Corporate Treasurer of the Year 2012: Readers' Choice Award
The Awards, which will be held on 24 May at the Sofitel Grand Hotel in Amsterdam, the Netherlands, will recognise the shortlisted treasurers and teams who have done the most to contribute to the success of their organisation, wherever they are in the world. Now in its third year, the event has a hard-earned reputation for authority and independence. The judging panel consists of working treasury professionals from Tiffany’s, AkzoNobel and Etihad among others, who are willing to use their real-world expertise to ensure that the very best examples of great corporate treasury work are rewarded.
One category of the awards is a readers’ choice trophy, however, where it is votes that matter. The Corporate Treasurer of the Year is voted for by their peers on the gtnews website, with the winner announced on 24 May at the Awards gala dinner. [Voting is now closed and the final shortlist of three can be seen here, the full list of contenders is below].
The winner of this readers’ choice award will be recognised by their peers as an industry spokesperson and leader – a treasurer who has overcome the challenges posed by the financial and/or eurozone crisis, overcome natural disasters or other impediments to the supply chain, got to grips with regulations and still made an outstanding contribution in treasury. This category is nominated by and voted on by readers. The top three candidates will make the shortlist in this category and the winner will be announced at the Awards on 24 May. In the event of a tie in the amount of votes, the judging panel will cast the deciding vote.
A full list of all the contenders follows:
Under the leadership of vice president and treasurer, Gary Bischoping, Jr, Dell underwent an unrivalled treasury transformation where substantially all operations worldwide occur on a single treasury management system. Additionally, a majority of treasury payment initiation and bank reporting communicates via SWIFT, making Dell one of its largest corporate users. Dell took a ‘big bang’ approach to speed the transformation and enable a path toward replacing most legacy proprietary bank platforms and processes. The global TMS now handles nearly all treasury activities for more than 700 bank accounts in 100+ countries and provides a single view of cash balances. Not only does the treasury management system (TMS) significantly enhance visibility and streamline controls through a single channel, it also feeds into Dell’s forecasting system to provide improved forecasting accuracy.
In Q411, that resulted in an 80% decrease in receipts and disbursements variance. Bischoping took the automation and standardisation further, and created a centralised operations team in Bratislava, Slovakia, leveraging an existing Dell finance hub. Now the Dell treasury operations team is able to manage global cash positioning with three professionals (a significant cost savings) covering all EMEA and Americas time zones. This cash management ‘centre of excellence’ has enhanced efficiencies through standardisation, simplification and improved controls. This strategic positioning of staff has also allowed Dell treasury to focus on more strategic initiatives supporting business growth, managing acquisitions and improving debt investor relations.
In 2010, Stanley Works merged with Black & Decker, creating the largest hand and power tool business globally, Stanley Black & Decker, with over US$7bn in revenue and 40% market share. The merger had major implications for treasury, with acquisition financing and treasury integration expertly led by Craig Douglas. This included establishing a new, rationalised pan-European treasury structure within only six months, to support the current and future needs of the new business.
Some of the activities that Douglas and his team undertook included:
Under Douglas’ leadership, treasury now fully leverages the brand and revenue potential of the group, enabling cash to be mobilised easily and efficiently. Market confidence in the company’s financial strategy is evidenced in the company’s share price, which is nearly double (US$80 per share) the value of the former Stanley Works shares.
Gerald Laderman is nominated for his stellar performance in the financial crisis and remarkable leadership in UAL Corporation’s US$12.8bn merger with Continental Airlines. This landmark, transformational transaction creates the largest airline in the world with US$29bn in revenues, serving 144 million passengers per year flying to 370 destinations in 59 countries. The company obtained its single operating certificate from the Federal Aviation Administration (FAA) in 2011. Laderman and his team’s efforts to survive the crisis include maintaining a strong liquidity cushion, reopening the capital markets for all airlines and achieving interest rates lower than competitors. In fact, the company continues to lead the industry with unrestricted liquidity, representing 25.5% of trailing 12-month revenue. Laderman increased bank funding capacity for the combined company, with the completion of an upsized and extended term credit facility during Q411.
