The colorful plastic clog maker Crocs CROX (NASDAQ), whose shoes at one point were selling like hoola hoops back in the late 50’s and early 60’s, but are now selling more like a dying fad finally made a change at the top of the corporate ladder. The company which had been under the tutelage of Ron Snyder has seen its stock and products decline even faster than the current stock market. Yesterday the firm announced that Snyder would be retiring and the company had selected John Duerden, a former president and COO of Reebok International back in the 90s. Duerden had also been a high level executive at Dictaphone. He has over twenty years experience managing at a senior level. According to a story in fibre2fashion.com,
Duerden began his career with Xerox Corp. and its UK joint venture, Rank Xerox, where he held line and staff management positions in Europe, the U.S., Latin America and the Asia-Pacific region. He later served as chairman and CEO of Dictaphone Corp., a maker of voice management hardware and software and subsequently as chief operating officer of the development division of Invensys plc, a British engineering conglomerate. He served as a non-executive director of Telewest plc, a British cable, TV, telephony and broadband company; and of Sunglass Hut International. He comes to Crocs from the Chrysallis Group, a consulting group he formed in 2006, focused on the development and renewal of brands.
Crocs appears to have waited far too long to make a change at the top. Snyder, who as the company’s CEO, was selected by Douglas McIntyre of Wall Street’s 24/7 back in November as the “Most Overpaid CEO of the Day“. The company for too long has been living off of their plastic clogs fad. Very little was done by the firm to find new products. The company has managed to find ways to expand internationally but that has not been sufficient for its long term survival. The newly appointed CEO Duerden at least has the requisite qualifications to attempt a real turnaround of the firm. It is difficult to say in today’s difficult marketplace what Duerden can come up with in terms of new products we will just have to wait and see. According to a story in the Boston Business Journal,
Crocs on Feb. 19 reported that it lost $33.2 million, or 40 cents a share, in the fourth quarter of 2008, versus a profit of $38.3 million, or 45 cents a share, in the same quarter of 2007, ahead of analysts’ expectations.
It said its revenue declined to $126.1 million in Q4 from $224.8 million a year earlier.
The company said that while sales revenue declined sharply in the Americas and Europe through all of 2008, it rose 22.4 percent in Asia.
Crocs said it expects a loss of 17 to 32 cents a share in the first quarter of 2009. It said it expected revenues of between $110 million and $135 million.
There are many out there that still feel there is hope for the Crocs brand (see Schaeffer Market blog), I am not nearly as positive. We will just have to wait and see what the new CEO can do to turn the company around.