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David Jones CEO’s shock resignation

Source: Linkedin

David Jones is losing its fourth chief executive in five years.

David Thomas, chief executive of the struggling department store, abruptly announced his resignation yesterday, citing “personal reasons”.

Thomas had been driving the business’s turnaround to become a world-class shopping experience filled with exclusive brand-partners, such as Disney, Chanel and Gucci. This included $400 million redevelopment of David Jones’ Elizabeth Street location in Sydney.

While the business searches for a replacement, parent company Woolworths Holdings Group chief executive Ian Moir will work directly with the department store’s management team to enable the business to run as-usual.

A discrimination complaint was made against Thomas last year. He was cleared of wrongdoing in November 2018.

Details of the complaint are unknown, but an external investigation into the matter found “no evidence to support the claim.”

“David Jones does not tolerate discrimination in any form and is focussed on fostering an inclusive culture and workplace for its team that does not differentiate based on race, religion, gender or sexual orientation,” a David Jones spokesperson told IR.

Harmers Workplace Lawyers, the firm which reportedly handled the complaint, has been contacted for comment.

Shares in parent company Woolworths Holdings fell almost 3 per cent after it alerted shareholders of the resignation, with its share price hitting a monthly low of 47.62 rand per share.

Thomas was reportedly not present at the retailer’s winter launch the day before the announcement.

The announcement is the second lot of bad news for the retailer, which saw depressed sales over the crucial holiday trading period due to reduced spending and foot traffic in-store and the Elizabeth Street redevelopment hamper the retailer’s 0.9 per cent comparable sales growth.

Overall sales for the business grew by 1 per cent over the 26 weeks to 23 December 2018, with sales performance weakening in line with the rest of the retail market in the final weeks leading up to Christmas.

David Jones is not the only business to have struggled over the period. Napoleon Perdis complained about slow sales after entering voluntary administration last week, and jewellery retailer Tiffany revised its fiscal 2018 expectations after a disappointing holiday performance.

Citi retail analyst Bryan Raymond described the February reporting season as a “mixed bag”, defined by the slow holiday period.

“Christmas trading updates to date have been varied by category and retailer, confirming the divergence in sales trends we observed across our post-Christmas feedback,” Raymond said.

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