ROST - Earnings call transcript Q4 2017

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Operator

Good afternoon, and welcome to the Ross Stores Fourth Quarter and Fiscal Year 2017 Earnings Release Conference Call. The call will begin with prepared comments by management followed by a question-and-answer session. [Operator instructions].

Before we get started, on behalf of Ross Stores, I would like to note that the comments made on this call will contain forward-looking statements regarding expectations about future growth and financial results including sales and earnings forecasts and other matters that are based on the company's current forecast of aspects of its future business. These forward-looking statements are subject to risk and uncertainties that could cause actual results to differ materially from historical performance or current expectations. SEC. in XX-K release XX-Q's and on with included fiscal the and are file Form XXXX fiscal the factors today's and press company's X-K's Risk XXXX Form

over Now, to I'd turn like the Barbara Chief Executive to Rentler, Officer. call

Barbara Rentler

afternoon. Good

Officer; call Vice Hartshorn, and Connie me Executive President, O'Sullivan, President Gary Stores Finance Executive Group Vice and President Loss and are and Joining today Financial Michael Michael Operating Senior Chief Vice Chief our Officer; Call, Legal; on President, Cribb, Investor of Prevention; John call fourth followed and President, to today any you with XXXX. quarter performance, respond our Vice We'll begin happy questions for may Kao, Relations. XXXX we'll outlook a our by have. be to Afterwards, review our and

our despite own climate, full expectations and release, press year. difficult competitive comparison for quarter a ahead today's in and both noted sales of in retail the were very earnings well our fourth multi-year the As

and We XXXX are XX assortments XX January up these reflect ended bargains results, ended of for which pleased $X.XX in ongoing from with $X.XX, weeks XX, today’s X, shoppers. February share Earnings delivering weeks XXXX. compelling the per broad were to value-driven the success our

and to per January benefit ended of share XX the include the from share per the $X.XX recently year XXXX, $X.XX a XXXX. For the reform $X.XX legislation. quarter compared approximately XX the Both February ended X, $X.XX XX, grew weeks enacted earnings week XXrd in to weeks tax and from fiscal

prior of earnings up the were up store the a for year. basis year Fiscal million grew quarter from weeks fiscal prior top quarter items, ended earnings the in XXXX, billion ended January comparable period Net the $X.X $XXX net prior fiscal XX, billion for a X, grew per Total XX% for the grew both $X.X over to $XXX in February with these earnings share to the fourth X% for XX-weeks XXXX to the million, sales XXXX $X.X in XX-week Excluding on sales year. XXXX XX% X% and XXXX. on increase billion compared XX year.

XXXX, XX up fiscal For billion the in January ended the increased XX, weeks for with February XX% versus $XX.X ended store XXXX. same sales a X% sales XXXX XX-weeks to X% increase year X,

For at the was sales fourth the across best. with trends Florida performing all were Ross merchandise quarter, the broad-based fairly strongest children��s major region. Geographically, categories

Our from by sales as gains solid fourth in of margin mainly on XXrd points the well This week. margin leverage of driven last expense quarter improvement as same-store was strong operating impact up XX.X% was basis XX merchandise year. and the

sales dd’s increased both to For merchandise assortment operating the in points customers year a respond full of leading year, and continued robust operating record to gains positively XX.X%. to DISCOUNTS basis quarter margin its XX another profits. also and

total inventories levels XX% over XXXX, last ended the total X% of year consolidated year. were up at to we the prior As with packaway similar

As in-store planned inventories were X%. up average

dividend for investments. eligible past We our paid we As programs. plan to and success. per our been workforce future Further, significant prior of growing capital ongoing and our believe us sheet business. key to of up authorization our these XXXX cash actions from continue for $X.XXX board up balance $X.XX current ability approved to over quarterly the board other XX,XXX XXXX year. and associates to increases to who needs the The will generate our retain a of critical attract for to growth allow our be talented after and have will over $XX our performance bonuses the associates minimum cash our providing hour, of a include also improving reflects make shareholder today’s of increased an wage of wage These leave billion, hourly related release, amounts million. and payout benefit noted previous $XXX in and raising funding store our and one-time share, competitive approved higher in-store repurchase to and to recently XX% in the The strength

every cash in planned XXXX. as dividend commitment XXXX since stocks its repurchased record our raised inception to stockholder since our value year annually and This reflects also have and enhancing returns. We continuing consistent

