Gary Stolkin, the chief executive of The Talent Business, has been removed from his position after the company's parent, Hat Pin, revealed a dismal set of figures for 2007.
On Monday morning, Hat Pin released a profits warning to the Stock Exchange, reporting that the second half of 2007 had seen the business "perform significantly below management expectations". It added that: "This led to a deterioration of working relations between the board and the former chief executive, Gary Stolkin, who has now left."
In a separate note e-mailed to several agency managers, Angela Campbell-Noe, Hat Pin's chief executive, talked of a "strained" relationship with Stolkin and revealed that "The Talent Business, trading as Kendall Tarrant in 2006 reported profits of more than £1.5 million, and this year it is likely to post profits of less than £40,000."
Sources close to Hat Pin say Stolkin has been talking to the holding company about a possible management buyout of The Talent Business.
Following the profits warning, the company's share price fell from 79p on Friday 18 January to a 52-week low of 42.5p on Tuesday 22 January.
Stolkin has worked for Hat Pin since 2006, when the company purchased Stolkin + Partners, merged it with Kendall Tarrant, then renamed the combined company the Talent Business last year.
In 2007, the company invested in building a global talent company. It opened an office in the US, relocating Lucy Meredith to New York, where she became chief executive and hiring Cindy Gallop as a non-executive director. It also built its presence in Sao Paulo, Portland, Singapore and Shanghai.
Meredith denied that a management buyout of The Talent Business was being discussed. Hat Pin did not return calls and Stolkin could not be contacted.