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The embattled chief of early childcare group ABC Learning, Eddy Groves, claimed he "put his nuts on the line" every day and was still the best person to run the company despite a string of financial disasters that had savaged the market value of the group.
ABC's year of pain descended into near farce yesterday when it unveiled a fresh $213 million write-down and was forced to restate its 2007 accounts.
One of the strongest candidates for Australia's worst-managed listed company is now expected to post a loss of $437 million for the 2009 financial year.
This will mean a turnaround of more than half a billion dollars from its profit last year of $147 million.
There is little end to the pain in sight for shareholders, whose investment has shrunk from $7.57 per share in May last year to as low as 66c in June.
The company's shares shed 10c yesterday to close at 72.5c. ABC also said it would cancel its second-half dividend as it relied on price increases on the back of an increase in the federal childcare subsidy from 30 per cent to 50 per cent of parents' costs.
There was no sign that Mr Groves was any closer to leaving the group than he was in February, when margin loans he held against the company's shares helped to tank its share price -- an episode from which the company has never recovered. Mr Groves said he had sacrificed his entire salary in favour of an options package struck on July 1.
"I walk in here every day and don't earn a cent unless I perform," he said.
"But I believe shareholders think I am the best person to turn this company around."
The terms of the issue make the 23c options exercisable at 92c on or after July 1 next year, so ABC shares must be priced at $1.15 or more for Mr Groves to see a financial gain.
ABC was forced into a sale of 60 per cent of its US business, its main growth strategy, and its British voucher business will be next on the block.
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Mr Groves claims to have turned his back on the highly leveraged deal-making behind the company's troubles.
"I am best doing what I love best," he said.
Mr Groves has seized control of day-to-day operations in the company in an effort to resuscitate the tarnished reputations of him and his company.
In early July, UBS market analyst Dan Hurren agreed with Mr Groves.
"The problems of the last 12 to 18 months are largely ones of corporate governance, which can be rectified by a rigid board and a crack financial team," Mr Hurren said.
- reprinted from The Australian