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Philip Clarke to depart as Tesco’s CEO
July 21st, 2014
CHESHUNT, England – Tesco PLC is replacing Philip Clarke after three years at the helm of the United Kingdom’s largest supermarket chain, following another profit warning.
Dave Lewis, head of Unilever’s personal care unit, will succeed Clarke as chief executive officer on October 1, Tesco said on Monday. Clarke, 54, will remain as CEO until Lewis arrives and will stay in a supporting role until January.
Lewis, 49, has held roles globally during his three-decade tenure at Unilever, including the chairmanship of its U.K. and Ireland business and president of the Americas.
News of Clarke’s departure came as Tesco warned that sales and profits for the first half of the year would be lower than expected. Last month Tesco reported its biggest sales decline in at least two decades.
Tesco’s share of the U.K. grocery market has slipped under Clarke’s watch, from 30.2% when he took over as CEO in March 2011 to 28.9%, as the U.K.’s largest retailer is being squeezed by discounters Aldi and Lidl at one end of the U.K. grocery market and by upscale chains such as Waitrose at the other end.
Clarke launched major initiatives to restore sales and profit growth, which to date have failed to reverse the retailer’s course. In the fiscal year ended February 22, Tesco’s sales were flat at 70.9 billion pounds (approximately $118 billion). Trading profit in the period fell 6%. Profitability was down in all of Tesco’s operating regions: the United Kingdom, Europe and Asia.
Earlier this year Clarke revealed a plan to accelerate growth in new channels and invest in sharper prices, better product quality and assortments, and improved customer service.
Clarke’s departure means Tesco will have changed its entire board in little more than three years, Bloomberg News reported. The company announced in April that Laurie McIlwee, its chief financial officer, would be leaving, becoming the sixth director to depart since 2011.