Myer Chairman Resigns Before AGM, Global Recruitment Underway
The Chairman of embattled department store, Myer, has resigned four hours before the company’s AGM, after losing the support of two major shareholders; Solomon Lew and Geoff Wilson.
Some commentators claim it may propel a domino effect of other directors’, and potentially also its Chief Executive’s, exit from the board.
Chairman Garry Hounsell announced he was retiring after realising he was unlikely to receive the vote of billionaire investor, Solomon Lew, nor fund manager, Geoff Wilson, for re-election:
“Ahead of today’s Myer AGM, it has become apparent that Myer’s two largest shareholders are not supporting my re-election and I will not allow my ongoing tenure as Chairman to be a distraction to the hard work of the executive team,” reads a statement in an ASX announcement.
Mr Wilson’s fund owns 7.6% of Myer, is dubbed to have changed his position in recent periods, calling for a reduction of the retailer’s board and cut in directors fees.
It comes as vocal shareholder, Solomon Lew, continues his assault on the iconic retailer’s board over claims of mismanagement coupled with a declining share price.
The company bought a 10.8% stake in Myer at $1.15 three years ago – shares are currently around 22.5 cents.
JoAnne Stephenson has been appointed acting chairman, whilst the retailer undertakes a global search to hire a permanent replacement chairman.
“It is essential that John King and Myer’s management team are able to execute the strategy during the all-important peak trading period, between Black Friday and January’s Stocktake Sale, without further disruption and it is hoped that my appointment as Acting Chairman will enable this to occur,” adds Stephenson.
Hounsell was Chairman of Myer for three years, with its online business faring record growth during the coronavirus crisis this year.
“Our online business is going from strength to strength, with growth of almost 100 per cent in the second half of FY20 to become one of the biggest and fastest-growing online retail stores in Australia, and the Customer First strategy led by our CEO, John King, and the executive team sees our stores well-stocked and well-prepared for the summer,” states Mr Hounsell.
It comes after Myer slumped to a $172.4 million full year net loss, hit by store closures and the impact of COVID19.
It follows a net profit of $24.5 million last year.
Full-year revenue dropped 15.8% to $2.5 billion, with no dividend declared.
The result [post-AASB 16] is dubbed the company’s second largest loss in over a hundred-year history.
Back in 2018, Myer reported a $486 million full-year loss, slammed by impairments and write downs.