Sainsbury's this morning issued its second profit warning in four months today and said chairman Mr Peter Davis will leave a year ahead of time.
Britain's third-biggest supermarket chain, which is losing market share to bigger rivals Tesco and Asda, said Mr Davis would be succeeded on July 19th by Mr Philip Hampton, a former finance director at British bank Lloyds TSB and telecoms group BT Group.
The firm also said profits in the current financial year would be hit by attempts to improve on-shelf availability and to trade out of an over-stocked position in non-food goods.
"Underlying profit before tax for 2004/05 will be significantly below consensus market forecasts with the majority of the impact expected in the first half," it said in a statement, adding analysts consensus forecast for underlying profits had been £505 million sterling ($916 million).
Sainsbury's shares were marked down nearly 10 per cent at 260 pence in pre-market trade, dealers said.
Mr Davis's departure follows criticism from investors about plans to give him a bonus worth over £2 million. He had moved up to chairman in November to make way for former Marks & Spencer executive Justin King as chief executive.
As Mr King's predecessor, Mr Davis spent three years pouring £3 billion into modernising stores, systems and depots, but his recovery plan failed to lift sales.