Dakota Plains Holdings Inc. (NYSEMKT: DAKP) is still searching for a permanent CFO following the resignation of Timothy Brady. It’s been more than a month since Brady left the company and a man called Jim Thornton tapped to step in as caretaker CFO. But fears over prolonged CFO recruitment process and recent weak quarterly reports seem to be working against the stock.
Dakota Plains Holdings Inc. (NYSEMKT: DAKP) didn’t elaborate on why Brady was leaving the company, yet he was among the executives who oversaw the company’s IPO. In a press release announcing the exit of Brady and the appointment of a temporary replacement, Dakota’s CEO, Craig McKenzie, praised the outgoing CFO for his contribution to the company. But the release also fell short of explaining why Brady was resigning from his position.
Replacement CFO at Dakota Plains Holdings Inc. (NYSEMKT: DAKP)
The search is still on for Brady’s permanent replacement and it seems Dakota is taking is time to assess the candidates for the job carefully so that it can hire the best for the sensitive job. In the meantime, Thornton is backstopping as caretaker CFO and there is no knowing how long he will have to remain in the position. But there is no doubt that a prolonged CFO search will increase investor anxiety over the future of Dakota.
Tepid 4Q2015 results
On top of the CFO vacancy, the other issue keeping investors on the edge of their seats is Dakota Plains Holdings Inc. (NYSEMKT: DAKP)’s weakening financial performance. The company’s exposure to the energy market has been a source of pain. For example, revenue from crude oil transloading in 4Q2015 nearly halved to $3.7 million compared to $7.7 million in the corresponding quarter a year earlier.
Overall, Dakota Plains Holdings Inc. (NYSEMKT: DAKP) posted a net loss of $3.4 million in 4Q2015, significantly wider than a net loss of $0.9 million a year ago. The lower crude oil prices have adversely impacted crude oil transloading fees, thus hurting revenues and bottom-line.