Papa Johns confirms closure of 74 stores after years of financial losses
Pizza chain Papa Johns has confirmed that they have closed 74 of their UK stores over the past two years due to financial losses. The food firm has lost money every year since 2021, including a loss of almost £20million in the year up to October 2024.
However, the company's managing director Chris Phylactou has stated that they are finally to see profits this year after a poor run since the pandemic. But that hasn't been enough to stop the closures.
There were 43 stores, all based in England, that closed in May of this year. And the Mirror has reported that a further 31 stores were shut last year.
Speaking on an upcoming episode of City AM's Boardroom Uncovered podcast, Phylactou shared that two of Papa Johns' largest partners flagged the risk of insolvency during 2023.
He said: "We took a strategic decision to acquire those and we kept those restaurants for nearly a year. We tried to look at which ones we could turn around and fortunately 60 of them were really good.
'We franchised them internally to incumbent franchisees, 13 of them we've kept under corporate ownership, but unfortunately 43 of them we've had to close. Closing restaurants is never an easy decision.
"It's the last thing we ever want to do. It's a lot of jobs, particularly when people's livelihoods are at stake. But if restaurants are performing badly and losing a lot of money, sometimes the best decision is to close them.'
Papa Johns is the UK's second largest pizza takeaway brand, behind Domino's. The first UK Papa Johns stores opened in Essex in 1999 and in 2013 it opened its 200th UK store.
At the start of 2024, Papa Johns owned 118 branches and 406 franchise stores. But in 2023, Papa Johns closed 22 branches and opened 15 new sites.
The UK arm of Papa Johns disclosed a pre-tax loss of £21.8million in the year to October 2024, with a loss of £19.2million in 2023 and a £4.1million loss in 2022.
It was then that Papa Johns made the "difficult decision" to close stores. He said: "Having people lose their jobs is the last option for us. We tried everything to keep the restaurants open.'
He added: 'It's never an easy decision and something that I wasn't happy doing, but it's something that we had to do as a brand.
"We held on to the restaurants probably longer than we should have to protect the people for as long as we could.
'And we put a lot of effort into trying to turn those businesses around. But unfortunately, they were even the wrong location and the performance of the restaurants was really bad. So there was no business case to keep them open.'
It has not been confirmed how many jobs have been lost due to the closures, and the specific locations of all 74 stores have not been revealed.
However, the 43 high street stores shut in May were all in England, with closures stretching from London to the Midlands.
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