Introduction
It is with a heavy heart that we report that the 41-year-old pizza chain Bertucci’s has filed for bankruptcy for the second time. The chain, which has been a staple of the Italian-American dining experience for decades, has been struggling to stay afloat in the face of the pandemic. The chain has been forced to close many of its locations, and the remaining ones have seen a significant decrease in business. This has led to the chain filing for Chapter 11 bankruptcy protection in order to restructure its debt and hopefully emerge from the crisis in a better position. We will be following this story closely and will update you as more information becomes available.
41-Year-Old Pizza Chain Bertucci’s Files for Bankruptcy For the Second Time
Bertucci’s, a 41-year-old pizza chain, has filed for bankruptcy for the second time in its history. The company, which operates more than 80 restaurants in the Northeast, filed for Chapter 11 bankruptcy protection on Monday in Delaware.
The filing comes after the company had been struggling with declining sales and rising costs. In a statement, the company said it had been “experiencing significant financial challenges” and that it had been “unable to reach an agreement with its lenders to restructure its debt.”
The company said it had reached an agreement with its lenders to provide $20 million in debtor-in-possession financing, which will allow it to continue operating while it restructures its debt. The company said it plans to use the financing to “strengthen its balance sheet and position the company for long-term success.”
Bertucci’s, which was founded in 1978, is the latest in a string of restaurant chains to file for bankruptcy in recent years. Other chains that have filed for bankruptcy include Ruby Tuesday, Logan’s Roadhouse, and Sbarro.
The company said it plans to continue operating its restaurants while it restructures its debt. It said it is “committed to providing its customers with the same great food and service they have come to expect.”
Once considered among the best in brick oven pizza, Bertucci’s has filed for Chapter 11 bankruptcy for the second time in just four years. The pizzeria brand has pointed to both the pandemic and recent inflation as the primary drivers of the bankruptcy filing.
According to this latest bankruptcy court filing, Bertucci’s claims both the pandemic and inflation have contributed to decreasing sales and rising prices. The brick-oven pizza brand generated $97.9 million in sales last year, but still reported an operational loss tallying $14 million.
There’s also a fair amount of debt on the chain’s spreadsheets. Bertucci owes nearly $21 million in secured debt to PHL Holdings, LLC, as well as an additional $26.5 million in unsecured debt and $1.5 million in unpaid state sales tax.
First founded in Massachusetts in 1981, Bertucci’s enjoyed great success in the 1980s. In 1989, the pizza chain was even named one of USA Today’s Top 10 Pizza Restaurants in the country. More recent decades weren’t as kind to Bertucci’s, and the chain was sold for the first time in 1998.
In 2018 the Bertucci’s brand filed for federal bankruptcy debt protection for the first time. A few months later the brick-oven chain was sold to the corporate parent of Planet Hollywood: Earl Enterprises.
At the time of the acquisition Earl Enterprises, was excited to add Bertucci’s. “We are delighted to announce the ownership of Bertucci’s. Our love affair with Boston is very deep and we look forward to continuing business in a thriving market. Bertucci’s is an iconic brand that so many have come to love and enjoy, therefore it is really important to continue this tradition,” said Robert Earl, Founder of Earl Enterprises.
Once upon a time, Bertucci’s boasted close to 100 domestic restaurants, but dozens of locations closed during its first bankruptcy. Today, the pizza chain operates 47 restaurants across nine U.S. states in the Northeast. On a more positive note, sales did jump up by 21% last year, but Bertucci’s is still far behind where they were in 2018, when system sales came in at $138.4 million.
On a related note, fellow pizza chain Happy Joe’s also filed for bankruptcy earlier this year. Just like Bertucci’s, Happy Joe’s cited the pandemic and inflation-related increases in food and labor costs as major business hurdles.
John Anderer