Papa John’s International Inc. (NASDAQ: PZZA) founder and CEO, John Schnatter is stepping down from the positions amidst his remarks about the National Football League protests. The pizza chain has now announced Steve Ritchie will be the new CEO, effective January 1, 2018. Schnatter will remain chairman of the company.
Papa John’s shares were down 3.7 percent on Friday.
The NFL grew controversial when athletes began to kneel down during the national anthem to raise awareness against police brutality against minorities. The protest drew even more heat when President Donald Trump said that players should be fired for their actions.
Papa John’s claimed that the kneeling during the national anthems led to a weaker third quarter sales. Schnatter was quickly criticized and bashed on for his comments regarding the protests.
“The NFL has hurt us by not resolving the current debacle to the players’ and owners’ satisfaction,” Schnatter said in November.
Consumers quickly blamed the pizza chain for its quality for its weak sales. Papa John’s gained even more negative attention after white supremacist groups praised the company for its stance. Shortly after, the company apologized for Schnatter's comments.
Ritchie, as the new CEO, began working at Papa John’s in 1996, by 2006 he became a franchise owner, before becoming COO in 2014.
"I am humbled to take on this role," said Ritchie. "By focusing on our team members, we will deliver the world class experiences our customers deserve. At Papa John's, any opportunity is achievable if you dedicate yourself to putting your best foot forward every day. I'm certain our future company leaders are delivering pizzas in one of our 5,000 stores around the world right now.”
The problem for investors is that even with new CEO, it won’t change the same store sales. Papa John’s has posted three straight quarters of declining store sales. The company’s NFL protest comments definitely did affect sales, but even prior that, sales were already slipping. The company ended up pointing fingers at the NFL for its struggling sales.