Home Retail Group Plc, the owner of U.K. store chains Argos and Homebase, said Sara Weller will step down as head of Argos as it reported a drop in full-year profit.
Weller, 49, is leaving “for personal reasons,” the Milton Keynes, England-based retailer said today. She will step down in June after more than seven years in the role. Chief Executive Officer Terry Duddy will take on the position while the company considers internal and external candidates for a successor.
So-called benchmark pretax profit at Home Retail fell 13 percent to 254 million pounds ($415 million) in the year ended Feb. 26. That compares with the 250.5 million-pound average estimate of 21 analysts surveyed by Bloomberg. The company lowered its forecast for pretax profit five weeks ago, citing weakness at Argos.
Same-store revenue will probably decline at Argos this year, while sales at the Homebase home-improvement chain will be “broadly flat,” the retailer said last month. U.K. retail sales fell by a record in March as accelerating inflation and concerns about employment prompted consumers to cut back, the British Retail Consortium said on April 12.
“There has been a particular weakness at Argos, explained by weaker consumer confidence trends amongst older, lower-income consumers,” Caroline Gulliver, an analyst at Execution Noble, said in a report. She has a “sell” rating on the stock.
Home Retail fell 6.9 pence, or 3.2 percent, to 209.3 pence in London trading yesterday. The stock has gained 11 percent this year, compared with the 1.3 percent decline of the FTSE 350 General Retailers Index.
U.S. investment firm Madison Dearborn Capital Partners has increased its stake in Home Retail twice in the last month to 5.14 percent, which analysts said has prompted speculation of a possible takeover bid.
The retailer maintained its full-year dividend at 14.7 pence for the fourth year in a row.