Whole Foods Makes Major Board Changes

(RTTNews) - Under pressure from its shareholders, Whole Foods Market Inc. (WFM) on Wednesday appointed a new chief financial officer, replaced five directors on its board and also laid out plans to improve its operations as well as reduce costs.

Whole Foods has been struggling with decline in sales and weak earnings results for quite some time, and in February announced the closure of nine stores.

In April, Jana Partners said it acquired an 8.3 percent stake in Whole Foods. The activist investor had been pushing for the grocery chain to explore strategic options, including a possible sale.

The hedge fund had also proposed four nominees to the company's board. However, the board members named by Whole Foods on Wednesday were not on Jana Partners' slate.

On Wednesday, Whole Foods said it appointed Keith Manbeck as Executive Vice President and Chief Financial Officer, effective May 17, 2017.

Manbeck most recently served as Senior Vice President of Digital Finance, Strategy Management and Business Transformation at retailer Kohl's Corp. Glenda Flanagan will retire as CFO, coincident with Manbeck's appointment.

Whole Foods also announced the appointment of five new independent directors to its board of directors.

The five new board members are Ken Hicks, the former chief executive of Foot Locker; Sharon McCollam, Best Buy's Chief Financial Officer; Ron Shaich, the CEO of Panera Bread; Joe Mansueto, Morningstar founder; and Scott Powers, the CEO of State Street Global Advisors.

In addition, the company named Gabrielle Sulzberger as the new Chair of the Whole Foods Market Board of Directors, and Mary Ellen Coe as the new Chair of the Nominating & Governance Committee.

With these changes, the Whole Foods board of directors will now comprise 12 directors, 10 of whom are independent and six of whom were added in the last seven months.

Further, Whole Foods said it will accelerate a planned customer loyalty program roll-out to all U.S. stores by the end of 2017 and also realize $300 million in additional cost savings over the next four years.

The company also said it plans to return to positive comps and earnings growth by fiscal 2018. . In addition, it's board announced a 29 percent increase in the regular quarterly dividend and authorized a new $1.25 billion share repurchase program.