Retail Food Group chairman Colin Archer has retired with immediate effect, a month after the embattled Gloria Jean’s and Donut King operator slumped to a $306.7 million full-year loss.
Archer, who was chairman for the last five of his 10 years with the company, had already announced his intention to retire, and stepped down to give successor Stephen Lonie the opportunity to take over ahead of the company’s annual general meeting. Archer’s exit comes four months after chief executive Andre Nel quit amid the financial fallout of accusations Retail Food Group was badly-treating franchisees.
Shares in Retail Food Group last month hit an all-time low after falling more than 90 per cent in eight months as the firm tried to clean up following the accusations.
The company last month said it now plans to close 250 domestic stores – up from the previously announced 200 – by the end of the 2019 financial year.
“I leave satisfied that the company has the leadership to further develop and implement the turnaround strategies,” Archer said on Tuesday.
“New group CEO, Richard Hinson, in particular, has re-invigorated the company with enthusiasm, commitment and his industry knowledge.”
Revenue for the 12 months to June 30 rose 7.1 per cent, but the company was forced to make $402.9 million in impairments and provisions to cover store closures, restructuring and a reduction in the value of its brands and assets.
Nel was replaced by Hinson in May, who stated the business remained “fundamentally sound”.
“We are revitalising the network to focus on our customers first; improving performance, driving innovation and improving communication and transparency with our franchisees,” Hinson said.
“This is a 12 to 18-month turnaround of the RFG business.”
Earlier this month, the group reported it would close 250 domestic stores by the end of 2019, despite seeing revenue rise 7.1 per cent over the past 12 months.
“As 2017 progressed, it became evident that trading results were not meeting management’s expectations, impacted by challenging retail market conditions [and] negative market sentiment toward franchising and RFG in particular,” RFG said in a statement.