Denny’s pieces skyrocketed by more than 25 percent Wednesday after the comrades announced plans to sell most of its remaining company-owned stores upwards the next 18 months.
The company intends to sell between 90 and 125 restaurants in conduct to bring its total franchised locations to between 95 and 97 percent, Characterize Wolfinger, chief financial officer for Denny’s, told analysts on an earnings denominate Tuesday. About 89 percent of Denny’s restaurants are currently owned by franchisees.
In summing-up, the company expects to earn about $30 million from exchange up to 30 percent of 95 properties it owns. The proceeds will be reallocated toward buying higher-quality real estate, Wolfinger said.
“Our refranchising and development plan will enable us to further evolve as a franchisor of choice that take under ones ws more focused support services, all while yielding a higher distinction, more asset-light business model,” CEO John Miller said in a report.
By having more franchised locations, Denny’s will make multitudinous royalty revenue and save on costs associated with running discrete restaurants. Franchisees won’t be completely on their own, however. Many major name brands such as Dunkin and McDonald’s often co-invest with franchisees when it be given b win to major investments like digital upgrades and remodels.
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