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Chipotle CEO, CFO Talk Turnaround With Cramer

Chipotle CEO, CFO Talk Turnaround With Cramer

Casual fast-food chain Chipotle Mexican Grill, Inc. (NYSE: CMG) emerged from a highly publicized food safety scandal by focusing on the core business. Chipotle needed to return to its roots of serving "great ingredients, delicious food, and great people," CEO Brian Niccol told CNBC's Jim Cramer.

Cramer gives Niccol credit for overseeing one of the quickest turnarounds ever seen in the restaurant business. But Niccol said much of the success is the result of a new management team who built the right culture which was felt all the way down to restaurant-level workers, he said on "Mad Money."

Cramer also praised Chipotle for its ability to expand gross margins while overseeing new initiatives like delivery, which is typically a money-losing investment for restaurants. Niccol said Chipotle's margin growth can be traced back to a second assembly line in restaurants meant exclusively for off-premise orders.

Huge Advantage

The use of a dedicated and completely independent prep station for off-premise orders is a "huge advantage" as it doesn't have to interfere with the in-store experience, the CEO said.

Chipotle also benefits from a refined supply chain which was first built out in the 2000s, CFO John Hartung said in the interview. Over the many years the company consistently looked for new efficiencies while balancing growth.

"Our model was built along that when we were a very small company," Hartung said. "We just made sure we kept that all along the way as we went from 50 stores to 100 to now over 2,500 restaurants."

Chipotle's stock traded around $82.44 per share at time of publication.

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