UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark one)
_X_ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended November 2, 1996
OR
___ TRANSITION REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission file number 0-14678
ROSS STORES, INC.
(Exact name of registrant as specified in its charter)
Delaware 94-1390387
(State or other juristiction of (I.R.S. Employer Identification No.)
incorporation or organization)
8333 Central Avenue, 94560-3433
Newark, California(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, (510) 505-4400
including area code
Former name, former address N/A
and former fiscal year,
if changed since last report.
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No __
The number of shares of Common Stock, with $.01 par value,
outstanding on November 30, 1996 was 24,752,157.
2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
ROSS STORES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
($000) November 2, February 3, October 28,
ASSETS 1996 1996 1995
(Unaudited) (Note A) (Unaudited)
Current Assets
Cash and cash equivalents $25,305 $23,426 $23,599
Accounts receivable 18,207 9,901 9,197
Merchandise inventory 401,813 295,965 344,004
Prepaid expenses and other 13,269 13,474 11,750
_______ _______ _______
Total Current Assets 458,594 342,766 388,550
Property And Equipment
Land and buildings 24,115 24,102 24,102
Fixtures and equipment 160,539 156,811 149,923
Leasehold improvements 124,783 123,829 116,956
Construction-in-progress 28,922 16,808 13,654
________________________________________
338,359 321,550 304,635
Less accumulated depreciation 152,468 140,174 133,581
and amortization ________________________________________
185,891 181,376 171,054
Other assets 15,893 17,010 17,558
________________________________________
$660,378 $541,152 $577,162
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $196,929 $137,653 $172,809
Accrued expenses and other 61,936 42,944 47,097
Accrued payroll and benefits 41,891 30,064 25,364
Income taxes payable 14,018 10,555 2,007
________________________________________
Total Current Liabilities 314,774 221,216 247,277
Long-term debt 10,000 9,806 37,874
Deferred income taxes and other 22,938 18,614 21,465
liabilities
Stockholders' Equity
Capital stock 249 246 244
Additional paid-in capital 156,542 133,409 127,567
Retained earnings 155,875 157,861 142,735
________________________________________
312,666 291,516 270,546
________________________________________
$660,378 $541,152 $577,162
See notes to condensed consolidated financial statements.
3
ROSS STORES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
Three Months Ended Nine Months Ended
November 2, October 28, November 2, October 28,
($000 except per share data, unaudited) 1996 1995 1996 1995
Sales $403,383 $330,682 $1,179,987 $979,319
Costs and Expenses
Cost of goods sold and occupancy 283,797 237,555 833,472 710,403
General, selling and administrative 85,043 72,634 243,025 209,329
Depreciation and amortization 7,363 6,834 21,788 20,277
Interest (77) 473 138 2,452
_____________________________________________________
376,126 317,496 1,098,423 942,461
Earnings before taxes 27,257 13,186 81,564 36,858
Provision for taxes on earnings 10,903 5,277 32,626 14,745
Net earnings $16,354 $7,909 $48,938 $22,113
=============================================================================================================
Net earnings per share:
Primary $.64 $.32 $1.90 $.89
Fully diluted $.64 $.32 $1.89 $.89
=============================================================================================================
Weighted average shares outstanding:
Primary 25,625 24,863 25,757 24,734
Fully diluted 25,677 24,870 25,872 24,851
=============================================================================================================
Stores open at end of period 313 293
=============================================================================================================
See notes to condensed consolidated financial statements.
4
ROSS STORES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Months Ended
November 2, October 28
($000, unaudited) 1996 1995
Cash Flows From Operating Activities
Net earnings $48,938 $22,113
Adjustments to reconcile net earnings to net
cash used in operating activities:
Depreciation and amortization of property 21,788 20,277
and equipment
Other amortization 4,923 3,799
Change in current assets and current
liabilities:
Merchandise inventory (105,848) (68,821)
Other current assets - net (8,102) (3,431)
Accounts payable 61,012 64,691
Other current liabilities - net 37,227 6,548
Other 5,988 3,624
_____________________
Net cash provided by operating activities 65,926 48,800
=================================================================================
Cash Flows From Investing Activities
Additions to property and equipment (33,188) (29,871)
______________________
Net cash used in investing activities (33,188) (29,871)
==================================================================================
Cash Flows From Financing Activities
Borrowing under line of credit agreement 12,700 5,000
(Repayment) of long-term debt (9,835) (13,241)
Issuance of common stock related to stock plans 29,352 1,812
Repurchase of common stock (57,797) (8,054)
Dividends paid (5,279) (4,428)
______________________
Net cash (used in) financing activities (30,859) (18,911)
______________________
Net Increase In Cash 1,879 18
Cash
Beginning of year 23,426 23,581
____________________
End of quarter $25,305 $23,599
=================================================================================
Interest Paid $660 $2,822
Income Taxes Paid $29,163 $17,476
=================================================================================
See notes to condensed consolidated financial statements.
