Lindex CEO leaves after sales, profits fall, Swedish chief Peregi steps in
Last week it announced slower sales, lower margins and plunging profit. And this week? Ingvar Larsson, CEO of Stockmann-owned Lindex is leaving with Elisabeth Peregi, who’s currently the Country Manager of Lindex Sweden, named as interim CEO with immediate effect.
Stockmann’s CEO Lauri Veijalainen. thanked Larsson “for his excellent efforts to lead the company and strengthen Lindex's position as one of Europe's leading fashion chains.”
But he appears to have kept a promise he made last week very quickly. After reporting overall weaker Stockmann figures that were hurt by poor Lindex results, he had promised that “action will be taken to improve sales and profitability.”
So how tough is it for Lindex at the moment? The CEO change has come after the fashion retailer reported sales down 7.7% to €162.1million due to the company having to mark down more goods in Q2.
With its now-closed Russian stores factored-out, sales fell 7.6%, while comp sales were down a worrying 5.1%. Despite international markets being stronger, the core Scandinavian market is struggling and that meant operating profit fell to €12.6 million from €28.1 million.
To counteract this, the chain is both opening and closing stores with lossmaking sites being axed. But that plan has clearly not been enough to keep the CEO in his job.
That’s no surprise. Lindex has been a major prop for Stockmann in recent years but with that tough Nordics marketplace meaning it was unable to repeat the strong growth it was enjoying a year ago, clearly something needs to be done.
So what of the interim replacement? Peregi, who as mentioned runs the Swedish arm of the business, has held several positions with the firm. She was its CFO from 2010 to 2013, was previously head of its franchise arm and also of the Norwegian unit.
On Monday (August 21) she said: “I look forward to this mission and am pleased with the confidence to lead Lindex's continued development. We have big and exciting initiatives ahead of us that will take the company into the future.”
She will report to Veijalainen, who will take on the role of Lindex chairman. It’s not known whether Peregi is a candidate to take on the CEO’s job permanently but she must be in the running if she manages to spur an improved performance at the business.
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