Cliff Bleustein, the former Dell executive who took over as CEO of Computer Task Group 16 months ago, has been replaced as the Buffalo information technology company’s top executive by long-time CTG executive Arthur “Bud” Crumlish.
Bleustein, who took over as CTG’s chief executive officer following the 2014 death of former CEO James Boldt, “resigned by mutual agreement” with CTG’s board of directors, the company said in a statement Friday.
After going outside the company to replace Boldt, CTG is tapping into its own executive ranks for a successor to Bleustein. Crumlish has worked at CTG for 25 years and has headed its staffing business for the past 15 years.
Under Bleustein, CTG reduced its focus on the health care market as hospitals and other providers scaled back on the costly electronic medical records projects that Boldt had counted on to provide a growing source of revenue. Instead, Bleustein placed a renewed focus on building up CTG’s staffing business, which provides information technology services and personnel to companies.
But that shift failed to reverse the steady decline in CTG’s stock price, as well as both its revenues and profits. CTG’s stock, which traded for as much as $22.97 a share in June 2013, has since tumbled steadily and now trades at levels the shares had not seen since 2009, closing Thursday at $5.44, just 71 cents above the seven-year low of $4.73 that the shares hit in February.
CTG’s revenues, which peaked at $424 million in 2012, have fallen for three straight years and are expected to decline again this year. Its sales dropped by 13 percent from 2012 to 2015.
The company’s profits have weakened at an even faster pace, tumbling by 56 percent from 2013 to last year.
“We’ll continue to focus on expanding our revenue and profit contribution by targeting high-volume corporate users of external IT talent, where CTG is a trusted and preferred supplier, and building relationships that will allow CTG to add value with new customers,” Crumlish said in a statement.
“We remain absolute in our commitment and almost 30-year legacy of delivering comprehensive healthcare solutions to our payer, provider, and life sciences clients in the U.S. and Europe, while also looking for new ways to grow, and continue investing in, this strategic area of our business,” he said.
Crumlish also said he plans to expand the company’s efforts to build its business in European financial services and government markets.
Crumlish takes over at a time when CTG’s sales and profits continue to weaken. The company also said Friday that it expects its second-quarter revenues to drop by 12 percent to $83.5 million – steeper than the drop of slightly less than 10 percent that analysts were expecting and less than the sales of between $85 million and $87 million that the company had forecast in April.
CTG’s second-quarter profits are expected to improve from last year’s weak second-quarter. CTG said it expects to earn 8 cents per share during the quarter, including a gain of 3 cents per share from payroll tax credits. CTG had said it expected to earn between 3 cents and 5 cents per share, compared with 3 cents per share a year ago.
Bleustein is expected to receive a severance package worth about $1 million, which will reduce CTG’s third-quarter profits by about 6 cents per share after taxes.
Crumlish joined CTG in 1990 and has been senior vice president and general manager of strategic staffing services, the company’s biggest business unit, since 2001.