The struggling children's clothing retailer (PPL) said it would put its UK operation into administration and this would see it incur restructuring costs of up to $32m. The 36-store UK operation hadn't made an acceptable return and the company felt this was likely to continue for some time. It will be up administrators to decide if the business can be restructured, sold or closed down. The pre-tax damage to shareholder funds is expected to be $11m - $13m. ...

Recommendation: My father was a sub-editor on newspapers for most of his working life and was a master of headlines that incorporated a bad pun. Hence I am proud of my headline in October (MIR 652) that neatly summed up my views of this company: “Why Pumpkin Patch is a real lemon”. Having put out a SELL recommendation in June at $1.05 (having been a supporter until then – at higher prices, it must be said) I stressed in October that shares should be sold if the price were to weaken any further from its 77c. Among the company’s many failings, it had just announced its CEO had resigned – an automatic sell signal in my books for any company, no matter what the reason for the move. The shares subsequently hit rock bottom at 57c but have since appreciated strongly. Even the latest announcement has not deterred investors, who obviously feel the company will benefit by avoiding further losses. There is no way this company ranks as a good investment according to my criteria but I am intrigued by the strength of its recent recovery and, purely as a flutter, suggest it be considered as a SPECULATIVE BUY (latest price 75c). Be prepared to get out again quickly if the price dips, however. SPECULATIVE BUY at $0.75.