A Massive Pizza Chain Is Now Considering A Painful Bankruptcy

A massive pizza chain is now considering to file a painful bankruptcy in order to improve its capital structure.

MOD Pizza, which has been known to be a rapid-growing restaurant chain in the U.S., has reported to be planning to file for bankruptcy, according to a Wednesday report from Bloomberg.

The publication has stated, thanks to unnamed sources, that this is just a plan and has not yet been set in motion.

A MOD Pizza spokesperson stated that it is “exploring all options” to improve its capital structure.

We have a brand guests love, a passionate team and a solid turnaround plan underway that is making progress,” the spokesperson said.

We’re working diligently to improve our capital structure and are exploring all options to do so.

Since this is an ongoing process, it would be inappropriate to speculate on the outcome.

The chain had been growing at a brisk annual pace to become one of the largest in a burgeoning sector that specialized in “made-on-demand,” individual-sized pizzas, that are typically for lunch.

The chain was considering an initial public offering in 2021 and by last year had grown to nearly $700 million in system sales from more than 550 locations.

It generated $300 million more in sales than its competitors.

MOD was also very adept at raising money, including a $160 million fundraise it closed in 2019.

At that particular time, the chain operated 433 locations and vowed to have 1,000 locations within five years.

Aside from the pandemic and inflation, there were deeper problems that MOD Pizza was facing.

Former Coopers Hawk executive Beth Scott was named CEO in January, replacing cofounder Scott Svenson.

MOD Pizza ended up closing 26 underperforming locations.

A count on the company’s website, however, suggests additional locations have closed since then.

MOD Pizza has said it operated 527 locations in April, following the closures.

As of now, the company’s website lists 513 restaurants, according to Restaurant Business.

For more bankruptcy news and updates like this, opt-in for push notifications.

Also Read: Another Mall Clothing Retailer Now At High Risk of Bankruptcy

Other Economy News Today

Market News Today - A Massive Pizza Chain Is Now Considering A Painful Bankruptcy.
Market News Today – A Massive Pizza Chain Is Now Considering A Painful Bankruptcy.

An essential company now files a surprising bankruptcy after miscalculating demand for its inventory after the Covid-19 pandemic.

Supply Source Enterprises, a leading provider of branded and private label cleaning products and personal protective equipment, on May 21 filed for Chapter 11 protection to seek a sale of its assets.

Supply Source brands include The Safety Zone and Impact Products.

The Guilford, Connecticut debtor listed $50 million to $100 million in assets in its petition and $180 million in funded debt, which includes $80 million owed on a term loan credit facility, $60 million owed on an asset-based loan, and about $40 million in unsecured debt.

Before the Covid-19 pandemic, which generated huge demand for cleaning supplies and personal protective equipment in 2020, Supply Source had been consistently profitable with stable single-digit growth, according to a declaration from the debtor’s Chief Restructuring Officer Thomas Studebaker.

Once the pandemic hit in 2020, the debtor had substantial growth due to high demand for safety, hygiene and sanitation products

The debtor reported adjusted Ebitda of $93 million in 2020 which was nearly a 300% increase over the previous year.

However, the company’s financial performance deteriorated in subsequent years.

Based on the unprecedented demand in 2020, the company commissioned an industry study in early 2021 that concluded that the Covid-19 pandemic would fundamentally change the cleaning supplies and protective equipment industry and market for its products.

The study also estimated that the company’s Covid-related growth would likely be sustained through 2024.

In contemplation of continued customer demand at elevated prices, based on the study’s data, the debtor increased purchases of inventory even though the costs were higher due to supply chain constraints during the pandemic.

Despite the study’s assurance that growth would be sustained for years, the pandemic’s positive effect on the market faded by the end of 2021 and demand for PPE decreased to normal rates, reports TheStreet.

The reduction in demand led to large amounts of excess inventory that the company could not sell in the same quantities and prices.

The excess inventory forced the debtor to secure additional storage space, which increased storage costs.

These factors tightened the company’s liquidity and led to a decline in annual revenue in 2023 by 26% from 2022, resulting in a negative 2023 Ebitda of $13 million.

The debtor’s liquidity issues led to it being overdrawn on its asset-based loan facility by $30 million.

The ABL lender in February 2024 swept the debtor’s bank accounts, further impacting the company’s financial distress.

For more news and updates like this, opt-in for push notifications.

Also Read: This Massive Mall Retailer Is Now Closing In California

Market News Published Daily 📰

Market News Today - A Massive Pizza Chain Is Now Considering A Painful Bankruptcy.
Market News Today – A Massive Pizza Chain Is Now Considering A Painful Bankruptcy.

Don’t forget to opt-in for push notifications so you don’t miss a single article!

Also, thank you to all of our blog sponsors.

This year we’ve been able to increase push notifications slots making it more convenient than ever for new readers to receive their daily market news and updates.

Our readers can now donate $3 per month to support independent journalism.

For daily news and updates on your favorite stories, opt-in for push notifications.

Follow Frank Nez on X (Twitter)Instagram, or Facebook.

Support Independent Journalism ✍🏻

Support independent journalism for just $3 per month!

Your contributions help power Franknez.com as the cost of widgets and online tools continue to rise.

Thank you for your support!


  1. Curating Team

    Leave your thoughts below.

  2. Curating Team

    For more news and updates like this, opt-in for push notifications.

Leave a Reply

Your email address will not be published. Required fields are marked *

© 2024 Franknez.com

Theme by Anders NorenUp ↑