IHOP and Applebee's closing over 100 restaurants
DineEquity (DIN) said Thursday that it will close more than 100 Applebee locations and up to 25 IHOPs this year as the struggling restaurant company seeks to cut costs.
DineEquity will close at least 20 IHOP locations, though globally it plans to open more such restaurants. The company also announced the appointment of Steve Joyce as its new CEO -- he was formerly chief executive of Choice Hotels since June 2008.
"We are investing in the empowerment of our brands by improving overall franchisee financial health, closing underperforming restaurants and enhancing the supply chain," interim CEO Richard Dahl said in a statement. "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."
DineEquity shares have lost almost half their value this year, closing Thursday at $38.81.
In the latest American Customer Satisfaction Index report, which tracks the restaurant industry, for the first time fast-food restaurants are actually scoring higher in consumer satisfaction than their higher-end rivals.
Customer satisfaction with full-service restaurants slipped 3.7 percent to 78 points on the ACSI's 100-point scale. Fast-food chains, by comparison, held steady at 79 points. The results are based on a survey of almost 5,600 customers between June 2016 and May 2017.
Millennials, the biggest generation in America, prefer to cook at home or spend less on eating out, which may be giving fast-casual chains like Panera a boost. Meal-kit services such as Blue Apron may also be squeezing sit-down restaurants, given some consumers' desire to make their own meals with recipe kits.
