The Player: Jim Leng of Laporte: Building a global chemistry set

PERSONAL DETAILS:

Aged 53, the chief executive of Laporte lives in London and Scotland. Drives an Audi Quattro, a "driver's car, not a pose-in". He also rides a mountain bike. In 1998, he was paid pounds 585,000 including a basic salary of pounds 400,000. Mr Leng would like more time for badminton and squash. But he plays golf and runs on his treadmill to keep fit.

Laporte develops, produces and markets speciality chemicals for global customers in niche markets, covering pharmaceuticals, food, agrochemicals and construction.

CHALLENGE:

The trading climate for the UK chemical industry is difficult given the strength of the pound. The chemicals industry globally is consolidating. Bid rumours mention Clariant as a possible suitor for Laporte.

Mr Leng says the chemical sector "is a microcosm of what's going on globally", namely a trend towards bigger customers and bigger suppliers. The UK chemicals sector has been restructured. Laporte has sold more than 40 per cent of the businesses it had when Mr Leng joined. Although the group's turnover is roughly the same, the constituent businesses and markets served are different. Mr Leng says the main challenge is to make Laporte the most globally admired speciality chemicals company. In the six months to 30 June, Laporte increased its margins from continuing operations to 16.5 per cent. But Mr Leng is disappointed that he has not built sustainable shareholder value. He says this is difficult when the sector is out of favour with the City. The UK chemical sector has underperformed the FT All Share Index by 40 per cent in the past four years.

CORPORATE BACKGROUND:

Mr Leng was appointed chief executive of Laporte in October 1995, from chief executive at Low & Bonar. He had held several positions at John Waddington, including managing director of Waddingtons of Gateshead.

STRATEGY:

Since Mr Leng's appointment, Laporte has been streamlined under a new management team. Mr Leng says his strategic aim is to get global businesses with strong, leading positions in markets with above-average growth, capable of delivering sustainable profits and cashflow.

Most of the repositioning has been completed, but there is thought to be scope for bolt-on acquisitions. Mr Leng says the group is now more disciplined and knows exactly what it wants to do. The group's future success lies in its inventiveness, he says. He recognises they cannot compete on cost in low-margin businesses against producers in developing economies.

MANAGEMENT STYLE: Managing change and introducing a new culture is difficult and demanding, says Mr Leng. He is pleased none of the managing directors of the group's businesses left during restructuring. "They were more in touch with what needed to be done," he says. Mr Leng made a recent tour of the business operations and found morale was "great". He says he is open, demanding, faces problems head-on and is supportive. He says his managers are given responsibility with authority.

MOST ADMIRES IN BUSINESS:

John Brown, chief executive of BP, who "has made a truly global world- class business". Mr Leng also cites Marjorie Scardino, chief executive of Pearson, and Brian Souter, one of the founders of the transport group Stagecoach. Mr Leng says some get the opportunity to build something, but Mr Souter has created and built something. "He has had to go and mine his own clay before making his pot," says Mr Leng.

CITY VERDICT:

Most analysts recommend buying the shares for the medium to long term. Warburg Dillon Read's analysts say Laporte has a fundamentally attractive portfolio of businesses, but "the fact that operating margins are already at levels which will be difficult to push much further", means the focus is "firmly on the potential for the top-line". They recommend buying shares at under 700p and selling them above 800p.