Wolverine Worldwide on Thursday announced the sudden exit of chief executive officer Brendan Hoffman and named Christopher Hufnagel, formerly president of the company, as president and CEO. At the same time, the company downgraded its 2023 outlook.
According to a regulatory filing, the footwear company terminated Hoffman without cause, effective Aug. 6. The departure was not a result of a disagreement with the company’s policies or operations. Wolverine would not share details behind the sudden leadership change.
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In tandem with the news, Wolverine reported weak results for the second quarter. Revenues were down 17.4 percent to $589.1 million versus the prior year. Adjusted diluted earnings per share were 19 cents, down 70.8 percent from the same quarter in 2022.
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Shares of Wolverine were down more than 20 percent before markets opened on Thursday.
Hoffman joined Wolverine as president in September 2020 and succeeded Blake Krueger as CEO at the end of 2021. Hufnagel joined Wolverine in 2008 and served in several leadership roles before being named president in May 2023.
“I am honored to step in as CEO at this critical moment for the company,” Hufnagel said in a statement. “Wolverine Worldwide maintains some of the world’s most recognizable and loved lifestyle and footwear brands, and transforming our business to bring the full power of these brands to life will be a key driver of our success.”
The leadership change comes at a challenging moment for the footwear giant, which owns the Saucony, Merrell, Sperry and Sweaty Betty brands, among others. In the last year, the company has initiated a broad turnaround effort and has announced a potential sale of its Sperry brand after divesting its Keds business late last year.
Wolverine Worldwide board chairman Tom Long said in a statement that the board believes in Hufnagel’s ability “to deliver strong shareholder value on a sustained basis.”
Like other footwear brands this quarter, Wolverine’s wholesale business was challenged due to inventory excesses and conservative orders from wholesale retail partners.
“The trading environment is challenging, especially in global wholesale channels, where order demand has slowed as retailers manage their businesses more cautiously,” Mike Stornant, executive vice president and chief financial officer of Wolverine Worldwide, said in a statement.
Wolverine now expects revenues for the year to be in the range of $2.26 billion to $2.28 billion, which would represent a decline of more than 10 percent compared with the prior year. Adjusted diluted earnings per share are expected to be between 45 cents and 55 cents, which includes an 11-cent negative impact from foreign currency exchange headwinds.
Hufnagel described the outlook for the second half of the year as “disappointing,” though maintained confidence in the company’s ability to turn business around and improve profits in 2024.
“The current adversity has not only deepened our conviction that our strategic direction is more correct than ever, but that we must execute it with greater boldness and speed,” Hufnagel said.