Marsh, head of the firm鈥檚 contracting operations, quit after the problems in the construction division led the group to slash projected profit predictions.
Marsh had been set to take over as chief executive from David Calverly next June but has instead been replaced by Calverly, who will be responsible for construction until a replacement has been found.
Calverly, who had been due to retire next summer,
has now postponed his retirement until at least the beginning of 2004.
A City source said: 鈥淒avid will not go until he is sure that the problems have been addressed, so he staying on for at least another nine months.鈥�
Marsh鈥檚 departure last Friday came as the group warned that profitability in the construction division would not rise next year, and that it would also be
hit by a 拢4m restructuring charge. After the double announcement, the group鈥檚 share price plunged 26% to 22.5p, and fell another 5% on Monday.
Galliford Try said profitability in the construction division for the year 30 June 2003 would be 鈥渂roadly in line鈥� with the 拢500,000 made in the year to June 30. It had hoped the division would make a profit of 拢4m.
In an update to shareholders last Friday, the group said trading at the construction division in the first quarter had been disappointing. It also said that a hoped-for turn-around in the maintenance business had not materialised and that delays to the completion of some traditional building contracts had hit performance.
Calverly said the group would now focus on long-term framework agreements and infrastructure projects rather than commercial work and traditional contracts. The group鈥檚 construction order book stood at 拢600m, of which 70% was in these target sectors.
Chairman Tony Palmer said: 鈥淭he board is confident that the action it is taking will lead to improved margins and profitability in the future.鈥�
Marsh had been head of the group鈥檚 construction division since the merger of Galliford and Try in 2000. Before that he spent 11 years in senior roles at Galliford.
Galliford Try emphasised that the group鈥檚 housing business was continuing to perform well.
