UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

FORM 8-K

 

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

Date of Report:  May 20, 2003

 

Commission file number  0-14678

 

 

 

Item 7.  Exhibits.

 

Exhibit No.		Description
99.1		May 20, 2003 Press Release by Ross Stores, Inc.

 

Item 9.  Regulation FD Disclosure

 

In accordance with Securities and Exchange Commission Release No. 33-8216, the following information, which is intended to be furnished under Item 12, “Results of Operations and Financial Condition,” is instead being furnished under Item 9, “Regulation FD Disclosure.”

 

On May 20, 2003, Ross Stores, Inc. (the “Company”) issued a press release regarding the Company’s financial results for its first fiscal quarter ended May 3, 2003.  The full text of the Company’s press release is attached hereto as Exhibit 99.1.  Such information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed by the undersigned thereunto duly authorized.

 

 

	ROSS STORES, INC.
	Registrant
Date:   May 20, 2003	/s/  J. Call
	John G. Call
	Senior Vice President, Chief Financial Officer, Principal Accounting Officer and Corporate Secretary

 

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Exhibit 99.1

 

 

FOR IMMEDIATE RELEASE

 

 

ROSS STORES REPORTS FIRST QUARTER RESULTS

 

Newark, California, May 20, 2003 — Ross Stores, Inc. (ROST) today reported that earnings per share for the 13 weeks ended May 3, 2003 increased 7% to $.63, from $.59 for the 13 weeks ended May 4, 2002. Net earnings in the first quarter of 2003 were $49.3 million, up from $47.7 million in the prior year period. Sales for the first quarter ended May 3, 2003 increased 7% to $879 million, from $820 million for the quarter ended May 4, 2002. Comparable store sales for the same period declined 3% from the prior year.

 

Michael Balmuth, Vice Chairman and Chief Executive Officer, commented, “We are pleased to report that strong inventory and expense controls, as well as the earlier-than-planned opening of several new stores, offset the impact of lower-than-expected revenue on first quarter earnings. External issues, including unseasonable weather trends, the war in Iraq and the lackluster economic climate, negatively affected business during the period. Despite these pressures, however, we were able to show respectable earnings per share growth.”

 

Mr. Balmuth continued, “Expense trends improved during the first quarter, due mainly to lower incentive plan costs, combined with better than planned store payroll and benefit expenses. As a result, a 48 basis point decline in general, selling and administrative expenses as a percent of sales partially offset an 86 basis point decline in gross margin. Operating margin for the first quarter was 9.2% compared to 9.6% in the prior year.”

 

“Consistent with our long-term plan for 12% annual unit growth, we expect to add about 62 stores in 2003. Twenty-three of these new locations opened during the first quarter, including our initial entry into the state of Tennessee. We ended the period with 530 stores in 24 states,” noted Mr. Balmuth.

 

Mr. Balmuth continued, “We remain committed to returning capital to stockholders through our stock repurchase and dividend programs. During the first three months of 2003, we repurchased 1.1 million shares of common stock for an aggregate of $40.7 million under the two-year $300 million program authorized by our Board of Directors in early 2002. We ended the quarter with 76.7 million shares of

 

 

common stock outstanding and approximately $109 million remaining under this repurchase authorization, which we expect to complete in fiscal 2003.”

 

The Company will provide additional details concerning its first quarter results and business outlook for the balance of 2003 on a conference call to be held on Tuesday, May 20, 2003 at 11:00 a.m. Eastern Daylight Time. Participants may listen to a real time audio webcast of the conference call by visiting the Company’s web site located at www.rossstores.com. A recorded version of the call will also be available until the end of the month at the web site address and via a telephone recording through Tuesday, May 27, 2003 at 402-220-5900, PIN #2342.

 

Forward-Looking Statements: This press release contains certain forward-looking statements regarding expected annual unit growth and new store locations, 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,” “forecast,” “project” and similar expressions identify forward-looking statements. Risk factors include obtaining acceptable new store locations, competitive pressures in the apparel industry, changes in geopolitical and general economic conditions, changes in the level of consumer spending on or preferences in apparel or home-related merchandise and the Company’s ability to successfully implement various new supply chain and merchandising systems in a timely and cost effective manner. Other risk factors are detailed in the Company’s Form 10-K for fiscal 2002. 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 the Company’s outlook at any other point in time. The Company does not undertake to update or revise these forward-looking statements.

 

* * * * *

 

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 530 stores in operation as of May 3, 2003, compared to 470 stores at the end of the same period last year.

 

* * * * *

 

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ROSS STORES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

 

		Three Months Ended
($000, except per share data, unaudited)		May 3, 2003			May 4, 2002
Sales		$	879,284		$	819,611
Costs and Expenses
Cost of goods sold, including related buying, distribution and occupancy costs		653,248			601,857
General, selling and administrative		145,139			139,255
Interest (income) expense		(70		)	224
		798,317			741,336
Earnings before income taxes		80,967			78,275
Provision for taxes on earnings		31,658			30,606
Net earnings		$	49,309		$	47,669
Earnings per share
Basic		$	0.64		$	0.60
Diluted		$	0.63		$	0.59
Weighted average shares outstanding (000)
Basic		77,052			78,865
Diluted		78,254			80,585
Stores open end of period		530			470

 

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ROSS STORES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

($000, unaudited)		May 3, 2003			May 4, 2002
Current Assets
Cash and cash equivalents		$	116,544		$	72,630
Accounts receivable		23,260			24,464
Merchandise inventory		756,002			674,033
Other current assets		48,563			26,940
Total Current Assets		$	944,369		$	798,067
Property and equipment, net		415,552			344,623
Other long-term assets		39,833			38,984
		$	1,399,754		$	1,181,674
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts payable, accrued expenses and other		$	591,635		$	535,966
Income taxes payable		30,580			30,568
Total Current Liabilities		$	622,215		$	566,534
Long-term debt		50,000			—
Other liabilities		45,302			43,675
Deferred income taxes		25,021			7,646
Stockholders’ Equity		657,216			563,819
		$	1,399,754		$	1,181,674

 

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ROSS STORES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

		Three Months Ended
($000, unaudited)		May 3, 2003			May 4, 2002
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings		$	49,309		$	47,669
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization of property and equipment		13,965			12,861
Other amortization		3,649			3,082
Change in assets and liabilities:
Merchandise inventory		(39,484		)	(50,643		)
Other current assets - net		(16,570		)	(154		)
Accounts payable		3,493			51,536
Other current liabilities		(2,921		)	33,211
Other		120			(3,050		)
Net cash provided by operating activities		11,561			94,512
CASH FLOWS USED IN INVESTING ACTIVITIES
Additions to property and equipment		(27,419		)	(27,260		)
Net cash used in investing activities		(27,419		)	(27,260		)
CASH FLOWS USED IN FINANCING ACTIVITIES
Proceeds from long-term debt		25,000			—
Issuance of common stock related to stock plans		1,879			10,841
Repurchase of common stock		(40,677		)	(42,075		)
Dividends paid		(4,449		)	(3,739		)
Net cash used in financing activities		(18,247		)	(34,973		)
Net (decrease) increase in cash and cash equivalents		(34,105		)	32,279
Cash and cash equivalents:
Beginning of period		150,649			40,351
End of period		$	116,544		$	72,630

 

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