Buca di Beppo’s bankruptcy plea this week was at least four years in the making.
In a filing Monday, William Snyder, the casual-dining chain's recently named chief restructuring officer, blamed the COVID-19 pandemic for Buca's current financial troubles, saying that it was never able to fully recover after the virus upended its business in 2020.
Since then, Buca di Beppo has closed 30 restaurants, including 13 last week, leaving it with 44 locations. It worked to otherwise lower costs by consolidating vendors and cutting hours, and it ran promotions to drive traffic.
But that was not enough to keep up with reported liabilities of between $10 million and $50 million. Assets were estimated at less than $50,000.
Meanwhile, the chain’s sales and profits have continued to decline. So far this year, Buca di Beppo’s systemwide sales are down 5% compared to 2023, and they have fallen about 14% since 2021, according to the filing. Over the first five months of this year, net revenue was $74.8 million, or 10% lower than the same period a year ago. Restaurant-level earnings before interest, taxes, depreciation and amortization were $3.1 million, an 18% decline.
The company attributed those problems to rising labor and food costs in the aftermath of the pandemic as well as lower demand from consumers.
It is hoping to use the bankruptcy process to find a buyer, and it set a deadline of 75 days from the filing date to get a deal approved.
The problems outlined by Buca di Beppo are not necessarily unique to the chain. The casual-dining segment as a whole has struggled to fully bounce back after the pandemic shifted more consumers toward takeout and convenience-focused quick-service brands.
But Orlando-based Buca di Beppo had been struggling even before the pandemic. After peaking at 95 locations in 2014, its sales and unit count declined each year leading up to 2020, according to Technomic data.
And it had other problems over the years, particularly an SEC investigation in 2005 that led to its CEO, CFO and controller pleading guilty to stealing hundreds of thousands of dollars from the company.
The chain was sold to current owner Planet Hollywood International in 2008 for $28.5 million.
Founded in 1993 in Minneapolis, Buca di Beppo is known for its over-the-top take on Italian-American “red sauce joints.” Its menu of classic Italian fare is designed to be shared family-style, and restaurants are bedecked with framed family photos, gaudy wallpaper and string lights. Each locations features a Pope Room, a group dining room themed around the leader of the Catholic church.
Buca di Beppo went public in 1999 and expanded rapidly prior to the SEC probe.
It is one of a number of restaurant chains to file for bankruptcy this year amid a challenging environment, including Red Lobster, Rubio’s Coastal Grill and World of Beer.
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