Dan Matthias to Continue as Non-Executive Chairman of the Board
PHILADELPHIA, Sept. 29 /PRNewswire-FirstCall/ -- Mothers Work, Inc.
(Nasdaq: MWRK), the world's leading maternity apparel retailer, today
announced that Dan Matthias will retire as the Company's Chief Executive
Officer on September 30, 2008. Edward (Ed) Krell, the Company's current
Chief Operating Officer, was named by the Board of Directors to succeed Mr.
Matthias as Chief Executive Officer, effective October 1, 2008. Mr. Krell
has also been appointed to serve as a member of the Company's Board of
Directors. Mr. Matthias will continue to serve as a director of the Company
and serve as non- executive Chairman of the Board, and will remain
available to management in an advisory capacity through September 30, 2012.
Rebecca Matthias, the Company's President and Chief Creative Officer, will
continue in her current capacity and will report to Mr. Krell.
Mr. Krell has served as a senior executive of the Company for nearly
seven years, having joined Mothers Work in January 2002. Mr. Krell served
as Senior Vice President- Chief Financial Officer from January 2002 until
November 2003, and served as Executive Vice President- Chief Financial
Officer from November 2003 until May 2007. In May 2007, Mr. Krell was named
Chief Operating Officer & Chief Financial Officer and he served in this
role until July 2008, when he was named Chief Operating Officer of the
Company.
Mr. Krell, on behalf of the Board of Directors, noted, "The Board
greatly appreciates Dan's contributions to Mothers Work as a co-founder
from its inception as a small catalog business 25 years ago to its current
position as the leader in maternity apparel. The entrepreneurial spirit
instilled in the Company by Dan and our President and co-founder, Rebecca
Matthias, has been immeasurably important to the Company's growth and
success. We are appreciative that Dan has agreed to serve as our
non-executive Chairman of the Board and look forward to his continued
contributions to the Company. In addition, the Board and I greatly value
Rebecca's service as President and Chief Creative Officer as she continues
to drive our merchandising, creative and publicity initiatives.
Ms. Matthias, on behalf of the Board of Directors, commented, "We are
very pleased to announce Ed Krell's promotion to Chief Executive Officer.
Since he joined us in 2002, Ed has continually taken on more and more
operational responsibility and has played a key role in devising and
implementing our strategic and operational initiatives to expand our
leadership position in the maternity apparel business and increase
shareholder value. Ed was instrumental in developing our strategic
restructuring, announced in July 2008, to streamline our merchandise brands
and store nameplates, reduce our cost structure and improve the long-term
profitability of our business. Under Ed's leadership, we will be determined
to increase profitability while continuing to maintain the keen focus on
generating cash flow which Ed has been driving. The Board and I are
confident that Ed is the right person to succeed Dan and to lead the
Company through these challenging economic times to a bright future for our
Company and its stockholders."
Mr. Matthias commented, "I am looking forward to serving the Company in
my new role and I enthusiastically support the Board's appointment of Ed as
our new Chief Executive Officer."
In connection with the retirement of Mr. Matthias, the Company will
increase by approximately 10% and fully accelerate Mr. Matthias'
supplemental pension benefits under his Supplemental Retirement Agreement
and, as a result, the Company expects to incur a pre-tax charge of
approximately $2.5 million in the fourth quarter of fiscal 2008. Cash
payments related to the Supplemental Retirement Agreement will not begin
until April 2009. Mr. Matthias will also receive an annual fee of $200,000
for Board and advisory services.
Mothers Work is the world's largest designer and retailer of maternity
apparel, using its custom TrendTrack(TM) merchandise analysis and planning
system as well as its quick response replenishment process to "give the
customer what she wants, when she wants it." As of August 31, 2008, Mothers
Work operates 1,038 maternity locations, including 756 stores,
predominantly under the tradenames Motherhood Maternity(R), A Pea in the
Pod(R), Mimi Maternity(R), and Destination Maternity(R), and sells on the
web through its DestinationMaternity.com and brand-specific websites. In
addition, Mothers Work distributes its Oh Baby by Motherhood(TM) collection
through a licensed arrangement at Kohl's(R) stores throughout the United
States and on Kohls.com.
The Company cautions that any forward-looking statements (as such term
is defined in the Private Securities Litigation Reform Act of 1995)
contained in this press release or made from time to time by management of
the Company, including those regarding results of operations, financial
condition, and various business initiatives, involve risks and
uncertainties, and are subject to change based on various important
factors. The following factors, among others, in some cases have affected
and in the future could affect the Company's financial performance and
actual results and could cause actual results to differ materially from
those expressed or implied in any such forward-looking statements: our
ability to successfully manage our various business initiatives, our
ability to successfully manage and retain our leased department and
licensed relationships and marketing partnerships, future sales trends in
our existing store base, unusual weather patterns, changes in consumer
preferences and spending patterns, demographics and other macroeconomic
factors that may impact the level of spending for maternity apparel,
overall economic conditions and other factors affecting consumer
confidence, the impact of competition and fluctuations in the price,
availability and quality of raw materials and contracted products,
availability of suitable store locations, continued availability of capital
and financing, ability to hire and develop senior management and sales
associates, ability to develop and source merchandise, ability to receive
production from foreign sources on a timely basis, potential stock
repurchases, potential debt prepayments, changes in market interest rates,
war or acts of terrorism and other factors set forth in the Company's
periodic filings with the Securities and Exchange Commission, or in
materials incorporated therein by reference.
Mothers Work press releases available through Company News On-Call at
http://www.prnewswire.com/comp/581877.html
SOURCE Mothers Work, Inc.
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Related links:
http://www.motherswork.com
http://www.prnewswire.com/comp/581877.html/
CONTACT:
Judd P. Tirnauer, Senior Vice President &
Chief Financial Officer of Mothers Work, Inc., +1-215-873-2278
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