Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Discounting makes Pumpkin Patch wary of Christmas trading

Pumpkin Patch wary of Christmas trading as retailers keep discounting

By Paul McBeth

Nov. 20 (BusinessDesk) - Pumpkin Patch, the children's clothing chain that closed underperforming stores in the US and UK this year, is wary of the upcoming Christmas trading period as the environment stays tough and retailers continue to discount their wares to attract bargain-hungry customers.

Chief executive Neil Cowie told shareholders the tough trading conditions from the 2012 financial year have carried over into the new period and he doesn't expect that will "materially improve" in the short-term.

"Promotional activity remains higher than normal as all retailers attempt to spark life into customers, but as a result, margins are impacted," Cowie said in annual meeting speech notes published on the NZX. "The general consensus out there is that Christmas will be challenging, so for that reason my primary focus is making sure we pull every trick out of the hat to maximise sales opportunities."

Pumpkin Patch has been shifting its distribution focus to online channels and away from physical outlets to keep a lid on costs, after it overhauled its structure this year, taking a $39 million charge to do so.

Cowie said the retailer has based its entire distribution operation out of Auckland and can beat delivery by local online businesses competing in its eight international markets. About 11 percent of Pumpkin Patch's Australasian sales were online in the 2012 year.

"This gives us a great platform on which to base the significant growth we are expecting from online in the future," He said.

Pumpkin Patch's international partners unit, which develops and supports relationships with third-party operators who sell the company's products, is looking at new ventures in the Middle East, Central America and Asia, though Cowie said he wasn't able to elaborate.

Chair Jane Freeman told shareholders the board will review its freeze on dividend payments at the end of the first half, but backs repaying bank debt before doing so.

Pumpkin Patch is looking at allocating shares to Cowie and his team under the existing long-term incentive scheme, and shareholders will receive a letter about the plan in the coming days, she said.

"The allocation creates a long-term retention tool and an incentive for the team to continue with the development of strategies that will drive improved shareholder value into the future," Freeman said.

The shares were unchanged at $1.25 in trading today, and have jumped 94 percent this year.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Genetics: New Heat Tolerant Cow Developed

Hamilton, New Zealand-based Dairy Solutionz Ltd has led an expert genetics team to develop a new dairy cow breed conditioned to thrive in lower elevation tropical climates and achieve high milk production under heat stress. More>>

Fractals: Thousands More Business Cards Needed To Build Giant Sponge

New Zealand is taking part in a global event this weekend to build a Menger Sponge using 15 million business cards but local organisers say they are thousands of business cards short. More>>

Scoop Business: NZ Net Migration Rises To Annual Record In September

New Zealand’s annual net migration rose to a record in September, beating government forecasts, as the inflow was spurred by student arrivals from India and Kiwis returning home from Australia. More>>

ALSO:

Scoop Business: Fletcher To Close Its Christchurch Insulation Plant, Cut 29 Jobs

Fletcher Building, New Zealand’s largest listed company, will close its Christchurch insulation factory, as it consolidates its Tasman Insulations operations in a “highly competitive market”. More>>

ALSO:

Scoop Business: Novartis Adds Nine New Treatments Under Pharmac Deal

Novartis New Zealand, the local unit of the global pharmaceuticals firm, has added nine new treatments in a far-ranging agreement with government drug buying agency, Pharmac. More>>

ALSO:

Crown Accounts: English Wary On Tax Take, Could Threaten Surplus

Finance Minister Bill English is warning the tax take may come in below forecast in the current financial year, as figures released today confirm it was short by nearly $1 billion in the year to June 30 and English warned of the potential impact of slumping receipts from agricultural exports. More>>

ALSO:

Auckland Outage: Power Mostly Restored Overnight

Vector wishes to advise that all but 324 customers have been restored overnight. These customers are spread throughout the network in small pockets. The main St Johns feeder was restored around midnight allowing most of the customers in all affected areas to have power this morning. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand

Mosh Social Media
 
More RSS  RSS
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news