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Chipotle Mexican Grill On Tuesday, Inc lost Wall Street’s estimates for quarterly earnings, hurt by costs related to maintaining its business during the COVID-19 pandemic, with burrito chain shares falling nearly 2% in after-hours trading .
Strong digital operations in the fast-casual network, an outstanding performance in the sector during the coronavirus, helped to overcome the worst of the impact, even though its expenses have increased as it strengthens its distribution network.
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Digital sales increased almost threefold and generated a 5.7% increase in comparable sales, helped by an increase in online orders in some parts of the United States.
Total revenue increased 11.6% to $ 1.6 billion in the fourth quarter ended December 31, the company said.
Excluding single items, the company earned $ 3.48 per share, losing an estimated $ 3.73, according to IBES data from Refinitiv.
“It is now well established that November was weak across the space, and while Chipotle is resilient, it is not immune,” analysts at Piper Sandler wrote in a note after a earnings report.
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The company’s stock price has risen more than 10% so far this year and increased 66% in 2020 – by far the best performing stock in the restaurant industry, according to Credit Suisse.
His success came in part from his ability to increase digital sales quickly during the pandemic. For the year 2020, Chipotle’s digital sales grew 174.1% to $ 2.8 billion and represented 46.2% of sales. About half of digital sales went to delivery orders.
The chain is testing quesadillas, as well as smoked brisket, after the national launch in January of cauliflower rice with cilantro and lime for a limited time.
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Chipotle did not provide sales forecasts during the pandemic. However, for 2021 he said he hopes to open 200 new restaurants and have an effective tax rate between 25% and 27%.
About 70% of its new restaurants will include “Chipotlane” digital drive-thrus. Sales at locations with Chipotlanes are 10 about 10% higher on average than those without, said Chief Technology Officer Curt Garner told Reuters in an interview.
| Ticker | Safety | Last | change | Change % |
|---|---|---|---|---|
| CMG | CHIPOTLE MEXICAN GRILL INC. | 1,523.05 | +14.03 | + 0.93% |
The company is also testing the pickup “next to the car”, in which an employee brings orders to a customer’s car in 29 restaurants.
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“What we’ve seen so far has been really encouraging,” said Garner.
(Reporting by Nivedita Balu in Bengaluru; Additional reporting by Hilary Russ in New York; Editing by Anil D’Silva, Dan Grebler and Richard Pullin)