investment statement for - Pumpkin Patch investor relations

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Basis of PreparationPro forma historical financial information used for the 12 month periods ended 31 July 2001 and 2002 is extracted from thehistorical financial statements and management accounts of Pumpkin Patch and adjusted for the change in balance datefrom 31 December to 31 July effective 31 July 2003 and the change in the accounting policy in 2001 relating to the treatmentof landlord contributions; so that the historical results are comparable with the Pumpkin Patch forecast performance.Accordingly the pro forma figures presented above differ from the summary historical information set out on page 67 of theProspectus. The amounts included for 31 July 2003 have been taken from special purpose audited financial statements for the12 months then ended and differ from the summary historical financial information set out on page 67 of the Prospectus asthat information includes the historical financial information for the 7 months ended 31 July 2003.The principal assumptions applied in arriving at the forecasts are set out on page 22.Notes to Accompany Financial Information1. United Kingdom RetailThe Financial Performance summary includes the following results for the United Kingdom.Financial Performance for 12 months ended 31 July 2001 2002 2003 2004 2005$000 $000 $000 $000 $000(Pro Forma) (Pro Forma)(Unaudited) (Unaudited) (Audited) (Forecast) (Forecast)Operating Revenue 5,384 12,413 14,480 17,323 17,841EBITDA (Loss) (999) (852) (1,870) (1,673) (1,547)Depreciation 188 436 716 799 811EBIT (Loss) (1,187) (1,288) (2,586) (2,472) (2,358)2. In 2002 the group acquired 100% of the shares in Pumpkin Patch Limited (UK). The 2002 results includeamortisation/impairment of goodwill of $1,538k on the purchase of Pumpkin Patch Limited (UK). The charge was deemednecessary by the Directors after they reviewed the carrying value of the subsidiary and recognising that the purchase wasmade primarily as part of overall restructuring of group ownership structures.3. Operating cash flow in 2001 was impacted primarily by an increase in the value of inventory resulting from increased storenumbers and the timing of deliveries from suppliers.4. Capital Expenditure is disclosed after deducting landlord contributions. Capital expenditure in 2001 reflects the 17 storesopened during the year; 2002 reflects lower store openings but higher than average landlord contributions; 2003 includesthe purchase of land adjoining the East Tamaki Road distribution centre.5. The Directors have decided to restructure all existing employee share schemes prior to listing on the NZX at an estimatedcost of $7,450k.This will be recognised in the period ended 31 July 2004. Full details of the schemes can be found on pages51 to 52. A portion of the $7,450k is not deductible for tax purposes in 2004.6. January 2004 borrowings include bank overdraft of $3,955k, short term borrowings of $11,000k, current portion of termliabilites of $763k, term liabilities of $13,875k and loans and advances from shareholders of $2,500k. Forecast July 2004borrowings only comprise bank overdraft of $1,652k.Principal Assumptions underlying the Prospective Financial InformationThe principal assumptions upon which the forecast financial information is based are summarised below and should be readin conjunction with ‘What are my Risks?’ on pages 41 to 45.The prospective financial information for the years ending 31 July 2004 (“FY04”) and 31 July 2005 (“FY05”) on page 21 constitutesa forecast as defined by the New Zealand Financial Reporting Standard No. 29,‘Prospective Financial Information’ and has beenprepared on the basis of assumptions as to future events that the Directors reasonably expect to occur associated with theactions the Directors reasonably expect to take as at the date the information was prepared. The forecast was prepared as at8 April 2004 for use in this Investment Statement. Actual audited results for the 6 month period to 31 January 2004 and actual22
unaudited results for February 2004 and March 2004 have been incorporated into the forecast for the year end 31 July 2004.The forecast information has been prepared for the purposes of this Investment Statement and may not be suitable for any otherpurpose. There is no present intention to update this prospective financial information or to publish prospective financialinformation in the future.In preparing the forecast financial information, the accounting policies set out in the Prospectus as part of the Group financialinformation have been applied without change. There is no expectation of any change to the accounting policies that wouldrequire a material change in the reporting of Pumpkin Patch’s activities in the future.General assumptions across all countries in which Pumpkin Patch operatesEconomic EnvironmentThere will be no material change in the general economic environment.Legislative and Regulatory EnvironmentThere will be no material change to the legislative and regulatory environment in which Pumpkin Patch operates.Competitive EnvironmentThere will be no material changes to the competitive markets in which Pumpkin Patch operates and no new entrants that willmaterially change the competitive environment.Industry ConditionsThere will be no material change to the competitive activity, industry structure, unanticipated fashion trends, general industryconditions, third party retailer relationships or the employee environment.Other AssumptionsIncome TaxThere will be no change to the tax regime in New Zealand, Australia or the UK, including no change to the company tax rateof 33%, 30% and 30% respectively.Management of Pumpkin PatchPumpkin Patch’s senior management and other key people will continue in their current roles.Disruptions to OperationsThere will be no material disruptions to Pumpkin Patch’s operations or brand arising from long term IT or power failures, naturaldisasters, fires and explosions, and major disruptions to freight distribution networks.Company-Specific AssumptionsForeign ExchangeActual rates to March 2004 have been included in the FY04 forecasts and the following exchange rates have been utilised inthe prospective financial information:FY04FY05April to July 04AUD 0.8750 0.8750USD 0.6150 0.6150GBP 0.3703 0.3700EUR 0.5000 0.500023
Page 1: Lead ManagerGoldman Sachs JBWere (N
Page 4 and 5: fashion created for kidsimportant d
Page 6 and 7: fashion created for kidsPumpkin Pat
Page 8 and 9: chairman’s letterDear InvestorOn
Page 11 and 12: summary of share offeroffer descrip
Page 13 and 14: application for sharesAdditional in
Page 15 and 16: shareholding structureOn the Alloca
Page 17 and 18: directorsGreg MuirExecutive Chairma
Page 19 and 20: senior managementMike ArandGeneral
Page 21 and 22: investment overviewstrong Australas
Page 23: financial informationThe financial
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Page 31 and 32: Pumpkin Patch’s innovative design
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Page 35 and 36: wholesale salesPumpkin Patch has id
Page 37 and 38: Pumpkin Patch... our peoplePumpkin
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Page 43 and 44: Tax implications on returnsThis sum
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Page 47 and 48: consequences ofinsolvency and/orwin
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Page 53 and 54: Clauses 1(4) and 13(a)(iii) of Sche
Page 56 and 57: summary of option offer... employee
Page 58 and 59: application instructions for option
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Page 62 and 63: how to applyYou should read this Of

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