Truworths International is beefing up its management team at a time the team at the South African fashion retailer needs to spice up its growth trajectory.
It said yesterday that it had appointed Sarah Proudfoot and Emanuel (Mannie) Cristaudo as the group’s joint deputy CEOs with effect from October 1.
The share price slid 3.1% to R51.58. The share is down 30.09% over three years.
In September 2020, shareholders were advised that Michael Mark planned to retire at the November 2022 AGM. A group-wide senior executive succession plan was implemented to ensure a smooth transition in a number of senior management positions, including that of CEO.
Shareholders were also advised that after the successful implementation of the succession plan, it was envisaged that Mark would move into a consulting role to advise the board and support the transition.
This as Mark has been at the helm of the firm for 33 years.
Following the appointments of the joint deputy CEOs, the board had asked Mark to remain in his position as the group’s CEO post the 2022 AGM in November while handing over an increasing number of operational responsibilities to Proudfoot and Cristaudo and the executive team.
“The timing of the appointment of my successor has yet to be decided by the board,” he added.
Mark said the appointments “confirm the board’s firm belief in the competence and leadership of Sarah and Mannie”.
“The board feels confident that Sarah and Mannie, together with the eight Truworths directors and 11 divisional directors, and the five directors and divisional directors of Office, are the right team to take the group into the new era by retaining the strength of the group’s unique DNA while at the same time being able to continue to move the businesses forward and deal with the many challenges and opportunities that present themselves in the ever-evolving environments in which we operate,” he said.
Proudfoot, 54, has been the deputy managing director of Truworths since 2021. Cristaudo, 63, is the chief operating officer and chief financial officer of the group.
The new team has its work cut out as Truworths has underperformed for a long time.
According to Simply Wall Street’s company analysis, the firm’s earnings ratio (6.8x) is below the South African market (8.8x).
It forecasts that Truworths’s earnings will decline over the next three years (-1.3% per year).
Earlier this month Truworths International reported a 49.9% rise in annual profit as consumers coming out of Covid-19 lockdowns splashed out on items to rejuvenate their wardrobes and homes.
The global apparel industry has been recovering from a punishing 2020, when shops were forced to close to prevent the spread of Covid-19 and consumers switched formal dresses and shirts for sweat pants and lounge wear.
One thing Proudfoot and Cristaudo will not have to worry about is the retailer’s UK subsidiary, Office.
After a torrid few years, Truworths turned its fortunes around with UK Office sales growing by 16.6% in sterling terms and by 14% in rand terms in their last results.
Furthermore, Truworths has resolved the Primark issue.
Earlier this month the retailer and Primark reached a settlement over the ownership of the name of the UK fashion retailer, with the remaining Truworths stores under the name set to be rebranded.
Truworths won a court case against British/Irish retailer Primark in the Supreme Court of Appeal, which allowed them to use the Primark label in South Africa.
Primark stores operated by Truworths will be converted to SYNC stores, a brand store of Truworths.
BUSINESS REPORT