Ashworth CEO Herrel Resigns
NEW YORK – Randall Herrel has resigned as chairman and chief executive officer of Ashworth Inc., the golfwear and sportswear marketer, effective Oct. 17, the company said late Tuesday.
James B. Hayes has been elected chairman of the board, effective immediately. He has most recently served as the lead independent director of the Carlsbad, Calif.-based firm. Additionally, Gary Schneiderman, who has been executive vice president with responsibility for sales, marketing and customer service, has been named president.
Ashworth has commenced a search for a new CEO.
Ashworth has created an office of the chairman to assist in its executive transition. This group, which will report to the chairman, initially will include Herrel and Peter Weil, a director. Upon Herrel’s departure next month, Schneiderman and Winston Hickman, chief financial officer, will become members of the body. Weil has entered into an agreement to provide additional services to the firm.
Herrel has been CEO of Ashworth for ten years and chairman for six. His resignation hadn’t been expected and was announced two hours after the close of the Nasdaq market, where Ashworth shares closed up 19 cents, or 3%, at $6.55 on Tuesday. Their 52-week low is $6.17 versus a corresponding high figure of $10.45.
In a statement, Hayes noted, “We believe the structural and organizational changes announced today will help ensure a smooth transition as the Company maintains its focus on continued operational improvement and enhanced financial results…. We also greatly appreciate Randy Herrel’s leadership over the last 10 years and congratulate him on his many noteworthy accomplishments in developing and implementing the company’s strategic growth plan.”
While the changes follow a tumultuous year for Ashworth, they don’t come on the heels of disappointing financial results. Just last week, the firm said that it returned to profitability in its third quarter, posting earnings of 5 cents per diluted share versus a loss of 24 cents in the year-ago quarter. Despite an 18.5% decline in sales in the golf channel, revenues grew to $52.8 million from $48.3 million.
However, the company has been in the midst of several contentious issues in the past year, and some of them may have spilled over into boardroom drama, one financial analyst, requesting anonymity, said Tuesday. The firm last November undertook a strategic review to consider, among other options, a possible sale, but recently decided to focus on improvement of results and operations instead. It was also involved in a time-consuming and expensive proxy contest.
In addition to various lines under the Ashworth umbrella, the firm manufactures and markets, under license, apparel and accessories under labels including Callaway Golf Co., The Game and Kudzu.
