Beleaguered Pumpkin Patch has issued an earnings downgrade and also told the market negotiations are under way for ''revised terms and conditions'' of its banking facilities.
Having risked breaching its banking covenants last November and then been unable to find a buyer or recapitalise this year, Pumpkin Patch is setting about restructuring itself.
In the wake of the surprise resignation of chief executive Di Humphries about three weeks ago, chairman Peter Schuyt yesterday announced existing director Luke Bunt had been appointed managing director.
Director Rod Duke resigned from the board this week because of increased commitments in his other role as Briscoe Group's managing director, which is making a hostile takeover bid for Kathmandu, while long-serving director Brent Impey would retire in November, he said.
He reaffirmed previous guidance for the current financial year of normalised earnings before interest, tax, depreciation and amortisation (ebitda) of about $14million.
''Transformation and financing costs will take this to a modest reported loss on an after-tax basis,'' Mr Schuyt said.
However, with international wholesale markets being increasingly challenging, and with adverse currency impacts forecast, Mr Schuyt expected a negative effect on earnings for full-year 2016.
''Normalised ebitda for full-year 2016 is likely to be significantly below that forecast for full-year 2015,'' Mr Schuyt said.
Pumpkin Patch was engaged in ''positive discussions'' with its bank over existing banking facilities and expected by the end of the month ''to have revised terms and conditions in place appropriate for the company at this time''.
While next year's earnings expectations were ''disappointing'', the company was confident and committed to ''embarking on the change process'', he said.
