Telstra Corp. Chief Executive Officer Sol Trujillo will step down from Australia's largest phone company a year ahead of schedule after a tenure marked by clashes with the government, Bloomberg reported.
The board will search for a successor and expects to make an appointment by June 30, when Trujillo, 57, will leave, Melbourne-based Telstra said in a statement to the Australian Stock Exchange today.
Telstra today posted its first six-month profit drop in two years after sales of traditional phone services fell. Trujillo's successor will need to find new businesses after the company's omission from a government-funded national Internet network that may cost it A$2 billion ($1.3 billion) in potential sales.
"He failed to find a successful pathway to working with the government instead of taking a confrontational approach all the time," Angus Gluskie, who looks after about $256 million at White Funds Management Pty. in Sydney, said before the company's announcement. "That last step may have cost him."
Telstra fell 1.9 percent to A$3.70 as of 11:59 a.m. in Sydney trading. The stock has dropped 27 percent since Trujillo took over the company in July 2005 from Ziggy Switkowski, who was fired after losing more than $2 billion in a failed Asian expansion during his six-year tenure.
Shareholders have lost 4.7 percent of their holdings, including reinvested dividends, since Trujillo was appointed, compared with a 44 percent drop for New Zealand's Telecom Corp. and an 8.2 percent decline for Australia's benchmark S&P/ASX 200 Index, according to data compiled by Bloomberg.
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