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UFood Grill closes fourth store in two months

BOSTON UFood Grill, the quick-serve chain specializing in healthful cuisine, said this week its franchised Salt Lake City-based restaurant has closed amid a downturn in sales sparked by the recession.

The franchisee’s closure is the second in as many months for UFood Grill, following the shuttering of three stores in June when UFood’s Chicago franchisee terminated operations. Those closures also were a result of the economic downturn, the company said.

UFood Restaurant Group Inc., the chain’s parent company now operates four locations and franchises an additional four restaurants.

“We are disappointed that the recession is significantly reducing the number and size of consumer transactions that were at such high levels just a short time ago,” George Naddaff, chairman and chief executive, said in a statement. “Certain areas of the country have experienced severe declines in consumer traffic, which penalizes any style restaurant. We remain persistent in being innovative in developing new menu items and price points that will continue to drive the consumer to our restaurants.”

The company continues to report drops in revenue and same-store sales.

For the second quarter ended June 28, the company reported a 19.4-percent decline in revenue to $1.3 million. Systemwide same-store sales fell 12.8 percent at both corporate and franchised units.

The company booked a narrowed operating loss, however, totaling $1.1 million, compared with $3.2 million in the same quarter a year earlier, on reduced costs, especially for general and administrative expenses. Its net loss for the second quarter totaled $1.2 million, versus a net loss of $3.1 million in the same quarter last year.

Naddaff stated that the company would continue to seek onsite foodservice locations, such as hospitals and airports, in which to open more UFood stores.

“Our success with non-traditional restaurant locations is representing a compelling business model for our food concept,” he said. “While the times are difficult, we are encouraged by how we are positioned to expand our concept and providing affordable, convenient, quick-service restaurants offering delicious food that is better for you.”

Founded in 1999 as Lo Fat No Fat by Watertown, Mass.-based entrepreneur Tim Kurtz and chef Chris Pappas, the concept was acquired by Naddaf in 2004 and renamed KnowFat! The name was changed in 2008 to UFood Grill.

Contact Elissa Elan at [email protected].

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