What drove the significant revenue growth for Chipotle in the first nine months of 2012?

Revenue growth was driven by two primary factors: the opening of 123 new restaurants during the period, expanding the company's footprint, and a comparable restaurant sales increase of 8.3%. This comparable sales growth was primarily a result of an increase in customer visits and the impact of menu price adjustments.

What are the key cost drivers and how did Chipotle manage them?

Key cost drivers include food, beverage, and packaging; labor; and occupancy. Chipotle successfully managed these costs, with food costs as a percentage of revenue decreasing slightly due to menu price increases and lower avocado prices, offsetting inflation. Labor costs as a percentage of revenue also decreased, benefiting from higher average restaurant sales and menu price increases.

What are the significant legal and investigative matters Chipotle is currently facing?

Chipotle is involved in several legal proceedings, including ADA cases, and government investigations related to employee work authorization, which have led to both civil and criminal inquiries. There are also shareholder derivative and class action lawsuits. While the company is cooperating and intends to defend itself vigorously, the ultimate outcome and potential liabilities are not yet determinable.

How is Chipotle addressing potential supply chain issues, particularly with 'naturally raised' meats?

Chipotle's 'Food With Integrity' initiative emphasizes naturally raised meats. However, the company acknowledges supply constraints and has periodically served conventionally raised beef in some restaurants, with clear signage to inform customers. They are working to maintain their standards while navigating these challenges and expect continued inflationary pressures on ingredients like chicken and beef.

CMG 10-Q Quarterly Report Q3 FY2012 — Revenue, Net Income, EPS

Summary

Chipotle Mexican Grill, Inc. (CMG) reported strong financial performance for the nine months ended September 29, 2012. Revenue increased by 21.5% year-over-year to $2.03 billion, driven by both new restaurant openings (123 opened in the period) and comparable restaurant sales growth of 8.3%. Net income rose significantly to $216.6 million from $157.5 million in the prior year period. The company's operational efficiency also improved, with key expense lines like labor and occupancy costs decreasing as a percentage of revenue, contributing to higher operating income. Despite facing challenges related to food cost inflation, particularly for chicken and beef, Chipotle managed to improve its food costs as a percentage of revenue due to menu price increases and favorable avocado prices. The company continues to focus on its 'Food With Integrity' initiative. Investors should note the ongoing legal proceedings and government investigations, particularly concerning employee work authorization, which could present future risks.

Financial Highlights

42 data points

Beta

Net Income

$72.30M

EPS (Diluted)

$0.05

Total Assets

$1.71B

Cash & Equivalents

$421.15M

Free Cash Flow

$75.89M

Financial Statements

Beta

Operating Expenses	$582.87M
Operating Income	$117.66M
Net Income	$72.30M
EPS (Basic)	$0.05
EPS (Diluted)	$0.05
Shares Outstanding (Basic)	1.58B
Shares Outstanding (Diluted)	1.59B

Key Highlights

1Revenue for the first nine months of 2012 reached $2.03 billion, a 21.5% increase compared to the same period in 2011.
2Net income grew to $216.6 million for the nine months ended September 29, 2012, up from $157.5 million in the prior year.
3Comparable restaurant sales increased by 8.3% for the first nine months of 2012, driven by customer visits and menu price increases.
4The company opened 123 new restaurants during the first nine months of 2012, bringing the total to 1,350 restaurants.
5Food, beverage, and packaging costs as a percentage of revenue improved to 32.3% from 32.7%, despite inflationary pressures.
6Labor costs as a percentage of revenue decreased to 23.4% from 24.0%, primarily due to higher average restaurant sales.
7The company announced an additional $100 million share repurchase authorization, demonstrating confidence and commitment to returning capital to shareholders.

CHIPOTLE MEXICAN GRILL INC Quarterly Report for Q3 Ended Sep 30, 2012

Summary

Financial Highlights

Key Highlights

Frequently Asked Questions