Document
FALSE000074573200007457322019-11-212019-11-21

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 (date of earliest event reported):
November 21, 2019

ROSS STORES, INC.
(Exact name of registrant as specified in its charter)
Delaware
0-14678
94-1390387
(State or other jurisdiction of incorporation)(Commission File No.)(I.R.S. Employer Identification No.)

5130 Hacienda Drive, Dublin, California 94568
(Address of principal executive offices)

Registrant's telephone number, including area code:
(925) 965-4400
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbolName of each exchange on which registered
Common stock, par value $.01ROSTNasdaq Global Select Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐




Item 2.02 Results of Operations and Financial Condition.
On November 21, 2019, the Company issued a press release regarding the Company’s financial results for its fiscal quarter ended November 2, 2019. The full text of the Company’s press release is attached hereto as Exhibit 99.1.
The information furnished with this Item 2.02, including Exhibit 99.1, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
 No.

 
Description

99.1
104Cover Page Interactive Data File. (The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.)




SIGNATURES

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

Date: November 21, 2019


ROSS STORES, INC.
Registrant


By: /s/Travis R. Marquette  
Travis R. Marquette
Group Senior Vice President and Chief Financial
Officer, and Principal Accounting Officer

Document

Exhibit 99.1
http://api.tenkwizard.com/cgi/image?quest=1&rid=23&ipage=13216759&doc=8__________________________________________________________________


FOR IMMEDIATE RELEASE

Contact:Travis MarquetteConnie Kao
Group Senior Vice President,Vice President, Investor Relations
Chief Financial Officer(925) 965-4668
(925) 965-4550connie.kao@ros.com


ROSS STORES REPORTS THIRD QUARTER EARNINGS,
UPDATES FOURTH QUARTER GUIDANCE


Dublin, California, November 21, 2019 -- Ross Stores, Inc. (Nasdaq: ROST) today reported earnings per share for the third quarter ended November 2, 2019 of $1.03, up from $.91 last year. Net earnings grew to $371 million from $338 million in the prior year. Third quarter sales rose 8% to $3.8 billion, with comparable store sales up a strong 5% on top of last year’s gain of 3%.

For the nine months ended November 2, 2019, earnings per share were $3.32, up from $3.06 last year. Net earnings were $1.2 billion, compared to $1.1 billion in the prior year. Sales year-to-date rose 7% to $11.6 billion, with comparable store sales up 3% versus a 3% gain for the first nine months of 2018.

Barbara Rentler, Chief Executive Officer, commented, “We are pleased that our third quarter results were ahead of expectations. Operating margin of 12.4% was also above-plan mainly due to better than expected sales and merchandise margin.”

Ms. Rentler continued, “During the third quarter and first nine months of fiscal 2019, we repurchased 3.0 million and 9.6 million shares of common stock, respectively, for an aggregate price of $326 million in the quarter and $966 million year-to-date. We remain on track to buy back a total of $1.275 billion in common stock during fiscal 2019.”









ROSS STORES, INC. 5130 Hacienda Drive, Dublin, CA 94568 (925) 965-4400














Looking ahead, Ms. Rentler said, “As we enter this year’s holiday season, we are up against multiple years of strong comparable store sales gains. In addition, we expect another fiercely competitive retail landscape, along with ongoing uncertainty surrounding the macro-economic and political environment. As such, while we hope to do better, we continue to project fourth quarter comparable store sales gains of 1% to 2% versus a 4% increase last year.”

Ms. Rentler continued, “Given these sales assumptions, we continue to expect fourth quarter earnings per share to be in the range of $1.20 to $1.25, which now includes a one-time, non-cash benefit of $.02 per share, primarily due to the favorable resolution of a tax matter, offset by slightly higher pre-tax expenses. This forecasted guidance compares to $1.20 per share in the prior year period, which also included a one-time per share benefit of $.07 related to the favorable resolution of a tax matter.”

Ms. Rentler concluded, “Based on our year-to-date results, and our updated fourth quarter guidance, we are now planning earnings per share for fiscal 2019 to be in the range of $4.52 to $4.57, up from $4.26 in fiscal 2018.”

The Company will host a conference call on Thursday, November 21, 2019, 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 #5397837 until 8:00 p.m. Eastern time on November 29, 2019, as well as on the Company’s website.




















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Forward-Looking Statements: This press release contains forward-looking statements regarding expected sales, earnings levels, new store growth, 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,” “outlook,” “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 and 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 that may affect shopping patterns and consumer demand for seasonal apparel and other merchandise, and may result in temporary store closures and disruptions in deliveries of merchandise to our stores; potential information or 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; potential disruptions in our supply chain or information systems; issues involving the quality, safety, or authenticity of products we sell, which could harm our reputation, result in lost sales, and/or increase our costs; our ability to effectively manage our inventories, markdowns, and inventory shortage to achieve planned gross margin; changes in U.S. tax, tariff, or trade policy regarding apparel and home-related merchandise produced in other countries that could adversely affect our business; volatility in revenues and earnings; an adverse outcome in various legal, regulatory, or tax matters; a natural or man-made disaster in California or in another region where we have a concentration of stores, offices, or a distribution center; unexpected issues or costs from expanding in existing markets and entering new geographic markets; obtaining acceptable new store sites with favorable consumer demographics; damage to our corporate reputation or brands; effectively advertising and marketing our brands; issues from selling and importing merchandise produced in 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 2018, and Form 10-Qs and Form 8-Ks for fiscal 2019. 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 2018 revenues of $15.0 billion. Currently, the Company operates Ross Dress for Less® (“Ross”), the largest off-price apparel and home fashion chain in the United States with 1,550 locations in 39 states, the District of Columbia, and Guam. 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 currently operates 260 dd’s DISCOUNTS® in 19 states 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.


