Long-serving Truworths CEO set to stay put despite turbulent times

● Going nowhere slowly. Truworths International CEO Michael Mark is staying put at the retail giant, despite having been at the helm of the 100-year-old company for more than a quarter of its existence — 27 years.

Mark, it seems, is sleeping easy at night with the full knowledge that the Truworths International board is not keen to rock the boat by experimenting with a fresh pair of hands at the helm.

Given the harsh trading environment of the past two years in the South African retail industry, an experienced fashion hand like Mark provides comfort to the board that he is the man to steer the company out of these turbulent times.

The 64-year-old Mark also has a track record that speaks for itself.

He has transformed Truworths from the specialised boutique store it was in the early 1980s into a retail giant with global reach.

It has a presence in Namibia, Botswana, Zambia and Ghana. It also has offices in the UK, Ireland and Germany.

“Essentially when the board decides that it’s time for me to move on, or when I decide it will be an easy transition, low-key and pretty uneventful.

“The board, however, is keen for me to stay on for the time being to ensure we navigate successfully and remain focused through this challenging period and so am I happy to do so,” he said this week.

He hinted that when the company was faced with the reality of his departure — whenever that happens — there would be a search for “an internal successor” to take over.

Legacy concerns may well loom large for Mark. Would he want to exit now and be remembered as the long-serving CEO who left at the height of turbulence, or remain and be remembered as the one who steered the group from its lowest ebb back to its glory days?

The turbulence was evident in Thursday’s lacklustre Truworths International financial results for the six months to December.

Group retail sales increased by 1% to R10.3-billion from R10.2-billion over the same period the previous year. Truworths contributed sales of R7.4-billion and its Office unit R2.8-billion.

The group’s operating profit declined, as did headline earnings per share.

Mark said the results “were not top-line, but mediocre”, but pointed out that under his watch “debt had been reduced and costs contained”.

“We are highly regarded by customers with about 970 stores worldwide and about 850 stores in South Africa alone. We also have a third of all credit accounts in South Africa and our product and brands are among the best-known and are highly regarded in South Africa and the UK and they are all aspirational.

“Our debtor’s book is looking very healthy, new accounts are growing which augers well for the next 12 to 18 months. We have been in a tough environment but the outlook now looks more positive than it has for a number of years.”

Industry analysts, however, have been critical of how slowly Truworths has adapted to changes in fashion under Mark’s eye.

Particularly, the company has a high exposure to womenswear, a sector that has been in decline due to increased competition, oversaturation and fast-paced changes in fashion.

Could it be that Mark has been in the game for so long that blind spots have developed?

Mark said the company’s “game was continuously changing” and most of the criticism from industry analysts was angled at seeing “a drop in prices and use of cheaper products” by the retail giant.

“But we don’t think that model will work for us and we will stick to our DNA and what defines us as Truworths,” Mark said.