5
ROSS STORES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Three and Nine Months Ended November 2, 1996 and October 28, 1995
(Unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have been
prepared from the records of the company without audit and, in the opinion of
management, include all adjustments (consisting of only normal recurring
accruals) necessary to present fairly the financial position at November 2, 1996
and October 28, 1995; the interim results of operations for the three and nine
months ended November 2, 1996 and October 28, 1995; and cash flows for the nine
months ended November 2, 1996 and October 28, 1995. The balance sheet at
February 3, 1996, presented herein, has been derived from the audited financial
statements of the company for the fiscal year then ended.
Accounting policies followed by the company are described in Note A to the
audited consolidated financial statements for the fiscal year ended February 3,
1996. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted for purposes of the interim condensed
consolidated financial statements. The interim condensed consolidated financial
statements should be read in conjunction with the audited consolidated financial
statements, including notes thereto, for the year ended February 3, 1996.
The results of operations for the three and nine month periods herein presented
are not necessarily indicative of the results to be expected for the full year.
The condensed consolidated financial statements at November 2, 1996 and October
28, 1995, and for the three and nine months then ended have been reviewed, prior
to filing, by the registrant's independent accountants whose report covering
their review of the financial statements is included in this report on page 6.
6
INDEPENDENT ACCOUNTANTS' REPORT
Board of Directors and Stockholders of Ross Stores, Inc.
Newark, California
We reviewed the accompanying condensed consolidated balance sheets of Ross
Stores, Inc. (the "Company") as of November 2, 1996 and October 28, 1995, and
the related condensed consolidated statements of earnings for the three-month
and nine-month periods then ended and the related condensed consolidated
statements of cash flows for the nine-month periods then ended. These condensed
consolidated financial statements are the responsibility of the Company's
management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data, and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, the objectives of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.
Based on our reviews, we are not aware of any material modifications that should
be made to such condensed consolidated financial statements for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of Ross Stores, Inc. as of February 3,
1996, and the related consolidated statements of earnings, stockholders' equity,
and cash flows for the year then ended (not presented herein); and in our report
dated March 15, 1996, we expressed an unqualified opinion on those consolidated
financial statements. In our opinion, the information set forth in the
accompanying condensed consolidated balance sheet as of February 3, 1996 is
fairly stated, in all material respects, in relation to the consolidated balance
sheet from which it has been derived.
Deloitte & Touche LLP
San Francisco, CA
November 22, 1996
7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
RESULTS OF OPERATIONS
PERCENTAGE OF SALES
Three Months Ended Nine Months Ended
November 2, October 28, November 2, October 28,
1996 1995 1996 1995
SALES
Sales ($000) $403,383 $330,682 $1,179,987 $979,319
Sales growth 22% 12% 20% 12%
Comparable store sales growth 14% 4% 12% 2%
COSTS AND EXPENSES
Cost of goods sold and occupancy 70.4% 71.8% 70.6% 72.5%
General, selling and administrative 21.1% 22.0% 20.6% 21.4%
Depreciation and amortization 1.8% 2.1% 1.8% 2.1%
Interest 0% 0.1% 0% 0.3%
NET EARNINGS 4.1% 2.4% 4.1% 2.3%
=======================================================================================================
Sales
The results of operations for the three and nine months ended
November 2, 1996, over the same periods last year, reflect an
increase in the level of sales which was due to the increase in
comparable store sales as well as a greater number of open stores
during the current period.
Costs and Expenses
The declines from the prior year in cost of goods sold and
occupancy expense as a percentage of sales for the three and nine
month periods ended November 2, 1996 were primarily due to
stronger than planned comparable store increases which
contributed to (i) lower markdowns as a percentage of sales and
(ii) increased leverage on occupancy expenses.
General, selling and administrative expenses as a percentage of
sales also declined from the comparable periods in the prior
year. This improvement was due to the company's continued focus
on strict expense controls combined with the leverage realized on
the strong increase in comparable store sales, which more than
offset higher accruals for the company's incentive plan.
