NEW YORK - Seven of the 11 Ikinari Steak restaurants in New York operated by Pepper Food Service Co. will close, the Japanese company’s U.S. unit announced.
The operator of the stand-up steakhouse chain has judged it would be difficult to improve the loss-making outlets’ profitability. Of the four remaining Ikinari Steaks in New York, two will be turned into Pepper Lunch outlets run by the same company.
Pepper Food Service opened its first overseas Ikinari Steak in New York’s East Village in February 2017 and quickly increased the number of outlets in the city.
Aiming to enhance the chain’s name recognition in the United States, Pepper Food Service debuted on the Nasdaq stock exchange in September last year.
In the following month, however, Pepper Food President Kunio Ichinose told a news conference that the Ikinari Steak restaurants were facing sluggish sales in the U.S.
“We’re struggling very much,” Ichinose said, indicating a plan was being formed to review the chain’s U.S. business strategies.
On Thursday, Pepper Food Service said it incurred a consolidated net loss of ¥121 million in the year through last December, dragging its net balance into the red for the first time in eight years. It booked a special loss of some ¥2.5 billion due to the U.S. unit’s poor earnings.