Chipotle Mexican Grill Inc., the fast-food chain McDonald’s Corp. sold to the public in January, said third-quarter profit more than doubled as the company added new restaurants. Sales rose less than analysts anticipated.
Net income rose to $11.8 million, or 36 cents a share, from $5.08 million, or 19 cents, a year earlier. Sales climbed 28 percent to $211.3 million, Denver-based Chipotle said today on its Web site. The average estimate of six analysts in a Thomson Financial survey was $212.5 million.
Chipotle is the second-best performing stock to go public this year. Chief Executive Officer Steve Ells, who founded the company in 1993 before selling to McDonald’s five years later, plans to open more than 80 restaurants this year, adding to 500 locations amid rising demand for its burritos and tacos.
“This is a high-growth potential concept,” Deutsche Bank Securities Inc. analyst Laurie Hahn in Greenwich, Connecticut, wrote in an Oct. 18 investors note. She rates Chipotle as “hold.” “Expansion of brand equity and new store openings should continue to fuel growth.” Shares of Chipotle fell 91 cents, or 1.5 percent, to $58.99 at 5:26 p.m. in extended trading. The shares rose 85 cents to $59.90 in New York Stock Exchange composite trading before the release of the results. Its stock has more than doubled since its January 25 initial public offering.
Chipotle increased sales at restaurants open at least a year by 11.6 percent in the quarter, and opened 30 locations. Same-store sales next year will rise as much as 5 percent, the company said.
McDonald’s Transactions McDonald’s bought Chipotle in 1998, five years after Ells, a former chef and graduate of the Culinary Institute of America, opened his first Mexican food restaurant near the University of Denver.
After running the chain for almost eight years, McDonald’s offered shares to the public at $22 a share in January. It sold the rest earlier this month.
Chipotle, named after a smoked jalapeno pepper, sells burritos, tacos, salads and a low-carbohydrate burrito bol, or a burrito without the tortilla, so it uses fewer ingredients and kitchen supplies than other chains, analysts said. The company charges higher prices and offers more service than traditional fast-food outlets.
