Papa John's, the troubled pizza chain in search of a turnaround, has fired its chief executive and brought in brand marketing expert Rob Lynch, now president of Arby's.

The Louisville-based company announced Tuesday morning that Lynch will replace Steve Ritchie as president and CEO effective immediately.

The leadership change comes nearly seven months after activist investor Starboard Value took a $250 million stake in Papa John's, and its managing partner Jeff Smith joined the board as chairman.

The announcement led company founder John Schnatter to offer his first comments in months, saying that getting rid of Ritchie is the right move and one he'd called for during the last 15 months.

"I am pleased that Jeff Smith and the board have finally come to that realization and made a change in leadership," according to his statement.

Smith declined to reveal in an interview why the board decided to replace Ritchie, except to say that "our job is to do what's in the best interest of the company."

Lynch's background, "capabilities" and proven success in a turnaround at Arby's uniquely positioned him to step in at a pivotal time for Papa John's, Smith said, adding that "we are very, very excited" to bring Lynch on board.

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Investors and a few industry analysts responded with a thumbs-up, propelling the stock price up more than $4 per share by the market's close, from nearly $44 a share to more than $48.

The shake-up comes as the country's third-largest pizza delivery company is still struggling to recover from the crisis that followed reports in July 2018 that Schnatter had used a racial slur during a media-training session.

Schnatter, the longtime face of Papa John's and its ad campaigns, was subsequently stripped of his chairmanship on the board of directors and also lost his multimillion-dollar endorsement contract.

Before he was booted, Schnatter had warned the board that Ritchie wasn't competent to lead the company, and he publicly criticized his one-time protege after he left.

On Tuesday, Schnatter took a shot at Ritchie, saying that under him, "the company was run very poorly. While I still have many reservations about the actions of the board of directors and their ability to fix this business, the decision to terminate Steve Ritchie is a step in the right direction," according to a statement.

The public spat between Schnatter and top leadership lasted late into 2018 and, according to many analysts, dragged down recovery efforts. Papa John's ended 2018 with a $72 million drop in net income and nearly 190 fewer stores.

Many minority-owned franchise operations took the biggest hit, as African American customers took their business elsewhere. Despite rebranding to scrub Schnatter's image and new TV commercials to highlight the company's diverse workforce, the pizza maker's performance has been underwhelming.

In the second quarter, the company reported its first profit of $8.4 million since the scandal, but sales in North America declined 5.7%. The chain revised its forecast for this year to include a loss of 10 cents a share to 40 cents a share, stepping back from its prior outlook of break-even results for a profit of 50 cents a share.

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Lynch has served as president of Arby's since 2017. The Atlanta-based fast food chain, known for its roast beef sandwiches, has more than 3,300 locations around the world. He joined the company in 2013 as chief marketing officer and is credited with leading the "We Have the Meats" campaign.

While he's known for his marketing prowess, Lynch said in an interview, he's spent a lot of time working on restaurant operations. Previously, he was brand manager at Taco Bell, a Yum Brands company. He also worked for Proctor & Gamble Co. and Heinz.

"The marketing stuff is the stuff that catches all the headlines," Lynch said, but underlying that is a lot of hard work on creating a quality product and serving customers.

Asked about his marching orders at Papa John's, Lynch said he's focused on understanding what the leadership teams have been working on. "Over the last couple of years, there's been a lot of work streams put in place," so he will evaluate them and see if there's a way to increase efficiencies.

Ritchie, a Louisville native, started in 1996 as a $6-an-hour worker taking phone orders at a Papa John's store in St. Matthews, rising to manager, then multiunit supervisor, major franchisee, director of global operations and finally to president and chief operating officer before being named CEO on Jan. 1, 2018.

Thirteen months later, however, Ritchie may have sealed his fate by bringing on Starboard and Smith in a crucial role as chairman. At other companies, Smith has led proxy battles to take control of boards of directors. The heads of CEOs and other top executives have rolled, too.

Ritchie, who could not be reached for comment on Tuesday, was asked shortly after Smith and Starboard joined the team about a Fortune Magazine headline describing Smith as "the investor CEOs fear most."

"Don't believe everything you read," Ritchie told a reporter. He lavished praise on Smith, telling of his frequent visits to the company's headquarters to get to know top managers, sample products in test mode and offer strategies for the pivot away from last year's turmoil.

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Smith said in an interview that Papa John's is better off because of Ritchie's steady hand in stabilizing the company. "It's never an easy decision to make a change ... we're very thankful for the job that Steve did."

Under the company's executive severance, Ritchie's involuntary termination is expected to pay at least $2.8 million, a combination of salary, bonus and the value of restricted stock.

Schnatter left the company's board in late April and has been selling large blocks of stock, including more than 700,000 shares last week for a tidy $30 million.

In his statement Tuesday, the founder said he'd "told the Papa John’s board on many occasions for the past 15 months, a new CEO was needed to get the company moving in the right direction.

"I advised Chairman Jeff Smith directly as soon as Starboard invested in Papa John’s that he needed to replace Steve Ritchie. I am pleased that Jeff Smith and the board have finally come to that realization and made a change in leadership. Rob Lynch has proven to be an effective marketing leader in previous roles. As the company’s largest shareholder, I’m hopeful that he can be successful at Papa John’s."

As football season gets underway, a new marketing campaign featuring NBA Hall of Famer Shaquille O'Neal, now a company board member and new brand ambassador, will roll out shortly. The new campaign is a play to win back turned-off fans and spin a new story for Papa John's.

Lynch has met with O'Neal, he said, and knows he's passionate about playing a leading role. "We're going to leverage that to the fullest potential," he said.

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Analyst Chris O'Cull and his team at investment advisory firm Stifel Financial complimented Lynch and his hiring. At Arby's, he hired "a team excited about creating a culture that allowed risk-taking to reach customers," O'Cull wrote.

"Arby's needed to take calculated risks to change consumers' perception of the brand and to break-through the clutter of QSR (quick serve restaurants) advertising, given it spent a fraction of the marketing dollars as its competitors. We envision Mr. Lynch will take similar approach with Papa John's."

Grace Schneider: 502-582-4082; gschneider@courierjournal.com; Twitter: @gesinfk. Support strong local journalism by subscribing today: courier-journal.com/graces. Reach Billy Kobin at bkobin@courierjournal.com or 502-582-7030.