Lamb Weston names insider Michael Smith as its chief executive officer following pressure from activist investor Jana Partners to make changes to its top brass or sell itself.
Shares of the frozen potato snacks maker were down 13% in premarket trading as it also lowered its annual profit and sales forecasts.
Smith, who is currently the company's chief operating officer, will take over from Thomas Werner on 3 January, the company said in a statement.
Activist investor Jana Partners revealed a roughly 5% stake in the company two months ago and has asked Lamb Weston to improve operations or consider selling itself.
Michael Smith
In 2007, Smith joined Lamb Weston and served in roles of increasingly senior leadership during his 17-year career at the company.
He is an experienced professional and has been instrumental in driving growth across multiple areas of the company.
WG Jurgensen, chair of the board of Lamb Weston said, “Mike’s appointment represents the culmination of a thoughtful, years-long succession planning process by our board, and we are confident he is the right leader to guide Lamb Weston forward.
Mike has developed a deep understanding of all critical aspects of our business and commercial operations. He will also bring a fresh perspective to the role along with a blend of strategic thinking and a laser focus on capturing current market and operational opportunities, as well as a deep appreciation for our employees, customers and partners.”
Second-Quarter Performance
Net sales in the second quarter declined by 8% year-on-year to $1.6 billion, while income from operations declined 94% to $19 million.
Adjusted EBITDA for the period declined 25% to $282 million due to lower net sales and adjusted gross profit.
News by Reuters, additional reporting by ESM.
