Coty Makes Changes To Top Management Amid Supply Chain Issues
Cosmetics and fragrance maker Coty Inc has announced a major management shakeup, two months after the CoverGirl and Max Factor brand owner appointed a new chief executive officer as it grapples with supply chain issues.
The company, which handed over the reins to Pierre Laubies in November, on Friday named Luc Volatier as head of its global supply chain and Pierre-André Terisse as chief financial officer.
Laubies was previously CEO of coffee company JDE, which is owned by consumer goods conglomerate JAB Holding Co. JAB is the biggest shareholder of Coty.
"Laubies is clearly taking the reins and addressing Coty's biggest near-term challenges by announcing several leadership changes," Wells Fargo Securities analyst Joe Lachky said in a note.
Terisse, who replaces Patrice de Talhouët, served majority of his career with French food maker Danone SA. Volatier, who comes from JDE, replaces Mario Reis.
Supply Chain Disruption
Coty last year warned that its full-year performance would be hit by supply chain disruptions from a trucker strike in Brazil, hurricanes in the Unites States and a warehousing issue in Germany.
The warning resulted in a 67% decline for the stock in 2018.
Coty also appointed former Revlon Inc executive Gianni Pieraccioni as chief operating officer of its consumer beauty division, which includes brands acquired from Procter & Gamble in 2016.
"(The management change) is understandable given the performance of the (consumer beauty) division," Berenberg analyst Rosie Edwards said.
The consumer beauty division has been struggling to boost sales amid intense competition for shelf space in beauty aisles at retailers.
"I will assume personal responsibility for the consumer beauty division so that I can oversee the continuing transformation of this business," CEO Laubies said in a statement.
The division, a key revenue generator, has seen its sales fall in the last two quarters and the trend is expected to continue into the quarter ended December, according to Refinitiv's IBES.