Chipotle Shares Fall Further Following Updated Outlook, Receipt Of Grand Jury Subpoena
Chipotle offered an update to its fourth quarter outlook, including: 1) comparable restaurant sales to be -14.6 percent, 2) non-recurring expenses to be between $14 to $16 million, 3) restaurant level operating margins to be 20 to 21 percent, and 4) diluted earnings per share to be between $1.70 to $1.90.
Wall Street analysts were previously expecting Chipotle to earn $2.55 per share in the fourth quarter.
Receipt Of Grand Jury Subpoena
Chipotle also disclosed that it was served with a Federal Grand Jury Subpoena in California in connection with an official criminal investigation being conducted by the U.S. Attorney's Office.
"The subpoena requires us to produce a broad range of documents related to a Chipotle restaurant in Simi Valley, California, that experienced an isolated norovirus incident during August 2015," Chipotle wrote. "We intend to fully cooperate in the investigation. It is not possible at this time to determine whether we will incur, or to reasonably estimate the amount of, any fines, penalties or further liabilities in connection with the investigation pursuant to which the subpoena was issued."
Share Repurchase Authorization
Finally, Chipotle disclosed that its Board of Directors authorized a share repurchase program with a total aggregate purchase price of $300 million. The new authorization are in addition to a $300 million repurchase authorization that was announced on December 4, 2015, of which $116 million remained available as of the end of December.
Shares traded recently at $433, down 3.4 percent in the pre-market session.
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