Spring Ram chairman shoulders the blame: We got timing wrong and let shareholders down, annual meeting told

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BILL ROONEY, chairman of Spring Ram, the troubled bathrooms and kitchens group, ate humble pie in front of his angry shareholders yesterday.

Addressing the annual meeting in Leeds, he apologised for the sudden fall in profits and share price that shook the company earlier this year. 'With hindsight we should have played things differently last year,' he said. 'We got our timing wrong and have let shareholders down.'

Several private investors registered their anger by voting against the retention of Arthur Andersen as auditors. Although rejected on a show of hands at the meeting, Andersen retained its job by 105 million to 8 million shares after absentee votes were counted.

A small number of shareholders also voted against approving the accounts and there were large numbers of abstentions on both motions.

Private shareholders speaking at the meeting wanted Andersen to take the blame for financial irregularities that were uncovered last November at the Balterley Bathrooms subsidiary.

The irregularities had been perpetrated over a three-year period and cost the company pounds 3m - treated as an exceptional item in the 1992 accounts.

Spring Ram was long a stock market favourite as it apparently brushed aside vicious recession in its market place. However, the Balterley affair - allied to a fall in profits in 1992 - has undermined confidence in the group and sent the share price plunging by more than 50 per cent.

A small number of shareholders speaking for 13,500 shares voted against adoption of the 1992 accounts, but holders of 113 million voted to adopt the document.

John Dyson, a director of the local stockbroker BWD Rensburg, said the protest was not confined to private shareholders. 'There is a significant number of institutional investors who have taken their disappointment out on Arthur Andersen,' he said.

Mark Harman, who delivered the auditor's report to the meeting for Andersen, declined to comment on the protest vote directed at his firm.

Mr Rooney was more upbeat on the trading outlook, saying: 'The board believes that business prospects for the year as a whole are better than for 1992.'

A new finance director - to replace Stuart Greenwood, who resigned over the Balterley affair - and a second non-executive director would be announced 'at the earliest possible opportunity'.

Roy Barber, former chairman of the construction equipment group Thomas Robinson, took up his position as Spring Ram's first non-executive director at the start of this month. He will be paid pounds 25,000 a year.