DUBLIN, Calif., Nov. 17, 2016 /PRNewswire/ -- Ross Stores, Inc. (Nasdaq: ROST) today reported
earnings per share for the third quarter ended October 29, 2016 of $.62, a 17% increase on top of a robust 15% gain
in the prior year. Net earnings grew to $245 million, up from $216
million last year. Sales for the 2016 third
quarter rose 11% to $3.1 billion,
with comparable store sales up 7% versus a 3% gain in the prior
year.
For the first nine months of fiscal 2016, earnings per share
were $2.06, up 11% on top of a 15%
increase last year. Net earnings were $817
million, up from $757 million
in the prior year. Sales for the first nine months of 2016
rose 8% to $9.4 billion, with
comparable store sales up 4% on top of a 4% gain in 2015.
Barbara Rentler, Chief Executive
Officer, commented, "We are very pleased with our
better-than-expected sales and earnings growth in the third quarter
as customers responded favorably to the compelling values we
offered throughout our stores. Operating margin of 12.6% was
ahead of plan, increasing 55 basis points mainly from higher
merchandise margin."
Ms. Rentler added, "During the third quarter and first nine
months of fiscal 2016, we repurchased 2.8 million and 9.1 million
shares of common stock, respectively, for an aggregate price of
$179 million in the quarter and
$530 million year-to-date. We
remain on track to buy back a total of $700
million in common stock during fiscal 2016 to complete the
two-year $1.4 billion authorization
approved by our Board of Directors in February 2015."
Ms. Rentler continued, "As we enter this year's holiday season,
we face our most challenging multi-year sales comparisons. In
addition, the ongoing uncertainty in the macro-economic, political,
and retail environments could, once again, lead to a very
promotional fourth quarter. While we hope to do better, given
these potential headwinds, we are maintaining our comparable sales
guidance for a 1% to 2% increase on top of 6% and 4% gains in 2014
and 2015, respectively. Earnings per share for the period are
expected to be $.72 to $.75, up from
$.66 in last year's fourth
quarter. Based on our year-to-date results and updated
guidance, fiscal 2016 earnings per share are now forecasted to be
$2.78 to $2.81, up 11% to 12% on top
of a 14% gain last year."
The Company will host a conference call on Thursday, November 17, 2016 at 4:15 p.m. Eastern time to provide additional
details concerning its third quarter results and management's
outlook for the remainder of the year. A real-time audio
webcast of the conference call will be available in the Investors
section of the Company's website, located at www.rossstores.com. An
audio playback will be available at 404-537-3406, PIN #8704502
until 8:00 p.m. Eastern time on
November 25, 2016, as well as on the
Company's website.
Forward-Looking Statements: This press
release contains forward-looking statements regarding expected
sales, earnings levels and other financial results in future
periods that are subject to risks and uncertainties which could
cause our actual results to differ materially from management's
current expectations. The words "plan," "expect," "target,"
"anticipate," "estimate," "believe," "forecast," "projected,"
"guidance," "looking ahead" and similar expressions identify
forward-looking statements. Risk factors for Ross Dress for
Less® ("Ross") and dd's DISCOUNTS® include
without limitation, competitive pressures in the apparel or
home-related merchandise retailing industry; changes in the level
of consumer spending on or preferences for apparel or home-related
merchandise; market availability, quantity, and quality of
attractive brand name merchandise at desirable discounts and our
buyers' ability to purchase merchandise that enables us to offer
customers a wide assortment of merchandise at competitive prices;
impacts from the macro-economic environment, financial and credit
markets, and geopolitical conditions that affect consumer
confidence and consumer disposable income; our ability to
continually attract, train and retain associates to execute our
off-price strategies; unseasonable weather trends; potential data
security breaches, including cyber-attacks on our transaction
processing and computer information systems, which could result in
theft or unauthorized disclosure of customer, credit card,
employee, or other private and valuable information that we handle
in the ordinary course of our business - such breaches of our data
security, or our failure or delay in detecting and mitigating a
loss of personal or business information, could result in damage to
our reputation, loss of customer confidence, violation (or alleged
violation) of applicable laws, and could expose us to civil claims,
litigation and regulatory action, and to unanticipated costs and
disruption of our operations; potential disruptions in our supply
chain or information systems; issues involving the quality, safety,
or authenticity of products we sell; our ability to effectively
manage our inventories, markdowns, and inventory shortage to
achieve planned gross margin; volatility in revenues and earnings;
an adverse outcome in various legal, regulatory, or tax matters;
natural or man-made disaster in California or in another region where we have
a concentration of stores or a distribution center; increase in our
labor costs; unexpected issues or costs from expanding in existing
markets and entering new geographic markets; obtaining acceptable
new store sites with favorable demographics; damage to our
corporate reputation or brands; issues from importing merchandise
from other countries; and maintaining sufficient liquidity to
support our continuing operations, new store and distribution
center growth plans, and stock repurchase and dividend programs.
