Reputational damage done

Phil Ryan’s credibility has taken a major blow. For someone that kept telling everyone he and his team knew better than anyone else what “She” wants and when “She” wants it, the 20% online sales collapse reveals anything but.

A move in the right direction, to restart sales growth, can only sustainably commence when Phil Ryan and the Board openly admit to getting it very wrong. They have lost control of sales performance in Europe, USA and mainland Europe. Blame on economic factors masks the deterioration in market share against its competition. CCX is ‘not’ expanding market share in its online channel and the Chairman’s stated claim of CCX’s 2023 priorities of doing so ring hollow.

Claiming sales growth compared to 2021, which was a year in which sales from acquisitions had yet to extrapolate out and which were funded by a shareholder capital raising is ingenious-Phil Ryan should be embarrassed in stating this.

Phil Ryan’s stated claim that Northern Hemisphere (inclusive of USA) facing greater economic pressures, is quite frankly, one of complete bull# and deflects from his underperformance as a CEO. There are many clothing retailers in the USA that are performing better than a 12% sales reduction delivered by Phil Ryan since 30 June. The result is a shocker and he deserves all of the criticism due for doing so.

CCX’s operational management structure and where it sits needs wholesale review. The US market can’t continue to be managed by way of fly in and remote control leadership execution. It needs its leader on the ground, at the coal face to pick up on trends on the street, in store and on line at competitors, as they happen and away from heavy reliance on data analytics thousands of kilometres away in Sydney.

Product categories need deep rooted review; it is not a leader in any product category and has not penetrated any new product category in any meaningful way over recent years.

Its social media strategy requires re alignment. It lags its competitors in connecting with social influencers, it has a sporadic approach to posting on popular apps and has not done anything innovative for years. There is little doubt it is a laggard in social media marketing and way behind the competitors.

The Board and its strategic oversight role also needs review. What 3 year sales growth has it set the management team to achieve? When will CCX reach 1 $billion in global sales and how will it get there? Why is there no discussion of this? Where is CCX heading?

Simple annual sales goals and stock metrics won’t achieve the step change required here. If the Board members are not up to this task then they need to resign and appoint new members to assume this responsibility.

We are sick of hearing that the plus size global market is $180bn in size when CCX’s share is less than 0.2% and falling. Appalling.

Then there is the problem of huge over investment in inventory, well, what is left to be said here. It has paralysed CCX’s ability to execute on inorganic growth and the problem will take another 7 months to be fixed.

Lastly, haven’t heard any apology for taking shareholders money at $3.05 a share, sold on the promise of using those funds to grow sales; shameful behaviour and this unapologetic act of management and the Board won’t easily be forgotten by the shareholders who own this company.

The CEO and Board members are deserving of all the criticism levied at them and should be ashamed of their update to shareholders today.