SITUATION: Through a series of acquisitions, a Louisville-based home improvement company grew to become the nation's fifth largest remodeling concern. However, overhead and debt became overburdening. The company brought in a new CEO and began working through its financial and operational difficulties. The CEO inherited a shareholder base that had witnessed a precipitious decline in the value of its holdings.
SOLUTION: The annual report was the centerpiece of a comprehensive investor relations program. The CEO's message acknowledged the difficulties of the past - but more important, also detailed his plans for recovery and growth.
RESULTS:Informal surveys within the financial community and among shareholders showed that the CEO gained significant credibility for putting forth such a public plan and then meeting the milestones that were set forth. Reflecting the company's growth in earnings, the stock price increased from around 18 cents per share - at its lowest - to a recent price of around a dollar.
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