Steve Ells, the chief executive officer of the Chipotle Mexican Grill burrito chain, told an investment conference in New York City on Tuesday morning that he isn’t “satisfied” with the pace of the company’s recovery from health scares in the last year.
The stock’s value fell to $365.62 shortly after noon – a 7.8 percent drop. Before the tumble, according to Bloomberg, the company’s shares were already down 17 percent in 2016.
“I’m not satisfied with the rate of recovery,” Ells told a Barclays investment conference. “I’m particularly not satisfied with the quality of experience in some of our restaurants.”
The company experienced a crisis after a widespread E. coli outbreak and reports of other food-related illnesses gained widespread attention last year.
Since then, the company has tried to woo customers back, changing its food-safety protocol, advertising more and starting up a loyal-customer program — with mixed results.
According to Bloomberg, Chipotle’s same-store sales fell nearly 22 percent in the last quarter, worse than expected.
“2016 has been the most challenging year in our history,” Ells told the conference attendees. “We obviously have a long way to go.”
Chipotle hit an “inflection point” in July, when it began gaining more customers than it was losing,
Ells said that trust in the brand has returned to normal levels, with the company gaining more customers than it is losing since July of this year.
The chain is going through higher-than-normal employee turnover, and, the company announced, it is imposing a hiring freeze until its sales recover.
“People are leaving for better wages elsewhere,” Peter Saleh, an analyst at BTIG, told Bloomberg. With declining sales, he said, Chipotle doesn’t have the capability to pay people more.
“They’re in a really tough spot,” he said. “I’m not exactly sure what they’re going to do.”