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Retailing group Flooring Brands has dumped its newly recruited chief executive in a cost-cutting exercise that also sees the departure of its financial controller and a director.
Ed Connolly, who was lured to the flooring retailer in June from a senior management position at The Warehouse Group, ends
his tenure by Christmas, while financial controller Mark Moore leaves at the end of the month. Board member Sandy Maier, a former Citibank New Zealand chief executive, has already given up his directorship.
Connolly joined after more than 30 years in retail. He had been headhunted out of Britain three years ago by Warehouse Group chief executive Ian Morrice to lead Warehouse Stationery before being asked to move across to the Red Sheds as director of its 300-strong commercial division.
Chairman Rodney Martin broke the news to franchisees and suppliers at a group conference at the weekend.
"Basically what's happened is that we have looked at next year's trading, and I'm expecting that trading is going to be difficult."
The group, which controls a third of New Zealand's retail flooring industry through the Carpet Court and The Floor Store franchises, has also had to delay plans to list on the equity markets next year, given the market's weak state.
"Sandy Maier and Ed Connolly were both brought on specifically for the purposes of assisting us in guiding us through that capital markets event, and since it's not going to happen for at least a year, both Sandy and Ed Connolly have agreed with me to stand down from their positions."
Martin spoke to the trio last month, and said all three agreed to go.
"All three of them were great assets to the business," he said.
The company has already shed a lot of costs in anticipation of a difficult year ahead. Sales have been tracking down, but the group met its ebit target up until the end of September.
Martin, however, expected that to become increasingly difficult.
"All the indicators are that next year's going to be a very difficult year."
The group's chief operating officer, Chris Ogden, will act as chief executive when Connolly leaves at Christmas.
Martin said a new chief executive would be reappointed when the markets were more favourable for a float. He said Maier had already agreed to come back on to the board during that time.
Previous chief financial officer Les Harvey returns to the role, having stepped aside to assume a role within the group in mergers and acquisitions.
