Chico’s FAS (NYSE: CHS) today announced the promotion of Molly Langenstein to CEO and President of Chico’s FAS, effective June 24, 2020. Ms. Langenstein is a 30-year retail fashion veteran with a proven track record of success in revitalizing sales and profitability. Since August 2019, Ms. Langenstein has served as President of the Company’s two largest brands, Chico’s and White House Black Market. The Company recently posted one of the fastest turnarounds in fashion retail with three consecutive quarters of unprecedented growth with a 9.4% increase in sales from Q1 to Q4 of fiscal year 2019 prior to the COVID-19 pandemic.
The Company also announced that current CEO and President Bonnie Brooks, who stepped into her role in April 2019 to lead the Company’s turnaround, will now become Executive Chair of the Board of Directors and continue to oversee the Company’s strategic direction. William (Bill) Simon, a member of the Board and former President and CEO of Walmart U.S. and senior advisor to KKR private equity firm, will assume the role of Lead Independent Director. David Walker, who has served as Chair of the Board for the past five years, will remain a member of the Board of Directors. Ms. Langenstein also will become a member of the Board of Directors. All appointments are effective June 24, 2020.
These three new simultaneous leadership appointments are the result of a planned succession designed to strengthen and provide ongoing stability and continuity to the business, and to further support the Company’s future.
“Molly joined the Company in August to reposition and rebuild our two significant apparel brands. She has proven to be an exceptional leader who quickly seized the immediate opportunities of improving product assortments, driving sales, and recruiting senior talent, particularly in merchandising, digital and marketing,” said Ms. Brooks.
Ms. Brooks added: “Throughout the fall period, the Company demonstrated its capacity to dramatically change its performance trajectory, which continued strongly into the pre-COVID-19 spring season. Molly has shown superb leadership during both this high growth phase and particularly in the current environment, as we pivot to a post-COVID-19 operating model. The new culture of agility, and the ability to grow sales while reducing expenses, has already served us well during this period, and I am confident we have a path forward for a sustainable future with Molly at the helm of the Company.”
As President of Chico’s and White House Black Market for the past nine months, Ms. Langenstein led the apparel group, including its brick-and-mortar boutiques and digital platforms, while increasing sales, product quality and elevating taste and style.
“I’m honored to lead this company of customer and product obsessed people and three unique brands, each thriving in their own market white space to provide solutions that women say give them confidence and joy,” said Ms. Langenstein. “Starting next week, all three brands will begin to open stores in a phased rollout to immediately deliver sales.”
Ms. Langenstein added: “We have operated primarily as a digital company. We equipped our store management with Style Connect, our proprietary digital styling tool, to communicate directly with many of our customers to drive sales to digital fulfillment. Both our digital performance and our customers comments demonstrate that our investments in innovative technology have benefited our business, which we will continue to enhance in our post-COVID-19 operating model.”
In addition to these appointments, the Company today announced a significant restructure of the overall organization, primarily to achieve a leaner, streamlined structure more efficiently aligned to the needs of the business, and to achieve meaningful cost reductions of approximately 30 percent across the Company.
As previously announced on April 27, Chico’s FAS has a strong financial position consisting of cash, investments and undrawn funds available in its asset-based credit facility along with wholly-owned significant real estate assets of multiple distribution centers and office buildings. In addition, the Company has taken prudent actions to reserve cash and to significantly reduce overall expenses, to ensure it remains strong during this period.
Store Reopening Rollout Plan
In addition, starting on May 4, Chico’s FAS will reopen its boutiques for three additional types of revenue generation: the fulfillment of national online orders through store inventories; reintroducing buy-online-pick up in store (BOPIS) with contactless curbside pickup service; and introducing a new shop-by-appointment service for each of its Chico’s, White House Black Market and Soma brands.
These new offerings will be available in locations that are allowing retailers to reopen on a limited basis and will be consistent with all local health and safety guidelines and regulations.
Style Connect, the Company’s proprietary digital styling tool, has been a significant enabler of the above reopening activities and has contributed to the robust digital sales during the temporary store closure period for the Company.
Earnings Call and Annual General Meeting of Shareholders Correction
The Company today announced that its conference call to review first quarter 2020 financial results will be held on June 10, 2020.
In a previous press release, the Company’s 2020 Annual Meeting of Shareholders was incorrectly communicated as being scheduled on June 24, 2020. The correct date of the Company’s 2020 Annual Meeting of Shareholders is June 25, 2020 and it will be held as a virtual meeting.
