Slide 1: Ross Stores, Inc. Investor Overview
Ross Stores, Inc. Investor Overview August 2018
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 2017 revenues of $14.1 billion Ross Dress for Less® is the largest off-price apparel and home fashion chain in the U.S. with 1,453 stores in 38 states, the District of Columbia, and Guam Also operates
Slide 4: 1,680 Stores in 38 States (as of 8/4/18)
1,680 Stores in 38 States (as of 8/4/18) Ross dd’s Ross dd’s Ross dd’s Ross dd’s Alabama 24 Idaho 11 Nebraska 1 Tennessee 31 2 Arizona 66 13 Illinois 72 4 Nevada 31 8 Texas 192 51 Arkansas 8 Indiana 14 New Jersey 13 1 Utah 21 California 297 91 Iowa 4 New Mexico 12 3 Virginia 38 Colorado 33 3 Kansas
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 2018 5
Slide 6: Merchandise Mix
Merchandise Mix* * Fiscal 2017 August 2018 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 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, Nevada, Illinois, Colorado, Louisiana, New Mexico, Maryland, No
Slide 11: dd's DISCOUNTS Update
dd’s DISCOUNTS Update Another year of robust gains in sales and operating profits in 2017 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’ v
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: Raising Long-Term Store Potential
Raising Long-Term Store Potential Recently announced an increase in our long-term store count potential to 3,000 locations, from a previous target of 2,500 Believe we can further increase penetration in both existing and new markets, given increases in population densities, new trade areas, and
Slide 14: Financial Results
Financial Results August 2018 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 2017 Results
Fiscal 2017 Results FY 2017 sales increased 10% to $14.1 billion, with comparable store sales up 4% over fiscal 2016 Children’s was the best performing category Midwest was the strongest region Added 89 net new locations in FY 2017 Ended the year with 1,409 Ross and 213 dd’s DISCOUNTS stor
Slide 17: First Six Months 2018 Results
First Six Months 2018 Results Sales in the first six months of 2018 increased 9% to $7.3 billion, with comparable store sales up 4% over the prior year Earnings per share in the first six months of the year were $2.15, up from $1.64 last year Operating margin for the period was 14.5% relative
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 the prior year Record levels of merchandise gross margin have been driven by better buying and faster inventory turns from our sizeable reduction of selling store inventories
Slide 19: Higher Levels of Cash Returned to Stockholders
Higher Levels of Cash Returned to Stockholders In March 2018, our Board of Directors approved an increase in our stock repurchase authorization for 2018 to Share repurchases and $1.075 billion dividend payments Represents an increase from the previous $875 million authorization ($ millions) Co
Slide 20: Capital Expenditures
Capital Expenditures 2017 Actual 2018 Forecast New stores $ 137 million $ 140 million Existing stores 126 million 140 million Distribution, Transportation 42 million 80 million Information Systems, Corporate, Other 66 million 115 million Total $ 371 million $ 475 million August 2018 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 1,453 locations in 38 states, the District of Columbia, and Guam dd’s DISCOUNTS op