Last week United Technologies, products and services provider for the building systems and aerospace industries, made a surprise announcement that CEO, Louis Chenevert, has stepped down as the company faces disappointing margins and underperforming stock. Current CFO, Gregory Hayes, will replace him as CEO, and Peter F. Longo will now serve as Acting Chief Financial Officer.
“I can’t see anything in the past that would have caused this; it’s about the future,” said William Blar & Co. analyst, Nick Heymann. “This is a company that has not been renowned for above average organic growth. But the path forward will be more challenging than the recent history.”
Longo Joined UTC in 1988
Since 2011 Longo has served as the company’s Vice President, and Principal Accounting Officer. Longo joined United Technologies in 1988 at Pratt & Witney and has held a variety of leadership positions including Vice President, Controller, and Chief Information Officer.
Longo received his Bachelor of Science degree in Accounting from Bentley College, and is a Certified Public Accountant.
Current Financial Troubles
Chenevert, who led the company for six years, invested heavily in new jet engine technology and urbanization of new markets (including China) as an effort to turn financial earnings around and drive future growth. After a series of strategic initiatives, mergers and acquisitions the company’s share price climbed nearly 50% under Chenevert’s leadership.
More recently, the company continues to report underperforming stock, dropping 4.4% this year alone. Recent quarters have reflected subpar order growth and struggling margins.
Together Hayes and Longo will be charged with turning the company’s weak financial reporting around by cutting costs and investing in profitable emerging markets. Hayes, who is known for “his intense focus on operational execution, strong balance-sheet management and cash-flow generation” according to Heymann, will likely provide strong guidance for Longo as he begins his tenure as CFO.
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