FRESHDIRECT ACHIEVES PROFIT, LOSES CEO 2004-02-02 (2)

MARK HAMSTRA

NEW YORK -- Online grocer FreshDirect here has achieved profitability a little more than a year after it began operating, according to Joe Fedele, the co-founder and chief executive officer, who also said he is stepping down as CEO.

Fedele said he turned over the responsibility for day-to-day operations to Jason Ackerman, co-founder and chief financial officer, and Dean Furbush, chief operating officer. Furbush began at FreshDirect in October after previously serving as executive vice president, transaction securities, Nasdaq.

"I got this company to the point where it's profitable, and now it's time for me to work on other things," Fedele told SN. "I think I'm leaving it in good hands."

He said he will retain some responsibility for the supply chain and business strategy at the company, which was launched in September 2002 and has gradually expanded to several neighborhoods in New York City. It generates more than $2 million per week in sales, the company said.

John Boris, a spokesman for the privately held company, said the departure of Fedele, an outspoken executive who was largely responsible for procurement, was a "mutual" decision with the company's board and was "very amicable."

Boris declined to comment directly on the company's financial performance, but he did say the company has "proven that this business model can be profitable." He also declined to comment on reports that FreshDirect would issue a public stock offering. "Obviously, as the company grows, there are numerous opportunities," he said.