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

 

Scoop Business: NZ Dollar Falls To 3-Year Low As Investors Favour Greenback

The New Zealand dollar fell to its lowest in more than three years as investors sold euro and bought US dollars, weakening other currencies against the greenback. More>>

ALSO:

Scoop Business: NZ Govt Operating Deficit Smaller Than Expected

The New Zealand’s government’s operating deficit was smaller than expected in the first five months of the financial year as a clampdown on expenditure managed to offset a shortfall in the tax-take from last month’s forecast. More>>

ALSO:

0.8 Percent Annually:
NZ Inflation Falls Below RBNZ's Target

New Zealand's annual pace of inflation slowed to below the Reserve Bank's target band in the final three months of the year, giving governor Graeme Wheeler more room to keep the benchmark interest rate lower for longer.More>>

ALSO:

NASA, NOAA: Find 2014 Warmest Year In Modern Record

Since 1880, Earth’s average surface temperature has warmed by about 1.4 degrees Fahrenheit (0.8 degrees Celsius), a trend that is largely driven by the increase in carbon dioxide and other human emissions into the planet’s atmosphere. The majority of that warming has occurred in the past three decades. More>>

ALSO:

Scoop Business: New Zealand’s Reserve Bank Named Central Bank Of The Year

The Reserve Bank of New Zealand’s efforts to stifle house price inflation by using new policy tools has seen the institution named Central Bank of the year by Central Banking Publications, a publisher specialising in global central banking practice. More>>

ALSO:

Science Media Centre: Viral Science And Another 'Big Dry'?

"Potentially, if there is no significant rainfall for the next month or so, we could be heading into one of the worst nation-wide droughts we’ve seen for some time," warns NIWA principal climate scientist Dr Andrew Tait. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news