(Reuters) - Women’s specialty retailer Francesca’s Holdings Corp (FRAN.O) said it fired its Chief Financial Officer Gene Morphis for improperly communicating company information through social media.
Francesca’s board launched an investigation into Morphis’s activity on social media with the help of outside counsel after discovering the matter on May 11, the company said, without providing additional details.
The company, which went public in July last year, named Cynthia Thomassee as interim chief financial officer and said it had started looking for a new chief financial officer.
Morphis had been chief financial officer since October 2010.
The company couldn’t be reached for comment on the conduct that led to Morphis’s exit. But his recent tweets include comments about the retailer’s audit committee, his meetings with investors and his board, and the company’s results ahead of their announcement.
In its statement, Francesca’s said it expects employees to comply with company policies.
“It is an unfortunate turn of events for the CFO ... a poor choice made by someone who works at the company,” Stephens Inc analyst Travis Williams told Reuters.
The growing use of social media and the accompanying fear that internal information may get leaked has led many corporate organizations to lay out specific guidelines for their employees on social media behavior.
Analyst Williams noted that the company’s business remained healthy.
“That was confirmed today with them raising their guidance.”
Francesca’s, which competes with chains such as Chico’s (CHS.N) White House Black Market chain, Ann Inc’s ANN.N LOFT, and Urban Outfitter’s (URBN.O) Anthropologie, also raised its first-quarter outlook to a profit of 17 to 18 cents per share, from the 14 to 15 cents it had expected in March.
Analysts on average were expecting earnings of 15 cents per share, according to Thomson Reuters I/B/E/S.
In its last reported quarter, the retailer posted a better-than-expected profit as shoppers flocked to its boutiques during the holiday season.
Francesca’s shares rose 5 percent at $25.28 on Monday on the Nasdaq. They touched a high of $25.89 earlier.
Reporting by Arpita Mukherjee and Ranjita Ganesan; Editing by Saumyadeb Chakrabarty, Viraj Nair