Shares of Jack in the Box (JACK) climbed almost 3% in Tuesday morning trading after the company said it would shutter 67 company-owned Qdoba Mexican Grill restaurants.
The move comes as JACK completes an internal market performance evaluation. Restaurants affected by the decision will cease operations by the end of September. JACK will incur a $40 million pre-tax charge during the current fiscal year due to the closures, RestaurantNews.com notes.
A company executive said the closures were expected to boost the company’s financial performance and would optimize its footprint, channeling additional resources into markets where Qdoba has better brand recognition.
There are about 647 Qdoba restaurants in operation. JACK owns 340 of those.
While the company is shutting down some restaurants, it is planning to open new ones. During the current fiscal year, Qdoba will launch between 70 and 75 new locations in North America. More than 60 others will open next year.