Cafe Coffee Day (CCD) has closed down around 280 outlets in the first quarter of the current financial year 2020-21, the company said in a statement citing profitability issues and likely future increase in expenses.
With these closures, the total count of the coffee chain's outlets stood at 1,480 as on 30 June 2020.
Cafe Coffee Day is a brand owned by Coffee Day Global, a step-down company of Coffee Day Enterprises Ltd (CDEL).
The coffee chain also reported a decline in average sales per day (ASPD) to 15,445 during the June ended quarter from 15,739 in the corresponding period of the last fiscal. Its vending machines went up to 59,115 units during the quarter from 49,397 in the same quarter a year ago.
"Exports operations have been temporarily stopped due to lower margins and higher working capital requirement and around 280 outlets are closed during the quarter based on various factors including the profitability, future increase in major expenses," the company said.
It further said that the decision "will result in continuing the remaining cafes profitable and adding value to the company as a whole to continue as going concern".
CDEL has been paring its debt through the sale of non-core assets after the death of its promoter V G Siddhartha.
Earlier, in March this year, CDEL had announced to repay Rs 1,644 crore to its 13 lenders after concluding a deal with Blackstone Group to sell its technology business park. It had announced the last year that it will sell the Global Village Tech Park in Bengaluru to global investment firm Blackstone and realty firm Salarpuria Sattva at an enterprising value of Rs 2,700 crore.
CDEL's stake in IT firm Mindtree has been sold to L&T Infotech.
Shares of Coffee Day Enterprises Ltd were locked in a 4.79 percent upper circuit on Monday at Rs 20.80.