Engine Capital Releases Presentation To Board Of Matrix Service

Rhea-AI Summary

Engine Capital, a shareholder of Matrix Service Company (MTRX), has publicly disclosed a presentation to the Board, criticizing the company's performance under CEO Mr. Hewitt. The report points out ineffective capital allocation, a failed growth strategy, high operational costs, and poor mergers and acquisitions. Recommendations include halting M&A activities until a new leadership team is in place, significantly reducing costs, and repurchasing shares aggressively due to undervaluation. The full presentation is accessible on a dedicated website.

Positive

• Recommendation for aggressive share repurchase at undervalued prices.

Negative

• Significant underperformance of Matrix under current CEO.
• Disastrous capital allocation decisions by the Board.
• Failed growth strategy and bloated cost structure.
• History of poor mergers and acquisitions.
• Misalignment of incentives between management and shareholders.

NEW YORK, Nov. 4, 2020 /PRNewswire/ -- Engine Capital LP (together with its affiliates, "Engine"), a shareholder of Matrix Service Company ("Matrix" or the "Company") (Nasdaq: MTRX) announced today that it has publicly released a presentation shared with the Board of Directors of the Company in early October. The presentation highlights the significant underperformance of Matrix under the leadership of the current C.E.O. Mr. Hewitt and the disastrous capital allocation decisions made by the board of directors (the "Board"). In particular, the presentation highlights Matrix' failed growth strategy, bloated cost structure, history of poor M&A, and misalignment of incentives between management and shareholders. Engine concludes its presentation with the following recommendations:

• No more M&A until the Board has done a market check so that it can assess its alternatives and the Company has a new leadership team with a track record of value creation through M&A
• Significant reduction of the cost structure of the Company
• Aggressive repurchase of shares at the current undervalued price

The full presentation is available at www.abetterpathformatrix.com, a website dedicated to sharing Engine's views with respect to creating value at MTRX. Engine encourages interested parties to visit the website regularly. 

About Engine Capital

Engine Capital is a value-oriented special situations fund that invests both actively and passively in companies undergoing change.

Investor contact:
Engine Capital, L.P.
Arnaud Ajdler
(212) 321-0048
aajdler@enginecap.com

View original content:http://www.prnewswire.com/news-releases/engine-capital-releases-presentation-to-board-of-matrix-service-301166136.html

SOURCE Engine Capital Management LP

FAQ

What are the main criticisms made by Engine Capital regarding Matrix Service Company?

Engine Capital criticizes Matrix for underperformance under CEO Mr. Hewitt, ineffective capital allocation, high costs, and poor M&A decisions.

What recommendations did Engine Capital provide to Matrix Service Company?

Engine Capital recommends halting M&A, reducing costs, and aggressively repurchasing shares.

What is the stock symbol for Matrix Service Company?

The stock symbol for Matrix Service Company is MTRX.

When was the presentation to the Matrix Board released by Engine Capital?

The presentation was publicly released on November 4, 2020.

How does Engine Capital suggest Matrix Service Company address its underperformance?

Engine suggests that Matrix should implement new leadership focused on value creation and reassess its cost structure.