Denver-based M.D.C. Holdings this morning (Feb. 26) disclosed that its executive vp, chief financial officer and principal accounting officer, Paris G. "Gary" Reece, will retire from the company effective June 30.
Reece, who has been with the company for 20 years, is not only the person behind the company's finances, but he has also served as the M.D.C.'s liason with Wall Street and shareholders. The company said a search for a successor was underway.
The move surprised Wall Street. Michael Rehaut, the lead home building analyst at J.P. Morgan Securities, put out a research note on the announcement stating, "While CFO Reece has had a solid tenure at MDC, at slightly over 20 years with the last 9 as CFO, we note his still relatively young age of 53 years old makes his retirement a surprise. However, given the CFO's desire to spend more time with family, and our view that over the next few years MDC will be one of the more active participants in the industry to take advantage of opportunities coming out of this cycle, which we note are not yet upon the company, we believe the timing of the departure does make sense."
"Throughout his tenure, and in his role as leader of the finance team, Gary consistently demonstrated his financial integrity and strong work ethic," said Larry A. Mizel, MDC's chairman and chief executive officer. "We will deeply miss working with Gary so closely. His legacy with the company shall remain a very important chapter in our history. We regret seeing him go and wish him well."
In his research note, Rehaut wrote, "We do not believe this should be interpreted in any negative way with regards to the company's financial or strategic positioning." He added, "We continue to believe M.D.C. has one of the strongest positions in the industry, ending 2007 with zero net debt, $1 billion in cash, and strong cash flow generation of $593 million, which we expect to continue in 2008."
Reece will continue remain a consultant with the company for up to 18 months.