Denny’s is continuing on its path to become a largely franchisee-run company, though the casual-dining chain is struggling with traffic.
Six company-owned units have been sold to franchisees so far this year, Denny’s announced in a call with analysts Tuesday. That makes a total of 14 restaurants sold since Denny’s announced last fall that it would move to an almost-fully franchised model.
The family-dining chain reported same-store sales growth of 1.3% for the quarter ended March 27. Total operating revenue was $151.4 million, down from $155.3 million in the previous year.
Same-store sales growth for the quarter came from a 2.5% increase in menu prices, which partially offset the chain’s traffic decline.
Denny’s continues to grow its off-premise business, CEO John Miller told analysts. Off-premise sales made up 12% of all sales in the first quarter, up from 7% of total sales when the program began in 2017.
About 79% of Denny’s units currently offer delivery, up from 71% of stores at the beginning of the quarter, Miller noted.
Last October, Denny’s announced its plan to move from a 90% franchised business model to one that is between 95% and 97% franchised. That would require selling between 90 and 125 company-owned units.
The Spartanburg, S.C.-based chain has 1,705 units.
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