Board rejig for David Jones and Country Road

South Africa’s Woolworths Holdings has reviewed the operation and governance structure of its key Australian retail businesses.

The department store revealed that David Jones sales over the 26-week period declined by 8.8 per cent and by 10.5 per cent in comparable stores. Photo Luis Enrique Ascui

South Africa’s Woolworths Holdings has reviewed the operation and governance structure of its key Australian retail businesses, David Jones and Country Road Group, to create boards for both subsidiaries wholly staffed by managers rather than a mix of executives and non-executive directors.

The restructure of the two boards has seen non-executive director Chris Colfer step down from both subsidiaries.

However, Mr Colfer remains a director of Woolworths Holdings, and as its only Australia-based director will maintain a heavy interest in the performance of both David Jones and Country Road, which owns Country Road, Mimco, Trenery, Witchery and Politix.

Mr Colfer was appointed as a director of Woolworths Holdings, David Jones and Country Road in 2019 following the departure of two other Australia-based directors, former St George Bank chief executive Gail Kelly and veteran Patrick Allaway.

A spokesman for Woolworths said changes to the David Jones and Country Road boards were made to align them with a company-wide restructure of the various subsidiaries that formed the group’s international operations.

“Following a strategic review of governance structures conducted by Woolworths Holdings and completed in 2020, we have recently streamlined and aligned the structures of our subsidiary boards across the Woolworths group,” the spokesman said.

“Under the new structure our subsidiary boards in Australia and South Africa will comprise members of respective executive management teams only. This change will remove duplication, support decision-making and improve the governance structure of our business, while ensuring ­compliance.”

The Woolworths spokesman said this change would see Mr Colfer depart the David Jones and Country Road boards. “In line with the new structure, Woolworths group non-executive director Christopher Colfer will no longer sit on our Australian subsidiary boards at David Jones and Country Road Group.

“Mr Colfer continues as a non-executive director of Woolworths Holdings, where he remains the board’s Australian representative and continues to be actively engaged with the management teams of both Australian businesses.”

Earlier this week David Jones reported an improving trading performance in the lead-up to Christmas, powered by the Black Friday sales, government stimulus and the easing of restrictions, although the severe 12-week lockdown in Victoria was a drag on its results.

The department store revealed that David Jones sales over the 26-week period declined by 8.8 per cent and by 10.5 per cent in comparable stores. Woolworths Holdings, which bought David Jones for $2.1bn in 2014 as well as securing full ownership of Country Road Group, said the balance of the David Jones business, including online but excluding Victorian stores which traded significantly down on the prior period due to the extended lockdown, grew by 5.9 per cent.

Country Road Group delivered strong sales growth of 6.7 per cent in the last six weeks of the period, underpinned by new product ranges, particularly in the Country Road business, Woolworths Holdings said this week. Sales over the half declined by 5.2 per cent and by 2.4 per cent in comparable stores, negatively impacted by the lockdown in Victoria. Excluding Victorian stores, the balance of the Country Road Group business, including online, grew by 8.2 per cent.

For 2020 Osiris Holdings, the local company that houses the David Jones business, reported a bottom line loss of $125.9m on top of a $489.23m loss in 2019 and a $785m loss in 2018. In fiscal 2020 according to documents lodged with ASIC, Country Road Group posted a profit of $24.96m, down from $74.06m in 2019.