Pumpkin Patch's North American Downsizing a Prudent, Overdue Move

News out today that Pumpkin Patch [PPL.NZ] are going to ditch 20 of their 35 United States stores is good news for the company and investors.

It means investors will have less pain in the short term and that there is also still a base in North America from which it can expand again when economic conditions are far more rosy. The uncertainty of retailing conditions in the US and just how long things are going to be dire cannot be ignored.

As a shareholder am pleased about management's move but given that the retail sector in the US has been behaving like a WW2 Zero pilot on a suicide mission for an extended period, one could be a little critical that this move wasn't made 6 months ago. Having said that the exit seems to have been well planned.

Of course the US and New Zealand is littered with collapsing retailers, so Pumpkin has done well to survive, let alone make a profit.

Trading in New Zealand and Australia has been surprisingly resilient and my hunch and anecdotal evidence is that very high birth rates in both countries stimulated by welfare targeted at families having kids (a story for another day on another blog) means that demand in this region has been artificially raised - Thank's Aunty Helen!

There will be costs to exit the 20 stores and this will clearly make the bottom line look awful next reporting period in October but in amongst that bad news is one key piece of good news, 11 of the remaining 15 stores in the US have had their leases re-negotiated in a southerly direction. This is one of any retailers biggest sustained costs.

On a personal note, much of my reason to buy this company was its expansion plans in America and I am pleased the company is still going to pursue that market some time in the future. Without that avenue for growth I would have exited the company when the share price recovered.

The share price moved strongly upward on this news mainly because losses in the US will be far lower than previously pegged by analysts.

Look for an opportunity to buy on lower share prices when the forthcoming book entry loss is announced in October.


Pumpkin Patch @ Share Investor

Digging at Pumpkin's Profit
Long vs Short: Pumpkin Patch Ltd
Pumpkin Patch Buyback shows Confidence in the Future
Pumpkin Patch takes a hit
Pumpkin Patch ripe for the picking
What is Jan Cameron up to?
I'm buying
Why did you buy that Stock? [Pumpkin Patch]
Rod Duke's Pumpkin Patch gets bigger
Buyer of large piece of Pumpkin Patch a mystery
Pumpkin Patch a screaming buy
Broker downgrades of PPL lack long term vision
Pumpkin's expansion comes at a cost
Pumpkin Patch vs Burger Fuel
Pumpkin Patch profits flatten
New Zealand Retailers ring up costs not tills

Discuss this stock @ Share Investor Forum


Related Links

PPL Financial Data


Related Amazon Reading



International Retailing by Brenda Sternquist
Buy new: $64.40 / Used from: $52.00
Usually ships in 24 hours

c Share Investor 2009

Smacking/Anti Smacking Referendum

I must just put a plug in for voting in the Anti Smacking/Smacking Referendum that kicks off July 31.

Everyone should vote if they have an opinion on this subject, regardless of what that opinion might be, it is your democratic right to have a say even if the arrogant John Key says he will ignore the outcome of the referendum.

The referendum question is very clear, ” Should a smack as part of good parental correction be a criminal offence in New Zealand?” if you think a smack is OK you vote No, if you think a smack is not OK you vote yes.

Most people agree that the question is simple even though there has been much malarkey raised to try and confuse the issue.

This blog and myself support a no vote because I don't like the way good parents are being undermined and bad parents are getting away with beating and killing their kids.

Vote wisely.

Additional Info : From the Referendum site

How to vote

A Citizens Initiated Referendum on the question” Should a smack as part of good parental correction be a criminal offence in New Zealand?” runs from Friday 31 July until Friday 21 August.  Read more »

When to vote

Voting in the referendum runs from Friday 31 July until Friday 21 August.  Read more »

Going to be overseas?

If you have provided an overseas postal address with your enrolment details your voting paper will be sent to you directly. If you are overseas or your voting paper is sent to your New Zealand address you will need to arrange for your voting papers to be forwarded on to you.  Read more »

Help for voters with a disability

Read more »

The result

The preliminary result of the referendum will be announced after 7.00pm on Friday 21 August.  Read more »

What is a citizens initiated referendum?

