After nearly six years, Fred Boehler is out as president and CEO of Americold Realty Trust, the world’s largest publicly traded owner, operator and developer of temperature-controlled warehouses.
The board of trustees of the Atlanta-based real estate investment trust (REIT) said late Wednesday that Boehler was terminated without cause, effective immediately. Boehler, who had been with Americold for seven years, also resigned as a trustee.
George Chappelle, a food industry veteran, was named interim CEO, also effective immediately, Americold (NYSE:COLD) said. Chappelle joined the REIT’s expanded board of trustees along with Rob Bass, chief supply chain and global properties officer of Best Buy Co. (NYSE:BBY), and Pamela Kohn, chief merchandising officer of Sally Beauty Holdings Inc. (NYSE:SBH).
Americold did not comment on the reasons behind Boehler’s departure other than to say they weren’t related to disagreements with the board or management over corporate strategy, financial or accounting matters. Americold took no questions from analysts on its conference call where it disclosed its third-quarter results.
The term “termination without cause” is broadly defined as an action taken for the convenience of the company and for any reason other than the theft or misappropriation of funds, a material breach of the firm’s written code of conduct, and the conviction of a felony or a crime involving moral turpitude, among other violations.
Traders and investors appeared to shrug off the news. In after-hours trading, Americold shares were up more than 2.2%, to $30.99 a share.
The REIT reported that adjusted funds from operations, a key metric of a REIT’s performance, came in at 27 cents per share, in line with internal projections and a penny per share below the consensus of nine analysts polled on Barchart. Net income of $5.3 million was down more than $7 million from year-earlier levels, the company said.
Third-quarter revenue rose 42.5%, to $708.8 million. Net operating income (NOI), which represents a property’s gross operating income minus its operating expenses, was $155.8 million, a 15% year-on-year increase.
Revenue from the REIT’s global warehouse segment rose nearly 40%, to $542 million. NOI increased 13.5%, to $145 million. Americold operates 248 warehouses on four continents. Margins for the segment declined more than 6 percentage points, to 26.7%.
On the conference call, Americold executives said operations were buffeted by rapidly rising costs of labor and power, which combined account for three-quarters of its total costs. It has also been hampered by supply chain disruptions and by food production that has not kept pace with higher demand due to the COVID-19 pandemic.
Warehouse worker wages have recently risen, on average, 8% to 12%, and in some markets as high as 20% as the REIT looks to retain employees in a very tight labor market, executives said. Americold is in the process of raising rates on its warehouse tenants, executives said. Those higher costs will be passed on to consumers in the form of higher prices for temperature-controlled and frozen foods, they said.
