clears his desk at the end of July.

Joseph Taffe, who now seems to be GK Investment's go-to guy for transitions, will act in the post effective August 1.

Taffe's substantive job is deputy CEO of GK Investments. In that role, he has subbed for Don Wehby until Courtney Campbell came on the scene last year.

He takes up the acting post at H&L, well familiar with the company that, within the GraceKennedy structure, falls within the portfolio of GK Investments and is answerable to that division.

H&L, except for last year, had consistently returned profits for the conglomerate, but has been on a roller coaster that events in the construction market had more control of, starting with the cement crisis of 2004 and now the decline in construction GDP.

Restructuring efforts

Holness was appointed CEO of Hardware and Lumber in August 2005, two years after the merger of the H&L and Rapid and Sheffield Company Limited, as well as Agro Grace, distributor and retailer of agricultural inputs, in September 2003.

Last year, H&L lost $285.6 million.

It continued in the red in the first quarter ending March 2009, having a net loss of $113 million on the back of revenues of $1.5 billion notwithstanding recent restructuring of operations.

Those results followed new restructuring efforts, including the elimination of multiple jobs and the attendant cost for salaries.

Holness' retirement follows the implementation of the staff rationalisation programme in December last year which cut 88 of H&L employees from the payroll as well as other contract staff.

At the same time, in March, GraceKennedy chairman and chief executive officer relinquished his title as chairman for H&L, passing the reins to Erwin Burton, who runs the conglomerate's food division, and making way for Courtney Campbell as a member of the H&L board of directors.

Refreshing management

The changes have, in effect, refreshed the management and board. Andrew Kerr was, for example, given a wider portfolio of responsibilities over the finance division, as chief financial officer, following the resignation of Jacqueline Thompson earlier this year.

A comment was not immediately forthcoming from Holness, who was said to be in a meeting. And Campbell, his immediate boss, said he could not comment on the development, saying Holness' decision to take early retirement was a personal one.

Holness' links to H&L date back to 1991 when he worked with the Pan Jam group of companies as financial controller of Wherry Wharf Limited, a subsidiary of Pan Jam.

Pan Jamaican Investment Trust Limited owns 20.8 per cent of H&L, while GraceKennedy has a majority 67 per cent stake.

Interim manager Taffe hasworked in a number of senior management positions including group internal audit manager and group finance manager, says no more management changes are likely at H&L at this time, but rather the focus will turn to operational efficiencies.

"The issue of working capital management, getting our inventory and service levels right ... and category management is an area we are working very hard on in getting those things right," said Taffe.

"Once we get that right, we think our sales will reflect that."

Taffe's reference to 'category management' relates to a new sales strategy the company has been experimenting with since May.

It involves taking the total range of products carried by H&L and breaking them down into groups of related products.

Performance objectives for turnover, profitability and growth are then set for each category, based on the sales strategies identified for each grouping.

sabrina.gordon@gleanerjm.com