BREAKING NEWS: Operator of 1,200 Pizza Hut and 400 Wendy’s restaurants in the US files for bankruptcy

NPC International, the company behind 1,200 Pizza Hut locations and nearly 400 Wendy’s restaurants across the US has filed for bankruptcy.

 

The company filed for Chapter 11 on Wednesday after suffering a massive financial hit following widespread shutdowns aimed to slow the spread of coronavirus.

However, it has been revealed that the company was nearly €1 billion in debt before the shutdown while facing the costs of both labour and food rising. A spokesperson for the pizza chain said that they’d anticipated the filing, and are remaining supportive of their franchisee.

“As NPC works through this process, we support an outcome resulting in an organisation with a lower, more sustainable level of debt, ownership focus on operational excellence, and a greater level of restaurant investment,” the spokesperson said. They added that the filing would “strengthen the overall health and performance of the entire system for the long term.”

Pizza Hut, which is owned by Yum! Brands (YUM), pointed towards a recent filing showing that sales at its US restaurants open at least a year have begun rebounding off their March lows. Pizza Hut has 7,100 restaurants in the United States.
Jon Weber, CEO of NPC’s Pizza Hut division, said in a statement the company will use Chapter 11 to “evaluate and optimise our restaurant portfolio so that we are best positioned to meet the needs of consumers across the country.”
NPC operates only a small portion of Wendy’s roughly 6,500 US restaurants. A Wendy’s spokesperson said they were “generally performing very well” and the franchisee has kept current with their financial obligations.
“We expect that NPC will continue to be a productive member of the Wendy’s family, and we will continue to stay closely coordinated and support them moving forward,” the burger chain said.
NPC is the latest US company to file for bankruptcy during the Covid-19 pandemic. Chuck E Cheese’s parent company, GNC, 24 Hour Fitness, Neiman Marcus, J Crew all have filed in the past two months.

 

 

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Written by

Tony Winterburn

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