California Pizza Kitchen Inc. swung to loss in the third quarter, the company reported Thursday, on impairment charges, store closure costs and a legal class-action settlement.
The company’s full-service same-store sales did move into positive territory for the first time in two years, however, as the California Pizza Kitchen chain benefited from its successful Thank You Card Program, which encourages repeat visits. Same-store sales at full-service restaurants rose 0.7 percent.
For the quarter ended Oct. 3, CPK booked a net loss of $7.5 million, or 31 cents per share, compared with a year-ago profit of $5.8 million, or 24 cents per share. The write-down of 10 full-service restaurants totaled $18.7 million, while store closure costs and the legal settlement together totaled more than $6 million.
The Los Angeles-based company did not detail the legal settlement, and the company’s full quarterly filings were unavailable at press time. In the past, the company has dealt with legal fees for employee-related lawsuits and claims, as have many restaurant operators in California.
Excluding the non-cash charges, CPK said it would have earned $5.7 million, or 23 cents per share.
Total revenue fell 0.2 percent to $164.5 million.
“Looking ahead, we plan to drive traffic and comparable sales through menu innovation and by providing an exceptional dining experience for our guests,” Rick Rosenfield and Larry Flax, co-chief executives of California Pizza Kitchen, said in a statement. “We are implementing strategies to further control expenses and identifying leverage opportunities to strengthen our full service platform.”
Contact Sarah Lockyer at [email protected].
