JD Wetherspoon calls time on two of its executive directors
A surprise boardroom purge at JD Wetherspoon has seen two of the pub chain's four executive directors being ousted, including respected finance director Keith Down.
The group refused to explain why Down, who had been with it for two years, would be leaving along with chief operating officer Paul Harbottle, who was employed there for eight years and promoted to the board two years ago, only three weeks before a trading update.
In a short announcement to the stock market detailing the departures, Tim Martin, the firm's outspoken chairman and largest shareholder, thanked the two men for their "hard work and contribution to JD Wetherspoon over recent years", but offered no explanation.
But analysts suggested to the Guardian that the move was the result of strategic differences with Martin, who set up the business 31 years ago and was keen to reassert control. They speculated that there may have been a row over the chain's plans to undertake early morning openings in order to offer cooked breakfasts and coffee.
One noted that Down had built up a considerable reputation among investors for controlling costs and stabilising margins and had been central to an important debt refinancing earlier this year. But it was believed that Martin was determined to press aggressively ahead with diversification despite the diluting effect it was likely to have on margins.
Martin subsequently denied that this was the case, however. He said: "It's not connected to ham and eggs at 7am. We were the first to introduce no-smoking sections, the first to ban smoking entirely, first to do food all day. The [long-term] strategy hasn't changed since we've had just one or two pubs."
The group now has 784. Down will be replaced by deputy finance director Kirk Davies and chief executive John Hutson will assume Harbottle's responsibilities.
According to the Morning Advertiser, the Stonegate Pub Company, which is currently without a head office executive team, also denied rumours that it had poached the two Wetherspoon executives.