Sears Holdings Corp Chairman Edward Lampert acknowledged that having an interim chief executive for more than two years is not ideal and definitely weird, but said the retailer is in no rush to find a replacement for Bruce Johnson.
Johnson, who has operated with an interim tag since January 2008, was even elected to the board at the Sears annual meeting on Tuesday at its headquarters outside Chicago. Analysts have criticized the company's lack of urgency in hiring a permanent CEO.
We've been looking, but we're not looking every day and it's not consistent, hedge fund manager Lampert told reporters after a meeting that lasted more than three hours. I think I said it last year and I'll say it again, there's not a rush. It's not an ideal situation.
This is a very weird situation and I think that it would be different if we had not gone through both a major restructuring of the company and the economic environment, where even the most talented executives, a lot of them were under their desks, added Lampert, who rarely speaks to investors and media.
The interim nature of Johnson's title was fodder for jokes during the meeting, which was attended by several hundred investors and employees.
Johnson told how one employee recently greeted him with Hello, Mr. Interim. He added, however, that his expectations since he was named interim CEO have not changed and he would remain in place as the transition was made to a new CEO.
No matter whether the title says it or not, we are all interim in our positions, he said to reporters, adding a time would come when he will either move on to other things or the board will replace him.
Later in the meeting, Lampert, who has been described by some investors as autocratic, joked: Like Bruce, I'm an interim as well, or (so) my wife likes to tell me.
Lampert said good succession planning is part of good corporate governance and added his expectation has always been that Johnson would remain after a permanent CEO was hired.
Shares of Sears, home to the Sears and Kmart store chains, closed down 3.7 percent at $117.81 on Tuesday, compared to the previous day's high above $125 . The shares have more than doubled in value in the past year.
AN UNRECOGNIZABLE SEARS
Last month, Sears forecast a first-quarter earnings range that seemed likely to beat analyst expectations and moved a step closer toward its long-coveted goal of taking full ownership of its Canadian unit.
At the time, it said quarterly sales at stores open at least a year rose 3.2 percent at Kmart and 0.3 percent at U.S. Sears stores. It is due to report results by May 20.
Lampert, who in the past has been hailed as the next Warren Buffett, and Johnson discussed the new products Sears is offering as well as the company's goal to be a world class online retailer.
Lampert joked at the start of Tuesday's meeting that the crowd was bigger than he expected. He used a laptop to show off the latest features at Sears.com, including choosing from more than 67,000 options for sunglasses.
He wanted to show how the company is making the shopping experience easier as well as offering consumers more choice. Lampert said with so many changes in technology and consumers using online and mobile devices more often to shop for products, Sears will look different down the road.
Five years from now, this company to some people will be unrecognizable, he said.
Lampert also said the company would be less likely to keep money-losing stores open if there is no pension reform in Washington.
He said the company would not close all its money-losing stores, but said it could be a significant number that is more than 10 locations. He declined to provide further detail. The company operates about 3,900 stores in North America.
(Reporting by Ben Klayman; Editing by Michele Gershberg and Matthew Lewis)