M2 co-founder Vaughan Bowen moves to chief operating officer after 12 years in CEO role

M2 Telecommunications chief executive and co-founder Vaughan Bowen has announced he will be stepping down from his position, with chief operating officer Geoff Horth to replace him, after 12 years in the job.

Bowen, who started M2 in 1999 after working in the property services industry, says his natural abilities lie in the areas of transactions, mergers and acquisitions, which have been a major focus of the company over the past few years.

“I’ve been doing this for 12 years now,” Bowen told SmartCompany this morning. “I’m now the CEO of a 500-person company, and my natural abilities lie in the area of transactions and mergers.”

“We’ve just been fortunate over the last few years to have brought in a great general manager of our telecom business, and who has been central to the deployment of the Commander business and many other changes we’ve made.”

The announcement came alongside the release of M2’s financial results, which showed net profit after tax rose 72% year-on-year to $27.6 million, while EBITDA grew 54% to $8.3 million.

M2 has acquired a number of different businesses over the past few years, including Edirect, some Austar customers, Clear Telecoms, some assets of the Black and White Group and the Commander business in 2009.

However, Bowen says the change of leadership won’t necessarily mean the company will slow down on finding new acquisitions.

“Particularly given that the landscape is changing so much at the moment, it would be a shame for a business like ours that is so good at taking opportunities, to just bury them.”

“We’ve actually been quite passive lately. Over the past couple of years we’ve wanted to take the gas off our inquisitive instincts, and really tighten the business up.”

Bowen points to a 47% increase in operating margins over the past year, stating this is proof the company has been able to manage these acquisitions and yet maintain good financial results.

“Our earnings as a percentage of our revenue has grown because we’ve been driving all these efficiencies. We’ve really done what we set out to do. Customer churn levels are dramatically improved from where they were over the past couple of years.”

Bowen, who was a member of BRW’s Young Rich list last year, says his new role will keep him busy maintaining relationships with key partners.

“Our goal to continue to grow the business is higher than ever before, and obviously with me taking on this new role, it enables me to be at the forefront.”

“This will keep me very busy. There are a lot of aspects involved, with key aspects of our supplier relationship movement involved. The Telstras and NBN Cos are very important partners to us.”

While Bowen says he is proud of being able to grow the company from nothing into a 500-person entity in 12 years, he particularly emphasises the company’s ability to maintain its culture.

“We still have the founders here, we still have the founding executive team, and a wonderful alumni of M2 managers and board members.”

“We have the original culture, and that’s no mean feat when you’ve grown through acquisitions. They’ve jumped onto the M2 bus willingly, and we’re very proud of what we’ve achieved here.”

Horth has been part of the executive team for over two years, and has been a part of the telecommunications industry for over 20.