CHIPOTLE ANNOUNCES SECOND QUARTER 2024 RESULTS

Rhea-AI Summary

Chipotle Mexican Grill (NYSE: CMG) reported strong second quarter 2024 results, with total revenue increasing 18.2% to $3.0 billion. Comparable restaurant sales rose 11.1%, driven by an 8.7% increase in transactions and a 2.4% increase in average check. The company's operating margin expanded to 19.7%, up from 17.2% in the previous year. Diluted earnings per share grew 32.0% to $0.33, while adjusted diluted EPS increased 36.0% to $0.34.

Chipotle opened 52 new company-operated restaurants during the quarter, with 46 locations including a Chipotlane. Digital sales represented 35.3% of total food and beverage revenue. The company also completed a 50-for-1 stock split and repurchased $151.4 million of stock. For the full year 2024, Chipotle anticipates mid to high-single digit comparable restaurant sales growth and plans to open 285 to 315 new restaurants.

Positive

• Total revenue increased 18.2% year-over-year to $3.0 billion
• Comparable restaurant sales grew 11.1%, with transactions up 8.7%
• Operating margin expanded to 19.7% from 17.2% in the previous year
• Diluted EPS increased 32.0% to $0.33, adjusted diluted EPS up 36.0% to $0.34
• Opened 52 new company-operated restaurants, 46 with Chipotlanes
• Digital sales represented 35.3% of total food and beverage revenue
• Restaurant level operating margin improved to 28.9% from 27.5% year-over-year

Negative

• Food, beverage and packaging costs remained flat at 29.4% of total revenue
• Increased inflation in avocados and higher oil usage for frying chips
• Higher incidence of beef due to marketing initiatives
• Effective income tax rate increased to 25.0% from 23.8% in Q2 2023

Insights

Financial Analyst

Chipotle's Q2 2024 results demonstrate robust growth and operational efficiency. The 18.2% increase in total revenue to $3.0 billion is impressive, driven by both new restaurant openings and a strong 11.1% increase in comparable restaurant sales. The 8.7% growth in transactions is particularly noteworthy, indicating strong consumer demand and effective marketing strategies.

The company's focus on digital sales, representing 35.3% of total food and beverage revenue, continues to be a key driver of growth. The expansion of Chipotlanes in 88% of new restaurant openings is likely contributing to improved convenience and higher margins.

Profitability metrics show significant improvement, with operating margin expanding to 19.7% from 17.2% year-over-year. The restaurant level operating margin increase of 140 basis points to 28.9% is commendable, especially considering inflationary pressures.

The 32% increase in diluted EPS to $0.33 ($0.34 adjusted) reflects the company's ability to translate top-line growth into bottom-line results. The ongoing share repurchase program, with $647.7 million still available, demonstrates confidence in the company's future prospects.

Looking ahead, management's guidance of mid to high-single digit comparable restaurant sales growth for 2024, along with plans for 285-315 new restaurant openings, suggests continued momentum. However, investors should monitor potential headwinds such as ongoing inflationary pressures and the competitive landscape in the fast-casual dining sector.

Market Research Analyst

Chipotle's Q2 performance underscores its strong market position and effective strategies in the fast-casual dining segment. The 11.1% increase in comparable restaurant sales, driven by an 8.7% rise in transactions, indicates that Chipotle is outperforming the broader restaurant industry.

The success of marketing initiatives, such as the return of Chicken Al Pastor and the Braised Beef Barbacoa, demonstrates Chipotle's ability to innovate and drive customer engagement. This is important in a competitive market where menu innovation can significantly impact consumer choice.

The continued focus on digital sales, accounting for 35.3% of total food and beverage revenue, aligns with broader industry trends towards convenience and technology integration. The expansion of Chipotlanes in new restaurant openings is a strategic move that caters to changing consumer preferences for quick, contactless service.

Chipotle's ability to maintain food costs at 29.4% of total revenue, despite inflationary pressures, suggests effective supply chain management and pricing strategies. This is particularly important given the current economic environment and its potential impact on consumer spending habits.

The company's expansion plans, with 285-315 new restaurant openings projected for 2024, indicate confidence in market demand and the scalability of their business model. However, it will be important to monitor how this rapid expansion affects operational efficiency and brand consistency across locations.

