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Ross Stores Reports Record Third Quarter Results

    NEWARK, Calif., Nov. 17 /PRNewswire/ -- Ross Stores, Inc. (Nasdaq: ROST)
today reported that net earnings for the 13 weeks ended October 30, 1999 grew
to a record $34.6 million, from $28.0 million for the 13 weeks ended October
31, 1998.  Earnings per share increased 27% to $.38 for the quarter, from
$.30 for the same period in 1998.  Current year third quarter sales totaled
$609 million, up 15% from $531 million for the quarter ended October 31, 1998.
Comparable store sales for the 13 weeks ended October 30, 1999 rose 7% over
the prior year.
    For the nine months ended October 30, 1999, net earnings grew to a record
$107.4 million, from $88.3 million for the nine months ended October 31, 1998.
Earnings per share for the first nine months increased 26% to $1.16, from
$.92 for the comparable 1998 period.  Sales for the nine months ended
October 30, 1999 increased 14% to $1.774 billion, from $1.552 billion in the
prior year.  Same store sales for the first nine months of 1999 increased
7% over the same period in 1998.
    On September 22, 1999, the company effected a two-for-one stock split in
the form of a 100 percent stock dividend paid to stockholders of record as of
September 7, 1999.  All share price and earnings per share data reflect the
effect of that action.
    Commenting on these results, Michael Balmuth, Vice Chairman and Chief
Executive Officer, stated, "We are pleased with the record sales and earnings
achieved in the third quarter and first nine months of 1999.  This performance
indicates that our value-driven strategies remain on track.  Our ongoing focus
on more opportunistic buying, along with strict controls of both inventories
and expenses, contributed to a 65 basis point increase in operating margin,
which grew to a record 9.4% of sales in the third quarter compared to 8.7% in
the prior year period.  As a percent of sales, gross margin increased by
43 basis points while general, selling and administrative expenses declined by
15 basis points. "
    "We also remained on track with our expansion plans, opening 18 new stores
during the quarter, all in existing markets.  Another store has opened in
November, for a total of 34 new locations in 1999.  We expect to end the year
with 378 stores in 17 states," said Mr. Balmuth.
    Mr. Balmuth continued, "Delivering value to stockholders remains a top
priority at Ross as evidenced by our share repurchase program.  I am pleased
to announce that we recently completed the $120 million repurchase
authorization announced at the beginning of 1999."
    Mr. Balmuth also said, "Like other retailers in the apparel industry, our
sales month to date in November are below plan, with same store sales
currently flat to last year.  However, it is very early in the quarter, and
holiday shopping patterns are difficult to predict."
    Safe Harbor Statement Under the Private Securities Litigation Reform Act
of 1995:  This press release contains certain forward-looking statements which
are subject to risks and uncertainties that could cause the company's actual
results to differ materially from management's current expectations.  The
words "expect," "anticipate," "estimate," "believe" and similar expressions
identify forward-looking statements. Risk factors include competitive
pressures in the apparel industry, changes in the level of consumer spending
on or preferences in apparel or home-related merchandise, obtaining acceptable
new store locations, the company's ability to continue to purchase attractive
name brand merchandise at desirable discounts, unseasonable weather trends,
and larger than planned operating costs including those that could be related
to necessary modifications to the company's computer hardware and software
systems to enable them to process information with dates or date ranges
spanning the year 2000 and beyond.  The company presently believes that, with
modifications to existing software and conversions to new software, the year
2000 issue will not pose significant operational problems for the company's
computer systems as so modified and converted.  However, if unforeseen
difficulties arise or such modifications and conversions are not completed
timely, or if the company's vendors' or suppliers' systems are not modified to
become year 2000 compliant, then the year 2000 issue may have a material
impact on the operations of the company.  Other risk factors are detailed in
the company's Form 10-K for fiscal 1998.
    Ross Stores, Inc. operates a national chain of off-price retail stores
offering first quality, in-season, branded apparel and apparel-related
merchandise for the entire family at prices that average 20% to 60% less than
department and specialty stores, as well as merchandise for the home at
similar savings.  The company had 381 stores at October 30, 1999, compared to
350 stores at the end of the same period last year.

                              ROSS STORES, INC.

                               Three Months Ended       Nine Months Ended
                            October 30,  October 31,  October 30, October 31,
    ($000, except per          1999          1998        1999        1998
     data share,
    Sales                    $608,720     $531,139    $1,774,121 $1,552,390
    Costs and Expenses
     Cost of goods sold
      and occupancy           416,442      365,654     1,219,963  1,074,466
     General, selling
      and administrative      125,833      110,593       349,702    308,005
     Depreciation and
      amortization              9,459        8,653        27,911     24,765
     Interest expense             147          329           167        459
                              551,881      485,229     1,597,743  1,407,695

    Earnings before
     income taxes              56,839       45,910       176,378    144,695
    Provision for
     taxes on earnings         22,224       17,905        68,964     56,431
    Net earnings              $34,615      $28,005      $107,414    $88,264
    Earnings per share
     Basic                      $0.38        $0.30         $1.18      $0.93
     Diluted                    $0.38        $0.30         $1.16      $0.92
    Weighted average
     shares outstanding
     Basic                     89,986       93,466        91,015     94,692
     Diluted                   91,138       94,872        92,444     96,398
    Stores open
     end of period                381          350           381        350

                              ROSS STORES, INC.

                                                  October 30,    October 31,
    ($000, unaudited)                                1999           1998
    Current Assets
     Cash and cash equivalents                      $31,645        $26,657
     Accounts receivable                             15,884         12,212
     Merchandise inventory                          570,965        511,484
     Other current assets                            16,591         16,371
      Total Current Assets                         $635,085       $566,724

     Property and equipment, net                    266,672        239,837
     Lease Rights, deferred
      income taxes and other
      assets                                         51,723         37,839
                                                   $953,480       $844,400

    Current Liabilities
     Accounts payable, accrued
      expenses and other                           $435,952       $402,686
     Income taxes payable                            20,579          3,080
      Total Current Liabilities                    $456,531       $405,766

     Long-term debt                                  24,000         30,000
     Other liabilities                               47,200         38,347
    Stockholders' Equity                            425,749        370,287
                                                   $953,480       $844,400

SOURCE  Ross Stores, Inc.