Other risk factors are set forth in our SEC filings including
without limitation, the Form 10-K for fiscal 2015 and Form 10-Qs
and 8-Ks for fiscal 2016. The factors underlying our
forecasts are dynamic and subject to change. As a result, our
forecasts speak only as of the date they are given and do not
necessarily reflect our outlook at any other point in time.
We do not undertake to update or revise these forward-looking
statements.
Ross Stores, Inc. is an S&P
500, Fortune 500 and Nasdaq 100 (ROST) company headquartered in
Dublin, California, with fiscal
2015 revenues of $11.9 billion.
The Company operates Ross Dress for Less® ("Ross"), the
largest off-price apparel and home fashion chain in the United States with 1,342 locations in 36
states, the District of Columbia
and Guam as of October 29, 2016. Ross offers first-quality,
in-season, name brand and designer apparel, accessories, footwear
and home fashions for the entire family at savings of 20% to 60%
off department and specialty store regular prices every day. The
Company also operates 193 dd's DISCOUNTS® in 15 states
as of October 29, 2016 that feature a
more moderately-priced assortment of first-quality, in-season, name
brand apparel, accessories, footwear and home fashions for the
entire family at savings of 20% to 70% off moderate department and
discount store regular prices every day. Additional information is
available at www.rossstores.com.
* * * * *
Ross Stores,
Inc.
|
Condensed
Consolidated Statements of Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
($000, except stores
and per share data, unaudited)
|
|
October 29,
2016
|
|
October 31,
2015
|
|
October 29,
2016
|
|
October 31,
2015
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
$3,086,687
|
|
$2,782,855
|
|
$9,356,599
|
|
$8,689,273
|
|
|
|
|
|
|
|
|
|
|
|
Costs and
Expenses
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
2,206,092
|
|
2,003,347
|
|
6,634,142
|
|
6,190,282
|
|
Selling, general and
administrative
|
|
490,171
|
|
443,354
|
|
1,396,606
|
|
1,287,878
|
|
Interest expense,
net
|
|
4,156
|
|
4,427
|
|
12,733
|
|
8,082
|
|
|
Total costs and
expenses
|
|
2,700,419
|
|
2,451,128
|
|
8,043,481
|
|
7,486,242
|
|
|
|
|
|
|
|
|
|
|
|
Earnings before
taxes
|
|
386,268
|
|
331,727
|
|
1,313,118
|
|
1,203,031
|
Provision for taxes
on earnings
|
|
141,722
|
|
116,071
|
|
496,032
|
|
446,531
|
Net
earnings
|
|
$
244,546
|
|
$
215,656
|
|
$
817,086
|
|
$
756,500
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.63
|
|
$
0.54
|
|
$
2.08
|
|
$
1.87
|
|
Diluted
|
|
$
0.62
|
|
$
0.53
|
|
$
2.06
|
|
$
1.85
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding (000)
|
|
|
|
|
|
|
|
|
|
Basic
|
|
390,870
|
|
401,494
|
|
393,412
|
|
404,636
|
|
Diluted
|
|
393,372
|
|
404,504
|
|
396,056
|
|
407,888
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
|
|
|
|
|
|
|
|
|
|
Cash dividends
declared per share
|
|
$
0.1350
|
|
$
0.1175
|
|
$
0.4050
|
|
$
0.3525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stores open at end of
period
|
|
1,535
|
|
1,448
|
|
1,535
|
|
1,448
|
|
|
|
|
|
|
|
|
|
|
|
Ross Stores,
Inc.
