Diana Hunter steps down as Conviviality CEO

By Lisa Riley

Published: 19 March, 2018

Conviviality CEO Diana Hunter has stepped down from the board with immediate effect.

Announced today, Hunter’s resignation follows Conviviality having issued two profit warnings and the revelation that the company is facing a £30 million tax bill.

Non-executive chairman David Adams will step up to become executive chairman in the interim, with Hunter staying on “for a period of time in order to provide transition support”, said Conviviality in a statement.

Conviviality added that it was “continuing to engage with stakeholders” and would provide an update in due course.

It has been a stormy few weeks for the company which first issued a profit warning earlier this month when it warned that its earnings before interest, tax, depreciation and amortisation would be around 20% lower than expected because of an “arithmetic error” in its forecasts, as well as tougher trading and tighter margins.

It then issued a second profit warning last Tuesday, less than a week after the first one and on the day its shares were suspended when it admitted an unforeseen tax demand of £30 million.

Following the trading update, more than £300 million was wiped off Conviviality’s value.

At the time, the company said its guidance for net debt of about £150 million for the 52-week period ending 29 April 2018 remained unchanged.

Conviviality, which has been transformed during the past three years from an off-licence chain into the UK's biggest alcohol wholesaler following its takeover of wholesaler Matthew Clark and wine specialist Bibendum, said last week it was in talks with its advisors and brokers regarding the possibility of an equity fundraise to effect a recapitalisation of the business, thought to be in the region of £150 million.

In January this year Conviviality reported a 13% drop in pre-tax half-year profits. At the time chief executive, Diana Hunter, said the drop was due to the later-than-expected "phasing" of its cost-cutting efforts following a series of acquisitions.

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