Dive Brief:
- Domino's announced Wednesday Stuart Levy is resigning from his position as chief financial officer and executive vice president, effective immediately, according to a press release. He will stay with the company through the end of August in an advisory capacity.
- Levy was appointed to CFO in August 2020 after serving as the company's executive vice president of supply chain services. He will receive one year of base salary.
- Levy's departure comes amid a string of personnel changes at the CFO position for several restaurant chains, including Shake Shack and Starbucks. In addition to the staffing shift, Domino's has created a new Office of the CFO, overseen by CEO Ritch Allison.
Dive Insight:
The CFO turnover in the restaurant industry continues, with Levy's stint as the top financial executive at Domino's among the shortest at less than one year. Despite the fast turnover, the company was clear in its statement that his departure was not due to any disagreements over its financial reporting, accounting policies or judgments.
Over the last year, as restaurants struggled to adapt to the impact of the pandemic, several chains announced changes to their CFO positions.
Among some of the shorter tenures include Noodle & Company's CFO Ken Kuick, who resigned last August after nearly two years, and Jack in the Box's Lance Tucker who also left after two years.
Some CFO's departed during the COVID-19 crisis to pursue opportunities outside of the restaurant industry. Shake Shack's Tara Comonte left earlier this month, after about four years in the CFO role, to become CEO of biotech company TMRW Life Sciences. Dine Brands' top financial officer Thomas Song stayed at the chain for two and a half years before leaving in January, joining Aimbridge Hospitality in the same position. Dine Brands had an interim CFO for five months until appointing Vance Chang, who begins June 14.
Both Starbucks and Cracker Barrel saw their CFOs retire recently. Cracker Barrel's Jill Golder left at the end of 2020 after four years with the company, while Patrick Grismer retired Feb. 1 after two years at the helm of the coffee chain's financial division. Grismer stayed on as an advisor through May 2 to help with the transition.
These major changes at the C-suite level can create instability as interim executives are appointed and expensive recruitment searches ensue. Domino's, however, may be trying to offset the impact with the creation of its new financial office. It has also done exceptionally well during the pandemic in terms of sales, taking advantage of the growth in delivery.
Goldman Sachs doesn't expect a "meaningful shift" in Domino's strategy following Levy's exit. Analyst Jared Garber points out the company recently completed a recapitalization as well as a $1 billion accelerated share repurchase transaction.
During Levy's tenure, Domino's continued to see increasing sales, with growth of 13.4% during Q1 2021 compared to the year ago period. It marked the 40th consecutive quarter of same-store sales growth, helping drive revenue overall up 12.7% to $110.6 million in Q1.