Hartshorn further and fiscal Michael Now will results guidance. color full on on XXXX our details XXXX year quarter provide our and first

Michael Hartshorn

Barbara. Thank you,

with Let's results. start fourth our quarter

the Our size was a combination average traffic basket. an increase driven X% gain by of store of sales comparable higher and the in

XX by were the points XXrd and of quarter XX gain both by fourth improved cost that margin the mentioned, increased store which These general by basis lower XX in same basis of offset margin higher Barbara the and of freight includes from Cost-of-good were X% cost to week. XX points Selling, from points quarter XXrd administrative gains XX a lower during sales XX.X% the week. were higher driven operating volume in the merchandize and points XX points. quarter to points basis the As basis sold expenses points. mainly basis basis basis points XX expenses partially XX due leverage increase impact and basis occupancy by

XXrd operating XX For points benefit week. basis year, margin approximate to an a of XX points the includes basis which from increased record fiscal XX.X%, the

enacted Reform and from of mentioned are earnings tax the fourth $X.XX $X.XX rate. earlier, quarter of $X.XX week results lower XXXX Tax to savings deferred per from approximate share the benefit XXrd The inclusive Legislation. and Barbara fourth Federal recently a share of onetime amount taxes earnings related As an fiscal a benefit revaluation quarter from $X.XX tax of comprised per is and

common repurchased of we've of million. price total quarter, a million the $XXX During stock purchase X for

an year, for million. repurchased XX.X the price million full aggregate of For we $XXX

to outlook XXXX. for now Let's our turn

recent tax and Our related legislation benefit the competitive aforementioned impact from reflects and positive guidance wage the investments.

February $X.XX gains X, X, being are affected the to sales in by fiscal XX per added earnings million increase weeks following. the from the Ross statement total on XXX XXXX and to February Comparable weeks X, to For up in operating to grow expected to assumptions quarter be share of XXXX. ended top projected plan this revenue $XXX sales XXXX. This increase the X% XX XX of week, three compared X% year, store $X.XX for locations. XXXX ending in to DISCOUNTS weeks about XX approximately X% the to which past to XX February include forecasting Total year. weeks XXXX, year-over-year for stores the X% new sales XXXX ending X% the ending the fourth are XX dd's is are add fiscal each years. consisting $X.XX We we of to and for X, February The XX

expense The do and As are our stores. would up to be reflect previously XXXX, reform the XX% $XXX,XXX, be investments. from competitive in XX about million. week. of to be range be in projected the to by to about forecast XXrd average rate interest are legislation, inclusive in projected to be and benefited our relatively plans margin basis stock-based for or of decline close the our is margin, Capital projected about tax to expense plans million. to X%, which $XXX XXXX, about XX the these XX.X% XXXX, diluted not to with to XX.X% numbers points older gross X% operating XX% million is estimated approximately to Net $XXX we shares of of flat for outstanding impact benefit usual tax again our $XXX reflects approximately line and due and expect decrease is guidance to relocate compared and XX.X% expenditures forecasted we mentioned wage to Safer sales amortization amortization in depreciation merchandise

guidance. quarter to Let’s first move now our

XX ending to year. compared May for assumptions to to that X%, are the are last projected up following. quarter new of to to $X.XX sales same-store to first during DISCOUNT X%. XX quarter. X% includes sales to open period increase support Ross our be forecast locations we and projecting quarter per dd's in share the expect $X.XX Total are Other to XXXX, weeks For X guidance the the be we X, $X.XX Earnings first the X%