Net earnings for the three months ended November 2, 1996, totaled
$16.4 million, or $.64 per share, compared to net earnings of
$7.9 million, or $.32 per share, for the three months ended
October 28, 1995.
8
Taxes on Earnings
The company's effective tax rate for the third quarter of 1996
and 1995 was 40%. The rate for both periods reflects the
applicable statutory tax rates.
LIQUIDITY AND CAPITAL RESOURCES
The primary uses of cash during the first nine months of fiscal
1996 were for (i) an increase in inventory somewhat offset by a
related increase in accounts payable; (ii) repurchase of the
company's common stock; (iii) capital expenditures for new
stores, improvements to existing locations and improvements in
operating systems; and (iv) reduction in long-term debt.
Total consolidated inventories were up 17% at the end of the
third quarter from last year due mainly to an increase in the
number of new stores and higher levels of seasonal packaway
merchandise.
The increase in accounts receivable reflects an increase in
deferred compensation and credit card sales driven by the higher
volume of business. The increase in accrued payroll reflects the
accruals for the company's deferred compensation plan and
incentive plan. The increase in accrued expenses primarily
results from the timing of payments for expenses related to the
volume of business.
The decline in interest expense reflects lower borrowings which
resulted primarily from (i) higher earnings levels; (ii)
increases in accounts payable, accrued expenses and other
liabilities; and (iii) receipts from stock option exercises.
The company believes it can fund its capital needs for the
remainder of the fiscal year and the next twelve months and
complete the current stock repurchase program through internally
generated cash, trade credit, established bank lines and lease
financing.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Incorporated herein by reference to the list of Exhibits
contained in the Exhibit Index which begins on page 10 of
this Report.
(b) Reports on Form 8-K
None.
9
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: December 13, 1996 /s/John M. Vuko
John M. Vuko, Senior Vice President,
Controller and Principal Accounting
Officer
10
INDEX TO EXHIBITS
Exhibit
Number Exhibit
3.1 Certificate of Incorporation, as amended, incorporated
by reference to Exhibit 3.1 to the Registration
Statement on Form 8-B (the "Form 8-B") filed September
1, 1989 by Ross Stores, Inc., a Delaware corporation
("Ross Stores").
3.2 Amended By-laws, dated August 25, 1994, incorporated by
reference to Exhibit 3.2 to the Form 10-Q filed by Ross
Stores for its quarter ended July 30, 1994.
10.1 Agreement of Lease, dated November 24, 1986, for Ross
Stores' corporate headquarters and distribution center
in Newark, CA, incorporated by reference to Exhibit 10.5
to the Form 8-B.
10.2 Revolving Credit Agreement, dated July 31, 1993, among
Ross Stores, Wells Fargo Bank, National Association,
Bank of America, National Trust and Savings Association,
and Security Pacific National Bank ("Banks"); and Wells
Fargo Bank, National Association, as agent for Banks,
incorporated by reference to Exhibit 10.17 on the Form
10-Q filed by Ross Stores for its quarter ended July 31,
1993.
10.3 First Amendment to Revolving Credit Agreement, effective
on July 31, 1994, by and among Ross Stores, Banks and
Wells Fargo Bank, National Association, as agent for
Banks, incorporated by reference to Exhibit 10.5 to the
Form 10-Q filed by Ross Stores for its quarter ended
July 30, 1994.
10.4 Second Amendment to Revolving Credit Agreement,
effective on June 15, 1995, by and among Ross Stores,
Banks and Wells Fargo Bank, National Association, as
agent for Banks, incorporated by reference to Exhibit
10.4 to the Form 10-Q filed by Ross Stores for its
quarter ended July 29, 1995.
10.5 Credit Agreement, dated as of June 22, 1994, among Ross
Stores, Bank of America National Trust and Savings
Association as Agent, the Industrial Bank of Japan as Co-
Agent and the other financial institutions party
thereto, incorporated by reference to Exhibit 10.6 to
the Form 10-Q filed by Ross Stores for its quarter ended
July 30, 1994.
10.6 First Amendment to Credit Agreement, dated as of June
20, 1995, among Ross Stores, Bank of America National
Trust and Savings Association as Agent, the Industrial
Bank of Japan as Co-Agent, incorporated by reference to
Exhibit 10.6 to the Form 10-Q filed by Ross Stores for
its quarter ended July 29, 1995.