Overall, Chipotle's performance suggests it is well-positioned to capitalize on the ongoing recovery in the restaurant sector, with strategies that align well with evolving consumer preferences and market trends.

COMPARABLE SALES INCREASE 11% DRIVEN BY OVER 8% TRANSACTION GROWTH AS MARGINS EXPAND

NEWPORT BEACH, Calif., July 24, 2024 /PRNewswire/ -- Chipotle Mexican Grill, Inc. (NYSE: CMG) today reported financial results for its second quarter ended June 30, 2024.

Second quarter highlights, year over year:

• Total revenue increased 18.2% to $3.0 billion
• Comparable restaurant sales increased 11.1%
• Operating margin was 19.7%, an increase from 17.2%
• Restaurant level operating margin was 28.9%¹, an increase of 140 basis points
• Diluted earnings per share was $0.33, a 32.0% increase from $0.25. Adjusted diluted earnings per share, which excluded a $0.01 after-tax impact from an unrealized loss on a long-term investment and an increase in legal reserves, was $0.34¹, a 36.0% increase from $0.25¹
• Opened 52 new company-operated restaurants with 46 locations including a Chipotlane, and one international licensed restaurant

"The second quarter was outstanding as successful brand marketing, including the return of Chicken Al Pastor, drove strong demand to our restaurants. Our focus and training around throughput paid off as we were able to meet the stronger demand trends with terrific service and speed driving over 8% transaction growth in the quarter," said Brian Niccol, Chairman and CEO, Chipotle.

Common Stock Split Completed

On June 26, 2024, we executed a 50-for-1 stock split of our common stock with a record date of June 18, 2024, and proportionately increased the number of authorized shares of common stock to reflect the effect of the stock split.

Results for the three months ended June 30, 2024:

Total revenue in the second quarter was $3.0 billion, an increase of 18.2% compared to the second quarter of 2023. The increase in total revenue was driven by new restaurant openings and an 11.1% increase in comparable restaurant sales due to higher transactions of 8.7% and a 2.4% increase in average check. Digital sales represented 35.3% of total food and beverage revenue.

During the second quarter we opened 52 new company-operated restaurants, of which 46 included a Chipotlane, and one international licensed restaurant. These formats continue to perform well and are helping enhance guest access and convenience, as well as increase new restaurant sales, margins, and returns.

Food, beverage and packaging costs in the second quarter of 2024 were 29.4% of total revenue, in line with the second quarter of 2023. The benefit of last year's menu price increase was partially offset by inflation of avocados, and, to a lesser extent, increased oil usage for frying chips and higher incidence of beef as a result of the continued success of our Braised Beef Barbacoa marketing initiative.

Restaurant level operating margin in the second quarter was 28.9%¹ compared to 27.5%¹ in the second quarter of 2023. The improvement was primarily driven by the benefit of sales leverage, partially offset by wage and ingredient inflation.

General and administrative expenses for the second quarter were $175.0 million on a GAAP basis, or $171.3 million¹ on a non-GAAP basis, excluding a $3.8 million increase in legal reserves. GAAP and non-GAAP general and administrative expenses for the second quarter also include $121.9 million of underlying general and administrative expenses, $43.5 million of non-cash stock compensation, and $5.9 million of higher performance-based accruals and payroll taxes on equity vesting and exercises.

The effective income tax rate for the second quarter was 25.0% compared to 23.8% in the second quarter of 2023. The increase in the effective income tax rate was primarily due to a decrease in tax benefits related to option exercises and equity vesting, partially offset with a decrease in tax reserves.

Net income for the second quarter was $455.7 million, or $0.33 per diluted share, compared to $341.8 million, or $0.25 per diluted share in the second quarter of 2023. In the second quarter of 2024, excluding the $0.01 after-tax impact from an unrealized loss on a long-term investment and an increase in legal reserves, adjusted net income was $463.0 million¹ and adjusted diluted earnings per share was $0.34¹.

During the second quarter we repurchased $151.4 million of stock at an average price per share of $63.52. As of June 30, 2024, $647.7 million remained available under share repurchase authorizations from our Board of Directors, including an additional $400 million in authorized repurchases approved by the Board on June 5, 2024. The repurchase authorization may be modified, suspended, or discontinued at any time.

