MTY Group to Close Over 50 Pizza Chain Restaurants: Industry-Wide Structural Contraction

MTY Group (MTY), which operates over 80 restaurant brands including Papa Murphy's, Wetzel's Pretzels, and Cold Stone Creamery, has announced plans to close 68 underperforming corporate-owned restaurants over the next six to nine months, with up to 50 locations expected to be Papa Murphy's outlets. This move aligns with broader industry trends as major pizza chains like Pizza Hut and Papa Johns also undergo significant footprint reductions amid rising operational costs and shifting consumer preferences.

Strategic Retreat in Restaurant Portfolio

■Eric Lefebvre, CEO of MTY Group, confirmed that the targeted closures collectively generated over CAD 10 million in losses.

■The first shutdowns are scheduled for the week of July 13, with a phased approach to minimize disruption for employees, landlords, and suppliers.

■Lefebvre emphasized that the company is not pursuing a "fire sale" but instead strategically reducing its corporate store portfolio.

■Additional closures may occur if other locations underperform in line with revised financial benchmarks.

Papa Murphy's Financial Performance and Market Dynamics

■Founded in 1979, MTY Group operates across Canada, the U.S., and international markets, managing a diverse portfolio of dining concepts.

■The closures reflect localized financial struggles, with energy cost inflation and cash flow constraints cited as primary factors.

■Lefebvre noted that while some locations showed potential for improvement, others lacked the fundamental viability to justify continued investment.

From a maritime economy lens, this contraction mirrors broader shifts in global supply chain efficiency and commodity import cost volatility, as reflected in declining Baltic Dry Index (BDI) trends. Sector-wide closures signal reduced demand for logistics services and highlight how localized retail distress can amplify systemic risks in global trade networks.