OPERATIONS

Ahold’s Giant/Martin unit taps former Save-A-Lot exec as president

BY Staff Writer

Carlisle, Pa. — Ahold USA on Monday announced that Tom Lenkevich will join the company’s Giant/Martin’s division as president, effective March 4.

Lenkevich, who most recently served as COO and senior VP retail operations at Save-A-Lot Food Stores, will manage all aspects of the division, with responsibility for Giant and Martin’s sales, operating profits, organization and people.

“Tom’s decades of grocery experience combined with his central Pennsylvanian roots makes him a great addition to the Giant/Martin’s division and the Ahold USA leadership team,” stated James McCann, COO Ahold USA. “In addition to leading the division, Tom will be driving activities to achieve sales results and working with the Giant/Martin’s team to preserve the heritage of the local brand while at the same time reshaping retail with a strong focus on reinvesting in value and quality, and offering customers an omnichannel shopping experience to meet their needs both today and in the future.”

Giant/Martin operates nearly 200 supermarkets in Pennsylvania, Maryland, Virginia and West Virginia under the banners of Giant Food Stores and Martin’s Food Markets.

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Ascena reduces outlook further

BY CSA STAFF

Ascena Retail Group, the operator Lane Bryant, Justice and Dress Barn stores, cited increased spending on growth initiatives and a challenging sales climate for a second quarter profit decline and its second full year earnings guidance reduction in two months.

Sales for the company’s second quarter ended Jan. 26 increased 2% to $1.3 billion while consolidated same-store sales were essentially flat. A 3% comp decline at physical stores was offset by 28% e-commerce growth to achieve the overall flat comp increase. Net income fell to $31.9 million, or 19 cents a share, from $47.2 million, or 29 cents a share last year.

The decrease was due primarily to profit declines at Justice stores and increased operating expenses from growth-related investments in new stores, merchandising and design resources and e-commerce capabilities, according to the company.

“Second quarter net income was slightly above our revised expectations, despite softer than expected sales in January driven primarily by challenging weather that continued to negatively impact sales into early March,” said Ascena president and CEO David Jaffe. “However, in warmer regions sales have been in line with expectations. We are implementing promotional strategies and receipt flow adjustments to bring inventory balances back to targeted levels.”

Jaffe remained optimistic about the company outlook, citing very good progress on long range strategic priorities related to synergy initiatives and recently completed construction of a new national retail distribution center and a new e-commerce fulfillment center that becomes operational in the spring.

Ascena’s profits were expected to be under pressure following a January 13 announcement regarding holiday sales during November and December. At the time, Jaffe noted that, “a challenging holiday selling season resulted in increased promotional activity. We successfully cleared excess inventory and have taken the necessary markdowns in the second quarter to transition cleanly into the spring season.”

As a result, the company shaved as much as 20 cents of its full year profit forecast, reducing the range of earnings possibilities to $1.10 to $1.15 from earlier guidance of $1.25 to $1.30 for its fiscal year ending in July. However, late Monday, the company further reduced its full year estimate to a range of $1 to $1.05.

The soft holidays sales and expense pressure followed a respectable showing in the company’s first quarter ended Oct. 26 in which each of its formats posted positive same store sales growth.

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Kimberly-Clark makes executive changes

BY CSA STAFF

As Kimberly-Clark continues to focus on driving global expansion, the company has made executive changes so it can execute its business goals.

Elane Stock, group president of Kimberly-Clark Professional (KCP), has been elected group president of K-C International (KCI), and is succeeding Christian Brickman, who is leaving to pursue a senior executive officer position outside of K-C. Kim Underhill, currently president of K-C’s European consumer business, has been elected president of KCP.

In addition to these executive appointments, K-C’s global nonwovens operations and sustainability, safety and continuous improvement teams will now report to Mike Hsu, group president for K-C’s North American consumer business. These teams previously reported to Stock. The European consumer business will now report to Gustavo Calvo Paz, who will become president of Europe, Middle East and Africa. Calvo Paz currently leads K-C’s business in Eastern Europe, the Middle East and Africa.

"K-C has a deep bench of talented leaders to drive our business plan strategies across the globe," said chairman and CEO Thomas J. Falk. "Elane, Kim, Mike and Gustavo are all strong leaders with proven strategic, operational and innovation experience. These changes will help us further build our already strong consumer and professional businesses."

Stock joined K-C in 2010 and served as the company’s chief strategy officer prior to her role in KCP. Before joining Kimberly-Clark, she served as national VP at the American Cancer Society, and was previously a regional manager of Georgia Pacific’s (Koch Industries) Color Box business. She also held progressive management positions at McKinsey and Company both in the U.S. and Ireland.

Underhill is a 26-year veteran of K-C who joined the company in 1988. She recently led the development and execution of the company’s European strategic changes, which involved the exit of certain low-returning businesses and a re-focus on driving growth behind K-C’s strongest positions and opportunities in Europe. Prior to her Europe role, she was VP of K-C’s consumer business in the United Kingdom and Ireland from August 2009 until September 2011, and has also served in various marketing, supply chain and research and engineering roles in our North American consumer businesses.

All of these changes are effective April 1. Hsu, Stock and Underhill will report to Falk. Calvo Paz will report to Stock.

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