Minorplanet founder goes as broker slashes forecast

The founder and chief executive of the technology company Minorplanet Systems announced his retirement yesterday as the company promoted its finance director into the top job.

Jeffrey Morris, who is in his late-40s, is retiring from the business he set up in 1996 "with immediate effect". He is on a two-year contract, entitling him to a payment of twice his £260,000-a-year salary.

A spokesperson insisted yesterday, however, that his severance package would be "significantly less" than the £583,824 he earned last year – which had included a £260,000 performance-related bonus.

Mr Morris, who owns about 10 per cent of the business, is thought to have recommended Rob Kelly, finance director, as his successor after conceding that "a different style of management" was needed to take the company forward.

Michael Abrahams, the chairman, said "your board believes that the business now requires a more structured management approach," noting Minorplanet had been through a period of "exceptional growth characterised by a strong entrepreneurial spirit".

Minorplanet Systems sells technology to fleet operators which monitors and records a vehicle's position and speed as well as the distance it has gone.

The board shake-up came as the company announced pre-tax losses for the six months to 28 February had nearly halved to £7.3m. Sales were more or less flat at £51m.

But the figures were well beneath analysts' forecasts and left shares in the business nearly 7 per cent adrift at 92.5p. Analysts at the company's broker, Investec, slashed their forecasts for both the current year and the next. They are now predicting Minorplanet to make a loss of nearly £4m this year compared with their previous estimate of a profit of about £1.6m. For next year, they cut their profit forecasts to £7.2m from £11.3m.

Nevertheless, Mr Abrahams said yesterday he was "very confident" about Minorplanet's future. "The market opportunity open to us is huge. We believe that the strategic moves taken in this year of transition will deliver a strong performance for shareholders," he said.

The company said it had won "significant" contracts in the first half of the year. Minorplanet also said it was in discussions to sell its non-vehicle management information business in the US.

Separately, the company announced the appointment of Lucy Woods, who has held senior positions at the telecoms companies BT and WorldCom, as a non-executive director. It also named Ken Mullen, who was previously company secretary at Silentnight Holdings, as its company secretary.