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Share price gains over the past month for Brisbane-headquartered prepaid card solutions company EML Payments (ASX: EML) have been wiped out after the company sacked its US-based managing director and CEO Ron Hynes less than six months after his appointment.
EML shares are down more than 20 per cent at the time of writing, falling back to levels seen before a late November trading update that saw them surge on a 46 per cent increase in underlying earnings.
At the company's annual general meeting (AGM) on 26 November, chairman Anthony Hynes noted that Ron Hynes was "orientated towards sustainable growth".
"Ron is almost at his five-month mark and has worked quickly to deepen our management capability and create a medium-term plan that leverages the numerous assets of the company today to capture the opportunities around and ahead of us," the chairman said.
"Ron has a full mandate from the board to move at speed to reimagine and reshape the business for profitable growth."
The AGM coincided with the announcement of an 'EML 2.0 Strategic Plan' aimed at returning the company to double-digit transaction revenue growth in FY27 - a feat he said would be achieved by deepening EML's relationships with its 1,000-plus existing customers, while accelerating into new verticals, as well as geographies over time.
Geography-wise, the company had previously been pulling back from some of its international businesses by divesting Sentenial and liquidating PFS Card Services (Ireland) Limited (PCSIL).
The latter had been the source of endless woes for the group since its 2020 acquisition, followed by intense scrutiny from regulators and a share price collapse from which it has never recovered.
Despite the positive sentiment around Ron Hynes' efforts just recently, EML announced today that the board chose to discontinue his employment agreement, effective from 21 December.
The board resolved that "alternate leadership is required to execute the company’s strategy, EML 2.0".
"Ron will receive six months’ notice but will not receive any equity grants given he will not be in employment on the relevant vesting dates," the company said.
"The board and leadership team are wholeheartedly committed to our medium-term strategy EML 2.0 which was communicated to shareholders and the investment community at the company’s 2024 annual general meeting on 26 November 2024.
"Guidance for FY25 underlying EBITDA in the range of A$54-60m is affirmed."
In Ron Hynes' absence, independent chairman Anthony Hynes has assumed the role of CEO starting today. The incoming CEO was appointed to the board on 30 June, the same day of his predecessor's appointment to the CEO position.
"Our energised, passionate and broadened leadership team is building momentum and I’m excited to lend them my further support as we work hard to build a high-performance culture and make 2025 a formative year for EML," says Anthony Hynes.
"I love the payments industry having dedicated a significant part of my professional life to it and the upside for EML following the successful execution of our strategy is significant."
Business News Australia has sought comment on the announcement from Ron Hynes.
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