DOW JONES NEWSWIRES
Chipotle Mexican Grill Inc.'s (CMG) first-quarter net income
rose 47%, helped by a double-digit increase in revenue and lower
spending on marketing.
"We are very pleased with our first quarter, particularly given
the difficult operating environment," said Chairman Steve Ells.
The restaurant chain operates in the "fast-casual" segment,
which has been hit especially hard as the recession forces people
to think twice about dining out. However, aggressive cost cutting,
as well as falling food and energy costs, could provide
opportunities to pad margins even in the tough sales
environment.
Chipotle reported net income of $25.4 million, or 78 cents a
share, up from $17.3 million, or 52 cents a share, a year
earlier.
Revenue rose 16% to $354.5 million, as same-store sales jumped
2.2%.
Analysts polled by Thomson Reuters were looking for earnings of
55 cents a share on revenue of $360.2 million.
The company said it opened 26 restaurants in the quarter,
putting its count at more than 862 restaurants.
Restaurant-level operating margins rose to 23.5% from 21.2%, due
to higher menu prices and decreased spending on marketing and
promotions.
For 2009, Chipotle still expects 2009 same-store sales growth in
the low-single digits. The company also stuck by its scaled-back
plan for store openings, projecting 120 to 130. In addition,
Chipotle noted that promotional and marketing spending will pick up
in the second and third quarters with the launch of a new
campaign.
Formerly a unit of McDonald's Corp. (MCD), Chipotle - named for
a dried and smoked jalapeno pepper - was founded in 1993 and went
public in January 2006.
Chipotle shares closed up 5.6% at $85.50 and are halted in
after-hours trading. The shares remain off more than quarter from a
year ago despite more than doubling in the last five months.
-By Jay Miller, Dow Jones Newswires; 201-938-2331;
jay.miller@dowjones.com