American Apparel replaces chief financial officer with former Old Navy, Wet Seal executive
In a management shake-up, American Apparel Inc. has named John Luttrell, a former Old Navy and Wet Seal executive, as chief financial officer and executive vice president of the beleaguered clothing chain.
The move, effective Feb. 7, comes amid a period of transition for the Los Angeles apparel maker of colorful hipster clothing, which has struggled with debt issues and other problems in recent months. That has caused the company to report on several occasions that it has doubts about its “ability to continue operations as a going concern.”
An industry veteran, Luttrell replaces Adrian Kowalewski, who was named chief financial officer about two years ago. That announcement, in December 2008, raised eyebrows on Wall Street because Kowalewski was just 31 at the time and relatively inexperienced.
Kowalewski will remain with the company and has been appointed to the position of executive vice president of corporate strategy, American Apparel said in a regulatory filing Thursday.
Luttrell, 56, has more than 13 years of experience in the retail industry. From 2007 to 2008, he was executive vice president and chief financial officer of Old Navy. Prior to that, he held those positions at teen retail chain Wet Seal from 2005 to 2007.
Luttrell also worked at Cost Plus Inc., where he served as executive vice president and chief financial officer from 2004 to 2005, senior vice president and CFO from 2001 to 2004, and vice president and controller from 2000 to 2001.
American Apparel reported that Luttrell’s employment agreement includes a minimum base salary of $400,000 a year, subject to increase based on an annual review. He’s also entitled to bonuses and other performance-based “incentive compensation” that could more than double his base salary.
Luttrell’s appointment is the latest management change at American Apparel. In October, it named Tom Casey, a former Blockbuster Inc. executive, as its acting president to help redirect the company.
“We are excited to have John join the company and believe the wealth of his experience and background will significantly contribute to our ongoing commitments to improve internal financial controls and efficiencies,” said Peter Schey, a lawyer for American Apparel. "We are also excited to free up Adrian to concentrate far more of his time on developing both domestic and global critical strategies to expand the brand and the business going forward.”
Earlier this week, American Apparel said it had received a waiver to its credit agreement with Lion Capital and other lenders to help it avoid defaulting on its loan.
Shares of American Apparel were up 2.8% in after-hours trading Thursday.
-- Andrea Chang