Papa John’s blames Papa John for big sales decline

Papa John’s said same-store sales in North America fell 6.1% in the three months ending in July because of controversy surrounding founder John Schnatter’s use of a racial slur.

“Results have been challenged by recent events,” Steve Ritchie, president and CEO of Papa John’s, said in a statement on Tuesday. “Our entire leadership team understands the importance of getting our culture and business improvements right.”

Shares fell nearly 9% after hours on Tuesday.

The company said that July sales fell by about 10.5% in North America because of the negative publicity from the incident.

Last month, Schnatter admitted to using the N-word on a conference call. Schnatter apologized and resigned as the company’s chairman soon after Forbes published a story about the incident. He remains on the board, and own 29% of the company’s stock.

Schnatter left the chief executive seat at his namesake company in December last year amid a string of public relations debacles and slumping sales.

Schnatter expressed concern over the health of the company in a statement published on Tuesday.

“History shows that the Company performs better with me involved, and it declines when I step away,” he said.

— CNN’s Jordan Valinsky and Jackie Wattles contributed to this report.