William Morrison Supermarkets Plc Strategy Director Gordon Mowat and Trevor Strain, a senior director, are internal candidates to replace Richard Pennycook as finance director, a person with knowledge of the matter said.
The nomination committee of the Bradford, England-based company, led by Chairman Ian Gibson, is expected to also look externally for a replacement, according to the person, who declined to be identified because the matter is private.
Morrison, the smallest of the U.K.’s four main grocery chains, said today that Pennycook will leave in June 2013 after almost eight years. The shares fell to a two-year low. The departure deals a further blow to Chief Executive Officer Dalton Philips as Morrison’s share of U.K. grocery spending slides.
“Mr. Pennycook’s announcement comes at a time when the company is not trading particularly well in relative or absolute terms,” Darren Shirley, an analyst at Shore Capital, said in a note. “His departure is an unwelcome loss and distraction for the board.” Shirley has a sell rating on the stock.
Mowat joined Morrison last year from management consultant McKinsey & Co., where he helped lead its European consumer-goods and retail practice. He has been overseeing the grocer’s strategy including a push into convenience stores and online.
Strain is director of finance, trading and operations.
Morrison spokesman Simon Rigby declined to comment on possible candidates to succeed Pennycook.
Group Commercial Director Richard Hodgson and Mark Harrison, the retail director, are unlikely to seek the finance position because of their respective backgrounds in marketing and retailing, the person familiar with the matter said.
Pennycook, 48, said in a statement today that his decision to step down was a difficult one, adding that “I feel that it’s the right time to seek new challenges.”
Morrison fell 1.8 percent to 263.5 pence at 12:17 p.m. in London trading, the fourth-steepest drop in the U.K. benchmark FTSE 100 Index. The stock has declined 19 percent this year.
Morrison’s share of the U.K. grocery market slumped to 11.8 percent in the 12 weeks ended June 12 from 12.2 percent in the same period a year earlier, according to Kantar Worldpanel.
The retailer said in May that its sales declined for the first time in almost seven years in the first quarter as competitors offered more coupons.