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Ross Stores, Inc.
Condensed Consolidated Statements of Earnings
Three Months EndedNine Months Ended
($000, except stores and per share data, unaudited)November 2, 2019November 3, 2018November 2, 2019November 3, 2018
Sales$3,849,117  $3,549,608  $11,625,628  $10,876,153  
Costs and Expenses
Cost of goods sold2,766,432  2,547,331  8,311,950  7,736,533  
Selling, general and administrative604,605  561,577  1,754,825  1,640,581  
Interest income, net(4,402) (2,953) (14,819) (4,849) 
Total costs and expenses3,366,635  3,105,955  10,051,956  9,372,265  
Earnings before taxes482,482  443,653  1,573,672  1,503,888  
Provision for taxes on earnings111,550  105,545  368,877  358,124  
Net earnings$370,932  $338,108  $1,204,795  $1,145,764  
Earnings per share
Basic$1.04  $0.92  $3.35  $3.09  
Diluted$1.03  $0.91  $3.32  $3.06  
Weighted average shares outstanding (000)
Basic356,879  368,102  359,919  370,977  
Diluted359,299  371,061  362,455  373,936  
Stores open at end of period1,810  1,720  1,810  1,720  


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Ross Stores, Inc.
Condensed Consolidated Balance Sheets
($000, unaudited)November 2, 2019November 3, 2018
Assets
Current Assets
Cash and cash equivalents$1,142,709  $1,349,196  
Accounts receivable124,853  117,825  
Merchandise inventory2,168,796  1,979,080  
Prepaid expenses and other170,304  177,206  
Total current assets3,606,662  3,623,307  
Property and equipment, net2,565,882  2,418,226  
Operating lease assets3,042,298  —  
Other long-term assets200,999  194,234  
Total assets$9,415,841  $6,235,767  
Liabilities and Stockholders’ Equity
Current Liabilities
Accounts payable$1,480,205  $1,394,029  
Accrued expenses and other496,623  455,743  
Current operating lease liabilities559,433  —  
Accrued payroll and benefits321,977  317,525  
Current portion of long-term debt—  84,997  
Total current liabilities2,858,238  2,252,294  
Long-term debt312,778  312,328  
Non-current operating lease liabilities
2,601,372  —  
Other long-term liabilities225,934  371,844  
Deferred income taxes140,740  112,138  
Commitments and contingencies
Stockholders’ Equity3,276,779  3,187,163  
Total liabilities and stockholders’ equity$9,415,841  $6,235,767  


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Ross Stores, Inc.
Condensed Consolidated Statements of Cash Flows
Nine Months Ended
($000, unaudited)November 2, 2019November 3, 2018
Cash Flows From Operating Activities
Net earnings$1,204,795  $1,145,764  
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Depreciation and amortization255,089  246,151  
Stock-based compensation70,600  71,361  
Deferred income taxes23,070  19,607  
Change in assets and liabilities:
Merchandise inventory(418,354) (337,345) 
Other current assets(46,161) (62,081) 
Accounts payable305,648  328,062  
Other current liabilities43,968  35,758  
Income taxes(42,619) (5,338) 
Operating lease assets and liabilities, net12,911  —  
Other long-term, net1,983  8,133  
Net cash provided by operating activities1,410,930  1,450,072  
Cash Flows From Investing Activities
Additions to property and equipment(401,251) (293,366) 
Proceeds from investments517  739  
Net cash used in investing activities(400,734) (292,627) 
Cash Flows From Financing Activities
Issuance of common stock related to stock plans16,451  14,915  
Treasury stock purchased(56,920) (53,680) 
Repurchase of common stock(965,909) (806,500) 
Dividends paid(278,370) (253,863) 
Net cash used in financing activities(1,284,748) (1,099,128) 
Net (decrease) increase in cash, cash equivalents, and restricted cash and cash equivalents(274,552) 58,317  
Cash, cash equivalents, and restricted cash and cash equivalents:
Beginning of period1,478,079  1,353,272  
End of period$1,203,527  $1,411,589  
Reconciliations:
Cash and cash equivalents$1,142,709  $1,349,196  
Restricted cash and cash equivalents included in prepaid expenses and other10,947  8,933  
Restricted cash and cash equivalents included in other long-term assets49,871  53,460  
Total cash, cash equivalents, and restricted cash and cash equivalents:
$1,203,527  $1,411,589  
Supplemental Cash Flow Disclosures
Interest paid$10,560  $13,271  
Income taxes paid$388,426  $343,848  

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