Smith International announced Monday that H. Moak Rollins will step down as chairman of the Newport Beach firm. Rollins was appointed to the largely honorary position in January, when the oil field equipment manufacturer emerged from bankruptcy proceedings.
Robert Sutherland, executive vice president of Industrial Equity Ltd., will take over as the new chairman, although day-to-day operations will continue to be jointly managed by Loren Carroll, the company's chief financial officer, and Doug Rock, chief operating officer.
Carroll works out of Smith's Newport Beach corporate offices while Rock is based in Houston, which is the sales and marketing headquarters.
"All the CEO responsibilities will continue to be shared by Doug and me," Carroll said.
Industrial Equity Ltd., a New Zealand investment company, has been purchasing Smith International shares this winter and spring and controls about 25% of the company's stock, according to Carroll. Rollins, who lives in Austin, Tex., had been a director of Smith at the time he was named chairman, and will retain his position on the board. His relationship with the firm dates back to 1967 when he sold Drilco Oil Tools Inc. to Smith.
The demands of travel were the main reason for his decision to step down, Carroll said.
"Moak realized that his health, which is not the best, was being taxed by so much traveling," Carroll said. "And he felt satisfied that running the company no longer required him."
Carroll credited Rollins with helping to get the maker of drill bits back on a profitable track after a wrenching bankruptcy that left the company a fraction of its former size.
In 1981, Smith had sales of $1.2 billion, earnings of nearly $200 million and 14,400 workers. But the protracted slump in the oil industry, a failed acquisition attempt and a bitter 14-year patent infringement lawsuit by competitor Hughes Tool Co. forced Smith into bankruptcy in 1986.
Last year, Smith's three remaining divisions--Smith Tool, Dyna-Drill and Drilco--posted sales of $264 million. Smith currently employs 2,700 workers.
Analysts have generally praised the Smith executives for emerging from the bankruptcy with a streamlined company that is well poised to regain profitability.
For the fourth quarter of 1987, Smith reported earnings of $70 million on sales of $78 million. The company posted an operating loss of $4 million but was able to report the profit from the sale of assets under the reorganization plan.
Smith will announce "better than expected" first-quarter results first at the end of this week, according to Carroll. "We are significantly ahead of our projections. Profit margins are up, expenses are down. Everything is going exactly as we planned," Carroll said.