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Chipotle on Tuesday reported third-quarter results that showed sales fell more than expected, about one year since outbreaks of E. coli and norovirus were linked to its food.
The company reported revenue of $1 billion, and said sales at locations open for at least one year fell 22%. Analyst had forecast revenue of $1.09 billion, and a sam-store sales decline of 19%. Diluted earnings per share fell to $0.27 from $4.59. That includes 29 cents related to the impairment charges at its ShopHouse Asian restaurants and another 23-cent charge due to unredeemed giveaways through Chiptopia, its new rewards program.
Analysts had forecast EPS of $1.56, although this may not be comparable to the reported figure of $0.27.
The disease outbreaks drove customers away from Chipotle and, in the first quarter, led to the company’s first sales decline since it went public. Chipotle launched aggressive marketing campaigns and promotions to lure customers back.
“We continued to make steady progress in our sales recovery during the third quarter,” said co-CEO Monty Moran in the earnings release. “We are earning back our customers’ trust, and our research demonstrates that people are feeling better about our brand, and the quality of our food.”
Chipotle anticipated that next year will be better. In 2017, it forecast that comparable restaurant sales will rise in the “high single-digits.”
For the full-year 2016, Chipotle expected that new restaurant openings would be at or above the high-end of its previously announced range of 220 to 235. It saw same-store sales declines in the “low single-digits” for the fourth quarter.
The shares gained as much as 3% in after-hours trading before slipping. They were down 15% this year through the close of trading on Tuesday.