Children's clothing retailer Pumpkin Patch announced it was planning to close its United States retail operation, reassess its retail stores in the United Kingdom and realign some of its New Zealand-based support functions.
Outdoor specialist Kathmandu Holdings announced at the same time it was expanding its Australian and New Zealand network with the opening of four new stores yesterday.
The new stores were in Westfield Southland, in Melbourne, Wagga, in New South Wales, Cairns and Whakatane.
Kathmandu chief executive Peter Halkett said the retailer had already opened eight stores in Australia in the current financial year, and one in New Zealand.
"The new stores will be opened in time for Kathmandu's winter sale which starts on Thursday."
With the new locations, Kathmandu would have a network of 104 stores across Australia and New Zealand, he said.
In New Zealand, seasonally adjusted total retail sales values rose 2% in the March quarter, the largest rise in four years, Statistics New Zealand (SNZ) figures released yesterday showed.
Increases were recorded in all regions, except in Canterbury, which was down 2.2%.
While the retail trade survey was not designed to produce regional estimates, the information available showed that sales in several retail industries in Christchurch were significantly lower than at the national level due to the February 22 earthquake, SNZ business statistics manager Louise Holmes-Oliver said.
In the March quarter, the two vehicle-related industries were by far the largest contributors to the 2% increase in sales values, with vehicles and parts retailing up 5.9%, and fuel retailing up 5.6%.
The value of core retail sales, which excludes vehicle-related industries, rose 0.9%, with seven of the 13 industries recording increases, SNZ said.
Yesterday's retail figures were the first produced since SNZ moved to quarterly reporting of the survey, rather than monthly.
Because of the impact of Monday's aftershock on SNZ's Christchurch operations, SNZ did not accompany the latest retail figures with a commentary.
In the US, Americans bought fewer cars in May, pulling retail sales down for the first time in nearly a year.
Sales among US retailers fell 0.2% last month, the Commerce Department said. It was the first fall after 10 straight increases.
The slump in retail sales was the latest report signalling the economy had lost momentum.
US consumers, like those in New Zealand, are struggling to deal with high petrol prices and a slowdown in hiring.
While the surge in petrol prices eased in May, pump prices are significantly higher than a year ago and have started to rise again in New Zealand.
Pumpkin Patch chief executive, Maurice Prendergast, said the company had made the decision to shut the remaining 20 retail stores in the US and in the medium-term, focus on wholesale and web-based growth opportunities for that market.
In 2009, the company renegotiated all of its US leases down to levels that reflected market rents at that time. Those leases expired over the next two to three months, he said.
Discussions were held with landlords to extend leases.
"However, while lease extensions were available, the proposed lease would make the US retail operation unsustainable, especially given the poor state of the retail environment in that market," Mr Prendergast said.
In the UK, while many of the 41 stores were trading at levels considered acceptable given the tough retail environment, the company was developing strategies to improve the overall trading result - focusing on 17 underperforming stores, which generated the majority of the ebit loss from that market.
Twelve of those stores had leases expiring with the next 15 months and the company would be negotiating with landlords appropriate rent reductions or other reorganisation options that would improve earning results, he said.
Given continued challenging retail conditions, coupled with other factors, 2011 net profit after tax, before reorganisation costs, was expected to be between $12 million and $14 million.
In the year to July 2010, the company reported net profit of $25.5 million, well above the $14.5 million the year before.
In yesterday's announcement, the company said trading conditions across all markets remained challenging and volatile with no indication of material improvement in the near term.
Price rises from suppliers had been "abnormally" high, particularly the cost of cotton, Mr Prendergast said.
While raw material prices had stabilised, ongoing increases in labour and other manufacturing costs meant it would continue to investigate new suppliers and countries from which to source products.
Also, the start to the winter season had been warmer than normal, and the high New Zealand dollar was having an impact on the value of international sales.
