Parent company for Applebee's, IHOP to close up to 160 restaurants

(Courtesy: MGN)

The company that owns casual dining chains Applebee's and IHOP said they'll close at least 125 locations due to declining sales.

DineEquity, the parent company for both, said they'll close between 105 and 135 Applebee's restaurants (up from a previously projected 40 to 60) and 20-25 IHOP locations (up from a previously projected 18), according to its second quarter fiscal reports.

The company has yet to announce which restaurants it will close, but said it will base it on profitability, operational results and meeting its brand quality standards.

Applebee's has more than 2,000 restaurants worldwide. IHOP has more than 1,650.

"We are investing in the empowerment of our brands by improving overall franchisee financial health, closing underperforming restaurants and enhancing the supply chain," DineEquity's interim CEO Richard Dahl said in a release. "We believe 2017 will be a transitional year for Applebee's and we are making the necessary investments for overall long-term brand health and expect to see improvement over the next year."

Sales are down 7 percent at Applebee's for the first six months of 2017 after a 5 percent drop last year. IHOP has experienced 2.1 percent decline in 2017.

Despite those closures, DineEquity said plans to open up to 125 new locations through its franchisees (20 to 30 for Applebee's, with most of those international locations; 80 to 95 for IHOP, with most of those being domestic).

DineEquity also unveiled former Choice Hotels CEO Stephen Joyce as its new leader on Thursday. He assumes the role filled on an interim basis by Dahl, the board chairman who took over when former CEO Julia Stewart, who resigned in February.

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