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Club Med Chief Bourguignon Resigns

December 16, 2002

PARIS (AP) _ French resort operator Club Med said Monday Chief Executive Philippe Bourguignon has quit after the company reported lower revenue and a net loss for the second consecutive fiscal year.

The company was tightlipped on the exact reasons behind Bourguignon’s departure, but his resignation was interpreted by some investors and analysts as a sign that core shareholders have lost hope in turning around the leisure company and might consider putting it up for sale.

Core shareholders include Italy’s Exor, a holding company of the Agnelli family, with a 24 percent stake, and Caisse des Depots et Consignations, with an 8.2 percent holding.

Hit by weak demand and fears of terrorism, the company recorded a net loss of 62 million euros ($63.5 million) in the 12 months ended Oct. 31, from a net loss of $71.7 million in the year earlier period.

Club Med said its board would meet Monday to consider promoting its chief operating officer, Henri Giscard d’Estaing, to CEO.

Bourguignon has been Club Med’s head since 1997. His attempts to tap a younger clientele and upgrade the quality of Club Med’s resorts failed to prop up revenue and profit.

The company will release more detailed earnings for the fiscal year 2002 early Tuesday.

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