Bertucci’s declared bankruptcy on Thursday, marking the third time it has done so in just seven years.
The chain operates 15 restaurants in six states after closing seven units leading up to court proceedings. The ultimate goal of the bankruptcy is to reorganize the business and maximize value for creditors, stakeholders, and other interested parties.
Bertucci’s will prioritize high-performing sit-down locations and expand Bertucci’s Pronto, its new fast-casual spinoff that opened in Boston on Wednesday. The new concept features a smaller footprint, streamlined service, and a menu tailored for on-the-go customers, including breakfast items and customizable pizza by the slice.
The brand earned $53.2 million in revenue in 2024, down significantly from previous years. Through February year-to-date, it has earned $8.47 million.
It owes $7 million in unsecured debt and $25.06 million in secured debt. The chain also owes $940,000 in payroll taxes, $943,000 in sales tax, and $99,000 to the Department of Justice.
The brand first filed for bankruptcy in April 2018 because of growing competition from fast-casual chains and over-saturation in the restaurant industry. Planet Hollywood parent Earl Enterprises stepped in and purchased the concept for roughly $20 million. At the time, Bertucci’s had 56 locations.
In 2019, the Italian chain earned $120 million in annual sales. Momentum stopped in 2020 as COVID damaged the restaurant industry. Bertucci’s struggled to overcome restaurant closures and inflation, forcing it to declare bankruptcy for the second time in December 2022. Bertucci’s earned $97.9 million in fiscal 2021, but suffered an operating loss of $14 million and a net loss of $7.2 million. At the time, the restaurant owed $20.85 million in secured loans, $1.5 million in state taxes, and $26.5 million in unsecured loans.
During the second bankruptcy, Bertucci’s restructured its debt and reduced operational overhead, including shuttering unprofitable locations. It was down to 23 restaurants, which were all profitable or showed signs of recovery.
Although some restaurants have seen success, Bertucci’s has been “severely hurt by the
unanticipated deterioration of the US economy and lack of consumer demand for legacy casual-dining brands,” according to court documents. The filing points to Red Lobster, TGI Fridays, Tijuana Flats, Hooters, and On the Border as other examples.
“Several of the Debtor’s locations have failed to recover and continue to operate at a loss,” court documents state. “With losses accumulating, inflationary pressures still high, and industry headwinds gusting, the proverbial final straw fell on the Debtor’s business this year as the world saw food costs soar, consumer spending slow, and an uncertain global economy falling in (and out) of decline. These combined factors created a challenging environment for the Debtor, prompting decisive action to secure a sustainable path forward.”
