Metcash has tapped Peter Birtles to replace chairman Rob Murray, who will retire after more than seven years with the grocery wholesaler that supplies IGA and Foodland stores.
Mr Murray was appointed chairman of Metcash shortly after joining the board in 2015, and has since overseen the transition to a stronger financial position and culture.
The wholesaler made gains amid the pandemic but is grappling with rising food inflation across most categories, and some suppliers are asking for more price rises.
Mr Birtles, who is the former chief executive of Super Retail Group, is a non-executive director and heads the audit, risk and compliance committee at Metcash.
Mr Murray said he was proud to have played a role in guiding Metcash’s transition to the company it is today.
“Driving our success has been Metcash’s continued focus on championing successful independents, and the board and I have been wholeheartedly committed to this cause,” he said.
“Given my length of service as chairman, and with the successful transition of a new group CEO, I believe this is the right time for me to retire from the board. Peter is well-placed to take over from me, and I am confident he will be an excellent chairman of Metcash.”
Shares in the $4 billion Metcash fell slightly on Thursday, down 1¢ to $4.19 each.
Barrenjoey head of consumer research Tom Kierath said Mr Birtles is a steady hand who knows retail – as did Mr Murray – so he does not expect much change under the new chairman.
“The business is in a better place post-COVID, and IGA retailers are investing in price,” he said.
“They are really well placed. Metcash is not giving up share is the feedback we are getting from suppliers.”
Mr Kierath said the size and frequency of price rises were set to increase, in some categories double-digit price rises will become the norm, as inflation continues to climb.
He believes inflationary pressures will cause consumers to increase buying products on promotion and seek out lower priced private label which attract lower profitability for supermarkets.
New Metcash chief executive Doug Jones took the helm of the grocery wholesaler in February. The company also operates hardware businesses Mitre 10, Home Improvement and Total Tools.
Former chief executive Jeff Adams surprised investors in October by stepping down to make way for Mr Jones, who was CEO and senior vice president of South Africa’s Massmart Wholesale.
Mr Birtles said Metcash had a strong board and management team, with good plans to continue improving the competitiveness of its retail networks.
Metcash recently posted a strong 2022 result when earnings jumped nearly 18 per cent to $472 million, ahead of analysts consensus. The company also announced it will build a new food distribution centre in Victoria for a total capex of $70 million.
Former PwC senior partner Mark Johnson has also joined Metcash as a non-executive director. Mr Johnson is a highly experienced company director and holds directorships at Boral and Goodman Group, and formerly in Coca-Cola Amatil.
Extracted from AFR