Ardent Leisure Group's (ASX: AAD) announcement that its long-time CEO Greg Shaw would stand down from his role was not received well by the market with the stock finishing 19% lower on Wednesday. At one point, the shares lost 28% of their value.
However, it seems as though it wasn't so much Shaw's departure that turned the mood sour, but rather the appointment of his successor, Ms Deborah Thomas, the former editor of The Australian Women's Weekly magazine.
As reported by the Fairfax press, analysts have attributed the market's reaction to shock that Thomas, who has "a lack of operational leisure experience", would be appointed to the helm in the midst of an expansion phase overseas.
While many analysts may be hesitant to recommend the stock as a 'buy' following the announcement, Thomas said, "I can only say that I think it's a good opportunity to buy" – a notion which was backed by chairman Neil Balnaves who purchased $500,000 in shares on the day.
Ardent Leisure Group owns Dreamworld on the Gold Coast and the Goodlife Health Clubs as well as entertainment centres in the United States. After having reported a 16% fall in net profit for its most recent half-year period, Thomas recognised that the company needed to looks for ways to increase customers' expenditure.
Fairfax quoted Thomas as saying, "We are putting a lot of money into new products but we really need to improve marketing, and improve the per capita spend… At Dreamworld the numbers are up but the dollars are down."
Unfortunately, Ardent Leisure Group hasn't lived up to the market's expectations recently and the stock has fallen almost 33% since the beginning of the year. Although it is unclear what Thomas will bring for the company, Ardent's shares could be worth a second look and certainly deserve a place on your watchlist.
