Truckload and logistics provider Celadon Group Inc. continued a revamp of its executive suite late yesterday by naming transportation industry veteran Paul Svindland as its new CEO and long-time board member Michael Miller as chairman. It also announced that Paul Will, its current chairman and CEO, will retire by month's end after 24 years with the company.
Svindland will join Indianapolis-based Celadon from Farren International Holdings Inc., a private Houston-based holding company for three trucking concerns, where he is currently chairman and CEO. Farren's three units—Farren International, Patterson Motor Freight Inc., and Rig Runners Inc.—specialize in the expedited shipping of heavy-haul and outsized freight. Prior to that, Svindland was CEO of EZE Trucking Holdings Inc., which merged with Farren last July. Svindland will also join Celadon's board, the company said.
Svindland spent several years as executive vice president and chief operating officer of Pacer International, an intermodal and logistics provider. Pacer was acquired in January 2014 by Greenwich, Conn.-based XPO Logistics Inc. for $335 million in cash and stock. He also spent about a decade at transportation consultancies, including a stint as co-head of the global transport and logistics practice at the consulting company Alix Partners LLC.
Will, who will officially retire around July 24, will continue as a consultant to Celadon through next July. Miller, for his part, will begin a search for new directors, as well as a new chairman, the company said.
C. Thomas Barnes, who spent two decades in transportation before becoming president of Chicago-based logistics information technology provider Project44, said Svindland "excels in managing complex situations" and that he will lead Celadon "to a quick recovery by enhancing the current strength of the asset and nonasset models" in its portfolio. However, Charles W. Clowdis Jr., managing director, transportation, for IHS Economics & Country Risk at consultancy IHS Markit, said that Celadon may have been better off hiring someone with "strong direct motor carrier executive experience," such as James L. Welch, a long-time trucking industry leader who was hired in 2011 to revive the flagging fortunes of less-than-truckload (LTL) carrier YRC Worldwide Inc.
Celadon, the seventh-largest truckload carrier in the U.S., ran into trouble in early May when it projected a $10 million operating loss in its fiscal third quarter, which ended on March 31. The company also delayed issuing its fiscal third-quarter results after disclosing earlier this month that financial statements for the past six quarters ending last Dec. 31 should not be relied upon. It has yet to issue results for the quarter.
Eric Meek, Celadon's former president and COO, resigned in the wake of the projected results. Jon Russell, son of Steve Russell, Celadon's late founder, was named president and chief operating officer and put in charge of all trucking operations. Douglas Schmidt, who had been president and chief operating officer of one of Celadon's subsidiaries, was tapped to oversee the company's truckload division.
Company executives blamed the quarterly loss on poor management of its core truckload business, in particular the handling of owner-operators. Celadon's finances have also been thrown into question by an unprofitable joint venture involving its truck-leasing division. The company has said it expects to record a $7.8 million pretax equity loss in the March quarter from its interest in the venture and another loss in the fiscal fourth quarter, which ended on Friday. It has not disclosed the extent of the projected fiscal fourth-quarter equity loss.
Will said in a statement earlier this month that most of Celadon's key operating metrics, which include revenue per truck per day and fleet size, have been showing sequential improvement. Will added that Celadon has experienced its highest driver recruiting classes in recent history. The company recently instituted across-the-board pay increases for drivers.
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