Your take on DDRX was more fair, BB. As you know, this is the equivalent of walking into a religious temple and suggesting that the idol of worship is not necessarily the cause of rain.
For a more balanced read on DDRX, here is a close look at the truth:
Diedrich shake-up causes a stir; CEO resigns and is replaced by Stephen Coffey, chain's 5th chief in five years.
By TIFFANY MONTGOMERY, The Orange County Register
Diedrich Coffee of Irvine appointed its fifth chief executive in five years late Tuesday just as the company is beginning to expand after years of retrenching.
Diedrich needed a growth- oriented executive who could take the company to the next level, chairman Paul Heeschen said.
Stephen Coffey, who served as a senior executive at Mexican restaurant chain Chevys Inc. and a former chief executive of Edwards Theatres, takes the helm of Diedrich from Roger Laverty. Laverty resigned the same day Coffey was appointed. Laverty could not be reached Wednesday for comment.
While Laverty did a ``remarkable'' job stabilizing the organization, it was time to transition to a chief executive with a different skill set, Heeschen said.
``(Coffey) has a track record of successfully looking at a company, evaluating what's working and what's not as well as promoting actions that optimize shareholder value,'' Heeschen said.
Laverty spearheaded several initiatives at Diedrich, including closing underperforming stores, improving store operations by hiring more managers and remodeling coffeehouses.
As a result, Diedrich im proved sales at stores open more than a year, a key measure of a retail company's health, and opened new Diedrich locations in Orange County and new Coffee People stores in Portland, Ore.
Laverty also sold the international franchise rights to its Gloria Jean's brand for $15.7 million. That decision led to the company's net loss more than tripling to $1.5 million in the first quarter ended Sept. 21.
Coffey, who was not available for comment Wednesday, will have his work cut out for him. Diedrich, with 206 locations for its three brands, competes with Starbucks and its 7,500 domestic stores.
Without the boost from the Gloria Jean's sale, Diedrich would have recorded a net loss of $3.3 million for 2005, compared with a $1.6 million loss in 2004. Diedrich officials attributed the wider loss to decreases in its wholesale division and increases in store labor costs.
Restaurant consultant Randy Hiatt, president of Fessel International in Costa Mesa, said frequent changes at the top can be disruptive to a company.
``My guess is that they don't have the fortitude for any type of long-term strategy,'' he said. ``They've had a rocky road for several years, and I think they are looking for short-term results.''
Heeschen believes Diedrich can carve out its own niche.
``The success of our new stores demonstrates to consumer and landlords that Diedrich is different, viable and strong and is growing,'' he said.
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Sept. 2000: Timothy Ryan retires. J. Michael Jenkins replaces him.
March 2002: Jenkins steps down to fight gastric cancer.
August 2002: Philip Hirsch appointed after serving five months as interim CEO.
Dec. 2002: Hirsch resigns for personal reasons.
April 2003: Roger Laverty
December 2005: Laverty resigns; replaced by Stephen Coffey, former CEO of Edwards Theatres.