Papa Johns closes 74 UK restaurants amid rising losses, sales decline in 2024

UNITED KINGDOM – Papa Johns has announced the closure of 74 restaurants across the UK during the financial year 2024, as the company grapples with a challenging operating environment. 

This significant reduction has brought the total number of their UK outlets down from 524 to 457 by the end of 2024, reflecting a strategic effort to stabilize the business.

The closure decision follows a period of worsening financial performance. The company recorded a pre-tax loss of £21.8 million (US$27.0 million) in 2024, up from a £19.2 million (US$23.7 million) loss in 2023.

This continued decline contrasts sharply with the last profitable year of 2021 when Papa Johns posted an £8.1 million (US$10.0 million) pre-tax profit.

Over these years, the revenue also decreased from £102.3 million in 2021 to £88.6 million (US$110.0 million) in 2024, continuing a downward trend from £95.9 million the previous year.

The closures occurred in two main phases, with 43 locations shut following a consultation process in mid-May 2024 and an additional 31 outlets closed later in the year.

Papa Johns attributes these closures to a combination of geopolitical challenges, staffing shortages, and rising operational and commodity costs that have weighed heavily on margins.

The company stated that despite consumer confidence improving somewhat, it remains below pre-pandemic levels, with customers becoming more cautious and cost-conscious.

Despite these challenges, Papa Johns opened seven new locations in 2024, showing some selective growth.

Managing Director Chris Phylactou expressed cautious optimism, noting in a recent statement that the business is no longer losing money and anticipates returning to profitability in 2025 due to the difficult yet necessary decisions made to cut losses and streamline operations.

The UK was a key growth market for Papa Johns since its first restaurant opened in 1996.

However, the company now focuses on optimizing its footprint by closing underperforming sites to ensure sustainable future growth in a competitive market.

Overall, while Papa Johns faces significant hurdles in the UK market, the closure of underperforming restaurants aims to position the company on a path to recovery and renewed profitability in the near term.

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