Ruby Tuesday’s largest franchisee shuttered all 11 of its restaurants abruptly this week, wiping out in one move all of the chain’s locations in Illinois, according to local reports.
The restaurants were closed on Wednesday morning with simple signs on the front door. Restaurant employees were given little notice of the closures, according to reports.
The company that owns the Illinois locations is RT Midwest Holdings. RT filed for bankruptcy in 2012 and sold real estate in a sale-leaseback deal, according to bankruptcy court records. It emerged from bankruptcy a year later.
A statement from Ruby Tuesday said the casual-dining concept “went to great lengths” to help the operator stay open.
“Our Illinois Ruby Tuesday restaurants were owned and operated by an independent franchisee,” the company said. “As the franchisor of this concept, we went to great lengths in assisting the franchisee to remain open, but he has made the decision to close his restaurants. We appreciate the patronage of the many residents and guests that have dined at the Illinois Ruby Tuesday restaurants over the years, along with the dedicated employees of the franchisee, and will evaluate opportunities to return to the market in the future.”
Ruby Tuesday has struggled to generate positive sales for years, and the Maryville, Tenn.-based chain has simultaneously seen its unit count decline. The number of Ruby Tuesday restaurants has fallen from 705 units to 682 locations over the past two years. But most of those closures have been of company-owned units. The franchisor operated 646 of 682 locations as of May, according to Nation’s Restaurant News’ Top 100 data.
Systemwide sales, meanwhile, have fallen to $1.15 billion, from $1.22 billion over the same timeframe.
Ruby Tuesday stock is down 1 percent in Thursday morning trading, and is down 26 percent year to date.
Contact Jonathan Maze at [email protected]
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