More information will be available in our Quarterly Report on Form 10-Q, which will be filed with the SEC by the end of July.

Outlook

For 2024, management is anticipating the following:

• Full year comparable restaurant sales growth in the mid to high-single digit range
• 285 to 315 new restaurant openings with over 80% having a Chipotlane
• An estimated underlying effective full year tax rate between 25% and 27% before discrete items

Definitions

The following definitions apply to these terms as used throughout this release:

• Comparable restaurant sales, or sales comps, and comparable restaurant transactions, represent the change in period-over-period total revenue or transactions for restaurants in operation for at least 13 full calendar months.
• Average restaurant sales refer to the average trailing 12-month food and beverage revenue for restaurants in operation for at least 12 full calendar months.
• Restaurant level operating margin represents total revenue less direct restaurant operating costs, expressed as a percent of total revenue.
• Digital sales represent food and beverage revenue generated through the Chipotle website, Chipotle app or third-party delivery aggregators. Digital sales include revenue deferrals associated with Chipotle Rewards.

Conference Call Details

Chipotle will host a conference call on Wednesday, July 24, 2024, at 4:30 PM Eastern time to discuss second quarter 2024 financial results as well as provide a business update for the third quarter 2024.

The conference call can be accessed live over the phone by dialing 1-888-317-6003, or for international callers by dialing 1-412-317-6061, and use code: 5419901. The call will be webcast live from the company's website on the investor relations page at ir.chipotle.com/events. An archived webcast will be available approximately one hour after the end of the call.

About Chipotle

Chipotle Mexican Grill, Inc. (NYSE: CMG) is cultivating a better world by serving responsibly sourced, classically-cooked, real food with wholesome ingredients without artificial colors, flavors or preservatives. There are over 3,500 restaurants as of June 30, 2024, in the United States, Canada, the United Kingdom, France, Germany, and Kuwait and it is the only restaurant company of its size that owns and operates all its restaurants in North America and Europe. Chipotle is ranked on the Fortune 500 and is recognized on Fortune's Most Admired Companies 2024 list and Time Magazine's Most Influential Companies. With over 120,000 employees passionate about providing a great guest experience, Chipotle is a longtime leader and innovator in the food industry. Chipotle is committed to making its food more accessible to everyone while continuing to be a brand with a demonstrated purpose as it leads the way in digital, technology and sustainable business practices. For more information or to place an order online, visit WWW.CHIPOTLE.COM.

Forward-Looking Statements

Certain statements in this press release and in the July 24, 2024, conference call are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including statements under "Outlook" about our anticipated  full year 2024 comparable restaurant sales growth, goals for number of new restaurant openings, and estimated underlying effective full year tax rate, as well as statements about expected restaurants with Chipotlanes, our ability to achieve our long-term target of more than doubling our business in North America and expanding internationally, our rate of expansion, future food costs, future labor costs, future general and administrative and other costs, future estimated tax rates and future long-term prospects. We use words such as "anticipate", "believe", "could", "should", "may", "approximately", "estimate", "expect", "intend", "project", "target", "goal" and similar terms and phrases, including references to assumptions, to identify forward-looking statements. The forward-looking statements in this press release are based on currently available operating, financial and competitive information available to us as of the date of this release and we assume no obligation to update these forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the statements, including but not limited to: increasing wage inflation, including as a result of state or local regulations mandating higher minimum wages, and the competitive labor market, which impacts our ability to attract and retain qualified employees and has resulted in occasional staffing shortages; the impact of any union organizing efforts and our responses to such efforts; increasing supply costs; risks of food safety incidents and food-borne illnesses; risks associated with our reliance on certain information technology systems and potential material failures, interruptions or outages; privacy and cyber security risks, including risk of breaches, unauthorized access, theft, modification, destruction or ransom of guest or employee personal or confidential information stored on our network or the network of third party providers; the impact of competition, including from sources outside the restaurant industry; the impact of federal, state or local government regulations relating to our employees, employment practices, restaurant design and construction, and the sale of food or alcoholic beverages; our ability to achieve our planned growth, such as the costs and availability of suitable new restaurant sites, construction materials and contractors; the expected costs and risks related to our international expansion, including through licensed restaurants in the Middle East; increases in ingredient and other operating costs due to inflation, global conflicts, severe weather and climate change, our Food with Integrity philosophy, tariffs or trade restrictions; intermittent supply shortages relating to our Food with Integrity philosophy, rapid expansion and supply chain disruptions; the uncertainty of our ability to achieve expected levels of comparable restaurant sales due to factors such as changes in guests' perceptions of our brand, including as a result of negative publicity or social media posts, decreased consumer spending (including as a result of higher inflation, mass layoffs, fear of possible recession and higher energy prices), or the inability to increase menu prices or realize the benefits of menu price increases; risks associated with our digital business, including risks arising from our reliance on third party delivery services and the IT infrastructure; litigation risks, including possible governmental actions and potential class action litigation related to food safety incidents, cybersecurity incidents, employment or privacy laws, advertising claims, contract disputes or other matters; and other risk factors described from time to time in our SEC reports, including our annual report on Form 10-K and quarterly reports on Form 10-Q, all of which are available on the investor relations page of our website at ir.Chipotle.com.