XX.X% First quarter projected be operating last margin year's to to versus XX.X%. XX.X% is

estimated be quarter for the about expense interest $XXX,XXX. net addition, is In to

tax Our million. projected to weighted $XXX to shares reform outstanding diluted And XX% to due average to be XX% tax decrease rate be around approximately are again expected is legislation. to finally,

turn closing comments. back call the for I’ll to Barbara Now

Barbara Rentler

than year. fiscal Again, Michael. with and are you, we and the pleased better sales earnings expected gains our Thank quarter for fourth both

these today’s mentioned, strong deliver to by results previously were focus value our As to ongoing ability possible drive best bargains topic. the

and As we tough continue we from serious and comparisons face online brick both retailers. mortar and enter XXXX, competition multiyear to

result, we confident forecasting remain our a we business certainly a in continue Longer hope better. As prudent to but our very of we model. term, do to business approach strength to the take

consistently by always have the to expect. to demonstrates as our years several our past top ongoing the share values over now, our remains be the performance profitable come success. achieve market gains will ability our it proven is customers exceptional to This priority, key Our offering

over we you strategy any to out the have. and in we’d several the double-digit the average range. of believe open can Looking that up the At this next our with share to we gains to execution earnings continue point, annual low may proper per respond questions years, achieve call percentage like

Operator

question comes from with Your Instructions] first Hofkin [Operator Blair. Daniel William

Daniel Hofkin

Good afternoon.

comments in store a kind you recent just questions. about as intense of mortar wondering think since about obviously updated becoming of you Just it’s comment evidence on it point? of sort then a longer-term online seeing at those. Barbara guess you’ve are I any just how is Are a And thinking don’t a expect it Thanks. and of few years I first, in question your targets, that I this to there your quick trend intense. couple that you put competition, more or abate? or either kind of was brick steady been on quarters

Barbara Rentler

Sure, Daniel.

have questions here. You of couple a

competition few intense On competition think for intense, being I a has years. been the

I intense. think competition will remain

but I I it’s stores forward, better, remains will it intense. as be assuming think think I go promotional, to department seen highly online, think be yes, we whether

Michael O'Sullivan

On we Right XXX O’Sullivan. up your Mike we dd’s. X,XXX are In it’s about between second question open have believe XX the we and about up X,XXX potential, X,XXX we your stores about store Daniel year for each to stores. now, at stores. And potential new part our dd, Ross -- net of Ross, approximately

years' on math would if worth XX we you this open, just you you -- if isn’t of have that how the on actually growth. math do So, about do the that, but

to this point, make potential changes number. that to any plans at no store So,

Operator

question with next Guggenheim from comes Bob Securities. Drbul Your

Andrew Roberge

Drbul. on This is Andrew Roberge for Bob

Could guys the be that states. one cold of guess think Florida rebound a weather performance of in from that question, be second any around mentioned top great? the quarter? would I hurricanes that prior by was you or And then performing color on color any the you quantify our the if any whether I was category, that additional Thanks.

Michael O'Sullivan

had above the then that quarter strong the which below and called continued with we mentioned had in a a bounce the strongest California Florida, perform Of we as some of being comps the the to fairly top mentioned Texas benefit Merchandise out non-apparel the from children's of some performance somewhat and had many the a commentary, that average. in commentary, markets, reported. was regional for we was merchandise comps region. some outside Midwest on would of average. from Florida apparel hurricane. we on slightly I’d I us chain Sure, the major of broad-based. And highest the well comping performance, chain mentioned performance was as region the the of similar was say years our back to

Barbara Rentler

weather, performed based But cold specifically, assortments weather, as pertains it the cold on well. to weather

Operator

Tracker. comes Your Marni question Retail Shapiro with next from

Marni Shapiro

any you then, can openings, real pretty because stores to the was one store where you the Congrats, then bit, you're one the consistent Can been in little it you're process Barbara a last stores? bit real estate have that had that talk the you size missing little with are a or and there over the in changed a segments just quarter. estate question? And for your question or stores year you've so or opening Are the about fantastic talk you but I underdeveloped so?

Barbara Rentler

are we're treasure there hunting segments missing. different merchandise enhance to Marni, the assortments. I products think to We're whole of always the to in I don't add terms looking and classifications segments, think really

you new, like particularly missing things businesses. And to grow. you go of out try into you feel again, and different know, often couple don't and then know, areas so, underdeveloped businesses is as, continue to anything new start But overall try

