Chico’s FAS Inc., the struggling specialty retailer, has reorganized its management by naming Bonnie Brooks president and chief executive officer and Molly Langenstein president of the apparel group.
Karen McKibbin, Chico’s brand president, resigned after a short stint. She joined Chico’s in March after serving as president of Nordstrom Rack. In its announcement Thursday on the executive changes, the company said McKibbin resigned to pursue other opportunities.
Last month, the board rejected an unsolicited proposal from Sycamore Partners to acquire all of the outstanding shares for $3 per share in cash. The stock closed at $3.23 Thursday, down 5.6 percent or 19 cents.
Last March, the company disclosed that at least 250 stores in the U.S. would close over the next three years to focus on omnichannel operations, reduce costs, improve profitability and return on invested capital.
Last year, net income slid to $35.6 million, or 28 cents diluted earnings per share, compared with $101 million, or 79 cents per share, the year before. The $2.1 billion specialty retailer saw a 4.9 percent comparable sales decline last year, and last quarter, there was a comparable sales decline of 7 percent.
Brooks, a member of the board, had been serving as interim chief executive officer since April after Shelley Broader left as ceo.
During her career, Brooks has held several top jobs, including vice chairman of Hudson’s Bay Co.; president of HBC’s Hudson’s Bay and Lord & Taylor department store divisions; president of the Lane Crawford Joyce Group in Asia; president of Holt Renfrew, and global merchandise manager for Dickson Concepts Ltd., which owns Harvey Nichols. Brooks was instrumental in turning around Hudson’s Bay Department Stores and Holt Renfrew.
Langenstein will oversee all business activities for the Chico’s and White House Black Market divisions. She spent three decades with Macy’s but left in February amid cutbacks. She was most recently Macy’s general business manager for ready-to-wear, overseeing the buying, planning and product development for stores and digital, including leading Macy’s sourcing organization.
Chico’s said its intimate brands, Soma and TellTale, will continue to be led by Mary van Praag, president of the Intimates Group.
“Since being appointed interim ceo, Bonnie has moved quickly to sharpen the company’s focus on core priorities that have stabilized the business and positioned Chico’s FAS to deliver improved top and bottom-line results,” said chairman David Walker. “We received interest from a number of qualified external ceo candidates who brought deep merchant experience. The board determined that the best way to build on the progress under way at this time is to appoint Bonnie as ceo. In addition to providing continuity, Bonnie’s leadership enables us to continue leveraging both her experience driving numerous successful turnarounds at other apparel retailers as well as the knowledge she already has of Chico’s FAS.”
Brooks said, “The leadership structure announced today will strengthen the organization, create clear lines of responsibility and accelerate our sales driving priorities.”
Brooks also said she is “confident” the struggling Chico’s business is “moving in the right direction with stronger performance expected in the second half of the year.”
Brooks noted that Langenstein has “an exceptional record of success revitalizing sales and profitability in the retail fashion industry. Her ability to reimagine a business, optimize organizational design and enhance the customer experience ideally suits what we need to improve the performance of our apparel brands.”
“I believe Chico’s and White House Black Market are unique brands with the potential for growth that far exceeds what they are delivering today,” Langenstein said.
The company has been closing stores and last year began selling its brands on Amazon. It’s striving to drive better sales; simplify its shopping experience and provide greater personalized service, and transform sourcing and supply chain operations to increase product speed to market and improve quality.