10.7 Second Amendment to Credit Agreement, dated as of June
12, 1996, Ross Stores, Bank of America National Trust
and Savings Association as Agent, the Industrial Bank of
Japan as Co-Agent, incorporated by reference to Exhibit
10.7 to the Form 10-Q filed by Ross Stores for its
quarter ended August 3, 1996.
11
Exhibit
Number Exhibit
MANAGEMENT CONTRACTS AND COMPENSATORY PLANS
(EXHIBITS 10.8 - 10.33)
10.8 Amended and Restated 1992 Stock Option Plan,
incorporated by reference to the appendix to the Proxy
Statement filed by Ross Stores on April 24, 1995 for its
Annual Stockholders Meeting held May 25, 1995 ("1995
Proxy Statement").
10.9 Third Amended and Restated Ross Stores Employee Stock
Purchase Plan, incorporated by reference to the appendix
to the 1995 Proxy Statement.
10.10 Third Amended and Restated Ross Stores 1988 Restricted
Stock Plan, incorporated by reference to the appendix to
the Proxy Statement filed by Ross Stores on April 24,
1996 for its Annual Stockholders Meeting held May 30,
1996 ("1996 Proxy Statement").
10.11 1991 Outside Directors Stock Option Plan, incorporated
by reference to the appendix to the 1996 Proxy
Statement.
10.12 Ross Stores Executive Medical Plan, incorporated by
reference to Exhibit 10.13 to the 1993 Form 10-K filed
by Ross Stores for its year ended January 29, 1994
("1993 Form 10-K").
10.13 Third Amended and Restated Ross Stores Executive
Supplemental Retirement Plan, incorporated by reference
to Exhibit 10.14 to the 1993 Form 10-K.
10.14 Ross Stores Non-Qualified Deferred Compensation Plan,
incorporated by reference to Exhibit 10.15 to the 1993
Form 10-K.
10.15 Ross Stores Incentive Compensation Plan, incorporated by
reference to the appendix to the 1996 Proxy Statement.
10.16 Amended and Restated Employment Agreement between Ross
Stores and Norman A. Ferber, effective as of June 1,
1995, incorporated by reference to Exhibit 10.17 to the
Form 10-Q filed by Ross Stores for its quarter ended
October 28, 1995.
10.17 Amendment to Amended and Restated Employment Agreement
between Ross Stores and Norman A. Ferber, entered into
July 29, 1996, incorporated by reference to Exhibit
10.17 to the Form 10-Q filed by Ross Stores for its
quarter ended August 3, 1996.
10.18 Agreement between Ross Stores and Norman A. Ferber,
dated August 22, 1995, incorporated by reference to
Exhibit 10.18 to the Form 10-Q filed by Ross Stores for
its quarter ended October 28, 1995.
10.19 Employment Agreement between Ross Stores and Melvin A.
Wilmore, effective as of March 15, 1994, incorporated by
reference to Exhibit 10.20 to the Form 10-Q filed by
Ross Stores for its quarter ended April 30, 1994.
12
Exhibit
Number Exhibit
10.20 Amendment to Employment and Stock Grant Agreement by and
between Ross Stores and Melvin A. Wilmore, effective as
of March 16, 1995, incorporated by reference to Exhibit
10.20 to the Form 10-Q filed by Ross Stores for its
quarter ended October 28, 1995.
10.21 Second Amendment to Employment Agreement by and between
Ross Stores and Melvin A. Wilmore, effective as of June
1, 1995, incorporated by reference to Exhibit 10.21 to
the Form 10-Q filed by Ross Stores for its quarter ended
October 28, 1995.
10.22 Third Amendment to Employment Agreement by and between
Ross Stores and Melvin A. Wilmore, entered into July 29,
1996, incorporated by reference to Exhibit 10.22 to the
Form 10-Q filed by Ross Stores for its quarter ended
August 3, 1996.
10.23 Agreement between Ross Stores and Melvin A. Wilmore,
dated August 22, 1995, incorporated by reference to
Exhibit 10.22 to the Form 10-Q filed by Ross Stores for
its quarter ended October 28, 1995.
10.24 Employment Agreement between Ross Stores and Michael
Balmuth, effective as of February 1, 1995, incorporated
by reference to Exhibit 10.15 to the Form 10-Q filed by
Ross Stores for its quarter ended April 29, 1995.
10.25 Amendment to Employment Agreement between Ross Stores
and Michael Balmuth, effective as of June 1, 1995,
incorporated by reference to Exhibit 10.24 to the Form
10-Q filed by Ross Stores for its quarter ended October
28, 1995.
