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Dive Brief:
- The Children’s Place named Sheamus Toal as its new chief financial officer, effective Nov. 7, according to a press release. Toal is the second new CFO in less than a year and a half at the company.
- Toal most recently served as CFO of online mattress retailer Saatva, and before that spent 16 years at apparel retailer New York & Co and its parent, RTW Retailwinds, which liquidated in 2020. He will report to CEO Jane Elfers.
- Toal replaces Robert Helm, who left in October after starting in April 2021. The Children’s Place said in a September filing that Helm’s employment was terminated though not over any disagreements with the company or issues related to disclosures or accounting matters.
Dive Insight:
The Children’s Place has had a bumpy path through the pandemic era. After a pivot to digital last decade, and benefiting from failed competitors such as Gymboree and Babies R Us, the children’s apparel retailer had to contend with the slump in apparel during early COVID-19 period, and the school closures and decline in socializing that came with it.
By spring 2021, the company still showed financial weakness, according to RapidRatings data from the time. But those measures significantly improved later in the year.
After the trials of the early pandemic, and last year’s supply chain disruptions, The Children’s Place now faces demand declines as consumers brace against steep increases in food, gas and housing prices.
Elfers said in August, after the company’s second quarter, that “sales and profitability fell well short of our expectations due to a significant miss to our internal retail sales projections in the period from early June through early July.”
Driving the miss was a mix of a spending slowdown by consumers and unexpected rise in discounting among competitors. The end result was that top-line sales were down 8% and the retailer swung to a loss, with an operating loss of $13.8 million, after posting positive profits in the previous year’s Q2.
Elfers said at the time that consumers were still responding to The Children’s Place’s marketing and assortment, and its basics business was “very strong.”
The retailer’s new CFO is no stranger to tough times. Toal led RTW Retailwinds through its Chapter 11 in 2020 and the sale of the company’s intellectual property. He took over as chief executive after a massive leadership exodus in the months before bankruptcy. Prior to taking over as CEO, Toal also served as CFO, COO, and chief accounting officer and treasurer at the company.
Telsey Advisory Group analysts led by Dana Telsey said in a research note Tuesday that they believed Toal's background “as a seasoned financial executive who has experience with operational elements of consumer retail businesses should make him an effective partner to CEO Jane Elfers.”
The analysts added, “In our view, the combination of CEO Jane Elfers focusing on marketing and merchandising, along with Mr. Toal's CFO experience, solidifies and stabilizes the executive suite at a time of macro and operational challenges.”
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Ben Unglesbee, Khareem Sudlow
