Boulder Brands CEO Steve Hughes has stepped down

Boulder Brands CEO Steve Hughes has stepped down

Boulder Brands CEO Steve Hughes has resigned from the US food group, the company said today (10 June).

The owner of brands including Udi's and Smart Balance has appointed COO Jim Leighton as interim CEO with immediate effect.

The news was announced alongside company estimates that second-quarter sales would fall 5-7%. Boulder has faced challenges in recent quarters, making a loss of over US$127m in 2014 after impairment charges on its under-performing Smart Balance brand

In February, Boulder lowered its first forecast for sales for 2015 as a whole amid lower-than-expected growth from its gluten-free brands.

Last month, the company reported higher first-quarter sales and profits, although adjusted operating income were down and underlying earnings per share were flat year-on-year.

Dean Hollis, Boulder's chairman, said: "The board believes now is the time for new leadership at Boulder Brands. This change, along with the evolving dynamics of our industry, gives us confidence that we are well-positioned to leverage customer and consumer desires for authentic and scalable natural brands to deliver sustainable results and generate meaningful value creation."

Boulder expects second-quarter sales to decline approximately 5-7% to $122m-124m. It said the new forecast reflected a "reduction in sales trends".

The company said sales from its natural division - which comprises gluten-free brands Udi's and Glutino, plus Evol frozen foods - are estimated to range from being flat to rising 2%. Sales from Boulder's Balance arm, which includes the under-pressure Smart Balance brand, are expected to fall 16% to 18%.

Adjusted EBITDA for the second quarter of 2015 is expected to be in the range of $12m to $14m.

A decade ago, Hughes founded the business that became Boulder. He set up an investment vehicle in 2005 that became Smart Balance in 2007 when it acquired GFA Brands, the owner of the Smart Balance brand. By 2012, after buying Glutino and Udi's, Smart Balance had been renamed Boulder Brands.

He said: "Since co-founding Boulder Brands nearly ten years ago, I have had the pleasure of working with the most talented employees and management team in the industry. As Boulder Brands enters a new period of development, I believe now is the right time for a leadership transition. It has been exciting to watch a simple idea turn into a leading natural foods company with the scale and resources to expand our mission of making people's lives healthier all across the country."

Leighton has served as Boulder COO since October 2013 and has been a member of the board since 2007. He has also held roles with ConAgra Foods, Perdue Foods and Nabisco.

Boulder said its board had started a "a national search process" for a new CEO.