Fears over future of PizzaExpress amid 'talks over £1billion debt'
7 October 2019, 15:09
Popular restaurant chain PizzaExpress is facing an uncertain future after it allegedly hired financial advisers to deal with mounting debts.
PizzaExpress is reportedly preparing for talks with its creditors over its huge debts.
The restaurant chain's most recent accounts apparently show that it was in £1.1 billion debt at the end of last year, which works out at £1.6million per restaurant.
According to The Mirror, £655.6 million is due to be repaid by August 2022 with a large chunk of it in August 2021.
A report in Bloomberg states it’s believed to have appointed financial adviser Houlihan Lokey Inc. to prepare for debt talks.
They said “tough trading conditions for UK restaurant chains”, as one of the reasons for the upcoming talks.
A spokesperson from PizzaExpress told Hull Daily Mail: "We are not commenting on the speculation about PizzaExpress appointing creditors."
Pizza Express was founded in 1965 by Peter Boizot and it now has over 450 restaurants across the UK, and 100 more in Europe, Hong Kong, China and India.
At the end of last quarter, PizzaExpress chief executive Jinlong Wang said he was ‘pleased’ with their recent sales, saying: “Intense competition in the casual dining sector encourages innovation and we are constantly seeking ways to increase appeal to new and existing customers."
He added: “Looking ahead, whilst we expect both the UK and Ireland and International markets to remain challenging, we are confident in our ability to successfully appeal to customers and believe that we will continue to deliver a resilient performance across the remainder of 2019.”
This comes after Pizza Express’ major Italian restaurant competitor Prezzo shut down the majority of its restaurants last year.
The company secured the backing of creditors for Company Voluntary Arrangement (CVA) on Friday, which will allow the Italian-themed chain to exit unprofitable branches and secure rent reductions.
This led to 94 closures and 500 job cuts.
Jamie Oliver’s Italian chain also filed for insolvency in May this year, with all but three of the TV chef’s 25 UK restaurants shutting it’s doors.
At the time, Jamie said he was “deeply saddened” by the blow to his restaurant empire.