In a surprising turn of events, Pieter Boone, who served as CEO of Pick n Pay for just over two and a half years, has resigned from his position, citing the need for a change in leadership to steer the retailer back on the path to success. This decision comes on the heels of Pick n Pay’s recent financial struggles, including a significant loss in its half-year results, increased competition, load shedding, and a challenging consumer economy.
Gareth Ackerman, Chairman of Pick n Pay’s board, expressed his gratitude to Pieter Boone for his contributions, saying, “Unfortunately, in a very difficult environment, the performance of our core Pick n Pay business has been very challenging over the past months, and has not met expectations. Pieter accepts that the board has decided on a change in leadership. He leaves us with our heartfelt thanks and best wishes for the future.”
The impact of this announcement was swift and severe, as Pick n Pay’s shares plummeted by nearly 11% during morning trade on Monday, marking a staggering 44% loss in value over the past year.
Pieter Boone’s tenure as CEO began in April 2021, succeeding Richard Brasher. However, Boone’s resignation took immediate effect, leaving a leadership vacuum that needed to be filled swiftly to address the retail giant’s financial woes.
To lead the company during these challenging times, Sean Summers, who previously served as Pick n Pay’s CEO from 1999 to 2007, has returned to the helm of the company. Gareth Ackerman expressed his confidence in Summers, stating, “We are delighted that Sean is coming back to Pick n Pay. His knowledge and experience are unrivaled. He is passionate about getting Pick n Pay back on the right trajectory, and winning the trust and confidence of customers new and old. He is absolutely the right person for the job at this time.”
Summers is highly regarded within the company, with the late Pick n Pay pioneer Raymond Ackerman describing him as “an excellent leader who achieved remarkable things at Pick n Pay.” Ackerman’s legacy and Summers’ leadership skills have raised hopes that he can guide the company through its current challenges.
Regarding the transition, Pick n Pay has announced a short handover period between Boone and Summers, ensuring a smooth shift in leadership.
Summers expressed his commitment to revitalizing Pick n Pay, stating, “The best way I can honor Raymond Ackerman’s memory is to put Pick n Pay back onto its rightful path to growth and success. I worked closely with Gareth for many years, and we will make a great team together.”
The retailer’s recent financial struggles became evident in July when it released a trading update covering the 16 weeks to 24 July and the first half of the 2024 financial year. Pick n Pay disclosed that it faced abnormal costs amounting to R610 million, a stark contrast to the almost R672 million profit it reported in the prior half-year. Consequently, it is expected to report a first-half loss at the earnings, headline earnings, and pro forma headline earnings levels.
The challenges facing Pick n Pay are substantial, but with Sean Summers back at the helm and the support of the board, the retailer is poised to navigate these difficulties and work toward a brighter future.
