Under Pressure at Under Armour, CEO Says His Eye Is on the Ball

[mountaineer]

Under Pressure at Under Armour, CEO Says His Eye Is on the Ball
Kevin Plank’s multitasking this year has been ‘a big source of discussion,’ an analyst said. ‘Investors are concerned”

By Sara Germano
Updated Dec. 26, 2017 12:06 a.m. ET


BALTIMORE—Temperatures were near freezing earlier this month when Under Armour Inc.’s management convened a town-hall meeting in a parking garage at the company’s headquarters here. With minimal heat and some executives donning winter hats to keep warm, Chief Executive Kevin Plank got straight to the point. “2017 sucked,” he said.

This year, the athletic-gear company posted two consecutive quarters of net losses, including its first-ever quarterly sales decline, laid off nearly 300 employees and lost several top executives. Entering the final week of the year, the stock had dropped about 45%, erasing more than $5 billion in market value. Meanwhile, rival Nike Inc. gained almost 25% and the S&P 500 nearly 20%.

But if it was a tough year to be CEO of a sportswear company, Mr. Plank had another business project that was on a roll: his private investment firm. Plank Industries in 2017 opened a boutique hotel and a whiskey distillery and secured an additional $233 million in funding for a multibillion-dollar real-estate project in Baltimore.

The contrast in fortunes of the two companies controlled by Mr. Plank prompts the question of how well an executive can juggle corporate and personal projects, analysts say.

The founder-CEO’s multitasking this year has been “a big source of discussion. Investors are concerned,” said Jim Duffy, an analyst at investment firm Stifel. “They want to know he isn’t distracted, that it isn’t taking away from appropriately running Under Armour.”   ...

Wall St. Journal