Wet Seal Chief Quits, Citing Health Reasons : Clothing: Ken Chilvers, 45, is replaced by longtime partner in Irvine-based firm. He says there’s no connection to a nearly 42% plunge in the youth-oriented company’s yearly profits.
Wet Seal President Ken Chilvers announced his resignation for health reasons Friday. The youth-oriented women’s apparel chain also released its annual results, which show profits plunged almost 42%.
Chilvers, 45, the chief executive at the Wet Seal Inc., actually stepped down Monday and was immediately replaced by executive vice-president and longtime partner Kathy Bronstein, whom he said has virtually run the merchandising end of the business for the past 18 months.
The drop in corporate profits are unrelated to Chilvers’ unspecified health problems, he said Friday.
“I don’t remember the last time I had a sick day,” Chilvers said, adding that he has been mulling his resignation “for some time. My illness is not critical or terminal. I don’t have AIDS or anything like that.” He declined to elaborate further.
Chilvers said he is confident the new management team, headed by Bronstein, will steer the company efficiently as it proceeds with plans to expand the chain in California, Florida, Texas and the Northwest by adding 19 stores by the end of 1992.
The Wet Seal Inc., a subsidiary of Suzy Shier Inc. clothing stores in Montreal, has 113 stores in shopping malls in California, Arizona, Nevada, Hawaii, Florida and Texas. It sells moderately priced women’s clothing, focusing on the latest fashions in stores that feature giant video screens that play rock videos.
Chilvers, who received salary and stock worth $795,785 in 1991, said that he will stay on at the company for an undetermined amount of time to act as a consultant to Bronstein. Otherwise, he said he has no immediate future plans.
Bronstein, who made $546,785 in total compensation last year, has vowed not to alter the company’s marketing philosophy.
“We have no plans for changing the way we run the business,” Bronstein said, adding that during the eight years the two worked together at Wet Seal, they were “literally partners” in decision making.
The change in top management included two other promotions. Director of stores Sher Moeller will become vice-president of store operations and Jean Heller, associate general merchandising manger, will become vice-president of merchandising.
In its earnings report released Friday, the company announced annual profit of $4.22 million, equal to 35 cents per share, for the fiscal year ended Feb 1. This was down 41.1% from net income of $7.18 million, or 65 cents per share, during the previous fiscal year.
Annual revenue was $119.89 million, up nearly 12% from $107.43 million the year before.
For the fourth quarter, net income was $1.27 million, or 10 cents per share, a 9.9% increase from earnings of $1.16 million, or 9 cents per share, from the same period the year before.
Fourth-quarter sales amounted to $35.24 million, a 23% increase from sales of $28.46 million for the fourth quarter of the previous year.
Much of the profit in the last fiscal year was due to an expansion of 19 stores in California, Texas, and Florida, said James L. Thayer, a stock analyst with Bear Stearns & Co.