1

Restaurant level operating margin, adjusted diluted earnings per share, adjusted net income, non-GAAP general and administrative expenses, and non-GAAP effective income tax rate are non-GAAP financial measures. Reconciliations to GAAP measures and further information are set forth in the table at the end of this press release.

 

CHIPOTLE MEXICAN GRILL, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per share data) (unaudited)
	Three months ended June 30,
	2024				2023
Food and beverage revenue	$    2,954,913		99.4 %		$    2,497,509		99.3 %
Delivery service revenue	18,204		0.6		17,292		0.7
Total revenue	2,973,117		100.0		2,514,801		100.0
Restaurant operating costs (exclusive of depreciation and amortization shown separately below):
Food, beverage and packaging	873,673		29.4		738,664		29.4
Labor	716,627		24.1		611,678		24.3
Occupancy	138,663		4.7		123,897		4.9
Other operating costs	384,754		12.9		349,707		13.9
General and administrative expenses	175,028		5.9		156,496		6.2
Depreciation and amortization	83,562		2.8		78,771		3.1
Pre-opening costs	8,995		0.3		7,538		0.3
Impairment, closure costs, and asset disposals	5,762		0.2		16,240		0.6
Total operating expenses	2,387,064		80.3		2,082,991		82.8
Income from operations	586,053		19.7		431,810		17.2
Interest and other income, net	21,861		0.7		16,446		0.7
Income before income taxes	607,914		20.4		448,256		17.8
Provision for income taxes	152,243		5.1		106,466		4.2
Net income	$       455,671		15.3 %		$       341,790		13.6 %
Earnings per share:
Basic	$              0.33				$              0.25
Diluted	$              0.33				$              0.25
Weighted-average common shares outstanding:
Basic	1,372,800				1,380,222
Diluted	1,381,518				1,387,372

 

CHIPOTLE MEXICAN GRILL, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per share data) (unaudited)
	Six months ended June 30,
	2024				2023
Food and beverage revenue	$      5,639,361		99.4 %		$      4,848,518		99.3 %
Delivery service revenue	35,605		0.6		34,863		0.7
Total revenue	5,674,966		100.0		4,883,381		100.0
Restaurant operating costs (exclusive of depreciation and amortization shown separately below):
Food, beverage and packaging	1,652,749		29.1		1,431,223		29.3
Labor	1,376,077		24.2		1,195,472		24.5
Occupancy	274,362		4.8		245,828		5.0
Other operating costs	770,528		13.6		712,913		14.6
General and administrative expenses	379,653		6.7		304,836		6.2
Depreciation and amortization	166,805		2.9		155,356		3.2
Pre-opening costs	16,206		0.3		13,736		0.3
Impairment, closure costs, and asset disposals	11,241		0.2		24,601		0.5
Total operating expenses	4,647,621		81.9		4,083,965		83.6
Income from operations	1,027,345		18.1		799,416		16.4
Interest and other income, net	41,225		0.7		25,395		0.5
Income before income taxes	1,068,570		18.8		824,811		16.9
Provision for income taxes	253,612		4.5		191,377		3.9
Net income	$         814,958		14.4 %		$         633,434		13.0 %
Earnings per share:
Basic	$                0.59				$                0.46
Diluted	$                0.59				$                0.46
Weighted-average common shares outstanding:
Basic	1,372,488				1,380,711
Diluted	1,381,347				1,388,386

