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.