Business

Mike Ashley set to step down as Frasers CEO over next year

Group’s ‘head of elevation’ Michael Murray – partner of Ashley’s daughter – to succeed founder

Chief executive of Frasers Mike Ashley will step down over the next year. Photograph: Kirsty O’Connor/PA Wire

Thu Aug 5 2021 - 07:41

Mike Ashley, one of Britain's best-known and most outspoken business leaders, is set to step down as chief executive of the sportswear retail group he founded nearly 40 years ago, giving up the role to the partner of his daughter.

Frasers Group, formerly called Sports Direct, said on Thursday its board was in talks with regards to "transitioning" the CEO role from Ashley to Michael Murray, the group's current "head of elevation", over the course of the 2021-22 financial year.

“It is currently proposed that Michael Murray will assume the role of CEO on May 1st, 2022,” it said.

The group said that if Ashley did give up the CEO role he has held since 2016 he would remain on the board as an executive director.

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Shares in Frasers were down 1 per cent at 8.26am, paring 2021 gains to 35 per cent.

Ashley, who is also owner of Premier League soccer club Newcastle United, founded the company in 1982 and retains 64 per cent of its equity. He held the title of executive deputy chairman when Sports Direct floated in 2007 until 2016.

Murray is the partner of Ashley’s daughter Anna.

‘Selfridges of sport’

Though Murray does not currently sit on Frasers’ board, his job has made him central to the group’s strategy to modernise and go upmarket – the elevation strategy.

Ashley’s long-stated desire is to make Frasers the “Selfridges of sport”, emulating the status of the London department store.

“The group’s elevation strategy is transforming the business and receiving positive feedback from consumers and our brand partners, especially on projects such as the new Oxford Street Sports Direct which opened in June 2021,” Frasers said.

“The board consider it appropriate that Michael leads us forward on this increasingly successful elevation journey.”

The group reported a 29.4 per cent rise in core earnings in the 12 months to April 25th as a strong online performance offset a hit from store closures due to the Covid-19 pandemic.

Underlying earnings before interest, tax, depreciation and amortisation (Ebitda) were £390.8 million, up from £302.1 million in 2019-20, despite an 8.4 per cent decline in revenue to £3.6 billion.

Frasers said its UK stores have performed above expectations since reopening after lockdown and its online operation has continued to “significantly outperform” pre-Covid-19 periods.

However, it said it was not giving guidance for the 2021-22 year due to uncertainty caused by the pandemic.

“Management remains of the view that there is a high risk of future Covid-19 pandemic restrictions, likely to be over this winter and maybe beyond,” it said. – Reuters

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