Pizza Express to close 73 outlets with 1,100 jobs at risk

Pizza Express said it was closing 73 of its UK restaurants with the potential loss of 1,100 jobs as the coronavirus lockdown hit sales.

The company, which has 454 UK outlets, has started a company voluntary arrangement (CVA) to bolster its finances by agreeing rent cuts with landlords and moving temporarily to monthly rents from quarterly.

Owned by China’s Hony Capital, Pizza Express said that while most of its restaurants had been profitable over the past three years, earnings had been declining. It will seek approval for the CVA from creditors in a virtual meeting on September 4.

Hony earlier this month decided to cede control of Pizza Express, which it bought from rival private equity outfit Cinven for £900m in 2014, to creditors in a debt-for-equity swap.

Bondholders took ownership of the majority of the business ands pledged to pump in up to £144m and agreeing to halve the struggling chain's debt to £319m, with Hony keeping the Chinese and international operations.

The company is the latest casualty of the pandemic’s impact on the hospitality industry with many UK high street restaurants chains forced to close outlets and fire workers as demand slumped when the government imposed a lockdown in late March.

Zoe Bowley, Pizza Express's managing director for the UK and Ireland, said: "Unfortunately, the impact of the global pandemic has meant that we have had to make some incredibly tough decisions to safeguard Pizza Express for the long term."

Bowley said that in most cases, the stores selected for closure are near to another Pizza Express outlet that has already reopened or will be reopening soon.