Aus­tralia’s Wool­worths chief quits, 1,200 em­ploy­ees to go

The China Post - - GUIDE POST -

Aus­tralian su­per­mar­ket gi­ant Wool­worths said Wed­nes­day its chief ex­ec­u­tive will quit and 1,200 jobs faced the axe af­ter months of dis­ap­point­ing sales.

Grant O’Brien, who has been with the com­pany for 28 years and has been chief ex­ec­u­tive since late 2011, re­cently set out a three-year plan to grow the busi­ness.

“How­ever, the re­cent per­for­mance has been dis­ap­point­ing and be­low ex­pec­ta­tions,” he said in a state­ment.

“I be­lieve it is in the best in­ter­ests of the com­pany for a new lead­er­ship to see these plans to fruition.”

His re­tire­ment saw shares in Wool­worths, which is one of the big­gest su­per­mar­ket chains in Aus­tralia along with ri­val Coles, climb 1.86 per­cent to AU$27.34 by mid-af­ter­noon.

O’Brien said the com­pany was on track to ex­ceed a forecast AU$500 mil­lion (US$390 mil­lion) in cost sav­ings but it would take time for the three-year strat­egy to pro­duce re­sults in sales.

Food and liquor sales were poor in De­cem­ber and Jan­uary, still dis­ap­point­ing in April, and had failed to im­prove since.

Wool­worths said it ex­pected a net profit for the year of about AU$2.15 bil­lion af­ter sig­nif­i­cant items while on­go­ing strate­gic change would cost about AU$270 mil­lion, in­clud­ing up to AU$50 mil­lion in re­dun­dancy costs.

“We now an­tic­i­pate a to­tal re­duc­tion of ap­prox­i­mately 1,200 roles across sup­port func­tions, sup­ply chain and non-cus­tomer fac­ing store po­si­tions,” it added.

Com­pany chair­man Ralph Wa­ters said the board re­mained com­mit­ted to the three-year strat­egy an­nounced in May but said any new chief ex­ec­u­tive would not have their hands tied.

“I don’t think any CEO worth their salt would take the job with hand­cuffs on,” Wa­ters was quoted as say­ing in The Syd­ney Morn­ing Her­ald.

“If they have a dif­fer­ent view from the cur­rent strat­egy ... they’d need to con­vince the board to change di­rec­tion.”

O’Brien will re­main in the job un­til a re­place­ment can be found, with a search al­ready un­der­way.

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