Shares in Costa Group (ASX: CGC) have taken a big hit on the market today after the fruit and vegetable grower-marketer announced the resignation of CEO Sean Hallahan.
The shares fell more than 15 per cent in a sharply lower share market after Hallahan revealed an ‘intense couple of years’ for the Melbourne-based business during COVID-19 lockdowns had been part of the reason for his decision to resign, effective immediately.
Hallahan, who was appointed CEO in March last year, has been with Costa Group for five years, previously as chief operating officer.
Costa chairman Neil Chatfield says Hallahan has played a ‘pivotal role’ in the development and growth of the company.
“We understand that the last two years, particularly in Victoria, have taken a large toll on the business and personal lives of individuals,” says Chatfield.
“Under Sean’s leadership, Costa has performed extremely well during a challenging period with global COVID-19 disruptions and extreme weather conditions being successfully navigated and is in a strong financial position.”
Costa Group, which is one of Australia’s largest growers, packers and marketers of fresh fruit and vegetables and also has operations in China and Morocco, posted a 3 per cent increase in net profit for the latest June half year. Underlying net profit was 10.8 per cent higher at $49.2 million.
“I am proud to leave Costa in a strong position financially and operationally,” says Hallahan.
“Reaching my decision has been a process and there are several things that have gone into my decision. It has been an intense couple of years in agriculture made even more challenging with the overlay of the COVID-19 pandemic.
“It has been a privilege to lead Costa and to have been part of an outstanding team of people for five years. I wish Costa and its employees all the best for the future”.
Costa Group has appointed Harry Debney, a non-executive director and the former CEO who led the company through the IPO in 2015, to head the company until a permanent replacement is found. Hallahan is expected to support the interim CEO’s transition until mid-October.
“Harry has an intimate knowledge of the company and is regarded as one of Australia’s leaders in horticulture,” says Chatfield. “Harry is the right person to assist the company as it transitions to a new CEO”.
Costa Group shares were trading 39c lower at $2.15 at 12.04pm AEST.
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