Shares of Lumber Liquidators Holdings Inc. (NYSE:LL), the largest U.S. retailer of hardwood flooring, plunged 17 percent Thursday after CEO Robert Lynch unexpectedly resigned. The news comes less than a month after the company’s chief financial officer Daniel Terrell stepped down, the company said. Lumber Liquidators’ stock tumbled to as low as $20.97 in morning trading.
Thomas Sullivan, the company's founder, will serve as interim chief executive officer of the company, effective immediately. "I am really proud of the LL Team and I look forward to working with them and providing our customers with the best hardwood floors at the best prices as we have since I founded the Company over 20 years ago," Sullivan said in a statement Thursday.
The retailer has been facing challenges following the controversy surrounding a "60 Minutes" report in March on alleged safety problems with the company’s flooring. The laminate flooring made in China exceeds formaldehyde standards in California, according to the report. Formaldehyde has been linked to cancer.
The U.S. Department of Justice announced last month it is pursuing criminal charges against Lumber Liquidators in connection with an ongoing investigation into some of its imports from China.
In April, the Toano, Virginia-based company posted an unexpected quarterly loss. In a conference call with analysts and investors last month, the company said sales in current quarter had tumbled 8.2 percent to $52.6 million.
Lumber Liquidators operates more than 355 locations, featuring more than 400 flooring varieties, including solid and engineered hardwood, bamboo, cork, laminate and resilient vinyl.
Since the "60 Minutes" report aired in March, shares of Lumber Liquidators have lost nearly 60 percent of their value.