The Homa Files

Excerpted from the WSJ, “Uno Restaurant Chain …Facing Pinch”, Aug. 13, 2008

Uno Chicago Grill, a chain of 200-plus pizzeria-themed restaurants, will skip a bond payment on Friday as it tries to negotiate more financial breathing room.

Uno grew from a single Chicago landmark and is one of a growing number of regional and national restaurant companies squeezed by falling sales, rising food costs and burdensome debt.

Uno sales held up until late 2007, but have slid the last three quarters. Same-store sales were down 7.7 percent in the first quarter of 2008.

Long known for deep-dish, Chicago-style pizzas, Uno moved in recent years to a more expansive menu of grilled, fried and sautéed fare, including Angus beef steaks and Bolognese pasta, and drinks such as pomegranate margaritas.

Other chains, such as Chevys Fresh Mex are also in talks with their lenders

During the first half of 2008, same-store sales at midpriced sit-down restaurants declined an average of 1.1%.

In the last few months, sit-down chains such as Bennigan’s, Steak and Ale, Bakers Square and Village Inn chains have filed for liquidation or bankruptcy protection.

“Those other restaurants that filed, their concepts haven’t remained relevant. Ours has,” said Uno’s CFO.

Full article:
http://online.wsj.com/article/SB121859719364035879.html?mod=hpp_us_whats_news

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Observations

1. First, the IHOP down the street closes … now this.

2.  “Our concept has remained relevant” … so why are you diffusing your image by promoting Bolognese pasta and pomegranate margaritas … stick to deep-dish, man.

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