The logo of Chipotle Mexican Grill is seen on a napkin in Tiskilwa, Illinois, April 22, 2016.
Photo: Daniel Acker/Bloomberg via Getty Images
Chipotle Mexican Grill's stock dropped in after-hours
trading Tuesday after the Denver-based Tex-Mex food chain reported
wider-than-expected losses for the first three months of the year. The
company reported its first quarterly loss as a publicly traded company
as it struggles to recover from a series of food-safety problems in
several states in the last half of 2015.
“Our sales are on a gradual path to recovery,” Steve Ells,
founder, chairman and co-CEO of Chipotle, said in a statement Tuesday
announcing first-quarter results. “The best approach to re-building our
business is to proudly serve safe and delicious food in our high-quality
restaurants every single day, which is exactly what we will continue to
do.”
Chipotle posted a bottom-line loss of $26.43 million, or 88
cents per share, compared with a gain of $122.2 million, or $3.88 per
share, in the same period last year. Analysts polled by Thomson Reuters
had on average expected a
loss of 86 cents per share. Revenue was lower than expected, too, at
$834.5 million, the lowest since the third quarter of 2013, versus a
consensus estimate of $868.5 million. The company generated $1.09
billion in sales in the same quarter last year.
Same-store sales, an important retail metric that excludes
recently opened stores for a more accurate comparison to past
performance, dropped 30 percent, larger than the 29 percent fall
forecast by Nomura equity research.
Chipotle’s share price fell 2.6 percent shortly after the
earnings report was released after the closing bell in New York, to
$445.80. The company’s share price is down 7 percent for the year and 30
percent over the past 12 months, which suggests much of the impact from
the food-safety crisis has been priced into the stock.
Chipotle was hit with six outbreaks of E. coli, norovirus
and salmonella in several states in the last six months of 2015. The
sources of the outbreaks are unknown, but they spurred the company to
change the way some of its food is prepared and to give employees at its
roughly 2,000 outlets additional food-safety training.
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