 

CHIPOTLE MEXICAN GRILL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except per share data)
	June 30, 2024		December 31, 2023
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$           806,528		$           560,609
Accounts receivable, net	97,542		115,535
Inventory	35,560		39,309
Prepaid expenses and other current assets	91,852		117,462
Income tax receivable	71,529		52,960
Investments	683,287		734,838
Total current assets	1,786,298		1,620,713
Leasehold improvements, property and equipment, net	2,265,694		2,170,038
Long-term investments	972,644		564,488
Restricted cash	27,664		25,554
Operating lease assets	3,770,997		3,578,548
Other assets	74,599		63,082
Goodwill	21,939		21,939
Total assets	$        8,919,835		$        8,044,362
Liabilities and shareholders' equity
Current liabilities:
Accounts payable	$           203,480		$           197,646
Accrued payroll and benefits	223,410		227,537
Accrued liabilities	169,631		147,688
Unearned revenue	182,331		209,680
Current operating lease liabilities	264,304		248,074
Total current liabilities	1,043,156		1,030,625
Long-term operating lease liabilities	4,014,454		3,803,551
Deferred income tax liabilities	83,298		89,109
Other liabilities	67,107		58,870
Total liabilities	5,208,015		4,982,155
Shareholders' equity:
Preferred stock, $0.01 par value, 600,000 shares authorized, no shares issued as of June 30, 2024 and December 31, 2023, respectively	-		-
Common stock, $0.01 par value, 11,500,000 shares authorized, 1,371,372 and 1,874,139 shares issued as of June 30, 2024 and December 31, 2023, respectively	13,713		18,741
Additional paid-in capital	2,023,802		1,937,794
Treasury stock, at cost, 0 and 502,843 common shares as of June 30, 2024 and December 31, 2023, respectively	-		(4,944,656)
Accumulated other comprehensive loss	(8,514)		(6,657)
Retained earnings	1,682,819		6,056,985
Total shareholders' equity	3,711,820		3,062,207
Total liabilities and shareholders' equity	$        8,919,835		$        8,044,362

 

CHIPOTLE MEXICAN GRILL, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited)
	Six months ended June 30,
	2024		2023
Operating activities
Net income	$       814,958		$       633,434
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	166,805		155,356
Deferred income tax provision	(5,826)		7,827
Impairment, closure costs, and asset disposals	9,917		24,173
Provision for credit losses	(155)		312
Stock-based compensation expense	81,243		50,756
Other	4,511		(9,237)
Changes in operating assets and liabilities:
Accounts receivable	18,331		44,027
Inventory	3,763		(313)
Prepaid expenses and other current assets	20,348		(21,365)
Operating lease assets	135,881		121,363
Other assets	1,769		3,455
Accounts payable	7,802		(10,783)
Accrued payroll and benefits	(4,438)		7,597
Accrued liabilities	17,056		(66)
Unearned revenue	(22,260)		(19,894)
Income tax payable/receivable	(18,565)		146,177
Operating lease liabilities	(101,348)		(100,794)
Other long-term liabilities	2,020		5,521
Net cash provided by operating activities	1,131,812		1,037,546
Investing activities
Purchases of leasehold improvements, property and equipment	(273,193)		(257,601)
Purchases of investments	(738,434)		(590,656)
Maturities of investments	374,373		220,565
Net cash used in investing activities	(637,254)		(627,692)
Financing activities
Acquisition of treasury stock	(172,368)		(221,754)
Tax withholding on stock-based compensation awards	(73,011)		(67,474)
Other financing activities	(29)		115
Net cash used in financing activities	(245,408)		(289,113)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(1,121)		265
Net change in cash, cash equivalents, and restricted cash	248,029		121,006
Cash, cash equivalents, and restricted cash at beginning of period	586,163		408,966
Cash, cash equivalents, and restricted cash at end of period	$       834,192		$       529,972
Supplemental disclosures of cash flow information
Income taxes paid	$       277,427		$         33,252
Purchases of leasehold improvements, property and equipment accrued in accounts payable and accrued liabilities	$         76,304		$         55,904
Acquisition of treasury stock accrued in accounts payable and accrued liabilities	$           9,803		$           2,406

