Derby CEO Gary Matthews Under Pressure

STANFORD, Conn, USA (19 December) - With the appointment of Alan Finden-Crofts as the new Executive Chairman for Derby Cycle Corp., the position of Derby President and CEO Gary Matthews is under severe pressure. Finden-Crofts, one of the former owners of Derby and still a major shareholder, has been a member of the board since 1987 and a group chief executive from 1987 until he sold Derby Cycle Corp. in 1998. He was asked to come back and "concentrate on operations and develop a turnaround plan focused on profitability and cash management." Finden-Crofts will report directly to the board of directors. Derby President and CEO Gary Matthews will continue in his existing capacity. Finden-Crofts will start working with the management of the operating companies immediately to gather information and review the 2001 budgets. He is known as a staunch believer in both Raleigh and the production of bicycles in England. Reviewing the 3rd quarter figures of Derby, there still was a gross profit of US$ 4.3 million (EUR 4.9 mn), compared with US$22.7 mn in the same bracket of 1999. The net growth in bicycles produced was 18.000 more than in the same period last year, but the Derby flagship Raleigh had a dramatically poor performance. Derby USA was minus, Derby Germany was plus with a good profit (although they had to lay off a couple of weeks due to overstock) and Dutch Gazelle company reached a record production with a solid profit.(OB)