Macy's deal won't hit Pumpkin Patch

Pumpkin Patch does not expect to take an earnings hit from the planned conversion of the 62 stores of its US client Marshall Fields into Macy's stores.

Marshall Fields has been caught up in the US$11 billion ($15.75 billion) purchase of its parent company, May Department Stores by Federated Department Stores.

Federated, owner of the Macy's and Bloomingdale's chains, has now announced it plans to drop the Marshall Fields name, although it hasn't made a decision on 57 Lord & Taylor stores which it also bought.

Pumpkin Patch said at its full-year results earlier in September that the US amalgamation was creating uncertainty. But it would not quantify how much business Marshall Fields and Lord & Taylor represented.

Managing director Maurice Prendergast said yesterday that the change would not have much effect. "Marshall Fields is a small part of our overall wholesale sales so we expect little effect on our earnings in this area," he said.

Prendergast said the childrenswear retailer had yet to talk to Marshall Field but expected its main, up-market stores would be rebadged.

"We currently sell to other areas of their group such as Bloomingdales so as long as these stores still remain "brand enhancing" for us we still see this as business as usual," he said.

The company had already been actively slowing down its sales to Marshall Fields as it was also disappointed with the fit of the Pumpkin Patch brand in many of their stores. "As such we were concentrating on their higher end mid-West stores where Nordstrum, our main partner in the US, is underrepresented."

Prendergast said on the positive side the closing of other stores by Federated meant more space would become available over the next two or three years in retail malls as Pumpkin Patch continued to trial its stand-alone shops. It opened its first US store in July and plans to open three more next year.