CHARLOTTE, N.C. – Food industry veteran Daryl G. Brewster has been hired as the new chief executive and president of troubled doughnut chain Krispy Kreme Doughnuts Inc. (KKD), the company said Tuesday.
Brewster, who will also join Krispy Kreme's board, previously served as president of the North American snacks and cereals business of Kraft Inc.
Shares soared close to 14 percent on the news in early morning trading on the New York Stock Exchange.
Brewster said he started his new job at 7:30 a.m. Tuesday with a warm glazed doughnut and a cup of coffee.
"I'm very excited to come here," he said in a telephone interview from the company's headquarters in Winston-Salem. "This is a storied brand that will celebrate its 70th anniversary next year. And our dedicated customers love the doughnuts."
Stephen Cooper, the company's interim CEO since January 2005 and chairman of turnaround firm Kroll Zolfo Cooper LLC, has been named chief restructuring officer, Krispy Kreme said.
Once the darling of Wall Street, Krispy Kreme's troubles began in May 2004, when the company warned of a coming earnings drop that it blamed on the popularity of low-carbohydrate diets. The company's stock sank.
The stock plunge began a downward spiral that led to store closings, the ouster of longtime CEO Scott Livengood and the hiring of Cooper to try to revive the company. A report by a special committee of independent directors blamed Livengood and former Chief Operating Officer John Tate for most of the company's problems, saying they tried to "manage earnings" to meet Wall Street expectations.
Shares of Krispy Kreme rose to $7.26, up 87 cents on Tuesday.
In a statement, Chairman Jim Morgan said Brewster "brings with him not only a wealth of practical know-how, but also a solid understanding of the opportunities, as well as the challenges, currently facing Krispy Kreme.
"Krispy Kreme has made significant strides in its turnaround and today's announcement represents yet another step forward for the company," Morgan said. "Over the past 13 months, we have strengthened our management team, effected successful franchise and operational restructurings, and realigned the organization to focus on profitability and growth."
Brewster said his first priority would be to immerse himself in the business.
"The first thing I plan to do is to listen as much as I can to our customers and associates and franchisees and get a good lay of the land," he said. "I plan to make a lot of visits."