Chipotle Reports Declining Sales After E. Coli Scares

Toni Ann Booras Contributor
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Chipotle Mexican Grill has reported its first sales decline since going public in 2006 after two separate E. coli scares last year led to 22 hospitalizations.

The company announced fourth quarter profit totaled $67.8 million, falling 44 percent from the same period last year. The news comes as the company announced it has been served with a subpoena for food safety records going back to 2013.

The Centers for Disease Control and Prevention announced Monday that the E. coli outbreaks “appear to be over,” though officials were not able to trace the outbreaks to a single ingredient.

“Most ill people in these outbreaks ate many of the same food items at a Chipotle Mexican Grill restaurant,” a CDC release stated. “When a restaurant serves foods with several ingredients that are mixed or cooked together and then used in multiple menu items, it can be more difficult for epidemiologic studies to identity the specific ingredient that is contaminated.”

Reuters has reported that the company’s stock climbed Monday and Tuesday for a two-day gain of nearly 7 percent in light of the CDC’s announcement. The Associated Press reported co-CEO Steve Ellse said Tuesday the company was “pleased to have this behind us.”

“The fourth quarter of 2015 was the most challenging period in Chipotle’s history, but the Centers for Disease Control and Prevention has now concluded its investigation into the recent E. coli incidents associated with Chipotle,” Chipotle said in a statement. “We are pleased to have this behind us and can place our full energies to implementing our enhanced food safety plan that will establish Chipotle as an industry leader in food safety.”

The initial E. coli outbreak affected 55 people in 11 states, while five people in three states were infected by the second outbreak. These were preceded by two other incidents, when 64 people were infected with Salmonella in Minnesota and about 100 people were affected by norovirus in California in August. In December, at least 120 people, including many college students, were sickened after a norovirus outbreak at a Chipotle location near Boston College.

The U.S. Food and Drug Administration’s Office of Criminal Investigations is investigating the California norovirus outbreak and the company has been issued a subpoena for several documents related to the California store, according to AP.

The company has announced it will delay opening all stores until 3 p.m. on Monday, Feb. 8 to hold a national food safety meeting.