Citing declining sales, high employee turnover and a stale menu, the parent company of upscale burger chain BurgerFi and casual dining brand Anthony’s Coal Fired Pizza & Wings filed for voluntary bankruptcy protection.

In a petition filed Sept. 11 in U.S. Bankruptcy Court for the District of Delaware, Florida-based BurgerFi International said it intends to use Chapter 11 “to preserve the value of its brands for all stakeholders.”

According to the company, all 144 BurgerFi and Anthony’s locations will remain open. However, the process includes only the 67 corporate-owned locations and excludes franchised restaurants.

The filing comes less than a month after BurgerFi warned it was running out of cash and may need to file for bankruptcy in the future if the company can’t find alternative funding sources.

Since acquiring Anthony’s in 2021 for $156.6 million, BurgerFi has struggled financially. Last year, the company launched a turnaround effort that included bringing in former Smashburger President Carl Bachmann as CEO.

Wings on the rise

Following a “top-to-bottom evaluation of its operations,” BurgerFi said it has already closed 19 underperforming corporate-owned stores. The company also said it is continuing to evaluate operations and believes the current platform is “primed for success.”

Sales at both chains fell 4% during the three-month period ending July 1, a year-over-year decline of about $1.8 million, according to the company.

The drop was driven by negative same-store sales at both BurgerFi and Anthony’s, the company said. It also cited higher operating expenses compared with last year, primarily due to higher wages and a price increase in chicken wings.

In its Chapter 11 filing, BurgerFi reported assets of between $50 million and $100 million and up to $500 million in debt.

‘Confident’ in the process

In a statement, Jeremy Rosenthal, retained in August to serve as chief restructuring officer, said, “BurgerFi and Anthony’s Coal Fired Pizza & Wings are dynamic and beloved brands, and in the face of a drastic decline in post-pandemic consumer spending amidst sustained inflation and increasing food and labor costs, we need to stabilize the business in a structured process.”

“We are confident that this process will allow us to protect and grow our brands and to continue the operational turnaround started less than 12 months ago and secure additional capital,” he said.

Bachmann said, “Despite the early positive indicators of the turnaround plan initiated less than a year ago, the legacy challenges facing the business necessitated today’s filing. We are grateful for the continued support of our loyal customers, vendors, business partners and our dedicated team members, who are the heart of the company.”

Within New Jersey, BurgerFi has one location – Newark Liberty International Airport. It previously had restaurants in Cherry Hill, Secaucus and New Brunswick.

Anthony’s local footprint includes Ramsey, Mount Laurel, Edison, Wayne and Fair Lawn.

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