Rite Aid CEO John Standley To Step Down, Shares Up

(RTTNews) - Shares of Rite Aid Corp. (RAD) are up 11% in the extended session Tuesday after the drugstore chain said its Chief Executive John Standley and few other top executives are leaving. The company also announce restructuring plan aimed at cutting costs.

The company said John Standley will step down as chief executive officer. The Board will promptly commence a search process for a new CEO, and Standley will remain CEO until the appointment of his successor.

Bryan Everett, chief operating officer of Rite Aid Stores has been promoted to chief operating officer of the Company, succeeding Kermit Crawford who is leaving the company. Matt Schroeder, chief accounting officer and treasurer, has been promoted to chief financial officer. Schroeder is succeeding Darren Karst who is leaving the company this spring after supporting a brief transition.

Brian Hoover, group vice president and controller, has been promoted to chief accounting officer. Jocelyn Konrad, executive vice president, pharmacy, has been promoted to executive vice president, pharmacy and retail operations. Derek Griffith, executive vice president, store operations is leaving the company.

The company also announced actions that will reduce managerial layers and consolidate roles across the organization, resulting in the elimination of about 400 full-time positions, or more than 20% of the corporate positions located at the company's headquarters and across the field organization.

Rite Aid expects to achieve annual cost savings of around $55 million, of which about $42 million will be realized within fiscal year 2020. Rite Aid expects to incur a one-time restructuring charge of around $38 million to achieve the targeted cost savings.

"Rite Aid's Board of Directors is committed to more closely aligning the structure and leadership of the Company with our present scale and today's announcement is an important step in positioning Rite Aid for future success," said Bruce Bodaken, chairman of Rite Aid's Board of Directors.