10.26 Second Amendment to Employment Agreement between Ross
Stores and Michael Balmuth, entered July 29, 1996,
incorporated by reference to Exhibit 10.26 to the Form
10-Q filed by Ross Stores for its quarter ended August
3, 1996.
10.27 Employment Agreement between Ross Stores and Barry S.
Gluck, effective as of March 1, 1996, incorporated by
reference to Exhibit 10.23 to the Form 10-Q filed by
Ross Stores for its quarter ended May 4, 1996.
10.28 First Amendment to Employment Agreement between Ross
Stores and Barry S. Gluck, dated September 1, 1996.
10.29 Employment Agreement between Ross Stores and Irene S.
Jamieson, effective as of March 1, 1996, incorporated by
reference to Exhibit 10.24 to the Form 10-Q filed by
Ross Stores for its quarter ended May 4, 1996.
10.30 First Amendment to Employment Agreement between Ross
Stores and Irene A. Jamieson, dated September 1, 1996.
10.31 Employment Agreement between Ross Stores and Barbara
Levy, effective as of March 1, 1996, incorporated by
reference to Exhibit 10.25 to the Form 10-Q filed by
Ross Stores for its quarter ended May 4, 1996.
13
Exhibit
Number Exhibit
10.32 First Amendment to Employment Agreement between
Ross Stores and Barbara Levy, dated September 1,
1996.
10.33 Consulting Agreement between Ross Stores and Stuart
G. Moldaw, effective as of March 16, 1995,
incorporated by reference to Exhibit 10.16 to the
Form 10-Q filed by Ross Stores for its quarter
ended April 29, 1995.
11 Statement re: Computation of Per Share Earnings.
15 Letter re: Unaudited Interim Financial Information.
27 Financial Data Schedules (submitted for SEC use
only).
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (the
"Amendment") is made and entered into this 1st day of September,
1996, by and between ROSS STORES, INC. (the "Company") and BARRY
S. GLUCK (the "Executive"). The Executive and the Company
previously entered into an Employment Agreement effective as of
March 1, 1996, and it is now the intention of the Executive and
the Company to amend the Agreement as set forth below.
Accordingly, the Executive and the Company now enter into this
Amendment.
I. The Executive and the Company hereby amend the
Agreement effective as of September 1, 1996, as follows:
A. Place of Performance. Paragraph 3 shall be
amended to provide that the Company's buying office shall be
located in the metropolitan New York area.
B. Termination. Paragraph 6(e) of the Agreement
is hereby amended to provide that the Executive may terminate his
employment for Good Reason (as defined therein) if the Company
requires the Executive to relocate his place of employment or
residence outside of the New York metropolitan area.
C. Arbitration. Paragraph 18 of the Agreement
is hereby amended to provide that in the event of any dispute
relating to the parties' employment relationship or the Agreement
will be resolved by binding arbitration conducted in New York
City, New York.
D. No Other Modifications. Except as modified
by this Amendment, the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have executed this
First Amendment to Employment Agreement as of the date and year
first above written.
ROSS STORES, INC. EXECUTIVE
By: /s/Stephen Joyce /s/Barry S. Gluck
Stephen Joyce Barry S. Gluck
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (the
"Amendment") is made and entered into this 1st day of September,
1996, by and between ROSS STORES, INC. (the "Company") and IRENE
JAMIESON (the "Executive"). The Executive and the Company
previously entered into an Employment Agreement effective as of
March 1, 1996, and it is now the intention of the Executive and
the Company to amend the Agreement as set forth below.
Accordingly, the Executive and the Company now enter into this
Amendment.
I. The Executive and the Company hereby amend the
Agreement effective as of September 1, 1996, as follows:
A. Place of Performance. Paragraph 3 shall be
amended to provide that the Company's buying office shall be
located in the metropolitan New York area.
B. Termination. Paragraph 6(e) of the Agreement
is hereby amended to provide that the Executive may terminate her
employment for Good Reason (as defined therein) if the Company
requires the Executive to relocate her place of employment or
residence outside of the New York metropolitan area.
C. Arbitration. Paragraph 18 of the Agreement
is hereby amended to provide that in the event of any dispute
relating to the parties' employment relationship or the Agreement
will be resolved by binding arbitration conducted in New York
City, New York.
D. No Other Modifications. Except as modified
by this Amendment, the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have executed this
First Amendment to Employment Agreement as of the date and year
first above written.