|
Condensed
Consolidated Balance Sheets
|
|
|
|
|
|
|
|
|
|
|
|
|
($000,
unaudited)
|
October 29,
2016
|
|
October 31,
2015
|
Assets
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
Cash and cash
equivalents
|
$
878,811
|
|
$
485,703
|
|
Short-term
investments
|
803
|
|
1,413
|
|
Accounts
receivable
|
91,355
|
|
81,324
|
|
Merchandise
inventory
|
1,763,745
|
|
1,700,834
|
|
Prepaid expenses and
other
|
140,662
|
|
156,130
|
|
|
Total current
assets
|
2,875,376
|
|
2,425,404
|
|
|
|
|
|
|
Property and
equipment, net
|
2,310,670
|
|
2,307,665
|
Long-term
investments
|
1,316
|
|
2,190
|
Other long-term
assets
|
162,525
|
|
159,326
|
Total
assets
|
$
5,349,887
|
|
$
4,894,585
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
Accounts
payable
|
$
1,149,136
|
|
$
1,053,013
|
|
Accrued expenses and
other
|
439,570
|
|
417,156
|
|
Accrued payroll and
benefits
|
299,238
|
|
279,310
|
|
|
Total current
liabilities
|
1,887,944
|
|
1,749,479
|
|
|
|
|
|
|
Long-term
debt
|
396,376
|
|
395,909
|
Other long-term
liabilities
|
293,997
|
|
284,799
|
Deferred income
taxes
|
122,048
|
|
70,316
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
2,649,522
|
|
2,394,082
|
Total liabilities and
stockholders' equity
|
$
5,349,887
|
|
$
4,894,585
|
|
|
|
|
|
|
Ross Stores,
Inc.
|
Condensed
Consolidated Statements of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
|
($000,
unaudited)
|
October 29,
2016
|
|
October 31,
2015
|
|
|
|
|
|
|
Cash Flows From
Operating Activities
|
|
|
|
Net
earnings
|
$
817,086
|
|
$
756,500
|
Adjustments to
reconcile net earnings to net cash
|
|
|
|
provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
224,136
|
|
202,174
|
|
Stock-based
compensation
|
56,489
|
|
45,573
|
|
Deferred income
taxes
|
(8,040)
|
|
(3,414)
|
|
Tax benefit from
equity issuance
|
24,558
|
|
39,486
|
|
Excess tax benefit
from stock-based compensation
|
(24,558)
|
|
(39,406)
|
|
Change in assets and
liabilities:
|
|
|
|
|
|
Merchandise
inventory
|
(344,641)
|
|
(328,159)
|
|
|
Other current
assets
|
(43,045)
|
|
(57,271)
|
|
|
Accounts
payable
|
213,168
|
|
73,715
|
|
|
Other current
liabilities
|
100,385
|
|
65,802
|
|
|
Other long-term,
net
|
13,690
|
|
7,027
|
|
|
Net cash provided by
operating activities
|
1,029,228
|
|
762,027
|
|
|
|
|
|
|
Cash Flows From
Investing Activities
|
|
|
|
Additions to property
and equipment
|
(220,442)
|
|
(285,560)
|
Decrease (increase)
in restricted cash and investments
|
3,496
|
|
(91)
|
Purchases of
investments
|
-
|
|
(718)
|
Proceeds from
investments
|
914
|
|
603
|
|
|
Net cash used in
investing activities
|
(216,032)
|
|
(285,766)
|
|
|
|
|
|
|
Cash Flows From
Financing Activities
|
|
|
|
Excess tax benefit
from stock-based compensation
|
24,558
|
|
39,406
|
Issuance of common
stock related to stock plans
|
14,182
|
|
15,647
|
Treasury stock
purchased
|
(42,870)
|
|
(67,083)
|
Repurchase of common
stock
|
(530,303)
|
|
(530,303)
|
Dividends
paid
|
(161,554)
|
|
(144,833)
|
|
|
Net cash used in
financing activities
|
(695,987)
|
|
(687,166)
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
117,209
|
|
(210,905)
|
|
|
|
|
|
|
Cash and cash
equivalents:
|
|
|
|
|
|
Beginning of
period
|
761,602
|
|
696,608
|
|
|
End of
period
|
$
878,811
|
|
$
485,703
|
|
|
|
|
|
|
Supplemental Cash
Flow Disclosures
|
|
|
|
Interest
paid
|
$
13,271
|
|
$
13,201
|
Income taxes
paid
|
$
482,801
|
|
$
465,548
|
|
|
|
|
|
|
Contact:
|
Michael
Hartshorn
|
Connie Kao
|
|
Group Senior Vice
President,
|
Vice President,
Investor Relations
|
|
Chief Financial
Officer
|
(925)
965-4668
|
|
(925)
965-4503
|
connie.kao@ros.com
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/ross-stores-reports-third-quarter-earnings-updates-fourth-quarter-guidance-300365460.html
SOURCE Ross Stores, Inc.