Consolidated Burger Holdings, the franchisee operating 57 Burger King locations in Georgia and Florida, has filed for Chapter 11 bankruptcy. Last Monday, April 14, documents filed in the U.S. Bankruptcy Court for the Northern District of Florida revealed the company's plan to keep slinging burgers while pursuing a buyer for the distressed business assets, amidst sagging sales and high fixed costs that have plagued the company following the COVID-19 pandemic, as first reported by USA Today.
The filings note that sales for Consolidated Burger Holdings dropped to $67 million in fiscal year 2024 from $76.6 million the year before, while operating losses nearly doubled, rising from $6.3 million to $12.5 million over the same timeframe; financial woes attributed to decreased foot traffic and steadfast rents and debts that continued to ache the company's bottom line. According to FOX 5 Atlanta's report, both assets and liabilities for the franchisee are tallied up at about $78 million.
In their struggle to maintain operations, not all hope is lost for the quick-service restaurants spread across the two states, among them several placed inside Walmart stores. The company has been actively seeking a purchaser for approximately seven months leading up to the bankruptcy, showing resolve to find a way out of the financial sinkhole.
While this franchisee faces financial headwinds, the parent company of Burger King, Restaurant Brands, has been on a contrasting trajectory, recording a 19.7% increase in revenue to $8.4 billion in 2024, and with bold plans announced including a $2.2 billion "Reclaim the Flame" initiative that aims to rejuvenate Burger King joints with a fresh "Sizzle" redesign by 2028, targeting 85% to 90% of the nearly 7,000 locations across the United States, a move reported on by USA Today. This is paired with the company's acquisition of Carrols, previously Burger King's largest franchisee, as part of a broader brand turnaround endeavor.
The bankruptcy filing, which emerges as a significant event among Burger King's franchise operators in recent years, will see Consolidated Burger Holdings attempting to conduct business as usual while navigating through its restructuring process. The future of 57 Burger King locations is uncertain as the company looks for a buyer, while Burger King works on a major revamp of its restaurants nationwide.
