N Brown Group PLC (LON:BWNG) has appointed its interim chief executive, Steve Johnson, to the position on a permanent basis with immediate effect.
Johnson had filled the position as a placeholder when incumbent CEO Angela Spindler abruptly left the online retailer in September, having previously served as the company’s chief executive of financial services.
READ: N Brown shares slip as sales fall over key Christmas trading period
N Brown’s chairman Matt Davies said that since serving as interim CEO Johnson had shown “strategic thinking, pace, energy and focus which demonstrates that he is the best person to take the business forward”.
Before joining N Brown in 2016, Johnson had also held positions as product director at FTSE 100 supermarket J Sainsbury PLC (LON:SBRY) as well as senior management positions at Halifax.
In a note to clients, the company’s broker Shore Capital said Johnson had “very strong capabilities” in Financial Services, where the group had performed “robustly” in recent times amid changes in regulations.
They added that Johnson now had to make sure the Product and Digital sides of the business had “the right team and capability” to progress, which would be important to the company’s future as it continued to have “a distinctive and potentially very interesting business mix around fashion for all sizes and already high (c80%) online participation”.
Meanwhile, analysts at broker Peel Hunt said that the internal appointment offered an advantage as there was “no delay” for the CEO to bed in, which could have led to “a 12-18 month lag on any significant action”.
They added that the shares continued to offer “deep value”, although the challenge was to prove that the company could “deliver growth”.
Difficult time
Johnson’s appointment comes at a difficult time for the group after it reported a fall in sales over the key Christmas trading period, led by a decline in its legacy offline business.
There was also some grim news for the year ahead as the firm expected gross margins for the 2019 fiscal year to fall by up to 100 basis points (bps) amid a heavily promotional retail market, while the financial services gross margin was forecast to drop 100bps to 200bps.
In early trading Tuesday, N Brown shares were up 0.9% at 107p.