Michael O'Sullivan

And real question. then your Marni, on estate

finding we've additional closer and years of new fairly opened know, you of a timing terms last stores XX several As over year, factor a the steady locations. about opportunity in which at to XXXX, XXX, is a in it'll up a of more pace be

of In that’s other as terms I type to out flexible. in basically fairly now that's opportunities the new triggered will time store move But retailers would we're of in of existing terms terms of say to of anything buildings fact creating and the than driven that's of changing, into been in also for additional that business, partly some terms size been openings call I need moving And no some other flexible location gone we've for into. that by that, has flexibility more changes, be that's and out. other us the

Operator

Your Hutchinson next question with comes America. from Lorraine of Bank

Lorraine Hutchinson

on while. Thank you there’s you good mentioned, seen higher the are you, for that flattening a is have out any and My progress afternoon. first basket question headwind a been you on

Michael O'Sullivan

Lorraine. Sure

the units The was really very of increasing mentioned remarks, by higher similar to As that And comp the slightly. per down function trend of in was most throughout AUR driven and the traffic transaction year. the was driven the higher the was basket It decrease by we and business. is a basket. higher

Lorraine Hutchinson

then up decision following And little the wage Okay. the to bit behind on go are now? just to just laboring $XX. you your right maybe tightness of markets seeing guess a increase, I in $XX why the

Michael Hartshorn

and the seeing happy there's associates. we're where answer and of are level your across but to we no, labor Lorraine, markets not board pool we're pretty tight where new existing direct question that respond, the market always retention candidate across the our for They're is board. seeing the So, to with we have individual with hires tightness

entry one-time that me let So, the why a give rate, the you we're reasons paying couple programs. benefits improving minimum for we're of raising and wage answer, why with bonuses the

to our pace to effective up we labor Firstly, recognize although associates, we’re those the the are is rates, as reform is pretty wage there well dynamic and push ability it’s pipeline with us keep competitive. the as with currently those economy happy with doubt no And continue the hiring and important retain changes. that for going and things strengthening tax to to market

carved been and wages now that time we Secondly, as career success continuous success to success. that overtime. good reward changes of to well with with period over sort successful been with further enhancement associates opportunities have from benefit pretty of think of We long have and competitive helped associates tax a recognize is and and as that have able benefits a sort rate our time our who

So, why we’re associates keep happy line but to we is and it ability that making. to the are and that our question I answer bottom guess hire with your that’s making the today retain we changes to we want are way,

Operator

question Boruchow with Fargo. Wells next from comes Ike Your

Ike Boruchow

afternoon, thanks. Hi, everyone. Good

So, at embedded you going of or impact could your be from I that’s in to the the give could the the the to higher have margin wondering us I associates I be may us with may everyone will EPS question. store if else? wage you hour maybe wage for percentage was an year help just wage? the already And the piggyback are Michael then guess out, help guidance $XX what you’re that you on increase versus

Michael O'Sullivan

wouldn’t base. reasons, competitive how many call the We store XX%, associates of the I minimum wage. out of on the the is specifically so at already of Sure. already $XX our California that’s are say both for question would XX% at

impact. a one de-leverage basis benefit basis we reiterate, the also As two and XXX would But year, XXrd EBIT comparison. wage includes specific week points, from didn’t far and a guidance points as on the to we provide for are We comp. a that showing down XXX expect to just XX to

we benefit impact expect competitive year. be this factors, and I’d wage headwind those and cost call guidance freight a includes beyond to also these so, investments the from our out And

Operator

comes with Your next Stanley. question Greenberge Kimberly Morgan from

Kimberly Greenberge

I the worked freight range. have you know trucking much. seeing you talk can could manage be and secondarily, $XX this generally we in few And seeing? you modest the in have Thanks tell those now headwinds Mike, to looking QX so expense? are system hour us and/or just you been been until impacting of Are years how fully perhaps or some you the wonder headwinds if when it’s think acceleration for you am per in wage are then the not any experiencing that pressures that about sort to that will QX? last freight I if that so

Michael O'Sullivan

Sure, Kimberly.

like On the will timing, impact benefit $XX. California at the the investments wage a and past the quarter. does have be already the larger things first having said, quarter first That that’s

a us improving increase to of function driver and That the costs, freight market of an shortages. freight higher seen costs terms capacity. which that we regulatory rates, driven be to appears in tight In combination impacts is by a is economy, have of

addition, in prices QX, high. at In diesel were at years least three

to what and in XXXX would would Our into guidance. is we similar our to pressure expectation see, we built continue that we saw I say

