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Pumpkin Patch Profit Jumps 76 Percent on Cost Cuts

Sept. 22 (Bloomberg) -- Pumpkin Patch Ltd., which sells children’s apparel in New Zealand, Australia and the U.S., said full-year profit rose 76 percent as the company cut costs to cope with falling sales.

Net income rose to NZ$25.5 million ($18.7 million) in the 12 months ended July 31, from NZ$14.5 million in the year-earlier period, the Auckland-based company said today in a statement. The 2009 profit figure excludes one-off costs incurred when Pumpkin Patch closed some U.S. stores. Revenue fell 11 percent in 2010 to NZ$382 million as consumer demand slumped across most of the company’s global markets.

This ‘is a very strong result considering the subdued retail environments we faced,” Pumpkin Patch Chief Executive Officer Maurice Prendergast said in the statement. “We expect to open at least 22 new stores in the coming year to take advantage of the significant growth potential our retail markets have to offer.”

Sales in Australia fell 3 percent from a year earlier and 6 percent in New Zealand, excluding temporary stores set up in 2009 to clear excess stock, the company said. The company’s revenue from the U.S. and the U.K. fell in New Zealand dollar terms as the currency rose 12 percent against the U.S. dollar during the 12 months to July 31.

Pumpkin Patch this year launched a stand-alone Charlie & Me brand and expects to open at least seven stores in Australia and New Zealand in 2011.

The stock was unchanged at NZ$1.95 at 10:45 a.m. in Wellington trading. The company increased its dividend 27 percent to 9.5 cents per share.

To contact the reporter on this story: Phoebe Sedgman in Wellington at psedgman1@bloomberg.net.

To contact the editor responsible for this story: Iain Wilson at iwilson2@bloomberg.net

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