Chipotle 4Q14 Earnings Call Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. Full transcripts can be found at Seeking Alpha

Could not deliver these result without the broader vision

“Quite simply, I do not think that we would be able to deliver these results without such a compelling and broader vision we have made it our mission to change the way people think about any fast food and we have created an extraordinary food and people culture, and a very strong unit economic model that is allowing us to do that. ”

Success with young people is about the mission

“We believe that our popularity among these younger consumers is tied to our vision and the growing interest in issues related to food and how it is raised. Our own research shows that these issues are clearly becoming more relevant and important when customers choose where they will dine.”

Do things your way

“From the very first Chipotle restaurant nearly 22 years ago we have chartered our own path for how a restaurant company should be run in every single way. We have shown that you can own and operate all of your restaurants rather than franchise and still grow at a rapid rate, that you can spend more on ingredients not less, still serve high quality food at reasonable prices and have industry leading margins and returns, that you can build teams of top performers and power them to deliver high standards while still maintaining an efficient labor model and that you can remain focused on doing just a few things extremely well rather than trying to be all things to all people or engaging in a kind of marketing gimmicks that it become the hallmarks of traditional fast food and still continue to attract new customers and profitably grow the business over the long-term.”

8 restaurants per field leader

” we have reduced the field leadership ratios from a high of around 15 restaurants for a field leader just a few years ago to about eight restaurants per field leader today.”

2.4m sales per restaurant

“our average sales volume for restaurant that have been opened for at least 12 months is now $2,472,000 the highest we’ve ever achieved. ”

Beef/Avocado prices higher, Dairy prices should come down

“Beef prices are expected to remain elevated throughout the year and into 2016 due to continued supply constraints and avocado prices are expected to be slightly higher in 2015 as increased demand is projected to exceed the higher yields we expect from California and Mexico during the year.”

“We expect dairy price to come down during Q1 from record highs for our cheese and sour cream from late 2014 and remain at normalized levels throughout the remainder of 2015.”

Accessibility is an important part of our mission

“The second reason why we’re not in a hurry and never been in hurry to raise prices is part of our vision is to remain accessible. So it’s important that we’ve got to source these high end premium ingredients, sustainably raise ingredient. But we want to be affordable. We want people to feel like they can come to Chipotle as often as they want once a week multiple times a week.”

We’re not thinking about the stock price when we make business decisions

” none of our discussions about price and what we should charge and ingredients to source and what the going rates of that — how should price additional food integrity initiatives what kind of price we should charge, none of that ever involves a discussion of the stock price. And so our belief has always been that we have the vision to change food culture the past food culture in this country and if we’re successful at that we just believe that we can have lots and lots of value and we’ve done. We’ve done that I think even maybe more than a lot of people including ourselves thought were possible 8 years ago when we first went public and so we think that our vision is working or is becoming a reality.”