Kimberly Greenberge

you was point can on headwind XXXX the full as well that Michael, Actually quarter? fourth year remind the us for for a XX-basis

Michael O'Sullivan

So, basis for due it year for was the the points to freight points. the it was was XX and quarter basis fourth costs XXXX, impact full XX

Operator

question next with from comes Wolfe Research. Adrienne Your Yih

Adrienne Yih

afternoon. Good

on or me these great My wage, through be add is of congratulations wage Let increases. a costs this holiday. on some my pass ability of question to some freight they increases, the

As of little through some much. attempts through to pricing very give and up Does to a you move AUR? their increases price of frontline points. they inventory bit distribution pass these channel ability get your the kind cleans you up discipline Thank of more some that sort their expense as

Barbara Rentler

of our as Really is on is built is great AUR look what business branded at bargain. we be value pricing supposed a to

a and we're stores. with differential price in business business stores specialty So, department

and is expect. to values price things, that right our having two offering on differential that So, comes the our on is customer focus meaningful

customer don't value. absolutely of to straight customers want think pass certain through the its a I types on because So,

it's now. through think don't I the passed So, customer

Michael O'Sullivan

And to Barbara to just is AUR jus to, where adding these of expenses. would try look and not said. what some offset we

operating patent the is out been to if our And leverage over inflation by last has wages us not actually Number on the you that last taking been at wage steadily to few a wages, been You And two over three, look comp and now, at able of sales and expenses. know, taking piece years strong focus these we've that's strong four new, internal out we've time, managing going our years, the things. back same very despite very driven improve the number been some two, our one, helps margin. expenses.

So, look the going to costs ends goes what forward two, largely by the I help the think these should of sure sales the they is make To more that stronger leverage and those economy to be and using if being you should go important, we’re are customer retail. down up extent positive driven both line, final and costs increases number top and make is growth. a point some of number managing one, I'd about on sales do back basis, expenses. are two a still point factors about pocket that their try in money to the our having that, to that which That

Operator

Your next c. question comes from

Simeon Siegel

Thanks. And versus concentration are in QX prior would I and any what change but gross expect going Sorry you vendors margins? the Barbara, your there has the it, then been if top your to forward? anything missed years of for expectations change

Michael O'Sullivan

full didn't for Simeon, the quarter, first year. only we the provide

Barbara Rentler

with our our X,XXX of X% over of and And in comment mix vendor no mix of on do we of represents resources sales, vendors, top but we one obviously the I so. of specifics wouldn’t business than our more terms vendor mean

Simeon Siegel

guess how vendors talking does vendors, that the about concentration more of top change? not I just specific but And the

Michael O'Sullivan

No.

Barbara Rentler

No.

Operator

Boss question with next Your Matthew from JPMorgan. comes

Matthew Boss

picture Thanks. I question. larger have just a

e-commerce in If it? inventory opportunity how stores, expansion any closeout were then availability, think guess stores. I to as business your business? off promotions impacts we paired department incremental see or to do you secondly price best the negative department And about think you maintain As e-commerce this a about and about may the your as and on do and as think impact, overtime, creating way leaner be just were well of back just with think the positive positioning they we

Barbara Rentler

Sure.

there’s in the First of of all, availability been plenty marketplace.

So, we haven’t supply seen any issues.

stores, to is coming of terms coming e-commerce differentiate from. or goods hard from department where coming from it's the availability In

they In hand business community because their terms but better better. their their keep aligned more in stores, if is and business promote is -- will less, goods. merchants go if of more go produce confidence they that, is usually And inventories vendor be to less and that they out hand department with has the promoting

supply come typically, from. that’s where So would

their the be for business better, gets better should us. if supply So,

Operator

next question Citi. with from Your Lejuez comes Paul

Paul Lejuez

year about Hey, talk What then the guys. store year, that, your about how you be versus Can of last versus about was Texas? Thanks. year give talk may what makeup you think year, color like? CapEx the second, region, Florida and you by and this those any Ross CapEx. of on states California, breakdown spend openings openings about Can percent which just And dd’s? this that looks this

