The board of film group Winchester Entertainment yesterday called time on their chief executive Gary Smith. The company said Mr Smith had resigned from the business "to pursue other interests".
"They seem to have a focus on accelerating the group's production side and Gary and the rest of the team believe that can be better done by a new person," said a spokeswoman.
She said the decision was reached amicably and there had been no pressure from shareholders for him to quit.
But a source close to the AIM-listed company said Mr Smith had become seen by the rest of the board as a liability and shareholders would be unlikely to mourn his passing.
Mr Smith, who has been with Winchester since it was formed 10 years ago, hit the headlines last year when it emerged that he had sold shares in the company less than two weeks before it issued the first of what became a string of profit warnings.
Mr Smith made £592,000 selling 400,000 shares in late January 2002 at 148p each.
Two weeks later the company, the worldwide sales agent for Last Orders, the film with Michael Caine, Bob Hoskins, Tom Courtenay and David Hemmings based on Graham Swift's Booker Prize-winning novel, warned that results for the full year would be "substantially below" the previous year's figure. Shares plunged 63% as analysts changed their forecasts of a £4.5m profit into forecasts of a £1.6m loss.
The share sale became the subject of an investigation, with Mr Smith proclaiming that he had not known about the trading position of the group until a few days after he had dealt. He was later cleared of any wrongdoing by the Financial Services Authority and yesterday a spokeswoman for Winchester said the decision to part with Mr Smith had nothing to do with that.
The company's woes, however, continued. Four months after the February profits warning Winchester admitted its losses would be larger because of the late delivery of several movies. At the end of the year shares slumped to 4.5p as it admitted it was making unacceptable losses. Since then shares have recovered - they closed at 29.25p yesterday.
