Ross Stores, Inc. reported sales of $374 million for the five week period ended October 2, 2004, a 3% increase above the $363 million in sales for the five weeks ended October 4, 2003. Comparable store sales for the same period declined 5% from the prior year.
For the eight month period ended October 2, 2004, sales were $2.687 billion, a 7% increase above the $2.523 billion in sales for the prior year's comparable period ended October 4, 2003. Comparable store sales for the eight months declined 2% from the prior year.
Michael Balmuth, Vice Chairman and Chief Executive Officer, commented, “Sales trends in September were within our forecast for a 2% to 5% decline in comparable store sales, despite the impact of three hurricanes in Florida, where we operate 74 locations. These results were on top of a 5% gain in same store sales in the prior year. We estimate that comparable store sales would have been down 3% without the effect on business from these storms.”
Mr. Balmuth said, “We continued to make progress during September in remedying the issues related to our Core Merchandising System. As previously reported, by the end of August we were able to provide the majority of the information and trend data requirements we consider most important to the buying process. The improved visibility that resulted from this information, however, now indicates that our projected markdown exposure from the merchandise imbalances that have developed over the past six months is greater than we previously forecasted.”
Mr. Balmuth continued, “While overall comparable store sales trends improved for the month as anticipated, recent lackluster trends in our home businesses, which grow in importance during the holiday season, are causing us to adopt a slightly more conservative outlook for fourth quarter sales. In addition, lower-than-expected productivity rates in our distribution centers as associates work to become more familiar and proficient with our new systems are putting pressure on distribution costs.”
Mr. Balmuth concluded, “As a result, we now estimate that earnings per share will be in the range of $.21 to $.23 for the third quarter ending October 30, 2004 and in the range of $.31 to $.37 for the fourth quarter ending January 29, 2005. Underlying assumptions include forecasted same store sales of down 2% to up 1% in October 2004, on top of a 2% decline in the prior year, and down 1% to down 4% in the fourth quarter of 2004, on top of a 4% increase in the prior year. The Company reported earnings per share of $.33 and $.48, respectively, for the third and fourth quarters of fiscal 2003.”
