DENVER New stores, increased customer traffic and higher menu prices helped propel a 22.5-percent surge in Chipotle Mexican Grill Inc.'s second quarter profit, company officials said Wednesday.
For the quarter ended June 30, Chipotle earned $24.5 million, or 74 cents per share, compared with $20 million, or 60 cents per share, in the same quarter last year. The results, however, still fell short of analyst expectations for per-share earnings of 75 cents.
Revenue for the quarter was $340.8 million, a 24.2-percent jump from a year ago, said officials for Chipotle, which operates more than 775 fast-casual restaurants. Total revenues were driven in part by the opening of 49 restaurants during the second quarter.
The more than 775-unit fast-casual chain also posted a 7.1-percent increase in same-store sales for the quarter, which the company attributed to increases in both menu prices and guest counts.
Chipotle said it began to feel some of the economic strain that the rest of the industry has been experiencing this year. Rising food and advertising costs pushed unit-level margins down to 22.4 percent, from 23.2 percent a year ago.
In addition to commodity pressures felt across the board, Chipotle serves more expensive naturally raised beef in 60 percent of its stores, naturally raised pork in all of its stores, and this quarter completed the systemwide rollout naturally raised chicken.
Although Chipotle said it faces “significant economic challenges in the short term,” the company still expects to grow per-share earnings over the long term at an average annual rate of at least 25 percent.
Chipotle also is sticking with plans to open between 130 and 140 restaurants this year and keep same-store sales increasing by mid-single digits.
In trading on Thursday, Chipotle's stock plummeted nearly 20 percent to close at $67.30 a share. It was the largest single-day drop for the company since it went public in early 2006.