Unilever chief Hein Schumacher has unexpectedly resigned after less than two years in the role, as the company attempts to push forward with its cost-cutting programme.
Schumacher will be succeeded by Unilever’s financial chief Fernando Fernandez from next week and leave the firm at the end of May, the firm said.
The news comes amid Unilever’s wide-ranging “productivity programme,” which will cull thousands of jobs and spin off its ice cream arm, including the Ben & Jerry’s division.
Following a “full review” of separation options, the ice cream business will be incorporated in the Netherlands and continue to be headquartered in Amsterdam, although it will have a triple listing of New York, London, and Amsterdam.
No details were given about the sudden departure, but Unilever’s board reportedly ousted Schumacher at a board meeting yesterday after deciding that CFO Fernandez was “better suited” to execute the turnaround plan, according to the Financial Times.
Outgoing Unilever CEO Hein Schumacher
“Markets typically flinch at abrupt leadership shifts but his deep experience, and a clear mandate to push change with urgency, signal a bold move to accelerate the final stretch of Unilever’s turnaround,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
According to UBS analysts, Fernandez is ” well known” by the investor community. While Schumacher may have built the foundations of the cost-cutting plan, execution of the plan is becoming increasingly important.
Unilever shares dropped two per cent on the news and are down more than four per cent since the start of the year.
“Losing a chief executive after 18 months is never a good thing,” said Chris Beckett, head of equity research at Quilter Cheviot.
“For Unilever, especially during a strategy turnaround, it does not suggest things were going well behind the scenes or the business was firing on all cylinders.”
In Unilever’s full-year results, released earlier this month, the consumer giant reported “exceptionally weak” guidance, according to analysts.
Market growth, which slowed throughout 2024, was expected to remain soft in the first half of this year, with underlying sales growth at between three to five per cent.
“The last set of results suggested that turnaround had stalled somewhat, with weak guidance and sales growth only likely to improve as the company passes on higher commodity costs,” added Beckett.