Denny’s plans to close 150 stores in an effort to strengthen cash flow.
Management announced on Tuesday’s earnings call that 50 underperforming restaurants will close by the end of 2024, and the remaining 100 will close next year.
Stephen Dunn, Denny’s executive vice president and chief global development officer, said restaurants closing include older locations that are too old to renovate or are located in unprofitable locations. .
“Some of these restaurants are very old. So when you think about brands that are over 70 years old, you have a lot of restaurants that have been around for a very long time,” Dunn said at the meeting. told investors.
How many Denny’s stores are there?
Denny’s currently has 1,358 stores in the United States, with a significant presence in California, Texas, Florida, and Arizona.
More than 167 Denny’s restaurants are located outside the United States, with more than half in Canada.
Denny’s has not disclosed which 150 stores are scheduled to close.
Denny’s stock drops nearly 18%
Dunn said the 150 closures will clean up the company’s restaurant portfolio and set it up for growth.
The company’s stock price fell nearly 18% on Tuesday after its quarterly profit fell short of analysts’ expectations. The company’s stock price fell 50% during the fiscal year.
“It’s never easy to close a restaurant. It’s difficult because you’re working with external factors and the landlord,” Dunn said. “And, of course, we’re dealing with people’s lives, but closing underperforming restaurants is a strategic advantage for many franchisees because it strengthens revenue cash flow in the long term. We realized that.
