Rzepka out, Gingo back as CEO at A. Schulman

FAIRLAWN, Ohio—A. Schulman Inc. boss Bernard Rzepka has paid the price for recent struggles at the global compounding leader.

Officials at Fairlawn, Ohio-based Schulman announced at the close of business on Aug. 18 that Rzepka was leaving the company effective immediately. He'll be replaced by Joseph Gingo, who was credited with rebuilding Schulman before relinquishing the top job to Rzepka in 2014.

"Joe led this Company through a remarkable seven-year renaissance as its chief executive officer, and the board is confident that he will restore A. Schulman's operational and financial performance to the high level our shareholders expect," lead independent director David Birney said in a news release.

"We thank Bernard for his dedicated service to A. Schulman during the last 24 years,” Birney added. “His many contributions throughout his career with the company should not be overlooked or minimized in light of this transition."

Schulman recently downgraded its earnings expectations for its 2016 fiscal year, leading its stock price to drop more than 25 percent on Aug. 11. The firm also is engaged in a lawsuit against the former owners of Citadel Plastics, which Schulman acquired for $800 million in 2015. Schulman officials have claimed Citadel owners withheld information that has affected the performance of the business.

Gingo, age 71, led Schulman from 2008 to 2014. He said in the release that the firm will undertake a comprehensive review of its business plan, as well as near- and longer-term global end market trends. Schulman intends to retain a leading advisory firm to assist in this review process.

"Like our fellow shareholders, the board is not satisfied with the company's less-than-optimal performance throughout fiscal 2016," Gingo added. "In light of last week's earnings guidance revision, the time has come to conduct a comprehensive review of our business plan and strategic execution."

Gingo also said that he is committed to conducting “a deliberate and unvarnished assessment as promptly as practical.”

"Our intent is to provide additional information on our review as appropriate, when appropriate," he said. "We will not, however, speculate on any potential outcomes from this assessment or the timetable for it. The goal is to verify our market intelligence, refine our vision and improve our execution."

Schulman ranks as one of the largest compounders and concentrate makers in both North America and Europe, and as one of Europe's largest resin distributors as well. The firm employs 5,000 at 60 sites worldwide and posted sales of around $2.4 billion in its 2015 fiscal year.