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Chipotle Mexican Grill rode a wave of online orders to a 7.8 percent year-over-year revenue increase despite a sharp drop in in-restaurant sales attributed to the coronavirus during the first quarter of 2020.
Comparable restaurant sales were up 14.4 percent through the end of February but dropped 16 percent in March as the pandemic forced nonessential workers to mostly stay home, according to Chipotle’s first-quarter financial results released Tuesday. However, the Newport Beach, California-based burrito chain’s digital sales grew by 80.8 percent to $371.8 million, accounting for more than a quarter of its sales.
In order to promote online ordering, Chipotle announced free delivery starting March 15 lasting through at least early May and a partnership with Uber Eats.
Brian Niccol, Chipotle’s chairman and CEO, said the company’s investments in digital “allowed us to quickly pivot our business” amid social distancing.
Chipotle netted $76.4 million on revenue of $1.4 billion in the quarter. It posted profits of $2.70 per share, a 13.7 percent decrease. The company said it had $909.2 million on hand in cash and short-term investments.
Chipotle’s stock price was up more than 2 percent in after-hours trading Tuesday.
|CMG||CHIPOTLE MEXICAN GRILL INC.||1,248.39||+13.81||+1.12%|
Still, with the pandemic ongoing, Chipotle withdrew its previous fiscal guidance given the uncertainty of the situation. The company has already been forced to temporarily close about 100 of its restaurants.
“Our strong brand, business model and balance sheet give us the confidence to not only weather this downturn, but to continue to judiciously invest in key areas so that when we come out on the other side, we will emerge even stronger,” Niccol said.
The financial report came the same day that the Department of Justice announced that Chipotle would pay $25 million to settle criminal charges related to a foodborne illness outbreak that sickened more than 1,100 people between 2015 and 2018.