His nearly 25 years in the industry helped the treasury and merger integration teams prioritize and navigate the complicated list of ongoing integration challenges. These include legacy treasury systems and personnel, plus legal, risk management, hedging, investment policies and tax. Post-merger, his focus is on applying best practices developed over years at Continental in managing cash – including the most robust cash forecasting tools in the industry – and managing investor and bank relationships, then applying them to the combined airline. Laderman’s team has and will continue to evaluate the combined company’s exposure to interest rates, seeking to minimise earnings volatility while also minimise overall interest costs on outstanding debt.
In 2011, Live Nation generated US$5bn as the largest producer of live music concerts worldwide, connecting 47 million in 40 countries fans via 22,000 events to 2,300 artists. It operates 130 venues and is one of the world’s leading live entertainment ticketing, artist management and e-commerce companies. Two treasury professionals and four staff support this operation. One is senior vice president (SVP) treasurer Bill Lowe. Lowe has created an integrated global cash and risk management platform, where company cash, foreign exchange (FX), interest rate and counterparty risks are managed proactively from headquarters.
When Lowe joined in October 2007, Live Nation had 60+ banks with 700+ accounts in the US. Domestic banking was paper-based, reconciliation was a nightmare, cash transparency was problematic and FX risk unchecked. Today, Live Nation has two primary domestic banks with about 200 accounts (excluding Ticketmaster), resulting in a 70% reduction in both accounts and bank analysis fees. The solution includes cash delivery that works well with artists, who typically are paid at performance end – often at night. Now all Live Nation domestic businesses conduct banking electronically with real-time reconciliation. Lowe also oversees an active FX hedging programme. Although tickets are purchased in various currencies, artists generally prefer US dollars. Lowe works with business managers setting tour budgets in dollars and employing hedging strategies that protect monetary expectations. In 2012, Lowe will extend the bank consolidation programme to Europe to lower counterparty risk, minimise costs and improve cash transparency using pooling and automated intercompany loan system.
Lisa Stone, reporting to the head of group finance, led the four-strong Belron treasury team through an exceptional year of achievement in 2011. The team manages all of the group’s funding, bank relationships, hedging and daily cash management, as well as setting and monitoring the group’s treasury policy and standards. 2011 was the most challenging year in the treasury team’s history, with a requirement to refinance around €600m of debt facilities, cope with increased risk within the banking sector, and manage highly volatile foreign exchange (FX) rate scenarios. Simultaneously, the team implemented a new IT2 TMS to improve its efficiency and effectiveness for future years.
Stone was directly responsible for managing and negotiating the refinancing, which was achieved through a US private placement (seven to 12 years) together with a five-year club deal with the group’s core relationship banks. This complex operation was all achieved at competitive pricing (20 basis points below management expectations) thanks to the close relationship nurtured with the group’s lenders, who benefited from the clarity of the information supplied by Stone. All related cash management, interest rate and FX challenges were handled effectively and efficiently. The IT2 system was implemented on time and within budget; it is already delivering significant, incremental benefits, including a 50% increase in enterprise-wide cash visibility, to 95%, and process efficiencies through straight-through processing (STP). This outstanding record of success throughout 2011 – in two major, complex and exceptional projects – was achieved through Stone’s strong and effective team leadership, working with her colleagues and external partners.
QinetiQ, the former research laboratories of the Ministry of Defence, was floated on the London Stock Exchange in 2006. Its transition from civil service to private sector was incomplete, as inflexible working practices, lack of commerciality and unsustainable cost base were carried forward. A turnaround strategy was called for to focus on the core activities of the group, strengthening the balance sheet, implementing a cost-cutting drive and making enhancements to its treasury operations. The company’s new executive team led by Leo Quinn, chief executive officer (CEO), undertook an ambitious self-help programme to restore QinetiQ’s financial position and address operational weaknesses. QinetiQ’s treasury team of five people, led by Stephen Webster, group treasurer, worked across the UK, North America and Australia, to deliver fast on an ambitious turnaround strategy.
Webster led a deleverage drive, paid down long term debt early, helped cut finance costs and secured a new five-year £275m revolving credit facility. Just one year after the overhaul began the company’s financial position has been transformed. Webster played a key role in the detailed planning and execution of the programme by quickly focusing on the health of the balance sheet, improving working capital, disposing of small non-core businesses to secure the long-term success of the business. The company’s balance sheet has been transformed, with substantial cash holdings and net debt falling to less than one times EBITDA. With the treasurer’s risk management responsibilities extending to pensions and insurance, this is a lean treasury team, with an extensive remit, delivering big results.