News this morning of the CEO Mark Jones resigning is both surprising and disappointing. He’s been at the helm for a relatively short-period of 13 months and critical to the investment led turnaround strategy. This admittedly has had mixed success to date but his planned departure will no doubt lead to a period of uncertainty. He has decided to go back into the private sector but will stay with Goals until a successor is found. Today’s news coming on the back of a mixed set of interims last month (prompting further downgrades of c.20%) and an increasingly cautious outlook for UK consumer, will only further weaken investor sentiment. On a 2-3 month view it is imperative the Board finds a strong and suitable replacement quickly and the company hits this years forecasts. The shares are down 11% YTD and trade on a FY17 P/E of 12.1x falling to 10.9x for FY18. We expect some downside pressure on the stock today. Ultimately an end-game involving a 3rd party taking the company private remains a distinct possibility given a sustained period of disappointments endured by long suffering shareholders.
