Domino's CEO leaves pizza parlour for new equity role
Domino's Pizza said on Friday its Chief Executive Lance Batchelor would stand down next year, dealing a second managerial blow to Britain's biggest pizza delivery firm this year and hitting its shares sharply.
Batchelor, who has led the firm's expansion into Switzerland and Germany, will join the group's Chief Financial Officer, Lee Ginsberg, in leaving the firm after he announced his departure in July this year.
Shares in the group were down 8.7pc in early trading.
"Lance has been offered a new role in a significant private equity backed company and as a result has tendered his resignation," Domino's Chairman Stephen Hemsley said in a statement. "His new company operates in a non-competing sector."
Domino's, which has around 800 stores in the UK and Ireland, said Batchelor would stay with the firm until April 30, 2014. The group, which has already announced a replacement for Ginsberg, has opened the search for a new CEO.
Batchelor, a former submarine warfare officer with the Royal Navy, joined Domino's as CEO in December 2011. As well as growing the core UK business, Batchelor has said he sees good growth potential in Germany despite a stuttering start.
Higher labour costs have forced Domino's to halve its original target of 400 stores by 2020 for Germany, and push its break even forecast for that business back as much as two years to 2017.
"Further senior management change so shortly after news of the FD leaving is not good news for market sentiment," N+1 Singer analysts said.
"Given some valid question marks over the pace of UK expansion possibly slowing down, and what that effect may have on operational gearing going forward, coupled with Germany related issues, today's news just creates further uncertainty."
In October the firm also slowed its British expansion plans for its current financial year from 60 to 50 new openings, with some analysts suggesting that figure could fall further to 45 for future years, hurting Domino's growth forecasts.
Shares in Domino's, a master franchisee of U.S. group Domino's Pizza Inc, were trading at 482 pence on Friday morning, valuing the business at just below £800m.