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TULSA — Shares of Matrix Service Co. plummeted 11 percent Tuesday after the company said its CEO and chief financial officer have resigned to join the same company in the midstream oil business, the industry they came from prior to joining Matrix.
President and CEO Michael Bradley and vice president and Chief Financial Officer Thomas Long will leave this month. Bradley will remain with the company and on the board through Nov. 19 and Long through Nov. 30 to assist with the transition. Their new employer wasn't disclosed.
Matrix Chairman Michael Hall declined to explain the executives' decisions but said in an interview that the resignations were unrelated to the company's recently disclosed internal fraud. In its annual report Sept. 29, Matrix said an internal investigation had uncovered a $1.7 million embezzlement scheme orchestrated by current and former employees.
Hall will lead the Tulsa, Okla.-based company while the board evaluates internal and external candidates for both positions. Hall previously served at various times as president, CEO and CFO of the company, which provides industrial construction, repair and maintenance for the energy industry.
According to the Sept. 29 filing, a U.S.-based worker helped a Matrix subcontractor improperly bill the company for $1.7 million. Most of the money went to five current and former Matrix employees over four fiscal years, it said. To conceal the scheme, the employees overbilled other Matrix clients by $1.3 million. Matrix later reimbursed the clients, and expects to recoup money through insurance.
The investigation cost Matrix $500,000 in the quarter that ended Sept. 30. The company has said it is cooperating with investigators and does not expect to incur costs in future quarters.
Separately, Bradley sold 8,317 shares last week at $10.29 each for a total of more than $85,000, according to a Monday regulatory filing. The proceeds covered taxes on other compensation that Bradley received.
Shares of Matrix fell $1.17 to close at $9.63.
