Retail Food Group CEO Richard Hinson resigns suddenly after just seven months in top job

Embattled Gold Coast franchisor Retail Food Group has lost another top executive after a shock resignation this morning.

SOUTHPORT franchisor Retail Food Group has announced the shock resignation of its chief executive officer who’s only been in the role since May.

Former Metcash executive Richard Hinson, is the latest to leave the group in a major overhaul which saw two chairmen depart in less than a month.

The company said it had learned of Mr Hinson’s intention to leave this morning.

The resignation has taken immediate effect, with new chairman Peter George taking on the responsbilities of the role “for the time being”.

The group reported an after-tax loss of $306.7 million, an eye-watering turnaround from its $61.9 million profit the previous year and far worse than its $87.6 million guidance.

In a statement to the ASX, the company said Mr Hinson would leave “as part of a major restructuring foreshadowed at the Company’s recent Annual General Meeting”.

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Richard Hinson has resigned from Retail Food Group.

“The restructuring is an immediate priority for the Company to reduce costs and become a more agile and customer focused organisation. Management will be decentralised to concentrate resources closer to franchisees, to support them in improving the performance and sustainability of their businesses,” RFG said in a statement.

“In parallel with the restructuring, RFG will renew its focus on serving franchise and non-franchise customers through brand promotion, product innovation and superior service.

Mr Hinson joined RFG in January as its Australian CEO before a promotion to the top job left by departed managing director Andre Nell in May.

FORMER RFG EXECS NOW THE COMPANY’S LANDLORDS

RFG executive chairman Peter George.

RFG executive chairman Peter George, who has himself only been at the company less than a month said: “Under Richard’s leadership, relationships with franchisees have improved and a range of actions have been taken to stabilise the business and improve performance”.

“Richard has driven positive change at RFG, and on behalf of the Board, I would like to thank him for his efforts during the early stages of the turnaround and wish him well in his future endeavours,” Mr George said.

Mr George will assume CEO responsibilities for the group for the time being.

Last week the company said it was not in a position to release a profit guidance for the current financial year, perhaps for several months.

The chairman was frank under shareholder questioning at the AGM about the likelihood of RFG’s lenders of calling in more than $260 million in loans — a potentially terminal prospect articulated by one shareholder who declared “all these programs mean nothing if the banks pull the rug out”.

“The short answer is that there’s $250-odd million in bank debt and we’re not earning enough to cover that debt,” Mr George replied.

“Do the banks want to take RFG over and sell those assets into a buyer’s market? No.

“Are they happy with the proposal we’ve put to them? So far, yes they are.

“They’re going to require some tangible evidence in the next couple of months to maintain that, but provided those initiatives proceed as we think then I have every reason to think the banks will allow us to restructure — but nothing’s certain.”

RFG shares shot up 1.5 cents from 38.5C before the announcement to 40C by 3.20pm - up 6.7 per cent from open.