Profile - Nick Hobson: New chief aims to continue to engineer success with Fenner

NICK Hobson has led a more nomadic life than most. In more than 20 years with Fenner, he reckons he’s crossed the Atlantic about 400 times.

His career has seen him emigrate between the US and the UK four times.

But now he’s looking forward to settling down. Earlier this month, Hobson replaced Fenner’s long-standing chief executive, Mark Abrahams, at the helm of the East Yorkshire-based conveyor belt maker.

He inherits an industrial group powering out of the recession, boosted by re-stocking, the weak pound, resurgent mining companies and booming Asian demand for commodities. Fenner’s underlying pre-tax profits in the year to the end of August surged by 49 per cent to £46.3m, lifting sales by 11 per cent to £552.5m.

“We were not that badly affected by the recession,” said Hobson. “As we came out of the recession we were fairly lean and mean. We’ve seen a huge ramp-up in investment mineral extraction companies.”

Many of the businesses in Fenner’s advanced engineered products division are now operating above pre-recession levels.

Despite taking over a company in good health, Hobson is keen to stamp his own mark on the engineer.

“When Mark became chief executive in the early 1990s we were this unfocused conglomerate. No one really understood Fenner; it was a grab bag of businesses.

“We’ve worked hard since Mark Abrahams became chief executive to turn Fenner from a rather unexciting industrial company into a company which is world class in many of the things we do.

“We’ve completed that piece of the journey. We’re profitable, cash positive, and in the FTSE 250. The City is looking at us differently. The monkey is now on our back to look to what the next 10 years might involve.”

One of his first tasks is getting acquainted with the City, its analysts and investors. It is an area, which, by his own admission, he is still getting used to.

“I know quite a lot of the business so the operational side of the job I’m reasonably confident in,” he said.

“The bit that’s a learning curve is the City. It’s something that I’m going to get stuck into.”

Hobson, who most recently headed Fenner’s precision polymers division in the States, has worked his way up through the ranks.

Abrahams, himself an internal appointment when he was promoted from finance director to chief executive in 1994, describes Hobson as “safe hands” to carry on Fenner’s momentum.

An engineering graduate, Hobson worked in various engineering roles in Bristol and Portsmouth after leaving the University of Bristol. His flirtation with the US began when he met an American, Pam, who became his wife.

They moved to Rockford, Illinois, in 1985 where he worked for aerospace group Sundstrand. His first role with Fenner came in 1987, when he became director of engineering for Fenner Fluid Power.

There he re-designed the division’s entire product range, and was promoted to its managing director in 1998. He moved to Romford in Essex, and became divisional managing director three years later.

After returning the fluid power division to growth, he shepherded it into its sale to SPX in 2000. Hobson spent two years as president of SPX Fluid Power, before returning to Fenner as divisional managing director of its precision polymers division, based in Manheim, Pennsylvania.

Under his stewardship the division doubled revenues and entered the medical sector. Most recently it snapped up a small US medical device maker, MRI Medical, for about £5.4m. Unsurprisingly, medical is an area Hobson sees great potential for.

“It’s not immediately apparent when you look at Fenner from the outside why we would bring any value to the medical sector,” admitted Hobson.

“People take a look at Fenner and see conveyor belts.

“But there are quite strong similarities between what goes on at the bottom of an oil well and what goes on at the bottom of an artery.” He’s interested in medical precisely because it’s a “demanding” area, where the cost of entry is high, and the rewards equally high. Hobson sees the medical arm becoming a $100m business in three years.

Most of its products are used in minimally invasive surgery, and Hobson is confident the demographics of the developed world will play into its hands.

“There’s an underlying demographic trend in western economies,” he said.

“The growth rates in age-related conditions is faster than healthcare as a whole.”

He also sees great potential in the group’s service operations, where Fenner not only supplies the conveyor belt, but also splices and maintains it.

In a world increasingly dominated by global commodities giants which do not want the hassle of maintenance, Hobson sees great potential in boosting Fenner’s position as an outsourced service provider.

“There have been structural changes in many of the engineering markets that we serve,” he said. “It’s kind of sorted out the men from the boys.

“We’re seeing a situation where they have laid off many of their technical staff. They are rather more dependent on companies like us to help them solve their problems.”

It’s a far cry from Fenner’s origins 150 years ago, in rented rooms in Hull, making leather engine belts. It’s also some distance from the mid-1990s when Abrahams took over.

But Hobson is convinced that to retain its relevance in a changing world, he needs to take a fresh look at the business. He has initiated a strategic review, and expects to unveil its results by the end of the year.

“I hesitate to say there’s a fork in the road,” he said. ”I think there’s a need to take a holistic view of our business. The world is an exciting place but there are some big challenges afoot.”

Hobson is quick to reassure - the review won’t involve a U-turn.

“Fenner does a great number of things very well. Clearly the numbers are moving in the right direction. We’ve got a first-rate workforce and we do an awful lot of things right.”

Hobson is keen to retain and nurture the company’s culture, which involves devolving decisions to the group’s 17 individual business units, each of which has its own profit and loss account.

“At the end of the day what has made Fenner successful has been our corporate culture,” he said.

“We delegate responsibility as far down the organisation as we can. We want to have individual management teams responsible for their own destiny.”

With both of his sons studying in America, Hobson expects to continue his regular trans-Atlantic flights to continue. “As a family we think nothing of getting in a plane and crossing the Atlantic.”

Nick Hobson

Title: Chief executive, Fenner Plc

Date of birth: 21/2/59

Education: BSc in Mechanical Engineering, University of Bristol

Favourite holiday: Anywhere bizarre or offbeat – we don’t do beach holidays

Last book read: Paris 1919: Six Months That Changed the World, by Margaret Olwen MacMillan

Favourite song: Baba O’Riley, The Who

Car driven: S-type Jaguar or 1969 AMC AMX

Most proud of: My children, Christopher and Andrew