Applebee’s and IHOP announced that they may close as many as 160 locations throughout this fiscal year. DineEquity Inc., which is parent of the two companies, expects that 105-135 Applebee’s may shut down compared to previous expectations that 40-60 locations could close. Closures regarding IHOP could range between 20-25 but 80-95 new restaurants will open up with 20-30 new Applebee’s locations across the globe. All of these closures will be based off of store profitability, operational results, and brand quality standards.
CEO of Dine Equity, Richard Dahl plans to aggressively close down these locations to simplify operations. These closures relate to 2 type of restaurants, the ones that are older and located with no high traffic and those that are underperforming which are worse than expected. Globally, there are 1,968 Applebee’s locations and 1,752 IHOP restaurants.
DineEquity’s net income for the second quarter of this year is $20.9 million, which is a drop from $26.4 million one year ago. Applebee’s sales declined 6.2% for the second quarter with IHOP sales dropping 2.6%.