Chipotle Mexican Grill (CMG) has expedited its CFO transition following the departure of CEO Brian Niccol for Starbucks (SBUX), the burrito chain announced on Wednesday.
Adam Rymer will now assume the role of finance chief on October 1st, rather than January as initially planned. This decision comes after Niccol’s announcement to join Starbucks as CEO on September 9th. Rymer was promoted to the CFO position in July, succeeding longtime CFO Jack Hartung. Hartung, who had intended to retire, will now serve as Chipotle’s president and chief strategy officer, effective October 1st. He will support interim CEO Scott Boatwright during this transition period.
Additionally, Jamie McConnell, Chipotle’s controller, will step into the role of chief accounting and administrative officer. To ensure leadership stability, Chipotle has implemented retention plans for its entire executive team during this transitional phase. Niccol’s move to Starbucks is aimed at revitalizing the coffee giant as it faces pressure from activist investors.
The transition at Chipotle comes at a crucial time for the company. Recently, Chipotle has been in the spotlight for both positive and negative reasons. On Tuesday, Chipotle’s stock rose following the announcement of a new menu item, Chipotle Honey Chicken, which is part of the company’s strategy to introduce two to three new items annually.
However, the company is also facing scrutiny from the National Labor Relations Board (NLRB). The NLRB has accused Chipotle of unlawfully withholding pay raises from unionized workers at its Lansing, Michigan location. The charges stem from allegations by the International Brotherhood of Teamsters, which claimed that Chipotle informed unionized workers they would not receive the same raises as non-unionized employees. The NLRB’s general counsel intends to file a formal complaint unless the issue is resolved.
Despite these challenges, some experts believe that Chipotle remains a strong investment. Stephanie Link, Chief Investment Strategist & Portfolio Manager at Hightower Advisors, indicated that the company’s recent stock decline presents a buying opportunity.
In after-hours trading, Chipotle Mexican stock fell 0.48% to $55.50. Earlier in the regular trading session, the stock closed at $55.77, down 0.66% for the day. Year to date, the stock has surged 24.21%.
