The owner of Romano’s Macaroni Grill, as well as the chain’s parent company and a handful of affiliates, filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court in Wilmington, Delaware on Wednesday, according to Wall Street Journal. This year alone, the Denver-based Italian food chain has closed 40 unprofitable locations partly due to the changing tastes of diners.
Nishant Machado, the company’s acting CEO, blamed the chain’s problems on “an overall downturn for the casual dining industry,” including a preference of customers toward “cheaper, faster alternatives,” and “a trend amongst younger customers to spend their disposable income at non-chain ‘experience driven’ restaurants.”
In its filing, Macaroni Grill cited hurt profits resulting from a decrease in sales and an increase in labor and commodity costs. With $23 million in secured debt, the chain also reported in its filing negative earnings before interest, taxes, depreciation, and amortization of $12 million on revenues of $230 million.
Macaroni Grill’s bankruptcy comes around the same time sit-down chain Ruby Tuesday agreed to be sold and privatized for $335 million after menu and restaurant changes failed to boost sales.
Hoping to keep its remaining 93 restaurants open, Macaroni Grill plans to slash its debt and reorganize around its top restaurants.
For more news like this, keep checking back with Deli Market News.