DOW JONES NEWSWIRES 
 

Chipotle Mexican Grill Inc.'s (CMG) fourth-quarter net income fell 3.2% on lower margins caused by increased food costs.

Shares rose 14% to $53.99 in after-hours trading as the quarter's results beat expectations and Chipotle announced it will open fewer stores this year than planned.

Several analysts who cover the company in recent months have lowered their investment ratings and price targets, warning investors that its store traffic was slowing, along with peers, in the "fast-casual" dining segment. The company said Wednesday that customer visits declined, though that was offset by higher prices.

The burrito restaurant chain reported net income of $17 million, or 52 cents a share, down from $17.5 million, or 53 cents a share, a year earlier. Revenue rose 19% to $345.3 million as same-store sales rose 3.5%.

Analysts polled by Thomson Reuters were looking for earnings of 49 cents a share on revenue of $339 million.

The company said it opened 39 new restaurants in the quarter, putting its count at more than 830 restaurants.

Restaurant-level operating margins fell to 21.1% from 22.1% due to higher food costs that offset menu price increases.

Looking ahead, Chipotle still expects 2009 same-store sales growth in the low-single digits. But the company reduced its plans for new openings in 2009, projecting 120 to 130, down from its previous forecast of 135 to 145.

In January, the company announced plans to open restaurants in Europe, beginning in London late this year. The move shows the company continues to expand at a time when competitors founder because of a sharp pullback in discretionary spending.

Formerly a subsidiary of McDonald's Corp. (MCD), Chipotle - named for a dried, smoked jalapeno pepper - was founded in 1993 and went public in January 2006, with the stock price doubling to $44 on the first day.

-By Aja Carmichael, Dow Jones Newswires; 201-938-5218; aja.carmichael@dowjones.com