Michael O'Sullivan

Paul. capital question. with I the Sure, start will

systems of is store we’re store -- again some and and is say state for on is about details, technology is markets enterprise maintenance our level on terms of and XX% is about dd’s a XX% existing store in we related technology that -- a our openings supply markets. call is XX% rollout, So in you refreshing new then saw in provide the it and And of rest will G&A. focused security. refreshes, capital information I I the also chain The -- typically and investments, for XX% by then quarter and million, stores, XX% third other then don’t new third XXX about focused the would

Paul Lejuez

time entering we’ll Ross? market for you next new are thinking And see guys then how you about guys

Michael O'Sullivan

for -- the has like, our rest. you at new five years region, we moment major the been last Well if well

of question openings. on couple So, -- just market going sort the thought for be of to when focus a opening really I outside to of to years. Midwest new us that’s If flatly we is

new are certainly -- next the be for us for to for Midwest. the going years, next markets few So,

net stores region. a other are is those out XX of I XXX about of would of growth, point The sort the make only quarter being new in new

markets The quarters other are in. existing already we’re in three

Operator

Your comes Bernstein. Merriman, from next question Jamie with

Jamie Merriman

Thanks very Good afternoon. much.

You a the broadly of evidence come? any the you economy. wage seeing couple to maybe increase, to increase that Do broadly that's expectation what's the and of the have business you're think more wage market in or in alluded happening seeing impact benefit terms more is yet, about on Thanks. times you're of still your that starting

Michael O'Sullivan

there are that so You into many go factors Jamie, know, the sales line.

So many things our it's that to factor. sales can affect hard our individual comp, one isolate

split the impact of For these example, in employment, the wage be reductions versus but sales. rate that to are our out driving factors may increases

their So to see conceptually contribution customer whether the lower pockets hard I easy of us because more would in it's us, that's evaluate taxes, help say to sales. for pretty isolate to and wages or but so has because making should it is of that money pretty the

Jamie Merriman

still there's Okay. seems more to of you like to comp it if think the way for Is that more play right do And thinking about to it? through. the guidance, through maybe see comes just start that

Michael O'Sullivan

results not environment better hope the the and may line, guidance. the positive higher and to some rates, tax do positives drive might my and of positive when some we the are these better, may economy negative strong the or our the know, you negatives certainly, Certainly, there it's, that growing be sustainable side our lower weigh improved negatives, living the a guidance, put do we retailers But the and side, will than that whether on went guidance. on cause cost that wage inflation more hope too, the from rate. we try and always and there promotional into we economies, caution are that you for together factors, know, the yeah always But we on reasons comp

the demonstrated think we last certainly can over it. that there I if years the chase business is few we've

business trying and we guidance. if to chase over even to business, always manage So go keep and to to exists to going the if the two, wanted guide as we're that if to we’ll one

Operator

Your next Evercore question Omar Saad, from comes with ISI.

Omar Saad

If planning quarter. brands and I a slightly as to a play Great where lot little ask kind has off a bit careful robust consumer the been us help think as maybe digital more, in but historically, a the inventory excess periods industry economy whole and disintermediation are and is business we the of are the Thanks. is a inventory stores question. have the period think macroeconomic historically coming you us careful those from model of careful, more as availability better Thanks. where want period bit a not maybe are with healthier, backdrop, about the healthier, performed and last entering we of is where more demand there inventory help a been rise how little department in has maybe of it couple philosophical years.

Michael O'Sullivan

Sure Omar.

and the doing. as is drivers the And the So, is the of the economy doing when how I do well. think in well if business upon is economy change performance a well economy we poorly done done doing based look we've back historically we've at our business our performance, when

happens competitors between So, is and us when the the economy is doing well, increases. what actually and other department stores price typically differentiation

and that store. drives value better the even offer actually to we business, So,

that to so to product, you economy up that an to also the other obviously tends can flipside improving the is happen negative fuel The thing make in in economy, vendors a happening. end more those help with tend us down,

more which other of becoming expectations the up life and stores You up with difficult. also of obviously met. some with supply, aren’t promotional, sales the department the retailers But because end makes end market you

we’ve you types feel at done of look both well in history, of like So, of the I kind if kind economy.

problems. face So, that we any it’s serious not clear to an us improving would economy in

Omar Saad

to You the or you’re one other prefer indifferent?

