Bob Evans Farms Inc. announced today that 27 underperforming restaurants will be closed and 1,100 jobs will be cut. According to the company, the move is an attempt to reduce costs and improve profitability.

A difficult decision

In a company statement released on Monday, Chief Executive Officer Saed Mohseni said the restaurant closings were a hard, but essential decision. Despite customer loyalty and commitment of employees, the locations were not meeting the company’s financial goals.

Workers affected by the layoffs will be offered jobs at nearby restaurants.

For full-time and part-time employees that cannot be moved, a severance package will be offered.

Over the weekend, Bob Evans quietly closed 21 company-owned locations in 10 states. The other six locations will be revealed later this year.

The 27 restaurants produced roughly $30 million in annual sales, but the closings will enhance the company’s annual operating income by $1 million. By selling the company-owned locations, Bob Evans expects to take in $20 million. Anticipated expenses related to the closings will be $7.5 to $8 million.

Bob Evans has been in trouble for years

This is the second time the diner-style chain has closed restaurants in the past year. In May 2015, Bob Evans closed nearly 20 locations.

Additionally, the Ohio-based restaurant and prepared foods company also made several real estate deals to spin off a pair of manufacturing plants as well as other restaurant properties.

However, the deals didn’t slow the decline insame-store sales. Industry analysts see significant challenges from competitors in the fast-food segment of the restaurant market.

As more and more customers choose fast dining over casual dining, the chain will continue to struggle.

Nonetheless, Bob Evans has still managed to increase sales. Last year, annual sales were $1.35 billion, beating the $1.33 billion for 2014.

Profit, on the other hand, has been falling. In fiscal 2015, the company made a profit of $16.6 million, significantly lower than the $33.7 million made the year before.

After the Bob Evans restaurant closings, the company will have 521 locations nationwide.

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