Slide 1: Ross Stores, Inc. Investor Overview
Ross Stores, Inc. Investor Overview May 2017
Slide 2: Disclosure of Risk Factors
Disclosure of Risk Factors Forward-Looking Statements: This presentation contains forward-looking statements regarding expected sales, earnings levels and other financial results in future periods that are subject to risks and uncertainties, which could cause our actual results to differ materially
Slide 3: Ross Stores, Inc. Overview
Ross Stores, Inc. Overview S&P 500, Fortune 500 and Nasdaq Sales EPS 100 company with fiscal 2016 revenues of $12.9 billion Ross Dress for Less® is the largest off-price apparel and home fashion chain in the U.S. with 1,363 stores in 37 states, the District of Columbia and Guam Also operates 1
Slide 4: 1,561 Stores in 37 States (as of 4/29/17)
1,561 Stores in 37 States (as of 4/29/17) Ross dd’s Ross dd’s Ross dd’s Ross dd’s Alabama 23 Hawaii 17 Missouri 21 South Carolina 22 1 Arizona 63 12 Idaho 11 Montana 6 South Dakota 1 Arkansas 8 Illinois 66 Nevada 29 5 Tennessee 29 2 California 284 83 Indiana 11 New Jersey 12 1 Texas 181 45 Colorado
Slide 5: Delivering Bargains
Delivering Bargains Department store brands Significant discounts off comparable prices Great savings every day Wide assortment of styles and fashions (e.g. “treasure hunt”) Constant flow of fresh merchandise May 2017 5
Slide 6: Merchandise Mix
Merchandise Mix* * Fiscal 2016 May 2017 6
Slide 7: Key Value Drivers
Key Value Drivers Opportunistic buying supported by a large and growing off-price buying organization Hundreds of merchants sourcing product from thousands of manufacturers and vendors Broad market coverage and strong vendor relationships enhanced by strategic location of buying offices in New
Slide 8: Typical Ross Customer
Typical Ross Customer Demographic How We Reach Her About 70-75% female, shopping for Marketing reflects the business herself / other family members strategy – great brands at great Wide range of household incomes – values every day! “want a bargain” vs. “need a bargain” Television is an effe
Slide 9: Ross Store Prototype
Ross Store Prototype Efficient, low-cost format Average approximate store size is 22,000 – 30,000 gross square feet Convenient self-service format Strong co-tenancy Visible and accessible retail locations Located in markets with a large proportion of broad income levels High traffic in
Slide 10: dd's DISCOUNTS
dd’s DISCOUNTS Concept launched in California in 2004 Average approximate store size ranges from 18,000 – 22,000 square feet Established shopping centers Stores located in California, Texas, Florida, Arizona, Georgia, Nevada, Louisiana, Colorado, Maryland, New Mexico, Tennessee, New Jersey,
Slide 11: dd's DISCOUNTS Update
dd’s DISCOUNTS Update Delivered solid growth in sales and operating profits in 2016 dd’s DISCOUNTS has benefited by delivering a faster flow of fresh and exciting product to our stores while operating on lower inventory levels Its improved performance also reflects that dd’s DISCOUNTS’ value-f
Slide 12: Commitment to Value
Commitment to Value Our top priority is ensuring access to terrific brands at great savings every day Reflected in ongoing investments in people and processes in our merchant organization Our highly skilled merchants purchase product from thousands of vendors and manufacturers, enabling consis
Slide 13: Significant Growth Opportunities
Significant Growth Opportunities Today, Ross Dress for Less® (“Ross”) is in only 37 states and dd’s DISCOUNTS has stores in 15 states Targeting long-term projected store potential of 2,500 locations in the U.S. Our current research and proven ability to cluster stores closer together indicate
Slide 14: Financial Results
Financial Results May 2017 14
Slide 15: Flexible and Resilient Off-Price Model
Flexible and Resilient Off-Price Model Long history of consistent sales and earnings growth in both healthy and challenging retail and macro-economic environments Benefiting from our ability to offer terrific bargains Taking advantage of close-out opportunities in the marketplace Continued i
Slide 16: Fiscal 2016 Results
Fiscal 2016 Results FY 2016 sales increased 8% to $12.9 billion, with comparable store sales up 4% over fiscal 2015 Shoes was the best performing category Midwest was the strongest region Added 87 net new locations in FY 2016 Ended the year with 1,340 Ross and 193 dd’s DISCOUNTS stores F
Slide 17: First Quarter 2017 Results
First Quarter 2017 Results First quarter sales increased 7% to $3.3 billion, with comparable store sales up 3% Sales gains were broadbased across most merchandise categories and geographic regions Earnings per share were $.82, up from $.73 last year Operating margin was 15.2% relative to las
Slide 18: Targeting Sustainable Profit Margins
Targeting Sustainable Profit Margins Over the long term, we believe EBIT margins can be maintained at a similar level to fiscal 2016 Record levels of merchandise gross margin have been driven by better buying and faster inventory turns from our sizeable reduction of selling store inventories by
Slide 19: Higher Levels of Cash Returned to Stockholders
Higher Levels of Cash Returned to Stockholders In February 2017, our Board of Directors approved a two-year $1.75 billion stock repurchase program for fiscal 2017 and Share repurchases and 2018 dividend payments Completed our prior two-year $1.4 billion repurchase program in 2016 ($ millions)
Slide 20: Capital Expenditures
Capital Expenditures 2016 Actual 2017 Forecast New stores $ 118 million $ 130 million Existing stores 90 million 110 million Distribution, Transportation 41 million 55 million Information Systems, Corporate, Other 49 million 105 million Total $ 298 million $ 400 million May 2017 20
Slide 21: Investment Highlights
Investment Highlights Favorably positioned as a leader in the off-price industry, which continues to gain market share Ross Dress for Less is the largest off-price apparel and home fashion chain in the U.S. with 1,363 locations in 37 states, the District of Columbia and Guam dd’s DISCOUNTS ope