Pressured DJs chief quits

The Australian Shareholders Association said it would renew its campaign to unseat David Jones chairman Dick Warburton following the shock departure. The ASA regards Mr Warburton and fellow David Jones director Reg Clairs as responsible for creating the new businesses which, due to operational losses and writedowns, have slashed the company's earnings.

Stephen Matthews, a director of the ASA, said Mr Warburton, with his many corporate positions, including his chairmanship of Caltex and seat on the Reserve Bank of Australia board, was spread too thin.

``David Jones has got some embedded problems that Mr Warburton needs to give his full attention to," Mr Matthews said. ``He has to have the time to nurture David Jones back to financial health and get the dividend and share price back up."

David Jones shares yesterday ended 3c weaker at $1.07, down from around $1.45 when Mr Wilkinson joined the retailer five years ago from Just Jeans.

News of Mr Wilkinson's departure comes on the eve of the retailer's full-year results, which are expected to show a fall in net profit of more than 60 per cent to between $6 million and $8 million. A $19.5 million writedown on the Foodchain business and costs incurred in exiting leases is largely behind the deterioration.

It is thought that, if not for those items, the underlying business would have displayed solid growth, backed by the core department store chain.

In a statement yesterday, Mr Wilkinson said he would most likely leave his $1 million-a-year job in the first quarter of 2003.

He said it was ``timely" to start discussing the matter with the board now after having initiated a sweeping strategic review of the business, including the writedowns and cuts to capital expenditure.

Candidates to succeed him from inside David Jones include stores director Don Grover, merchandise director Mark McInnes and chief financial officer Stephen Goddard.

Insiders said Mr Wilkinson, 57, first raised the prospect of his leaving several months ago. However, it is thought that board member John Coates, the former president of Australia's Olympic Committee, had agitated for him to quit.

In an address to shareholders in December 2000, Mr Warburton said Mr Clairs had played a lead role in the ``development and delivery" of Foodchain and David Jones Online. It is believed the pair blamed poor execution of their strategy by management for the disappointing performance of the new businesses.

Mr Warburton was not available for comment yesterday.

Major fund managers said it was unfair to hold Mr Wilkinson entirely responsible.

``It's a responsibility that needs to be shared as much with the board as with the chief executive," said Stephen Atkinson, a portfolio manager at Deutsche Bank.

``I would have thought that operationally David Jones hasn't performed that badly," Perennial Value Management analyst Hugh Giddy said. ``It's had problems more with issues of strategy. Foodchain appears ill-conceived and the board is involved with that as much as management."