July 7 (Bloomberg) -- Pacific Brands Ltd. gained to its highest level in a month in Sydney trading, after Australia’s largest listed clothing manufacturer announced that John Pollaers had stepped down as chief executive officer.
Shares rose 1.9 percent to 55 Australian cents at the close in Sydney, the highest level since June 6, after rising as much 5.1 percent. The benchmark S&P/ASX 200 index declined 0.1 percent.
“John’s decision to leave now has been driven by divergence between his views and those of the board regarding the best path forward for the company and its businesses,” Chairman Peter Bush, who will assume the role of executive chairman pending appointment of a replacement for Pollaers, said in a stock exchange filing today. “This divergence has become clearer as the strategic review being conducted by Macquarie Capital Ltd. has progressed.”
The Australian distributor of Bonds underwear and Everlast sportswear last month appointed Macquarie Group Ltd. to conduct a strategic review after cutting its earnings forecast. Pollaers, who joined the clothing company in 2012 after leading the break-up and sale of Fosters Group Ltd., had struggled to stem five straight years of sales declines as retailers increase direct sourcing from overseas.
Earnings before interest, taxes and one-time items will range from A$90 million ($84 million) to A$93 million in the year ending June 30, Pacific Brands said June 10. That would be as much as 26 percent less than prior period’s A$122 million.
Challenging markets, declines in consumer sentiment and a warm autumn mean profit margins are falling even with sales forecast to rise about 3 percent from a year earlier, the Melbourne-based company said at the time.
Pacific Brands will provide an update on the review by Macquarie Capital during the full-year result announcement on Aug. 26, it said last month, without giving further details.
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