Papa Murphy’s parent company lost about 100 locations in its financial third quarter, primarily from closures of franchise stores.
Canadian company MTY Food Group acquired the Vancouver-based take-and-bake pizza company in 2019. It remains the corporation’s largest brand, according to Restaurant Business Magazine.
MTY still maintains administrative offices for Papa Murphy’s in east Vancouver. The brand has locations across the United States and Canada.
“Store closures were … higher than in (the) previous quarter, mainly because of a higher number of Papa Murphy’s closures once again this quarter,” CEO Eric Lefebvre said during a recent investor call transcribed by Investing.com.
The company reported store closures in both its first and second quarters, but not nearly as many.
MTY, based near Montreal, Quebec, owns several big brands, including Famous Dave’s, Taco Time, Baja Fresh and Cold Stone Creamery.
Some of the company’s brands, particularly Cold Stone Creamery and Wetzel’s Pretzels, have performed especially well in recent months.
But Papa Murphy’s has faltered, according to the investor call.
Sales for the pizza company improved slightly compared with the previous quarter. But that hasn’t stopped locations from shuttering.
“There are certain markets that are a little bit more troubled than others,” Lefebvre said. “So we don’t see massive closures across the board.”
The executive said specific clusters of Papa Murphy’s locations are being closed by their owners.
MTY primarily franchises its outlets, but the company does maintain around 200 corporate-owned stores across all its brands.
“We try to save the stores as much as possible, but there are instances where we can’t necessarily save the store because we don’t have the proper infrastructure to run those stores in those markets where we can’t find a new franchisee for them,” Lefebvre said.
A representative from Papa Murphy’s didn’t respond to inquiries about which markets were most affected by the closures.
MTY Food Group trades on the Toronto Stock Exchange as MTY. Its stock is down from where it was a year ago, though it’s increased since dipping in September. It closed at $46.93 per share, Canadian, on Wednesday, down from its Tuesday close.
