Jack in the Box Puts New Eateries on Hold : Expansion: Plans could be delayed a few weeks or indefinitely while it assesses losses from food poisoning outbreak.
Most of the 85 new Jack in the Box fast-food restaurants planned for this year have been put on hold while the chain’s parent company, Foodmaker Inc., assesses losses from an outbreak of food poisoning.
A few of the restaurants are already under construction and those should continue as planned, Foodmaker spokeswoman Sheree Zizzi said Monday.
Financing of the rest could be delayed a few weeks or deferred indefinitely, she said, depending on how Foodmaker rebounds from the outbreak, which killed one child and made more than 300 people ill in Washington state.
Zizzi elaborated on statements made by the president of San Diego-based Foodmaker, Jack W. Goodall, during a stockholders meeting Friday. Goodall said spending on planned expansions are being deferred temporarily.
“We’re going to wait until our business is normalized,” Goodall said.
Zizzi could not say how many of the new restaurants are already under construction.
She said the 85 additions were planned to increase the company’s presence in markets that already have Jack in the Box restaurants, primarily in the West and Southwest.
“We have deferred any spending over the near term--a period of weeks,” she said. “We haven’t made a decision to cancel them.”
Jack in the Box officials have said sales dropped as much as 35% in the weeks after the chain’s burgers were blamed for an outbreak of illness caused by the E. coli O157:H7 bacteria strain, which sometimes contaminates meat but usually is killed with proper cooking.
Since the outbreak surfaced in mid-January, Foodmaker has changed its meat supplier and increased cooking times.
Foodmaker operates 715 Jack in the Box restaurants and has 446 Jack in the Box franchises.
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