There are concerns over the future of Goodman Fielder, Australia’s largest food group, after the company announced last week that CEO Peter Margin would be leaving the business.

Margin’s departure after five years at the helm follows the announcement in November that CFO David Goldsmith would leave Goodman Fielder next month to join TPG, while Geoff Erby, the head of the group’s home ingredients business left last year.

Margin’s record at Goodman Fielder is mixed. He led Goodman Fielder’s IPO in late 2005 to become Australia’s largest listed company but the business has since struggled to keep its share price above IPO levels of A$2.00 a share, with prices hovering between A$1.30-1.50 a share over the past year. Following the announcement of Margin’s departure, shares sank a further 2.6% to A$1.29 a share.

Nonetheless, while Goodman Fielder’s share price may have wobbled over the past few years, its results have remained largely positive. The group has recorded year-over-year EBITDA growth over the past five years, except in 2008, when it was hit by an A$234m increase in commodity and logistics costs. However, while the group’s profitability has continued to improve, the rate of growth has slowed significantly. In 2006, the first year after the IPO, Goodman Fielder’s EBITDA grew by 9.8%. In 2010, EBITDA grew but that growth slowed to 3.3%.

Deutsche Bank analyst Matthew Iser said Margin’s departure “raises concerns” for Goodman Fielder’s “outlook and strategy”. He said Margin’s departure was a “significant blow” for Goodman Fielder.

“With three successive high profile departures in such a short space of time, there is a significant question mark over the near term financial outlook and longer term strategic direction of Goodman Fielder,” said Iser.

Margin leaves the company at a time when it requires a experienced hand to lead it through the headwinds that lie ahead. His replacement will face rising commodity prices driven by the impacts of poor local weather and international markets. Margin’s successor will also have little scope to increase prices in a challenging market, where its two main customers, retail behemoths Coles and Woolworths Ltd, are continually squeezing supplier prices.

In perhaps an attempt to inject a sense of stability around the manufacturer’s future, it announced a series of executive appointments alongside the announcement of Margin’s departure. The company will appoint former CEO of Warrnambool Cheese and Butter Factory, Neil Kearney, as interim CFO.

Erby will be replaced by Andrew Hipperson as managing director of home ingredients. An internal appointment, he was previously managing director of the group’s Asia-Pacific division. Replacing him in that role, will be Aaron Canning, who was previously finance director of Goodman Fielder’s Asia-Pacific arm.

Ould said a search for a new executive is under way, and that the company “anticipates making an announcement” prior to Margin’s departure.

Industry watchers suggest that an internal replacement is likely, with Clive Stiff, managing director of fresh baking, and New Zealand dairy and meat managing director Peter Readie suggested as candidates.

Speaking about Margin’s record, company chairman Max Ould said: “Peter has done an outstanding job of leading the company through the IPO in late 2005 and establishing it as the leading locally owned food company in Australasia”.

Ould added that Margin oversaw “several acquisitions, the development of a number of new sites and has established Goodman Filder as a focused consumer driven company”.

Whoever replaces Margin will not only face a challenging outlook, but will also be a difficult act to follow.