Chipotle’s UK profitability ‘impacted’ by illness incidents that rocked US business

MIAMI, FL - APRIL 27:  Chipotle restaurant workers fill orders for customers on the day that the company announced it will only use non-GMO ingredients in its food on April 27, 2015 in Miami, Florida.  The company announced, that the Denver-based chain would not use the GMO's, which is an organism whose genome has been altered via genetic engineering in the food served at Chipotle Mexican Grills.  (Photo by Joe Raedle/Getty Images)

Chipotle Mexican Grill has conceded for the first time that an E.coli outbreak which rocked its US operations “adversely impacted” the sales and profitability of its UK operations last year.

Accounts logged with Companies House last week reveal that UK sales fell 5% to £7.8m for the year to 31 December 2016, while gross losses increased 37% to £1.9m.

Although the UK business was not caught up in the food safety crisis, the company’s directors said its results were affected by a “number of food-borne illness incidents associated with Chipotle restaurants in as many as 15 US states”.

Those incidents were widely reported in the fourth quarter of 2015 and first quarter of 2016. The company’s US management has since announced that it has taken “aggressive actions” to implement industry-leading food safety and food handling practices in all of its restaurants and throughout its supply chain.

As of December 31 2016, Chipotle had six restaurants in the UK, down by one on the previous year after the closure of its Wimbledon Hill Road site due to “low sales”.

Overall losses for the year totalled £4.3m in the UK, compared with losses of £4.7m the year before.

Chipotle develops and operates fast-casual restaurants which serve a focused menu of burritos, tacos, burrito bowls and salads, made using fresh ingredients.

In July last year, the intellectual property of the Chipotle business in EMEA was acquired by CMG UK for a purchase price of £6.9m.

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