 

CHIPOTLE MEXICAN GRILL, INC. SUPPLEMENTAL FINANCIAL AND OTHER DATA (dollars in thousands) (unaudited)
		For the three months ended
		Jun. 30, 2024		Mar. 31, 2024		Dec. 31, 2023		Sep. 30, 2023		Jun. 30, 2023
Company-operated restaurants opened		52		47		121		62		47
Chipotle permanent closures		(1)		(3)		(2)		(1)		-
Chipotle relocations		-		(2)		(3)		(2)		(3)
Non-Chipotle permanent closures		-		-		-		(6)		-
Company-operated restaurants at end of period		3,530		3,479		3,437		3,321		3,268
Average restaurant sales		$        3,146		$        3,082		$        3,018		$        2,972		$        2,941
Comparable restaurant sales increase		11.1 %		7.0 %		8.4 %		5.0 %		7.4 %
		For the three months ended
		Jun. 30, 2024		Mar. 31, 2024		Dec. 31, 2023		Sep. 30, 2023		Jun. 30, 2023
Licensed restaurants opened		1		-		-		-		-
Licensed restaurants at end of period		1		-		-		-		-

 

 

CHIPOTLE MEXICAN GRILL, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Below are definitions of the non-GAAP financial measures in this release. The following tables provide a reconciliation of non-GAAP financial measures presented in this release to the most directly comparable financial measures calculated and presented in accordance with GAAP.

Adjusted net income is net income excluding expenses related to restaurant and corporate asset impairment, corporate restructuring, certain legal proceedings, and loss on investments. Adjusted general and administrative expense is general and administrative expense excluding expenses related to corporate restructuring and certain legal proceedings. The adjusted effective income tax rate is the effective income tax rate adjusted to reflect the after tax impact of non-GAAP adjustments. Restaurant Level Operating Margin is equal to the revenues generated by our restaurants less their direct operating costs which consist of food, beverage and packaging, labor, occupancy and other operating costs. This performance measure primarily includes the costs that restaurant level managers can directly control and excludes other costs that are essential to conduct our business. Management uses restaurant level operating margin as a measure of restaurant performance. Management believes restaurant level operating margin is useful to investors in that it highlights trends in our core business that may not otherwise be apparent to investors when relying solely on GAAP financial measures. We present these non-GAAP measures in order to facilitate meaningful evaluation of our operating performance across periods. These adjustments are intended to provide greater transparency of underlying performance and to allow investors to evaluate our business on the same basis as our management, which uses these non-GAAP measures in evaluating the company's performance. Our adjusted net income, adjusted diluted earnings per share, adjusted general and administrative expenses, adjusted effective income tax rate and restaurant level operating margin measures may not be comparable to other companies' adjusted measures. These adjustments are not necessarily indicative of what our actual financial performance would have been during the periods presented and should be viewed in addition to, and not as an alternative to, our results prepared in accordance with GAAP. Further details regarding these adjustments are included in the tables below.

CHIPOTLE MEXICAN GRILL, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
Adjusted Net Income and Adjusted Diluted Earnings per Share (in thousands, except per share amounts) (unaudited)
	Three months ended June 30,
	2024		2023
Net income	$       455,671		$       341,790
Non-GAAP adjustments:
Impairment and exit costs:
Restaurant asset impairment and other restaurant exit costs(1)	-		4,765
Corporate asset impairment(2)	-		3,735
Corporate Restructuring:
Employee related and other restructuring costs(3)	-		3,495
Legal proceedings(4)	3,775		-
Investment(5)	6,016		-
Total non-GAAP adjustments	9,791		11,995
Tax effect of non-GAAP adjustments above(6)	(2,471)		(2,891)
After tax impact of non-GAAP adjustments	7,320		9,104
Adjusted net income	$       462,991		$       350,894
Diluted weighted-average number of common shares outstanding	1,381,518		1,387,372
Diluted earnings per share	$              0.33		$              0.25
Adjusted diluted earnings per share	$              0.34		$              0.25

