Ousted CE0 tight-lipped on Smiles
SHAREHOLDERS say ousted Smiles Inclusive CEO Mike Timoney has not answered questions about his dealings while at the helm of the embattled Gold Coast dental group and beforehand with Bartercard in the UK.
The Bulletin forwarded a series of 21 questions to Mr Timoney from shareholder Jonathan Hamilton.
Mr Hamilton and Lev Mizikovsky will move a motion at the EGM later this month to remove Mr Timoney and former chair David Herlihy as directors.
The motion is in response to Mr Timoney and Mr Herlihy’s original EGM motion to get rid of current chair David Usasz and non-executive director Tracy Penn.
It is part of a battle for control of the company, which listed last year with 52 practices and has seen its market capitalisation slashed from $60 million to $7.5 million in the wake of legal disputes, board infighting and lower-than-expected revenue.
The questions from Mr Hamilton to Mr Timoney included:
At any time while you were CEO and Mr Herlihy chairman was a risk identified in respect to working capital and/or group revenue?
What was your relationship and history with Bartercard UK?
Could you please detail the business case for undertaking your 120-day integration plan (for the 52 practices)?
●To what extent do you take ownership of the more than 80 per cent fall in the share price, given you were CEO and a company director?
Mr Timoney’s spokesman sent through a single sentence as a response: “We are singularly focused on strengthening the governance and business capabilities of the Smiles Inclusive Board in line with our desire to improve the company’s financial performance.”
Melbourne dentist Dr Michael Sawaya, who was one of the original dentists who sold his practice to Smiles prior to the stockmarket listing, said he was currently undecided about who to support at this month’s meeting.
“Basically, I just think there are a lot of questions that have gone unanswered as far as Mike Timoney is concerned,” he said.
“I see one side coming up with a turnaround plan and the other side is not answering questions.”
Dr Sawaya said Mr Timoney needed to “persuade people” with reasons for voting for him and the other directors he has nominated for the board, such as the former boss of Officeworks, Mark Ward.
Mr Hamilton, who sold two practices to Smiles prior to the float – one in Melbourne and one in country Victoria, said he was “flabbergasted” by Mr Timoney’s response.
“I am disappointed,” he said. “We cannot get clarity in respect to Mike Timoney’s position and history associated with activities surrounding Smiles Inclusive and the future for the company.
“I am concerned about why he is avoiding answering these questions.”
The current Smiles leadership insists Mr Timoney and Mr Herlihy were dumped in the wake of poor performance.
The pair have hit back, saying they were the victims of “renegade” directors who had resisted attempts to renew the board with executives with dental industry experience.
Smiles released a cashflow report last month showing staff costs had soared 41 per cent, partly due to redundancy payouts.
The company is currently suing Mr Timoney and Mr Herlihy for misconduct and has terminated Mr Timoney’s employment.
It is flagging a loss of “at least $4 million”, compared to an initial profit forecast of $2.3 million.
BASICALLY, I JUST THINK THERE ARE A LOT OF QUESTIONS THAT HAVE GONE UNANSWERED AS FAR AS MIKE TIMONEY (PICTURED LEFT) IS CONCERNED DR MICHAEL SAWAYA