Pumpkin Patch spurns substandard suitors, focuses on lifting performance

Friday 5th June 2015

Pumpkin Patch, the ailing children's clothing retailer, has abandoned plans to refinance or find a buyer after a number of discussions with interested parties weren't compelling enough for the board to seriously consider.

Chairman Peter Schuyt said the company will continue to focus on lifting Pumpkin Patch's performance, which it believes will deliver more value to shareholders in the medium term than any alternative. The retailer reaffirmed guidance for normalised earnings before interest, tax, depreciation and amortisation to be about $14 million in the year ending July 31, in line with earnings a year earlier, with targeted debt and inventory reductions likely to achieved.

"The company, and its advisers, held discussions with a number of interested parties but these did not result in any proposals being received that, in the board's opinion, represent satisfactory outcomes for the company," Schuyt said. "Market conditions are expected to remain challenging and earnings may be volatile going forward."

Pumpkin Patch shares jumped by a third in mid-March when the board announced plans to look at finding a potential buyer or recapitalising the company, and were unchanged at 26 cents today. That values the retailer at $44 million.

BusinessDesk.co.nz

Comments from our readers

No comments yet