Children's clothing retailer Pumpkin Patch says it's seeing some improvement in demand, mainly in its largest market, Australia.
At its annual meeting, the company told shareholders it was focused on expanding its market share across the Tasman, and it expects its strongest gains will take place next year.
It says trading in New Zealand is more subdued, and it's forecasting a slow but steady improvement.
Pumpkin Patch has scaled back its expansion plans in the US, closing stores to cope with the recession.
The retailer says the smaller network will help lift earnings, but demand remains unpredictable and there are no signs yet of a recovery.
In Britain, Pumpkin Patch says, conditions remain soft; but it's taking the opportunity to consider opening up an extra three stores.