Brian Niccol’s tenure at Chipotle Mexican Grill is off to good begin.
Taco Bell to take over the beleaguered burrito model, inheriting an organization that has suffered from a three-year gross sales stoop.
The hope is that Niccol, who joined the corporate on March 5, can revitalize the model. He has a popularity for advertising and know-how innovation, two key areas that haven’t been a high precedence for Chipotle. At Taco Bell, he launched cellular order and pay, repositioned the Mexican chain as a way of life model and pushed for extra ingenuity within the kitchen.
During the earnings convention name, Niccol stated Chipotle can be focusing closely on digital, advertising and menu innovation. He advised buyers that he would share extra element about Chipotle’s plan throughout a name forward of the second-quarter earnings report.
In the primary quarter, Chipotle stated internet revenue rose to $59.four million, or $2.13 per share, up from $46.1 million, or $1.60 per share, within the year-earlier interval. Analysts had anticipated Chipotle to report earnings of $1.57 per share, in response to Thomson Reuters.
Total income climbed 7.four p.c to $1.15 billion, in-line with analyst expectations.
Same-store gross sales for the quarter had been up 2.2 p.c, larger than the 1.three p.c analysts had anticipated, in response to StreetAccount.
As the corporate embarks on the subsequent section of its turnaround below Niccol, buyers will need to see if he can increase buyer visitors.
“One of [customers’] biggest complaints frankly is access to the brand,” Niccol stated. “The brand is not that convenient.”
Niccol stated that prospects need cellular ordering and supply, however that about half of them do not know that Chipotle is beginning to implement this stuff.
The new CEO has already made some adjustments on the firm. Chipotle, which has been gradual to advertise nationwide tv campaigns prior to now, has created a number of light-hearted new adverts that concentrate on the chain’s “real” components.
Refreshing Chipotle’s messaging and picture are key parts of Niccol’s turnaround plans. In explicit, he desires to remind prospects why they love the model and its meals.
While there have been some considerations that Niccol must compete with Steve Ells, the ex-CEO and founding father of the corporate, who has remained with Chipotle as govt chairman, Ells didn’t converse throughout the earnings name.
Chipotle maintained its outlook for 2018, which requires same-store gross sales to rise at a low-single digit tempo. It additionally expects to open between 130 and 150 new shops. In addition, Chipotle stated its board had approved one other $100 million in inventory repurchases.