September 19, 2016 – CDI Corp. has announced that president and chief executive officer Scott Freidheim resigned from the firm to pursue other, “non-competitive” business interests. Chief financial officer, Michael Castleman, has been promoted to the post of president and has agreed to serve as interim CEO while the board of directors selects a permanent CEO.
CDI named Mr. Freidheim its CEO in August 2014. Prior to CDI, he served as vice chairman-post acquisition management (Europe) at Investcorp International.
Mr. Freidheim’s resignation follows CDI posting first quarter revenues of $226.7 million, a decrease of 8.2 percent from revenues of $246.8 million a year ago. The Philadelphia-based recruiting company reported a net loss of $7.5 million, or 39 cents per share, compared to a loss of $0.2 million, or $0.01 per diluted share, last year.
CDI shares have fallen 14 percent since the beginning of the year. But more tellingly, its stock has dropped 51 percent in the last 12 months. Search firm stocks have generally been under pressure recently.
“Under Scott’s direction, we established our strategic road map, strengthened our leadership team, improved our client service and retention, completed our first strategic acquisition and expanded our financial capacity,” said Walter Garrison, chairman of the CDI board of directors and company founder.
“The board appreciates Scott’s leadership during a time marked by challenges within our market and client footprint,” he added. He said he was “grateful” to Mr. Castleman for agreeing to accept the additional responsibilities of president and interim CEO.
Mr. Castleman joined the company in October 2014 as executive vice president, corporate development and operations and was promoted to CFO in March 2015. He was previously president of Kenmore, Craftsman and Diehard brands, where he was responsible for all strategy and operations related to product development and management, brand marketing, strategic sourcing, business development and brand extensions.
He initially joined Kenmore, Craftsman and Diehard as CFO, responsible for financial management and operational performance improvement. Prior to that, he founded or co-founded several investment firms, including Lehman Brothers Venture Partners, the venture capital affiliate of Lehman Brothers Holdings, where he served as managing director and co-head.
Contributed by Dale M. Zupsansky, Managing Editor, Hunt Scanlon Media