A Weber banner on the New York Stock Exchange, August 5, 2021.
Source: NYSE
Weber shares tumbled roughly 13% Monday after the grill maker abruptly mentioned CEO Chris Scherzinger is departing amid waning demand for its merchandise in shops and on-line.
The Palatine, Illinois-based firm additionally suspended its quarterly money dividend and mentioned it’s dedicated to working with lending companions to stay in compliance with its credit score services.
Weber named Chief Technology Officer Alan Matula as its interim CEO, efficient instantly, because it searches for a everlasting substitute.
“We are taking decisive motion to higher place Weber to navigate historic macroeconomic challenges, together with inflationary and provide chain pressures which are impacting shopper confidence, spending patterns, and margins,” mentioned Kelly Rainko, nonexecutive chair of Weber’s board.
The firm additionally introduced preliminary outcomes for the three-month interval ended June 30, pegging internet gross sales at between $525 million and $530 million. Weber mentioned its efficiency was harm by slower retail visitors as rising inflation and different pressures weighed on shoppers. It was additionally hit by continued overseas foreign money devaluations.
Weber mentioned the headwinds are anticipated to persist into its fiscal fourth quarter and withdrew its fiscal 2022 forecast because of the market uncertainty.
The firm mentioned it’s contemplating layoffs and different methods to cut back bills, together with by tightening its inventories. It mentioned it would present further particulars when it experiences its fiscal third-quarter outcomes on Aug. 15.
Weber, which makes people who smoke, barbecue grills and different equipment for out of doors cooking lovers, went public final 12 months as households spent extra time cooking and entertaining at residence through the Covid pandemic. More lately, although, demand for its cooking merchandise has cooled as shoppers rethink spending amid inflation and the looming risk of a recession.
In the quarter ended March 31, Weber’s internet gross sales fell 7% and its internet loss got here in at $51 million, in contrast with internet earnings within the year-ago interval.
Scherzinger joins a rising listing of CEOs who’ve departed retail corporations in current months, from Gap to Game Stop, as boards develop displeased with sluggish efficiency, and provide chain disruptions and different challenges persist.
Weber shares are down virtually 50% 12 months to this point, together with Monday’s losses. Its market cap is about $1.9 billion.