Slide 1: Ross Stores, Inc. Investor Overview
Ross Stores, Inc. Investor Overview March 2016
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 Sales EPS S&P 500, Fortune 500 and Nasdaq 100 company with fiscal 2015 revenues of $11.9 billion Ross Dress for Less® is the largest off-price apparel and home fashion chain in the U.S. with 1,274 stores in 34 states, the District of Columbia and Guam Also operates 1
Slide 4: 1,446 Stores in 34 States (as of 1/30/16)
1,446 Stores in 34 States (as of 1/30/16) Ross dd’s Ross dd’s Ross dd’s Ross dd’s Alabama 19 Hawaii 17 Montana 6 Texas 176 35 Arizona 60 11 Idaho 11 Nevada 28 4 Utah 17 Arkansas 6 Illinois 55 New Jersey 12 1 Virginia 36 California 273 74 Indiana 8 New Mexico 9 2 Washington 41 Colorado 31 Kansas 7 No
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 March 2016 5
Slide 6: Merchandise Mix
Merchandise Mix* * Fiscal 2014 March 2016 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 75-80% 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 25,000 - 30,000 gross s.f. in suburban centers Convenient self-service format Strong co-tenancy Visible and accessible retail locations Located in markets with a large proportion of middle income households March 2016 9
Slide 10: dd's DISCOUNTS
dd’s DISCOUNTS Concept launched in California in 2004 Stores located in California, Texas, Florida, Arizona, Georgia, Nevada, Louisiana, Maryland, New Mexico, Tennessee, New Jersey, North and South Carolina, Oklahoma and Oregon Target customer is typically younger and from households with more
Slide 11: dd's DISCOUNTS Update
dd’s DISCOUNTS Update Delivered another year of better- than-expected gains in operating profits in 2015. 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 d
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 34 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 March 2016 14
Slide 15: Flexible and Resilient Off-Price Model
Flexible and Resilient Off-Price Model Strong sales and EPS growth achieved over the past five years in an uncertain and volatile macro-economic and retail climate Benefiting from our ability to offer terrific bargains Taking advantage of close-out opportunities in the marketplace Operating
Slide 16: Fiscal 2015 Results
Fiscal 2015 Results FY 2015 sales increased 8% to $11.9 billion, with comparable store sales up 4% over fiscal 2014 Juniors was the best performing category Midwest was the strongest region Added 84 net new locations in FY 2015 Ended the year with 1,274 Ross and 172 dd’s DISCOUNTS stores
Slide 17: Targeting Sustainable Profit Margins
Targeting Sustainable Profit Margins Over the long term, believe that EBIT margins can be maintained at a similar level to fiscal 2015 Record levels of merchandise gross margin have been driven by better buying and faster inventory turns from our sizeable reduction of selling store inventories b
Slide 18: Higher Levels of Cash Returned to Stockholders
Higher Levels of Cash Returned to Stockholders In February 2015, our Board of Directors approved a two-year $1.4 billion stock repurchase program for 2015 and 2016 Share repurchases and Repurchased 13.7 million shares for dividend payments $700 million in fiscal 2015 Expect to complete the rem
Slide 19: Capital Expenditures
Capital Expenditures 2015 Actual 2016 Forecast New stores $ 106 million $ 125 million Existing stores 124 million 85 million Distribution 93 million 120 million Information Systems, Corporate, Other 44 million 95 million Total $ 367 million $ 425 million March 2016 19
Slide 20: 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 1,274 locations in 34 states, the District of Columbia and Guam dd’s DISCOUNTS ope