DENVER (AP) — Mexican food chain Chipotle's first-quarter net income rose 8 percent as more customers flocked to its restaurants for burritos, bowls and tacos.
The Denver-based chain's popularity has kept growing because people see it as being a step up from traditional fast-food chains such as Burger King and Wendy's. The chain's "Food with Integrity" slogan is intended to underscore the higher quality of its ingredients.
First-quarter sales figures indicate its popularity isn't fading: sales at established locations rose 13.4 percent, driven in part by an increase in customer traffic. Higher costs for food beef, avocados and cheese as well as higher litigation costs ate into profit and earnings missed expectations.
Chipotle Mexican Grill Inc. says for the three months ended March 31, net income rose to $83.1 million, or $2.64 per share. That's up from $75.6 million, or $2.45 per share, a year ago. Analysts expected $2.86 per share.
Revenue climbed 24 percent to $904.2 million from $726.8 million a year ago. Analysts expected revenue of $872.9 million. Revenue in stores open at least one year, a key metric of restaurant revenue, jumped 13.4 percent.
The company has been mulling whether it can raise prices later this year without scaring off customers. It forecast revenue in stores open at least one year will rise in the high single digits for 2014, but said that excludes any menu price increase.
Chipotle has also been expanding rapidly. It opened 44 restaurants during the quarter and plans to open 180 to 195 restaurants during all of 2014.
Its shares climbed $26.29, or 4.8 percent, to $578.69 in premarket trading shortly before the market open.
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