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Ross Stores, Inc. is the largest off-price apparel and home fashion chain in the United States, operating under the brands Ross Dress for Less and dd’s DISCOUNTS. The company offers first-quality, in-season, name brand and designer apparel, accessories, footwear, and home fashions for the entire family at significant savings off regular prices . As of February 3, 2024, Ross had 1,764 locations across 43 states, the District of Columbia, and Guam, while dd’s DISCOUNTS had 345 stores in 22 states, providing a more moderately-priced assortment . Ross Stores targets value-conscious customers, with Ross focusing on middle-income households and dd’s DISCOUNTS targeting households with more moderate incomes .
- Home Accents and Bed and Bath - Offers a wide range of home décor items and essentials for the bedroom and bathroom, catering to diverse tastes and styles.
- Ladies' Apparel - Provides a variety of fashionable clothing options for women, including casual, formal, and seasonal wear.
- Men's Apparel - Features a selection of men's clothing, from everyday casual wear to more formal attire.
- Accessories, Lingerie, Fine Jewelry, and Cosmetics - Includes a diverse array of accessories, intimate wear, jewelry, and beauty products to complement any outfit.
- Shoes - Offers footwear for all occasions, including casual, athletic, and formal styles for the entire family.
- Children's Apparel - Provides clothing options for children, ranging from infants to teenagers, with a focus on comfort and style.
- Given the ongoing challenges with retail theft and the expected deterioration in shrink from last year, what specific loss prevention initiatives are you implementing to hold shrink at bay, and how do you anticipate this will impact your margins moving forward?
- With increased wage pressures due to statutory increases and a tight labor market, how are you balancing the need to adjust wages to retain staff while managing overall wage inflation, and what is the anticipated impact on your operating expenses?
- As you continue to intensify your value offerings to gain market share in a highly promotional environment, how do you plan to maintain merchandise margins, especially considering the 80 basis point drop in merchandise margin and the expectation of increased pressure in the second half?
- Considering your strategy focuses on domestic growth with plans to expand to 2,900 Ross stores and 700 dd's DISCOUNTS, how do you address concerns about potential market saturation in the U.S., and what are your plans for growth once you reach these store counts?
- With the addition of new vendors and expansion of your vendor base, how are you ensuring that the quality of inventory remains high and aligns with customer expectations, and are the new vendor partnerships contributing to better mark-on rates for margins?
Recent developments and announcements about ROST.
Financial Reporting
- Earnings Per Share (EPS): The company reported an EPS of $1.48 for the 13 weeks ended November 2, 2024, which is an increase from $1.33 per share for the same period in 2023.
- Net Income: Net income rose to $489 million, up from $447 million in the previous year.
- Sales: Sales for the third quarter of 2024 were $5.1 billion, compared to $4.9 billion in the prior year, marking a comparable store sales gain of 1%.
- Year-to-Date Performance: For the nine months ended November 2, 2024, EPS was $4.53 on net earnings of $1.5 billion, compared to $3.74 per share on net income of $1.3 billion for the same period in 2023. Sales for the first nine months of 2024 were $15.2 billion, with a 3% increase in comparable store sales over the prior year.
- The company faced challenges in the third quarter due to high costs on necessities affecting discretionary spending among low-to-moderate income customers. Additionally, severe weather and unseasonably warm temperatures negatively impacted sales.
- Despite these challenges, the operating margin improved to 11.9% from 11.2% last year, due to lower incentive, freight, and distribution costs.
- Ross Stores repurchased 1.8 million shares of common stock for $262 million during the third quarter and is on track to repurchase $1.05 billion in common stock during fiscal 2024 under its two-year $2.1 billion repurchase program.
- The company projects a 2% to 3% increase in comparable store sales for the fourth quarter ending February 1, 2025.
- EPS for the fourth quarter is expected to be between $1.57 and $1.64, compared to $1.82 for the 14 weeks ended February 3, 2024. The guidance includes a $0.03 per share unfavorable impact from the timing of packaway-related expenses.
- For the full fiscal year ending February 1, 2025, EPS is expected to be in the range of $6.10 to $6.17, up from $5.56 last year.
Earnings Report
Ross Stores, Inc. (ROST) Third Quarter Earnings Report
On November 21, 2024, Ross Stores, Inc. released its financial results for the fiscal quarter ended November 2, 2024. Here are the key highlights from the earnings report:
Operational Insights:
Fourth Quarter Guidance:
Ross Stores remains focused on delivering compelling values to maximize potential for profitable growth .
Corporate Leadership
CEO Change
Barbara Rentler, the current CEO of Ross Stores, Inc., will step down from her role effective February 1, 2025. James G. Conroy has been appointed as the next CEO, effective February 2, 2025. Conroy will join the company as CEO-Elect on December 2, 2024, and will report to the Executive Chairman until he assumes the CEO position .