CEO to leave as loss blows out Adele Ferguson: First good move in years PacBrands needs a little loving: Pollaers Rag trader stretched at the seams Sue Morphet was one of Australia’s more controversial chief executives.
Pacific Brands CEO steps down Commbank wholesale bikinis to face biggest shareholder … Shareholders launch class action against … Catalonia worries eurozone markets Japan introduces ‘premium Friday’ ASX winners and losers – a snapshot World markets leave Australia behind Inside Sofitel Sydney Darling Harbour The out-going chief of Pacific Brands will be remembered, perhaps unfairly, as the boss who pocketed a hefty pay rise, sacked 1800 textile workers and moved manufacturing of much-loved Australian brands to China.
In announcing her resignation today, Ms Morphet compared her five years as chief executive of Pacific Brands to playing against Collingwood “week after week”.
Those unfamiliar with Aussie Rules should infer that her job was bruising, bordering on awful – made worse by a notoriously one-eyed (even one-toothed) supporter base.
Jests aside, the reality was probably much worse.
How many chief executives have hired 24-hour security to patrol their own house? Ms Morphet did in March 2009 when unionists, politicians and many Australians piled on her for more than doubling her salary, from $685,775 to more than $1.8 million, even as she sacked several thousand workers and reported company losses totalling hundreds of millions of dollars.
When Ms Morphet was promoted from general manager of the underwear division to CEO of Pacific Brands in August 2007, her brief was to “transform” the company.
Ms Morphet inherited a business that was loaded with debt, wedded to ageing, middle-of-road brands, and under siege from the internet.
Its customers, large and small, were abandoning them. Supermarkets and retailers were making their own “home brand” products sourced directly from Chinese factories, leaving less room on shelves for Pacific Brands’ offerings which include Bonds, Berlei, KingGee and Rio.
In February this year, the company announced the loss of major customer Kmart, which stripped $33 million from Pacific Brands’ sales by dumping brands including Bonds in favour of directly sourced underwear products.
There was barely a let up in her tenure of almost five years.
Ms Morphet battled a global financial crisis, soaring cotton prices and consumers shopping online. It didn’t help when last year one of her staff, former Berlei bra boss Sally Berkeley, filed a $9 million unlawful dismissal lawsuit.
Ms Morphet’s big strategic play – employing cheaper Chinese workers instead of expensive Australian ones – might have worked a decade ago, but the company admitted today that Chinese wages are rising by between 15 and 20 per cent a year, and more in some regions.