Chipotle Disappoints on Earnings, Blames Commodity Prices
Mexican restaurant chain Chipotle (NYSE: CMG) announced a 23.7% jump in revenue to $596.7 million, higher than analyst estimates of $591.23 million. The company's diluted earnings per share were $1.81, up 23.1% on a year-on-year basis, but below analyst estimates of $1.83 per share, although closer to predictions of $1.82 on Estimize.
Despite the higher revenues, the company was hit by higher food costs accounting for 32.2% of sales, which the company attributed to higher commodity costs. However, restaurant operating margins were up 20 base points to 26.1% for the quarter, thanks to sales growth that offset higher costs.
The company also reported that its market presence grew by 5.8%, with 67 new restaurants opening in the quarter.
For the year, the company experienced revenues of $2.27 billion and opened 150 new restaurants, including a new location in England that established its European presence.
CEO Monty Moran crooned over the results. "Our accomplishments this year were truly amazing. Empowered cultures create excellent teams. These excellent teams are exciting, productive and powerful. They attract great employees and develop them to be at their very best, and they become the future leaders within our organization."