A Citizens Initiated Referendum gives everyone who is enrolled the opportunity to vote on a specific question.  Read more »

Frequently asked questions

Questions and answers about the referendum on the question "Should a smack as part of good parental correction be a criminal offence in New Zealand?"  Read more »

2009 Referendum

A Citizens Initiated Referendum on the question” Should a smack as part of good parental correction be a criminal offence in New Zealand?” runs from Friday 31 July until Friday 21 August.  Read more »

c Political Animal 2009

Aaron Bhatnagar Nuts off, Again

Further to the personal attack from local politician directed towards me over my mild criticism of his distasteful attack on a dead person, Michael Jackson in this particular case, Aaron Bhatnagar has another go on his blog, this time during office hours, on ratepayer time .

He makes a reference to a website put up by someone with distasteful, slanderous stuff written about me, putting my family in danger because he asks people to look at it, because it contains information that shouldn't be on the net and simply isn't true.

Is this the sort of individual that should be representing you, causing trouble for a fellow Aucklander?

In my opinion we need higher standards for our Pollies and Aaron just doesn't fit that bill.

I will let you be the judge of that dear reader.

This will be the end of the matter, as I dont want to give Aaron the attention he so clearly lacks.

c Political Animal 2009

Aaron Bhatnagar Nuts Off

It is hard to get good, upstanding representation from our politicians these days.

National, and especially local, and from all political colours, we seem to be dragging the bottom of the barrel when it comes to governance.

If it isn't Andrew Williams, Mayor of the North Shore, spending ratepayer money like a drunken sailor, with his own ratepayer funded wine, we have Mayor Banks across the bridge trying to outdo him by digging up perfectly good footpaths in the CBD again and spending 80 million bucks "turning sidewalks into roads", while he has well and truly broken his 2007 election promises by promising to use truckloads of ratepayer moola on the 2011 Rugby World Cup.

One of John Banks disciples, Auckland City Councillor Aaron Bhatnagar, appears to be fitting the mold (or should that be mould) when it comes to the stereotypical machinations of local politics.

Aaron is one of those councillors behind the push to build a multimillion dollar shed shaped like a shoebox on the Wynyard Wharf for the wealthy cruise ship set, instead of a world class public space or building, on one of the best harbour sites in the world- don't we just love the Sydney Opera House and its public surrounds.

Anyway Aaron has adventurous activities online, he nutted off yesterday:

This email exchange yesterday between yours truly and Aaron after he made tasteless jokes about Michael Jackson's death on his facebook page.

Only his replies are quoted because he has removed me from his Facebook friends after I told him to bugger off and my comments have been removed.

I basically started off saying he was being tasteless joking about the death of someone and joking about anyone's death is a pretty low thing to do. I wasn't abusive at all.

Here were his replies:

1."Grow up Darren, it was a very mild tongue in cheek comment based on one of his more famous songs. I've seen some pretty repulsive jokes about MJ, usually involving allegations of sex abuse by Jackson, so what on earth is your problem?"

When I suggested that his comments about someone dying were inappropriate for anyone in politics:

2."Any besides, what's my political career got to do with this? If politics somehow distorts my moral compass, what do we make of you, whose blog is called "The Political Animal - Politics with balls".

Are we to take it that your political interests generate an unhealthy fetish with genitalia?"

When I suggested what his mother might think about him joking about someone dying.

3."I get it now. You are Church of Michael Jackson. No criticising MJ by anyone.

I suggest you put a damp cloth on your forehead, have a nice cup of tea, and a take yourself off for a nice nap. You need it.

What a humourless scold."

4."What a tantrum!

I'm frankly astonished at your comments. Of all the things I could have said, it's almost unreal that my rather mild turn of phrase has set you off. If that's a standard you hold dear, then I don't want any of it."

When I told him to bugger off (this is when I DID get a little testicularly challenged) spend some more ratepayer and his daddy's money and make his jokes about dying somewhere else:

5. "LOL - now I know you are a nasty piece of work!"

Now I am used to getting abused by all sorts of people because I have strong opinions and put them out there and fair enough, I LOVE good debate, but a local politician having a laugh at a person dying (even a misunderstood individual like Jackson, there is perhaps a time for jokes but long after the person has been buried) so soon after they have died, surely shows the mentality and arrogance of an individual that really isn't suitable to represent people - what the hell is he saying behind his constituents backs!

Does he joke and carry on in a similar vein? Who knows.

For goodness sake, if you have a political career and have dopey things to say, keep them to yourself Aaron, it aint a good look.

It isn't that bright and it reveals a somewhat foul taste in the mouth.

We clearly need much better representation than this.

c Political Animal 2009