Chipotle Mexican Grill Inc. CMG 0.51% said it increased menu prices again, helping to boost sales in the past few months as it pursues a plan to build hundreds of more stores in the coming year.
For the company’s fourth-quarter ended Dec. 31, Chipotle reported per-share earnings of $5.58, after adjusting for one-time items, exceeding analysts’ expectations of $5.25 a share, according to FactSet. The chain reported net income of $133.5 million, down from $191 million in last year’s period.
The chain’s total sales were $2 billion, slightly above expectations.
The company’s shares rose 8% in aftermarket trading Tuesday to $1,583. Chipotle’s shares had been down more than 16% this year as investors grew concerned about how rising costs were affecting restaurants.
The Newport Beach, Calif.-based company said Tuesday that price increases helped boost its sales during the period. It increased prices by 4% in December, the company said. Chipotle’s same-stores sales were up 15.2% for the period compared with last year.
Starbucks Corp. , McDonald’s Corp. and many other chains said they have increased prices as costs have grown, and expect inflation to continue to be a concern this year.
Chipotle raised prices on its meals last year, with the chain saying it was particularly to help cover the cost of wage increases for hourly workers. It has also increased prices on food ordered through food-delivery apps compared with in-store costs.
Chipotle said that costs grew during the quarter, particularly for beef, freight and avocados. Wages were also up during the period compared with last year.
The company said Tuesday that the Omicron variant of Covid-19 began to weigh on its sales growth in December and last month. Restaurant chains, including Chipotle, have limited hours and seating during the recent coronavirus surge as they have struggled to have sufficient staffing.
Chipotle said its newer locations outside city centers were delivering robust sales, leading the chain to boost its guidance for overall restaurant location growth. The chain said Tuesday that it expected to have at least 7,000 Chipotle restaurants in North America over time, up from a previous goal of 6,000 locations. Most new restaurants will include drive-throughs dedicated to online orders, the company said.
Chipotle aims to open 235 to 250 new restaurants this year, it said.
Write to Heather Haddon at [email protected]
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Appeared in the February 9, 2022, print edition as ‘Chipotle Raises Its Menu Prices.’