(1)	Operating lease asset and leasehold improvements, property, plant and equipment impairment charges and other expenses for restaurants due to closures, relocations, or underperformance.
(2)	Operating lease asset and leasehold improvements, property, plant and equipment impairment charges and other expenses for offices or other corporate assets.
(3)	Charges for employee severance, stock modifications and third-party vendors related to the May 2023 optimization of our organizational structure.
(4)	Charges for estimated settlements for distinct legal matters that exceeded or are expected to exceed typical costs for these types of legal proceedings.
(5)	Charges for an unrealized loss in a long-term investment.
(6)	Adjustments relate to the tax effect of non-GAAP adjustments, which were determined based on the nature of the underlying non-GAAP adjustments and their relevant jurisdictional tax rates.

 

CHIPOTLE MEXICAN GRILL, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
Adjusted General and Administrative Expenses (in thousands) (unaudited)
	Three months ended June 30,
	2024		2023
General and administrative expenses	$       175,028		$       156,496
Non-GAAP adjustments:
Restructuring expense(1)	-		(3,495)
Legal proceedings(2)	(3,775)		-
Total non-GAAP adjustments	(3,775)		(3,495)
Adjusted general and administrative expenses	$       171,253		$       153,001

(1)	For three months ended June 30, 2023, costs for employee severance, stock modifications and third party related to the May 2023 optimization of our organizational structure.
(2)	Charges for estimated settlements for distinct legal matters that exceeded or are expected to exceed typical costs for these types of legal proceedings.

 

CHIPOTLE MEXICAN GRILL, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
Adjusted Effective Income Tax Rate (unaudited)
	Three months ended June 30,
	2024		2023
Effective income tax rate	25.0 %		23.8 %
Tax impact of non-GAAP adjustments(1)	-		-
Adjusted effective income tax rate	25.0 %		23.8 %

(1)	Adjustments relate to the tax effect of non-GAAP adjustments, which were determined based on the nature of the underlying non-GAAP adjustments and their relevant jurisdictional tax rates.

 

CHIPOTLE MEXICAN GRILL, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
Restaurant Level Operating Margin (in thousands) (unaudited)
	Three months ended June 30,
	2024		Percent of total revenue		2023		Percent of total revenue
Income from operations	$       586,053		19.7 %		$       431,810		17.2 %
Non-GAAP Adjustments
General and administrative expenses	175,028		5.9		156,496		6.2
Depreciation and amortization	83,562		2.8		78,771		3.1
Pre-opening costs	8,995		0.3		7,538		0.3
Impairment, closure costs, and asset disposals	5,762		0.2		16,240		0.6
Total non-GAAP Adjustments	$       273,347		9.2 %		$       259,045		10.3 %
Restaurant level operating margin	$       859,400		28.9 %		$       690,855		27.5 %

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/chipotle-announces-second-quarter-2024-results-302205678.html

SOURCE Chipotle Mexican Grill

FAQ

What was Chipotle's (CMG) revenue growth in Q2 2024?

Chipotle's total revenue increased 18.2% year-over-year to $3.0 billion in Q2 2024.

How much did Chipotle's (CMG) comparable restaurant sales grow in Q2 2024?

Chipotle's comparable restaurant sales increased by 11.1% in Q2 2024, driven by an 8.7% increase in transactions and a 2.4% increase in average check.

What was Chipotle's (CMG) earnings per share in Q2 2024?

Chipotle's diluted earnings per share was $0.33 in Q2 2024, a 32.0% increase from $0.25 in Q2 2023. Adjusted diluted EPS was $0.34, up 36.0% year-over-year.

How many new restaurants did Chipotle (CMG) open in Q2 2024?

Chipotle opened 52 new company-operated restaurants in Q2 2024, with 46 locations including a Chipotlane, and one international licensed restaurant.

What is Chipotle's (CMG) outlook for comparable restaurant sales growth in 2024?

For 2024, Chipotle anticipates full year comparable restaurant sales growth in the mid to high-single digit range.