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Chipotle storefront David Sundberg / Esto

Chipotle same-store sales rise 8.1% in 2Q

Company says it has “a lot of opportunity” to improve operations

Chipotle Mexican Grill Inc. said on Tuesday that its same-store sales increased 8.1 percent in the second quarter ended June 30 as the chain continues regaining sales lost in 2016.

The higher sales generated higher profits. Net income more than doubled to $66.7 million, or $2.32 per share, from $25.6 million, or 87 cents, a year ago. Revenues increased 17.1 percent to $1.17 billion. 

Restaurant level operating margin, meanwhile, increased to 18.8 percent in the quarter from 15.5 percent a year ago. 

The company is working to regain customers in the wake of a series of foodborne illness outbreaks in 2015 that sent sales plunging in 2016 — unit volumes fell 23 percent last year, hurting profits and cutting its stock price in half. 

Consumers and investors were reminded of those incidents last week, after customers at a restaurant in Virginia were sickened with what health officials have confirmed was norovirus in at least two cases. Later in the week, media reports showed video of rodents falling from the ceiling of a restaurant in Texas.

As of close on Tuesday, Chipotle stock had fallen more than 14 percent since July 10. The stock is now down 10 percent for the year.

“We saw encouraging signs in our improved financial results during the first half of the year,” company founder and CEO Steve Ells said in a statement. “Recent events, however, have shown that we still have a lot of opportunity to improve our operations and deliver the outstanding experience that our customers expect.”

Chipotle stock was up more than 2 percent in after-hours trading on Tuesday. The financial results were better than analysts had expected.

Contact Jonathan Maze at [email protected]

Follow him on Twitter: @jonathanmaze

TAGS: Finance
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