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Crocs names new CEO, closing 160 stores globally

After delivering an improved yet still weak end-of-year result in fiscal 2016, American footwear brand Crocs has announced the appointment of a new CEO and the closing of around 160 stores by 2018.

The Niwot, Colorado-based Crocs said fourth-quarter revenues decreased 10.5% to $187.4 million. For the full-year ending December 31, total sales fell to $1.04 billion, a 4.7% decrease on 2015. As a result, Crocs booked a yearly net loss of $31.7 million, a narrowing on last year’s $98 million loss.

In Asia, revenue in the quarter was $68.8 million, down 9.8%. Wholesale revenues were down 5.3% as a result of the sale of its South African business in April 2016. Retail sales in Asia declined 16.6%, on the back of a 12.1% comparable sales dive, despite the addition of nine stores in the region compared to last year.

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For the prior twelve months, the casual shoe retailer successfully reduced inventory by $21.2 million, or 13% “to generate approximately $40 million of cash flow from operations during the year,” said Gregg Ribatt, Crocs chief executive officer, in a press release.

However, the chief’s tenure will come to an end in June 2017.

“Effective June 1, Andrew Rees is being promoted to president and CEO, and I will step down as CEO but continue in my board role, added Ribatt.

Ribatt also revealed a reshuffle of senior management and the “expanding (of) responsibilities for certain executive team members to better utilise their talents and leadership expertise.”

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Michelle Poole, head of global product and merchandising will assume responsibility for marketing and Ann Chan, general manager of Europe, will mover over to head up the Americas.

Crocs’ Asia head, David Thompson, will absorb Europe into his regional fold, meaning he will covers Asia, The Middle East and Africa, as well as Europe.

The footwear brand has also appointed an e-commerce head, Adam Michael, who will oversee Crocs entire online activity.

Looking forward, Crocs plans to cap off a two-year transformation effort by closing some 160 of its 558 retail stores — roughly 28% of its fleet — by the end of 2018.

Crocs expects to gain back almost $10 million dollars from the closures.

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