ROSS STORES, INC. EXECUTIVE
By: /s/Stephen Joyce /s/Irene A. Jamieson
Stephen Joyce Irene A. Jamieson
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (the
"Amendment") is made and entered into this 1st day of September,
1996, by and between ROSS STORES, INC. (the "Company") and
BARBARA LEVY (the "Executive"). The Executive and the Company
previously entered into an Employment Agreement effective as of
March 1, 1996, and it is now the intention of the Executive and
the Company to amend the Agreement as set forth below.
Accordingly, the Executive and the Company now enter into this
Amendment.
I. The Executive and the Company hereby amend the
Agreement effective as of September 1, 1996, as follows:
A. Place of Performance. Paragraph 3 shall be
amended to provide that the Company's buying office shall be
located in the metropolitan New York area.
B. Termination. Paragraph 6(e) of the Agreement
is hereby amended to provide that the Executive may terminate her
employment for Good Reason (as defined therein) if the Company
requires the Executive to relocate her place of employment or
residence outside of the New York metropolitan area.
C. Arbitration. Paragraph 18 of the Agreement
is hereby amended to provide that in the event of any dispute
relating to the parties' employment relationship or the Agreement
will be resolved by binding arbitration conducted in New York
City, New York.
D. No Other Modifications. Except as modified
by this Amendment, the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have executed this
First Amendment to Employment Agreement as of the date and year
first above written.
ROSS STORES, INC. EXECUTIVE
By: /s/Stephen Joyce /s/Barbara Levy
Stephen Joyce Barbara Levy
EXHIBIT 11
ROSS STORES, INC.
________________________________________
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
(Amounts in thousands, except per share amounts)
Three Months Ended
November 2, 1996 October 28, 1995
Fully Fully
Primary Diluted Primary Diluted
Net earnings $16,354 $16,354 $7,909 $7,909
======= ======= ======= =======
Weighted average shares outstanding:
Common shares 25,048 25,048 24,578 24,578
Common equivalent shares:
Stock options 577 629 285 292
___ ___ ___ ___
Weighted average common and common
equivalent shares outstanding 25,625 25,677 24,863 24,870
====== ====== ====== ======
Earnings per common and common
equivalent share $.64 $.64 $.32 $.32
==== ==== ==== ====
Nine Months Ended
November 2, 1996 October 28, 1995
Fully Fully
Primary Diluted Primary Diluted
Net earnings $48,938 $48,938 $22,113 $22,113
======= ======= ======= =======
Weighted average shares outstanding:
Common shares 25,125 25,125 24,559 24,559
Common equivalent shares:
Stock options 632 747 175 292
___ ___ ___ ___
Weighted average common and common
equivalent shares outstanding 25,757 25,872 24,734 24,851
====== ====== ====== ======
Earnings per common and common
equivalent share $1.90 $1.89 $.89 $.89
===== ===== ==== ====
EXHIBIT 15
December 12, 1996
Ross Stores, Inc.
Newark, California
We have made a review, in accordance with standards established
by the American Institute of Certified Public Accountants, of the
unaudited interim condensed consolidated financial statements of
Ross Stores, Inc. for the three-month and nine-month periods
ended November 2, 1996 and October 28, 1995, as indicated in our
independent accountants' report dated November 22, 1996; because
we did not perform an audit, we expressed no opinion on that
information.
We are aware that our report referred to above, which is included
in your Quarterly Report on Form 10-Q for the quarter ended
November 2, 1996, is incorporated by reference in Registration
Statements Nos. 333-06119, 33-61373, 33-51916, 33-51896, 33-
51898, 33-41415, 33-41413 and 33-29600 of Ross Stores, Inc. on
Form S-8.
We are also aware that the aforementioned report, pursuant to
Rule 436(c) under the Securities Act of 1933, is not considered a
part of the Registration Statement prepared or certified by an
accountant or a report prepared or certified by an accountant
within the meaning of Sections 7 and 11 of that Act.
Yours truly,
Deloitte & Touche LLP
San Francisco, CA
5
0000745732
ROSS STORES, INC.
1,000
9-MOS
FEB-01-1997
FEB-04-1996
NOV-02-1996
25,305
0
18,207
0
401,813
458,594
338,359
152,468
660,378
314,774
10,000
0
0
249
312,417
660,378
1,179,987
1,179,987
833,472
1,098,423
0
0
138
81,564
32,626
48,938
0
0
0
48,938
1.90
1.89
