(Reuters) -Dollar Tree Inc said on Tuesday Executive Chairman Richard Dreiling will replace Chief Executive Officer Mike Witynski, nearly a year after agreeing to revamp its board in a settlement with activist investor Mantle Ridge.
Dreiling, 69, who has previously served as chairman and CEO of rival Dollar General, was appointed to Dollar Tree’s board as part of the settlement in March 2022. He will take on the role of top boss at the company effective Jan. 29.
In late 2021, Mantle Ridge pushed for a review of Dollar Tree’s business strategy and Dreiling as the top boss at the discount retailer along with an overhaul of its board.
Telsey Advisory Group analyst Joseph Feldman said investors would like to see Dreiling have a more “day-to-day hands on role at Dollar Tree” in hopes of improving the performance of the business, given his history of success at Dollar General.
Last year, Dollar Tree lowered its annual profit forecast for the second time as price cuts to attract inflation-wary shoppers pressured its margins.
But the price cuts at Family Dollar, rolled out in the second quarter, helped the banner post the strongest quarterly same-store sales jump since 2020 and grow traffic for the first time in three years.
With Dreiling at the helm, Feldman expects continued improvement in the Family Dollar business.
In June 2022, months after the settlement, Dollar Tree announced the exit of finance chief Kevin Wampler and some other top executives.
Jeffrey Davis was named successor to Wampler, who is with the company as an adviser till April 2023.
Witynski was appointed as the CEO in July 2020 to succeed Gary Philbin, who retired after serving in the role for nearly three years.
Shares of Dollar Tree rose about 1% in early trade.
(Reporting by Ananya Mariam Rajesh in Bengaluru; Editing by Shinjini Ganguli)