Hoerner tipped to quit Burton
Friday 13 June 1997
Dealers said sales at Burton were difficult. Burton shares closed 2p down at 124.5p in heavy late volume. A large amount of stock went through at below the market price in a late trade. Burton was not available to comment on the possible management change.
Many would see any decision by Mr Hoerner to step down as a surprise move as Burton has been viewed as an impressive recovery story. Much of the credit has been given to Mr Hoerner, who took over as chief executive in 1992 when the shares were bumping along at 30-40p.
However, there have been concerns about Burton's current trading and the group's share price has fallen sharply in the past month. The decline was triggered by the company's half- year results statement in mid-May.
Though pre-tax profits in the first half were 23 per cent ahead at pounds 108m, some analysts were worried about a slowdown in like-for-like sales growth. Same store sales in the first 10 weeks of the second half were 6.8 per cent ahead of the same period last year.
Analysts expressed particular concern about a slowdown in sales at Dorothy Perkins where like-for-like sales were just 1.7 per cent ahead compared with a 10.7 per cent increase in the first half. Principles suffered a 9.8 per cent fall in current like-for-like sales against the first half's 6.6 per cent rise.
It has been an on-going problem at Burton that while the Debenhams department stores have delivered consistent increases in sales and profits, the multiples such as Burton Menswear, Top Shop and Top Man have proved harder to stimulate.
Mr Hoerner has proved a popular figure in the City, which has been impressed by his straightforward approach. An amiable Nebraskan with a Midwestern drawl, he is more willing than most chief executives to admit to his mistakes. His record at Burton has been impressive. After joining the company in 1987 he moved up to the board in 1991 and was appointed chief executive a year later.
From a loss of pounds 4.2m in 1992 he has taken the group to profits of pounds 150m last year.
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