Nearing the bottom5 Apr '22
It is a worry that the SP has drifted so far South and there are a few things that do concern me. Creo is first and foremost a technology company. Amongst the management there is very little what I would call true sales and production expertise, people who have dedicated their life to mass manufacturing surgical instruments or marketing to GP's, hospitals, consultants. Mars is the perfect company. It has a modest office just off a roundabout on the A3 and all it does is manage a load of outsourcing contracts and patrol quality and cost. It does not manufacture, it does not market, it does not distribute. And why would it? There are people out there and that's all they do. Creo have gone for what I think is an outdated and scrappy approach. They are trying to do everything themselves with some expertise bought in (expensively) through acquisition. Undoubtedly they are going to make a lot of mistakes and incur considerable delays with this approach. The published sales figures are flattering because they are not core sales. There are too many lightweight hangers on, some of them incredibly well paid. I don't like the acquisitions personally and in a Covid year where lots of plans had to be put on hold the remuneration committee thought it was fair and reasonable to pay the main men a bonus of 75% of salary for doing there job and because of the brilliant acquisitions a transactional bonus of 100% of salary in cash plus a further bonus of 100% of salary in share options. So in a pretty lousy year Craig Gulliford takes home his £280,000 salary and £770,000 bonus and Han**** and Rees not far behind him. Total bonuses over 1.0% of market cap! I sold out the major part of my shareholding at an average just under £2.00 but sadly I have a big chunk still left and I really don't like the direction the company has taken the last 24 months. I think they need a new dynamic been there done that chairman with the skill to get the company back on track, take what I believe are genuinely outstanding products, outsource, get the real sales going, harness the technology before it is outdated and something even better comes along...from someone else.