Ross Stores Reports In Line - Analyst Blog

Ross Stores Inc. (ROST) reported results for the fourth quarter and full fiscal 2009. For the fourth quarter, the company reported earnings of $1.16 per share, which were in line with the Zacks Consensus Estimate.

Quarterly earnings were up 52.6% year-over-year. For fiscal 2009, Ross reported earnings of $3.54 per share, which were up 51.9% from fiscal 2008.

Net sales for the quarter increased 14% to $1.98 billion from $1.73 billion in the prior-year quarter. Comparable same store sales were up 10% year-over-year.  Sales were driven by strong merchandise categories in Shoes, Dresses and Home.

Gross margin for the quarter expanded 233 basis points (bps) to 26.1% versus 23.8% in the comparable prior-year quarter. Operating margin expanded 260 bps in the quarter to 11.7% from 9.1% in the prior-year period. The increase was driven by lower selling, general and administrative expenses.

For fiscal 2009, the company had cash and cash equivalents of $768 million and a debt-to-capitalization ratio of 11.5%. Also in fiscal 2009, the company repurchased 7.4 million shares of common stock for an aggregate purchase price of $300 million, thus completing the two-year $600 million stock repurchase program announced in early 2008.

Additionally, in January 2010, the Board of Directors approved a new two-year $750 million stock repurchase program along with a 45% increase in the quarterly cash dividend to $.16 per common share.

Ross Stores is the second largest off-price retailer in the U.S. offering first-quality, in-season, name brand and designer apparel, accessories, footwear and home fashions at savings of 20% to 60% off department and specialty store regular prices.

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