DENVER – Chipotle Mexican Grill Inc. reported improved earnings in its second quarter. The company reported net income of $46.9 million or $1.68 per diluted share for the second quarter that ended on June 30, compared to net income of $66.7 million, or $2.32 per diluted share in 2017.
For the first six months of 2018, net income was $106.3 million, or $3.81 per diluted share, compared to net income of $112.9 million, or $3.92 per diluted share, for the same period of 2017.
Revenues increased 8.3 percent to $1.3 billion from the second quarter of 2017. Since the beginning of 2018 revenues rose 7.9 percent to $2.4 billion.
The company said the increased revenue was driven by 69 new restaurant openings for the year. A smaller factor was 3.3 percent increase (2.8 percent for the first six months) in comparable restaurant sales.
“I’m pleased to report a solid second quarter with sales and restaurant margins ahead of expectations,” Brian Niccol, CEO, said. “While we made progress during the quarter with particular strength in digital sales, I firmly believe we can accelerate that progress by executing our reorganization and our strategy to win today and cultivate tomorrow.”Niccol was named Chipotle CEO in February after having the same position at Taco Bell. Founder and former CEO Steve Ells transitioned into an executive chairman role.
The company also stated that customers spent more per check, with many adding queso to their orders. That improved same-store sales, despite 1.8 percent fewer restaurant transactions.
Revenue of food costs also dropped to 32.6 percent, a decrease of 150 basis points compared to the 2017 second quarter.
“The decrease was driven by the benefit of the menu price increases and relief in avocado prices, partially offset by elevated beef prices during the second quarter of 2018 compared to the second quarter of 2017,” the company said.
Chipotle is still recovering profits from the foodborne illness outbreak of late 2015 that included several cases of E. coli O26 across 11 states followed by the discovery of Norovirus at a Boston-based restaurant that reportedly sickened 80 customers.