- Chipotle (NYSE:CMG) reports comparable sales increased 8.3% vs. +7.3% consensus.
- Digital sales increased 202.5% during the quarter to account for 48.8% of all sales.
- Restaurant-level margin fell to 19.5% of sales vs. 19.0% consensus, driven lower primarily by COVID-19 related impacts including higher delivery expense associated with increased delivery sales, elevated beef prices, increased incidence of steak, and fewer sales of high margin beverages. The decrease was partially offset by sales leverage, lower avocado expense, improved labor efficiency realized from digital enhancements to the restaurants and benefits from menu price increases.
- Balance sheet update: "Chipotle continues to maintain a strong financial position with $1.1 billion in cash, investments and restricted cash, and no debt, along with a $600 million untapped credit facility with which to continue to navigate this crisis. This financial position improved sequentially from $934.6 million in cash, short-term investments and restricted cash, as of June 30."
- As expected, no formal guidance was issued. Chipotle did say sales trends remained strong in September even though beginning mid-month it rolled over the successful 2019 Carne Asada program.
- Shares of Chipotle are down 5.39% in AH trading to $1,294.50. Investors may be disappointed about the lack of full-year guidance. CMG is still up about 15% since the Q2 report dropped.
- Previously: Chipotle Mexican Grill EPS beats by $0.32, beats on revenue (Oct. 21)