California Pizza Kitchen files for bankruptcy

The 35 year old player pizza chain filed for Chapter 11 on Thursday, explaining that the process will help it “reduce long-term debt and quickly emerge from bankruptcy as a much stronger business.” He warned that he will close unprofitable locationsbut did not say how many of its 200 global restaurants will be affected.

“The unprecedented impact of Covid-19 on our operations has certainly created additional challenges, but this agreement from our lenders demonstrates their commitment to the viability of CPK as a continuing business,” CEO Jim Hyatt said in a statement. communicated.

CPK secured nearly $47 million in new funding to ensure operations continue as normal. He has about $13 million in cash and hasn’t paid rent in recent months on the majority of his locations.

The temporary closure of indoor restaurants has also been harsh on the company, as on-site dining accounts for 80% of its sales, the company said in a filing. Revenues are currently down 40% from the same period a year ago, he said.

Restaurants, especially casual chains like CPK, have struggled in recent months. The closure of in-person dining in some states and the approximate economy of using third-party apps like Uber Eats or DoorDash — which drive up restaurant costs and encourage diners to eat at home — is a losing proposition for many.
These last months, Parent company of Chuck E. Cheese, the Italian chain Vapiano, the American unit of Le Pain Quotidien and FoodFirst Global Restaurants, which owns Bravo and Brio, have all filed for bankruptcy. Even large franchisees, such as NPC International, which operates thousands of Pizza Hut and Wendy’s restaurantsare currently navigating the Chapter 11 process.

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