In a statement to the NZX attributed to board chair Peter Schuyt and managing director Luke Bunt today, the board expressed “considerable regret” at placing Pumpkin Patch into voluntary administration.
The board believes the company’s executive team has made significant progress towards turning Pumpkin Patch’s fortunes around, but their efforts were not enough to save it.
“However, despite considerable efforts by the board and its management team, it has become evident that no solution is available to the company, at this time, to address the current over-leveraged and significantly capital constrained position.
“With no likely solution available, the board believes that the constraints currently experienced by the business are too great and the only appropriate action to best protect the interests of stakeholders is to appoint administrators.”
Andrew Grenfell and Conor McElhinney of McGrathNicol have been appointed as administrators for Pumpkin Patch and a number of its subsidiaries. The board named Neale Jackson and Brendon Gibson of KordaMentha as the receivers appointed by its bank, ANZ.
Pumpkin Patch has had a hard few years, but for a time, it seemed unstoppable. It was founded in 1990 by mum and former childrenswear buyer Sally Synnott, who spotted a gap in the market. She grew the business from a mail order catalogue to a chain of retail stores, adding a transactional website in 2001 to service Australian and Kiwi markets.
Entry into the US market followed in 2002, with Pumpkin Patch listing on the NZX in 2004. Franchise partner stores were opened across the Middle East in the same year. Retail stores in the US, franchises in Singapore, Malaysia, Indonesia, South Africa and Pakistan followed, along with the company’s first ecommerce website in 2006.
Pumpkin Patch shares peaked in 2007, when PPL stocks were worth $4.95. Before trading was halted on October 21, they had dropped by over 98 percent to $0.06, putting the company’s market capitalisation at around $10.13 million. In the full-year results it published last month, it reported a loss of $15.5 million in the year to July 31, while debt to its lender bank rose from $39 million to $46 million.