Don Schroeder, the president and CEO of Tim Hortons, has suddenly left the company, forcing Canada's biggest coffee chain to ramp up its search for a permanent replacement.
The board of Tim Hortons made the announcement Wednesday. Executive chair Paul House, who once held the top job in the company, will take on the role again on a temporary basis, the board said.
The board said it had already been engaged in comprehensive succession planning for the CEO position as part of its strategic planning.
"Don Schroeder has made significant contributions to Tim Hortons during his 20 years of service, and although a transitional arrangement could not be reached, we appreciate his leadership as president and CEO since his appointment in 2008," interim CEO Paul House said in a release.
The company would not elaborate to CBC News on the sudden departure of the CEO. But one analyst thinks the company's reference to its being unable to reach a "transitional arrangement" is likely the reason.
"It seems like the board went to him and said, 'Look, we want to find a different guy to lead this firm longer-term and take it to the next level, will you stick around in the transition period?' — and he just said 'I'm out,'" said Brian Yarbrough, a retail analyst at Edward Jones in St. Louis, Mo.
Two weeks ago, Tim Hortons reported quarterly results that missed analysts' expectations, disappointing investors. The stock price promptly tumbled by more than four per cent.
At the time, Schroeder noted that Canadian same-store sales were affected by higher redemptions for food and beverage prizes in the company's popular Roll Up the Rim to Win promotional contest.
While profits have held up in the face of a tough recession, the chain's expansion efforts into the U.S. market have been less successful. Late last year, Tims announced it would shut down 54 locations in New England, where it was losing money.
Shares of Tim Hortons were off 90 cents to close Wednesday's trading session at $45.05 — suggesting that investors weren't viewing Schroeder's sudden departure as disastrous.