Barbara Rentler

There’s that. much about

Operator

Advisory. Dana comes with Telsey Telsey Your from next question

Dana Telsey

And the afternoon. good Hi, congratulations and outlook. the on results

how does it business and fourth that As the terms its terms existing you. about them you off share, you quarter, price which in the margin are also, traditional showing gaining returns, think sounds costs you leases? online margin? to compare of some store the renewal you of just from new like occupancy your what they occupancy benefiting only Thank of as are those about versus seeing in how And faring returns off improved costs are online this in are and from think entities

Michael Hartshorn

What start coming Sure is stabilized to will our This we comp more year Dana, generally. costs question up that occupancy able have level. are occupancy are answer rentals actually of seen and stabilized I both we’ve new the below cost cost, have in with for X% lease historical at renegotiation things renewal. I’d lever and that occupancy rents

right the Going forward around in XXXX. X% we at see occupancy cost

Michael O'Sullivan

your if finding quality on high Dana then explain channel. to merchandise, it’s question your and And [ph] returned unspoiled, online off-price about possible that could returns, it’s be

As value, interested we that long one could availability that the as are underline things abundant that’s the we’d represents that be to be, of seeing. additional could, it in And I word the product. contributing great

As in unspoiled was it’s are mentioned a hard a out we see and the and identify earlier of that’s the specific separate good it for first represents would bargaining product at the merchandise to interested we Barbara end where for originally and us in sale it say answer, quality day is intended or I for

Operator

Company. question comes Oliver with & next from Chen Your Cowen

Courtney Willson

changes marketing in change productivity Thanks. remain XXXX? you you base, as as you I any taking similar this continue stores, you Courtney to Oliver just XXXX anticipating at for then build on open historical level? Willson our on levels store is are you Hi, are to planning versus strategy new store out are spend question the today. to new had And do Are your XXXX. for anticipating to in any question. a Thanks the

Michael O'Sullivan

question. On your marketing

our programs, do I message make in message the ways years to and in we said, the will message we change not That for has media message Our that -- to more that we ways terms whether is very not and strategy. that wouldn’t apparel will always that’s the over values and will that message the marketing look a look consistent. for customer been change. offer underlying strategy of we home The consistent. communication message and marketing will fashions. be or the or best offer value expect great effective the creative But the

Michael Hartshorn

The years. for last approach productivity to give the new store the on Ross. store that been XX% of new in new then somewhat similar focus stores And on XX% around productivity, are consistent over has our couple

Operator

with Tunick Your next Brian from question RBC. comes

Brain Tunick

the Great. the for what do you, talk guess XXXX. have might and you in think about talk categories in Thanks, top on biggest as the what of Barbara year. I lagged then opportunities maybe you And the XXXX congrats on maybe maybe in my or what are well, maybe can strong company? home company on that, business, store home anecdotal, think side, Michael much traffic year? know, your of gains, have Thanks closings could again. you maybe of any past the longer-term might goals competitor as you have And this just do a you percentage the then estimates traffic aided bankruptcies on about curious, grow any

Barbara Rentler

Brian. Sure

would the categories throughout In apparel I in the feel clearly the business, total category assesses in in biggest lagged feeling although that of Opportunities fourth the XXXX, company as a quarter moving good terms we we on, are mind, the was continuing number home. went that year and the most. company of don't you particular as improved, to it. year, more it's percent business, right the good good our percent terms of apparel do, direction. very we about we based, work terms say right in particularly know was of in both of growing about in lagged We moving to direction, ladies, has home that of home it's company a for business know, the area the a lag business has company, accessories, but and its years We broad always now, growth just have that is a it a see our for had that And grow. feel in the but

Michael O'Sullivan

Brian, then closures. impacted store on

meaningful stores, of to closed is the comp list proximity given the stores, either statistics. traffic the a stores benefit overall seeing but number to in not are to We or our

Operator

There over the are the back presenters. turn will no further at this to time. I questions call

Barbara Rentler

interest for joining great today us have Stores, you Thank your Ross a in day. and

Operator

call. This concludes today's conference

You may now disconnect.

Ross Stores (ROST) 6 Mar 182017 Q4 Earnings call transcript