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TravelCenters of America begins reopening dine-in restaurants

Reorganization and layoffs won’t contribute much to the bottom line this year

TravelCenters of America is slowly reopening dine-in restaurants in states that allow it, but hours of service are shorter and menus limited. (Photo credit: Jim Allen/FreightWaves)

TravelCenters of America (NASDAQ: TA) is slowly reopening dine-in restaurants at its travel plazas where allowed, but some changes forced by the COVID-19 pandemic may never be reversed.

“We have already undertaken rolling some locations on and we’re doing it in a prudent and self-disciplined way,” TA CEO Jon Pertchik said on a first-quarter earnings call on Tuesday. 

That means fewer hours, about half as many menu items, and as little as 25% occupancy based on state-by-state guidelines. It also means many of the 2,900 employees laid off April 17 may not return to work for some time – if ever.

“The salad bar and buffet features won’t be coming back – at least in this initial opening,” TA President Barry Richards said. “And that landscape could be changed forever just given the public reaction.”


Pertchik echoed that sentiment.

“In some unexpected ways, this pandemic gives us an opportunity to look really hard at how our full-service restaurants operate to become more efficient,” he said.

First quarter financials

The closing of the dine-in restaurants at TA’s travel plazas during the pandemic contributed to the company’s first-quarter loss of $18.5 million, or $2.23 per shared, 31% greater than the $12.7 million, or $1.58 per share, loss in the first quarter of 2019.


TA made more money on diesel fuel sales in the quarter because of lower prices and a surge in demand as coronavirus-driven lockdowns and shelter-in-place orders took effect in late March. At the same time, gasoline sales plummeted with the lack of movement of passenger traffic. 

Repair service revenue also took a hit because mild temperatures led to fewer truck breakdowns than the extremely cold temperatures a year ago.

As part of cutting capital spending, TA has delayed for one year a plan to convert 20 of its Iron Skillet and Quaker Steak & Lube restaurants to International House of Pancakes (IHOP) locations. TA agreed in October 2019 to remake up to 94 of its restaurants into IHOPs over the next five years. 

The average investment per site for the IHOP rebrandings is expected to be about $1.1 million. TA budgeted $118 million in capital spending this year, a figure it has reduced to $62 million.

“We’re also prepared to put our foot slowly and cautiously on the accelerator,” depending on the pace of economic recovery, Pertchik said.

Reorganization impact

Pertchik said a corporate reorganization announced April 30 affected every department, including the layoff of 130 employees at a cost of $4.2 million in severance, outplacement and other costs.  

“We wanted to make sure we did it in one fell swoop,” instead of increasing stress levels by dragging it out, Pertchik said. 


The layoffs will save about $4.4 million in earning before interest, taxes, depreciation and amortization (EBITDA) this year but about $13.1 million beginning in 2021, said TA chief financial officer Peter Crage.

“While it’s always difficult on a personal level to undertake reductions in force, there’s a level of anticipation and excitement over the opportunity to drive meaningful change in such an established, historic, large and complex organization like TA,” said Perchik, a veteran business turnaround expert hired in December 2019.

“These changes have nothing to do with the current health and economic crisis and have everything to do with executing our turnaround strategy and driving toward long-term shareholder value by focusing on the methods and ways to improve the financial health and functioning of the organization,” he said.

14 Comments

  1. Don Wolford

    Mass nursing the TA is doing is pricing themselves out of business the price of a hamburger over $10 that’s just utterly ridiculous

  2. Shamus P. Cella

    TA CORPORATE has been mismanaged for years !!! I remember when you could get appetizers, like wings and stuff. Slowly taken away, menu size, slowly dwindled. Then the quality of the cooks dropped off. Then portion measuring, and the quality off the food, (lmfao) there is so much sodium in the packaged, ready heat food they prepare……I’m surprised drivers ain’t keeled over at the booths from a heart attack. There is very little “HOME MADE” anything at a Petro or Ta. Don’t even get me started on the menu prices, that’s a whole can of worms I don’t dare to open. TA Corporate wants out of the restaurant game, they know their horrible at it. Quite frankly, I want them out as well !!! I want a chain to come in, like a IHOP…..at least prices, staff training, and quality of food will improve.

  3. allen Scarborough

    Guess since all about money,and screw the driver ill be finding other options also and on the 4th of this month bordentown nj I found out spend 500.00 in shop we will not be able to receive free shower since shop can’t put it on card just another reason to say ill find other places to shop.thankyou . [email protected]

  4. Walter Carte

    If you drop the Iron Skillet just go ahead and close the truckstops altogether..Iron Skillet is your biggest asset..We as drivers are tired of fast food and IHOP is basically fast food..The Iron Skillet is as close to a homemade meal as we can find..Please use this time to rethink thst idea..

    1. Shamus P. Cella

      IHOP, like DENNYS……they train there cooks and staff, at least I was lead to believe that by several friends in the restaurant business. TA CORPORATE, they do very little as far as training. The cooks are essentially “Line Cooks”. I’ll RARELY order a steak at a TA or Petro. They can’t cook a good steak, not to mention the cuts they seem to purchase, might as well be USDA Grade B Choice. Then there’s the buffet……(chill down my spine) the quality of the food there is less than desirable. I bet most dogs will turn their noses away from. I’m so disgusted with TA……I only patronize them cause my company has to fuel with them. Other than that……they SUCK !!!

    2. Don Wolford

      this man is correct us drivers are tired of fast food your iron skillets your best gig you got going the food’s decent services good we get the chance to sit down and relax and get what we want to eat IHOP is nothing but b******* fast food out of the microwave half of it so yeah you want to switch to IHOP you just lost a customer

  5. Donald VanOver

    Good info to have. Guess I’ll be finding other full service restaurants to eat at since the Iron Skillets will be changing to IHOP.

Comments are closed.

Alan Adler

Alan Adler is an award-winning journalist who worked for The Associated Press and the Detroit Free Press. He also spent two decades in domestic and international media relations and executive communications with General Motors.