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

 


UPDATED: Pumpkin Patch shares sink to record-low

UPDATED: Pumpkin Patch shares sink to record-low as 1H earnings plunge 98%

(Updates share price, adds company comment throughout)

By Suze Metherell

March 19 (BusinessDesk) – Shares in Pumpkin Patch plunged to a record-low after the children’s clothing chain reported a slump in first-half earnings and anticipates a strong currency may lean on profit for the rest of the year.

The stock sank 19 percent to 55 cents, valuing the retailer at $115 million, after the company reported a 98 percent drop in first-half profit to $106,000 in the six months ended Jan. 31. Revenue declined 17 percent to $128 million as two failed suppliers and major flooding in China disrupted its supply chain, leaving inventory short ahead of the Christmas trading period.

“The results on the table are terrible for our shareholders. There is massive potential, it just needs to be unleashed,” chief executive Di Humphries told an analyst briefing. “The most disappointing thing about these results is that we had done so much work and there is still more to do, but we are repositioning this business.”

Chief financial officer Matthew Washington said the impact of New Zealand’s strong currency against its Australian counterpart may have a bigger impact on earnings as the financial year unfolds, and risks in the second half are skewed to the downside.

Sales in Australia, the company’s biggest market, tumbled 19 percent in the half. The kiwi dollar was recently at 94.37 Australian cents, and has gained 12 percent since July last year.

“There is more risk on the downside than the upside in the short term,” Washington said. “That’s purely because of what we’re just seeing, or not seeing, coming out of Australia in particular, and also with that exchange rate there are a few headwinds in the latter part of the second half. “

Pumpkin Patch has gone through a period of reorganisation, reviewing operational and central support costs. Profit before those reorganisation costs, which includes losses from discontinued operations, was $1.3 million in the half, down from $6.5 million in the previous comparable period.

New Zealand sales fell 14 percent to $24.1 million and international sales declined 4 percent to $20.9 million.

Sales through its international websites rose 34 percent, it said without giving details. Online sales in Australasia were affected by the supply chain disruptions.

Humphries said consumers are still interested in the company, and that Pumpkin Patch is seeking to boost profitability by latching on to areas of growth in the retail sector.

“We can see where the strengths in online are and then really shifting the business model as to where we need it to go to go forward,” Humphries said.

The company anticipates announcing new partnerships in the coming months, without providing any detail.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

BusinessDesk: APN's NZME Sees Future In Paywalls, Growth In Digital Sales

APN News & Media has touted a single newsroom concept for its NZME unit in New Zealand, similar to what Germany's Die Welt uses, saying an 'integrated sales proposition' is helping it win market share, including ... More>>

Labour Party: Global Milk Prices Now Lowest In 6 Years

The latest fall in the global dairy price has brought it to the lowest level in six years and shows there must be meaningful action in tomorrow’s Budget to diversify the economy, says Labour’s Finance spokesperson Grant Robertson. “Dairy prices ... More>>

BusinessDesk: NZ Inflation Expectations Creep Higher In June Survey

May 19 (BusinessDesk) - New Zealand businesses lifted their expectations for inflation over the next two years, sapping any immediate pressure on the Reserve Bank to cut interest rates, and prompting the kiwi dollar to jump higher. More>>

BusinessDesk: Lower Fuel Costs Drive Down NZ Producer Input, Output Prices

May 19 - Producer input and output prices fell in the first quarter, mainly reflecting lower fuel costs and weakness in prices of meat and dairy products. More>>

Media: Fairfax Media NZ Announces Senior Editorial Team

Fairfax Media New Zealand has today confirmed its new editorial leadership team, as part of a transformation of its newsrooms aimed at enhancing local and national journalism across digital and print. More>>

Science: Flavonoids Reduce Cold And Cough Risk

Flavonoids reduce cold and cough risk Research from the University of Auckland shows eating flavonoids – found in green tea, apples, blueberries, cocoa, red wine and onions – can significantly reduce the risk of catching colds and coughs. The research, ... More>>


BusinessDesk: RBNZ House Alert Speech The Catalyst For Government Action

Prime Minister John Key all but conceded that pressure from the Reserve Bank of New Zealand for concerted action on rampant Auckland house prices was one of the main catalysts for the government's weekend announcements about tightly ... More>>

BusinessDesk: How To Fall Foul Of The New Housing Tax Rules: Tips From IRD

Just because you rented out your investment property doesn't absolve you from paying tax, says the Inland Revenue Department in a summary of commonly made mistakes by non-professional property investors when it comes to their tax liability.More>>

Legal: Superdiversity Law, Policy And Business Stocktake Announced

Mai Chen, Managing Partner at Chen Palmer New Zealand Public and Employment Law Specialists and Adjunct Professor of Law at the University of Auckland, today announced the establishment ... More>>

Housing: More House Price Gains Expected

House price expectations remain high, with a net 56% of respondents expecting house prices will increase. Fears of higher interest rates are fading, consistent with the RBNZ’s signals this year. Affordability and a lack of houses for ... More>>

TDDA: State-Of-The-Art Drug Testing Laboratory To Open In Auckland

World leading drug testing agencies, The Drug Detection Agency (TDDA) and Omega Laboratories, open New Zealand laboratory More>>

Network: Bigpipe Launches Ultra-Fast Broadband Into Wellington

Bigpipe Launches Ultra-Fast Broadband into Wellington Naked broadband provider Bigpipe has extended its national reach, announcing today, the launch of its unlimited UFB offering into Wellington. The Spark Venture business is giving Wellingtonians the ... More>>

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news