Pumpkin Patch, the children's clothing chain, returned to profit in the first half as costs to close underperforming stores in the US and UK a year earlier weren't repeated. Sales fell on tough trading conditions and inventory disruptions.
Profit was $4.7 million in the six months ended January 31, from
a loss of about $30 million a year earlier, the Auckland-based company said in a statement. Sales fell 5 per cent to $153 million.
The retailer had to contend with "pretty subdued" trading in its largest markets of Australia and New Zealand and the weak performance was compounded by late delivery of the company's summer inventory at the start of the season, resulting in lost sales opportunities, the company said.
"Even though trading conditions across the rest of the period more closely tracked last year and we had a reasonable Christmas, we couldn't recoup the sales and earnings lost at the start of the season," chief executive Neil Cowie said.
Shares of Pumpkin Patch fell 1.5 per cent to $1.30. The stock is rated a 'hold' based on a Reuters poll of four analysts, with a median price target of $1.55.
