British retailer McColl’s CEO Miller steps down amid financial woes

By Muhammed Husain

(Reuters) -The chief executive officer of Britain’s McColl’s, Jonathan Miller, stepped down on Thursday, weeks after the cash-strapped convenience store chain warned of lower annual profit, sending its shares tumbling 14%.

Miller’s exit comes as the group is in months-long talks with lenders over new funding options and reports of pressure from its supply partner Morrisons.

“Jonathan and the board have agreed that now is the right time to bring in a new chief executive to lead the business into a new phase,” said Executive Chairman Angus Porter.

Miller, who is stepping down after more than 30 years at the company, has been replaced by Chief Operating Officer Karen Bird on an interim basis.

McColl’s, which operates more than 1,100 convenience stores in Britain, has been grappling with supply chain issues that hit product availability in its stores, and the company’s first-quarter results were weighed down by a surge of Omicron cases.

Shares of McColl’s lost more than half their value in 2021.

Sky News reported on Tuesday that supermarket group Morrisons has appointed investment bank Houlihan Lokey to explore options for its exposure to the retailer.

McColl’s had declined to comment and Morrisons did not respond to a request from Reuters for comment on the report.

The convenience store chain last month forecast 2022 net debt of roughly 100 million pounds, higher than last year. McColl’s 2020 adjusted core earnings were 57.9 million pounds.

Refinitiv data showed the company’s credit score had sunk to 1, the lowest on a scale of up to 100, meaning it was highly likely to default in the next year.

The Brentwood, UK-based retailer said in a statement on Thursday its talks with lenders were going on and it believed a financing solution would be found involving its existing partners and stakeholders.

(Reporting by Muhammed Husain in Bengaluru; Editing by Subhranshu Sahu and Amy Caren Daniel)