Luby’s Inc., which earlier this year expressed concerns about whether it could remain solvent, announced Monday it has closed 21 units this year and has laid off some of its corporate office staff.
The company, which operates Luby’s, Fuddruckers Restaurants and Cheeseburger in Paradise, reported an overall same-store sales decrease of 0.5% for the quarter ended Aug. 29, as well as an overall loss of $33 million in fiscal 2018.
“While we are not pleased with our financial results in the quarter or the fiscal year, we are taking actions to improve our financial results and restaurant operating performance,” Chris Pappas, Luby’s president and CEO, said in a statement.
Luby’s is working to pay down its debt by selling off underperforming restaurants, Pappas said. The chain sold 10 such units in 2018. It is also pursuing debt refinancing.
Declining traffic hit each of the company’s brands hard. Luby’s saw a 5.8% decrease in traffic and Fuddruckers reported an 8.3% traffic drop for the quarter. Same-store sales at the company’s two Cheeseburger in Paradise units fell 4.4%.
The company had $39.3 million in outstanding debt at the end of its fourth quarter, down from $44 million in debt the previous quarter. Brand management filed a “going concern warning” in the previous quarterly earnings report, saying the company could have trouble staying in business if it could not pay down its debt.
Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.