Sports Direct SPD Dave Forsey yesterday resigned both as CEO of Sports Direct and as a member of the board, after, as he put it, having “given my entire working life to the company” – hardly the sentiments of a man happy with his fate. And guess who has been appointed by the nodding donkeys on the board to replace him as CEO ? Why of course it is none other than one Mike Ashley, the very same Mike Ashley who recently admitted to a parliamentary committee that his head was stuck so far up a cloud that he was completely unaware of the serious and long standing malpractices of his own company under his leadership.
Ashley’ performance in front of the committee was so embarrassing and harmful to the company, that most people in his position would have squirmed but he appeared to have not a squirm in him. Judging by those performances and the admissions as to his failings which he was forced into making, the one question should now be asked is, how can he believe that he is a fit and proper person to resume daily operational management of the company which he has so let down.
The damage caused to the company and its shareholders is huge.In August 2015 the share price stood at 805p since when it has fallen virtually non stop and closed yesterday 285.5p. Since as recently as the 6th September it has fallen by 17% following a critical report issued by its own lawyers and which identified serious shortcomings in working practices.
On the 15th September, Its in house brokers, Goldman Sachs, cut profit expectations by more than 5%. The company itself has had to warn of higher costs and lower margins.
What appeared to be another, of what should have been final straws, at least until yesterday, was to see Chairman Keith Hellawell, whose career since he stopped being a policeman hardly inspires confidence, clinging on to his position after the independent shareholders voted him out, a decision which brings us back to the nodding donkeys, who in true Sports Direct tradition, decided to ignore the vote and keep him on.