Chipotle Mexican Grill Inc. (NYSE:CMG) saw its shares fall after the restaurant chain missed analysts’ expectations for the latest quarter. The company reported profit of 69 cents a share for the third quarter of its fiscal year, compared with 27 cents per share in the same time last year. On an adjusted basis, the company reported earnings of $1.33 a share. According to data compiled by Bloomberg, analysts had estimated adjusted earnings of about $1.63 a share.
Total revenue came in at $1.13 billion, short of the $1.14 billion projection. Same-store sales grew 1 percent, missing the 1.2 percent estimate. The company now expects same-store sales to gain 6.5 percent this year, below the 7.2 percent estimate compiled by Consensus Metrix.
Chipotle opened 38 restaurants and closed 3 during the quarter. During the same time last year, the company opened 55 restaurants and closed 1. It now expects its plans for new restaurant openings to be at the low end of its previously forecasted range of 195 to 210.
Recent hurricanes and a hacker attack hammered the company’s earnings last quarter. In addition to the breach and the storms, higher avocado prices also hurt results. The company’s shares fell as much as 8.6 percent in late trading after the earnings report. The stock had slipped 14 percent this year through Tuesday’s close.
Chipotle’s turnaround effort remains slow going after trying to bounce back from a food-safety crisis. An E. coli outbreak struck the company in 2015, deflating its sales, profit and stock price. A norovirus incident in Virginia and a video of mice at a Dallas location this year have not helped matters. The company claimed that the July norovirus outbreak at the restaurant in Sterling, Virginia was the result of the restaurant’s leadership not following safety protocols and allowing a staff member to work while sick.
Chief Executive Officer Steve Ells said that he believes the company’s revival is still on course. Ells said in a press release, “Our leadership remains focused on setting the foundation for future growth, and we are confident in our teams’ ability to deliver against those plans.”
The Mexican restaurant chain introduced queso nationwide in September, lifting sales in the high single digits before leveling off. Mark Crumpacker, Chipotle’s chief marketing and development officer said about 15 percent of customers continue to order queso. However, some analysts have doubted whether queso could be a sustainable sales driver for the company.