Reuters | Jul 17, 2017 14:16
By Paul Sandle and Victoria Bryan
LONDON (Reuters) - British broadcaster ITV (LON:ITV) has poached easyJet (LON:EZJ) boss Carolyn McCall to be its next chief executive, hoping she can continue a record of delivering returns for shareholders in the face of intense competition.
McCall, who was CEO at newspaper publisher Guardian Media Group before moving to easyJet in 2010, will start at ITV on Jan. 8, replacing Adam Crozier, who has already stepped down.
The 55-year-old will join the maker of soap opera Coronation Street and reality show Love Island at a time when advertising revenues are coming under pressure as consumer spending slows and companies shift more of their marketing efforts online.
At easyJet, her departure comes at an awkward time as it grapples with the uncertainty over Britain's departure from the European Union, though the airline said on Monday it expected to report improving revenues in third-quarter results on Thursday.
Citi analysts described it as a "good and exciting" appointment for ITV, noting McCall delivered a total shareholder return of 312 percent at easyJet, outperforming the UK market.
"We also think her experience within media (at the Guardian) is a key positive," they added.
Broker Goodbody said management change at easyJet could provide an opportunity for the airline to cut costs even more aggressively.
At 1246 GMT, ITV shares were up 1.7 percent at 178 pence, while easyJet's were up 0.9 percent at 1,424 pence, reversing earlier losses.
McCall will have an annual salary of 900,000 pounds at ITV, plus a bonus worth up to 180 percent of salary and a long-term incentive plan worth up to 265 percent of salary, broadly in line with Crozier's package, ITV said.
Peter Bazalgette is leading the broadcaster as executive chairman until McCall's arrival, along with finance and operations chief Ian Griffiths.
BREXIT ISLAND TO LOVE ISLAND
Under Crozier, ITV has increased its production operations by acquiring independents including talent show "The Voice" maker Talpa Media and Mammoth Screen, the company behind drama "Poldark", which is screened by ITV's main rival BBC One.
But it still relies on advertising for nearly half of its revenue, and the company retains about 40 percent of the TV ad market despite a proliferation of new digital channels.
International cable TV group Liberty Global (NASDAQ:LBTYA) holds a near 10 percent stake in ITV, and although Liberty has said it is happy with the size of its holding, investors speculate it could eventually buy the broadcaster.
At easyJet, McCall expanded its network to focus more on primary airports to compete with traditional carriers rather than low-cost rivals such as Ryanair.
She has overseen a trebling in the share price, an increase in passenger numbers and the payment of about 1.2 billion pounds in dividends to shareholders.
However, there remains pressure on the carrier to keep costs under control, especially given the additional expense involved in setting up a new airline in Austria to protect post-Brexit flying rights, announced last week.
Still, John Grant, director of JG Aviation Consultants, said a new CEO would take over a successful business without the need to do any major "fire-fighting".
EasyJet said the search for McCall's successor had started.
In a message to staff seen by Reuters, McCall highlighted the work done by chief operating officer Chris Browne, who joined last year from TUI Travel, and other management including chief commercial officer Peter Duffy, chief information officer Chris Brocklesby and chief financial officer Andrew Findlay.
Written By: Reuters
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