Restaurant chain operator Wowprime Corp (王品) yesterday announced that it is shutting down two unprofitable brands, as it continue efforts to optimize its portfolio.
The company said it is winding down operations at Sufood (舒果), a vegetarian brand founded in 2010, as well as Ita Pasta & Risotto (義塔), founded in 2014.
Three of Sufood’s four branches are to be closed by the end of February, while a fourth branch on Taipei’s Fuxing N Road has been rebranded Su/Food, serving continental instead of all-vegetarian fare.
All four of Ita’s four restaurants would likewise close by the end of February, the company said.
The closures would lead to a one-time loss of about NT$200 million (US$6.48 million), with the amount to be booked this year, impacting earnings per share by NT$0.2, the company said in a statement.
The two brands have accumulated losses of between NT$250 million and NT$300 million, and the company would introduce stronger-performing brands at the commercial spaces they once occupied, it said.
Wowprime said that all employees at the affected restaurants would be transferred to positions at its other brands, and no changes would be made to their compensation, benefits and seniority within the firm.
Customers who have purchased gift certificates can either apply for a refund or redeem the same value at any of Wowprime’s restaurant chains, it said.
Since 2015, Wowprime chairman Chen Cheng-hui (陳正輝) has been looking to cull unprofitable brands, but the company has yet to return to the rapid growth of its heyday.
Chen last month announced that the company would continue expanding and would introduce up to three new brands and hire an additional 1,500 employees.
Analysts have welcomed the closures, saying the move would help the company cut recurring losses and focus its resources on stronger performing brands.
The company reported that revenue rose 1.27 percent month-on-month and 11.86 percent year-on-year to NT$1.25 billion last month, with its Taiwanese operations rising 15.25 percent year-on-year to NT$720 million, while its Chinese operations climbed 7.5 percent year-on-year to NT$530 million.
Revenue in the first 11 months of the year gained 2.89 percent year-on-year to NT$14.79 billion.
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