Denny’s will be closing 150 restaurants: Here’s why

Denny’s plans to shutter 150 of its restaurants as the company aims to strengthen its cash flow.
Fifty lower performing restaurants will close by the end of 2024, while the remaining 100 will shut down next year, executives announced in an earnings call Tuesday.
Among the restaurants closing are older locations that are too old to remodel or are based in unprofitable locations, according to Denny’s Executive Vice President and Chief Global Development Officer Stephen Dunn.
“Some of these restaurants can be very old. So when you think of a 70-year-old plus brand, you have a lot of restaurants that have been out there for a very long time,” Dunn told investors at the meeting.
There are currently 1,358 Denny’s locations in the U.S., with a heavy presence in California, Texas, Florida and Arizona.
More than 167 Denny’s restaurants are located outside the U.S., with more than half in Canada.
Denny’s has not clarified which 150 restaurants are slated for closure.
Dunn said that the 150 closures will clean the company’s restaurant portfolio as it prepares for growth.
Company shares dropped nearly 18% Tuesday when its quarterly earnings missed analysts estimates. Its annual stock is down 50% for the financial year.
“It’s never easy to close restaurants. It’s a challenge, you work with external factors, landlords,” Dunn said. “And of course, you’re dealing with people’s lives, but we’ve realized that closing underperforming restaurants is strategically advantageous to a number of our franchisees as it strengthens the bottom line cash flow for the long term.”