Papa John's to Generate Profit Following Closure of More Than 40 Locations
Pizza Giant Papa John's Targets 2025 Profit Following Mass Closures
Chris Phylactou, the top dog at Papa John's, has spilled the beans about the pizza empire's plan to bounce back to profitability in 2025, after axing over 40 eateries last year.
In an upcoming episode of City AM's Unplugged in the Boardroom, Phylactou opens up about the chaos triggered by these shutdowns and their personal impact.
According to City AM, the UK variant of Papa John's bled £19.9m in 2023, having drained £4.1m in 2022. The Milton Keynes-based division's turnover edged up from £95.1m to £95.9m during this period.
The last time Papa John's UK posted a pre-tax profit? Back in 2021, raking in £8.1m, with a turnover of £102.3m.
Closing Shops: A Painful Necessity
On the upcoming episode of Unplugged in the Boardroom, Phylactou admits that, in 2023, two of their major partners were on the brink of insolvency. They made the strategic move to acquire these partners and kept them going for nearly a year.
Fortunately, 60 of these stores were in a decent shape. They managed to offload these to existing franchisees internally. Thirteen were kept under corporate control, but regrettably, 43 had to bite the dust.
Closing stores is never a walk in the park, Phylactou concedes. It's a tough pill to swallow, especially considering the jobs at stake. However, when stores are performing poorly and hemorrhaging cash, deciding to pull the plug can be the smart move, he explains.
Papa John's UK: Money in the Bank
Phylactou also gave the lowdown on how Papa John's UK is no longer sanctioning financial losses and is now anticipating a profit in 2025. He credits these improvements to the gutsy calls made in the past, even though they meant job losses and personal discomfort.
Phylactou acknowledges that the decision to close certain locations was an arduous one, but necessary for the brand's longevity and growth. They held on to these eateries for as long as possible to protect employees, investing considerable energy into reviving these businesses. Unfortunately, some locations were simply in the wrong spot, with dismal sales, leaving no viable business case for continued operation.
You can catch the full scoop on the upcoming episode of Unplugged in the Boardroom from City AM - don't miss it!
- In the upcoming episode of City AM's Unplugged in the Boardroom, Chris Phylactou, the CEO of Papa John's, discusses the company's plan to return to profitability in 2025, following the closure of over 40 stores in 2023.
- Despite the painful necessity of closing stores, Papa John's UK is now expecting a profit in 2025, according to Phylactou's remarks in the same episode.
- Johns (Papa John's) aims to achieve profitability in the business sector by 2025, after taking a strategic approach to close underperforming stores and strengthen the overall financial standing of the company.
