Slide 1: Ross Stores, Inc. Investor Overview
Ross Stores, Inc. Investor Overview August 2019
Slide 2: Disclosure of Risk Factors
Disclosure of Risk Factors Forward-Looking Statements: This presentation contains forward-looking statements regarding expected sales, earnings levels, new store growth opportunity, and other financial results in future periods that are subject to risks and uncertainties which could cause our actual
Slide 3: Ross Stores, Inc. Overview
Ross Stores, Inc. Overview ▪ S&P 500, Fortune 500 and Nasdaq Sales EPS 100 company with fiscal 2018 revenues of $15.0 billion $16.0 $5.00 ▪ Ross Dress for Less® is the largest $15.0 off-price apparel and home fashion $14.1 $4.00 chain in the U.S. with 1,523 stores in $12.0 $12.9 39 states, the Distr
Slide 4: 1,772 Stores in 39 States (as of 8/3/19)
1,772 Stores in 39 States (as of 8/3/19) Ross dd’s Ross dd’s Ross dd’s Ross dd’s Alabama 24 Idaho 12 Nebraska 3 South Dakota 2 Arizona 67 13 Illinois 74 8 Nevada 31 8 Tennessee 32 2 Arkansas 8 Indiana 19 New Jersey 13 1 Texas 200 52 California 315 100 Iowa 6 New Mexico 13 3 Utah 21 Colorado 34 4 Kan
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 August 2019 5
Slide 6: Merchandise Mix
Merchandise Mix* Children's 8% Ladies Shoes 26% 13% Accessories, Lingerie, Fine Jewelry, Fragrances 13% Home Men's Accents, Bed 14% and Bath 26% * Fiscal 2018 August 2019 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 and other family members strategy – bargains on a wide assortment of brands and styles ▪ Wide range of household incomes – “want a bargain” versus “need a ▪ Television is
Slide 9: Ross Dress for Less Store Prototype
Ross Dress for Less Store Prototype ▪ Efficient, low-cost format ▪ Opening stores with average approximate size of 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 in
Slide 10: dd's DISCOUNTS
dd’s DISCOUNTS ▪ Concept launched in California in 2004 ▪ Opening stores with average approximate size of 18,000 – 22,000 gross square feet ▪ Established shopping centers ▪ Stores located in California, Texas, Florida, Arizona, Georgia, Illinois, Nevada, Colorado, Louisiana, New Mexico, Maryland, No
Slide 11: dd's DISCOUNTS Update
dd’s DISCOUNTS Update ▪ dd’s had another quarter of strong growth in both sales and operating profits for the second quarter of 2019 ▪ 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 solid performanc
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 ▪ Over the long-term, we believe we can operate a total of 3,000 stores ▪ Significant opportunity to expand in both existing and newer markets, such as the Midwest ▪ Today, we only operate in 39 states with plans to become a national retailer over time ▪ Long-term, w
Slide 14: Financial Results
Financial Results August 2019 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 2018 Results
Fiscal 2018 Results ▪ FY 2018 sales increased 6% to $15.0 billion, with comparable store sales up 4% over fiscal 2017 ▪ Men’s was the best performing category ▪ Midwest was the strongest region ▪ Added 95 net new locations in FY 2018 ▪ Ended the year with 1,480 Ross and 237 dd’s DISCOUNTS stores ▪ F
Slide 17: Second Quarter 2019 Results
Second Quarter 2019 Results ▪ Second quarter 2019 sales increased 6% to $4.0 billion, with comparable store sales up 3% over the same period last year ▪ Men’s was the best performing category ▪ The Midwest and the Southeast were our strongest geographic regions ▪ Added 27 net new locations in Q2 201
Slide 18: Target Sustainable Profit Margins
Target Sustainable Profit Margins ▪ Over the long term, we believe annual EBIT margins can be flat to slightly up on comparable store sales growth in line with our historical averages ▪ Record levels of merchandise gross margin have been driven by better buying and faster inventory turns from our si
Slide 19: Higher Levels of Cash Returned to Stockholders
Higher Levels of Cash Returned to Stockholders ▪ In March 2019, our Board of Directors approved a new two-year share repurchase program to be completed in Share repurchases and the next two fiscal years for $2.55 billion dividend payments ▪ Represents an increase from the previous $1.95 billion auth
Slide 20: Capital Expenditures
Capital Expenditures ▪ FY 2019 capital expenditures are projected to be about $600 million, up from $414 million last year. ▪ The increased level of capital expenditures in 2019 is driven by initial investments for our next distribution center. 2018 Actual 2019 Forecast New stores $ 135 million $ 14
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 1,523 locations in 39 states, the District of Columbia, and Guam ▪ dd’s DISCOUNTS op