Qdoba parent Jack in the Box to close 67 units this year

Jack in the Box Inc. (JACK) said it plans to close 67 company-operated Qdoba Mexican Grill restaurants by the end of the fiscal year as the restaurant operator looks to focus on its core markets.

The company expects to incur $40 million in charges during fiscal 2013, including about $28 million in impairment charges and $12 million in charges related to cash lease obligations and employee severance costs.

"By closing these locations and optimizing our company footprint, we can be more effective in focusing our advertising and marketing resources to support existing and planned restaurants in our core markets where we have high levels of brand awareness," said Qdoba President Tim Casey.

As of the end of the second quarter, Qdoba's system included 647 restaurants, of which 340 were company-operated. The company said its decision to close certain locations followed a comprehensive review of sales and other key performance metrics as well as an analysis of its real-estate portfolio. The closures are expected to boost Qdoba's financial performance, resulting in higher future earnings, average unit volumes, restaurant operating margins, cash flow and return on invested capital, it said.

The company said it plans to continue expanding the Qdoba brand in North America, with 70 to 75 new locations expected to open system-wide in fiscal 2013, including approximately 40 company locations. The company expects 60 to 70 new Qdoba restaurants to open next year, approximately half of which will be company locations.

Jack in the Box operates and franchises more than 2,200 namesake restaurants, as well as Qdoba Mexican Grill through a subsidiary. The company has been focusing its efforts on improving the consistency of its service and the quality of signature items, as well as upgrading its restaurants.

Last month, Jack in the Box's fiscal second-quarter profit fell 39% as it posted weaker sales, and the year-earlier was boosted by a large gain on the sale of restaurants. Same-store sales slipped 2% at Qdoba company restaurants in the latest period.

Shares closed at $36.99 and were unchanged after hours. The stock has gained 45% over the past 12 months.