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Receivers: Pumpkin Patch owes $66m

NZ Newswire logoNZ Newswire 27/12/2016 Sophie Boot
Image of clothes from Pumpkin Patch © Getty Images Image of clothes from Pumpkin Patch

Pumpkin Patch owes nearly $60 million to its bank and at least $6.6m to other creditors, receivers KordaMentha say in their first report on the failed children's clothing retailer.

The company was tipped into receivership by its lenders and appointed voluntary administrators in October after failing to reinvent itself in the face of shrinking sales and too much debt. KordaMentha's Neale Jackson and Brendon Gibson were named receivers.

Pumpkin Patch owed its lender ANZ Bank New Zealand $59.5m as of the date of receivership, the report says, up from $46m at the year ended July 2016. It posted a loss of $15.5m in the same period.

The company has $17.6m in assets, with $13.5m of that from investments, and $3m in fixed assets relating to its head office and distribution centre in East Tamaki, Auckland.

The receivers said they would look to sell the fixed assets once they were no longer needed as part of the realisation strategy, which involved selling through the existing retail and online channels. Inventory is owned by another company within the group, Pumpkin Patch Originals, which is also in receivership.

Pumpkin Patch has a number of creditors who have registered financing statements under a purchase money security interest, which has priority over other security interests.

The receivers said they were in the process of assessing claims from those creditors including ANZ, Cafe Express, Childs Play and Fuji Xerox.

An estimated $2.7m is owed to employees under preferential claims, with 1600 staff employed across the group, while Inland Revenue has not yet submitted a preferential claim.

Unsecured creditors are owed about $3.9m, but it was too early to say if there will be funds available to pay them, the receivers said.

The shares were suspended on October 26, having traded at 6 cents, valuing the retailer at $10.1m.

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