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New Chipotle stores, higher traffic lift 4Q profit

DENVER (AP) -- Chipotle Mexican Grill continued to open new locations throughout the final quarter of the year in an aggressive expansion, pushing net income nearly 7 percent higher.

Company shares, which had taken a beating after a weak third quarter, rose 4 percent in after-hours trading.

At stores open at least a year, revenue rose 3.8 percent on higher customer traffic. That's a closely watched industry figure because it strips out the effect of new and closing stores.

Despite increasing costs for ingredients, Chipotle had been reluctant to test customers with higher prices in a weak economy. But it did so, mostly in 2011, and the move appears to be paying off as the company's costs for beef, salsa ingredients and dairy keep rising.

The Denver restaurant chain reported earnings of $61.4 million, or $1.95 per share, for the quarter ending Dec. 31. That compares with $57.5 million, or $1.81 per share, for the same period last year.

Revenue rose 17 percent, to $699.2 million from $596.7 million.

The per-share earnings were a penny shy of Wall Street expectations, according to a poll by FactSet, but it topped analyst projections for revenue of $696 million.

After opening more than 120 new locations during the first three quarters of the year, Chipotle accelerated that pace in the final three months of 2012, opening 60 new restaurants.

It predicted a slower rate of openings this year, with 165 to 180 new restaurants.

In 2012, Chipotle earned $278 million, or $8.75 per shares, up from $214.9 million, or $6.76 per share, in 2011. Revenue in stores open at least a year rose 7.1 percent, while total revenue rose 20 percent to $2.73 billion.

For 2013, Chipotle expects slower growth in the metric: A range of unchanged to growth of up to a low single digit percentage.

Shares of Chipotle Mexican Grill Inc. rose $12.92 to $317.93 after the closing bell. The stock had lost 18 percent over the past 12 months.