ROST - Earnings call transcript Q3 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon, and welcome to the Ross Stores Third Quarter 2021 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 forecast, new store openings, COVID-related costs, and other matters that are based on the Company's current forecast of aspects of its future business. subject to and performance differ expectations. are cause that or statements results actual materially forward-looking to uncertainties risk could current These from historical factors XX - and and X-Ks press Form Risk with and Qs in the file fiscal SEC. XX-K, Forms Company's XXXX release, XXXX fiscal on included are the today's

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

Barbara Rentler

afternoon. Good

also and Investor our we'll begin Hartshorn, Orvos, followed appointed Group happy Operating any to Officer. I'd Officer, a you by with Michael review to for Relations. may Adam call President, call on questions President, Vice are Connie performance, to today on have. Group our update me Afterwards, Executive Joining quarter outlook and our third Kao, and welcome Vice be We'll an quarter like And our Chief the respond of today Chief fourth recently President Financial our year. fiscal

sales for were third million As net significantly increase of the release, noted Earnings assortment the and a million. quarter expectations, and This XX store $X.XX with sales ended ended a variant. these our bargains. compares to for respond $X.XX strong October $XXX of in $X.X income billion, weeks XXth, Xnd, to for earnings the our rose share results XX net consumers broad the per great XXXX on of XX%. Total XXXX. profitability to of government of comparable We spread exceeded $XXX XX% share to November on today's continue uncertainty stimulus waning favorably per COVID achieved to press quarter despite weeks sales related as

$X.X up same this to net from per $X.XX in store on of sales billion, with per the XXXX. $XX.X on for for of $X.X year months, XX%. share For share X period rose the first months billion, earnings X income comparable earnings net up Sales the first billion $X.XX were of XX%

at performing Ross, the period, quarter the exceeded third top performing remained the businesses, men's and performance their dd’s as were significantly strong the regions. also best trends children For the and our expectations. Midwest discounts were sales while Southeast during

dd's at same to Ross, to levels was up as merchandise period the At were the selling we Packaway by consolidated store substantial XXXX. to COVID. wages, total quarter-end, X%, related a cost freight, down to were for and X% ended pressures sales. use XX% XX% ahead-of-plan in inventories while compared XXXX, of like However, of continue impacted profitability amount average total negatively packaway support inventories versus

were supply delays there to congestion. receipt addition, chain due In

growth, Discounts of we for the Turning to with and addition XXXX store completed in XX Ross new dd's program quarter. our third expansion XX the

XX For year, of the we XX and added comprised Ross XX Discounts. full dd's locations,

Additionally, year-end. X we by store close plan to

our approximately return we expect As opening stores XXXX. program XXX to to of previously mentioned, in annual normal

Adam Now, guidance, will for results, details outlook Orvos third further the quarter fourth and provide on year. quarter our updated

Adam Orvos

Thank you, Barbara.

of driven XX.X% XX% average previously comparable traffic were down margin above XXXX. range. versus basket, As guidance store up slightly in with a was The quarter. stated, larger mainly increase was the Operating by well our sales

majority offset strong as by gain freight leveraged basis by impacted occupancy XX negatively from sales profitability points, by were of of Cost approximately in versus and COVID-related of and incentive XX basis goods XX These Domestic due rose sold basis quarter higher decline by margin, was partially by freight, which respectively. points higher the points basis Total XX points. for and The were freight period vast basis results. XXXX distribution third grew our net the expected XX basis merchandise overall leverage COVID COVID-related XX quarter. costs, costs increased from costs SG&A expected, wage, the SG&A. the also given expenses expenses mainly As headwinds ocean impacted offset for higher ongoing points. Buying points while XXX costs. than in period grew to and expenses basis points. was the declined higher better which XX

quarter, of common $XXX cost the remain back the shares stock buy repurchased stock track in a of of $X.X During for we million aggregate total million third $XXX to on We an year. million. for

discuss quarter our let's fourth Now, guidance.

our XXXX. in same projections As period a reminder, compared the to

worsening consumer industry-wide Looking there ahead, the strength related to ongoing encouraged season. uncertainty congestion important by are we significant enter holiday as demand, the supply of while we chain remains the

X% the share for sales while As store that are guidance X%, to ending in and sales include result, per be with range XXth, are up quarter to earnings comparable the support XX $X.XX the forecasting to our operating projected a we hope $X.XX we do better, projected XXXX. to assumptions Total fourth grow January to The XX% XX%. weeks following. to statement of

as be to to pressure supply margin and headwinds, operating reflects X.X%. This from stores well X.X% our in pay holiday distribution expect as mentioned We incentives chain forecast the previously centers. primarily ongoing

costs COVID-related EBIT to approximately are period. be points estimated interest million. the XX expenses margin addition, In about by negatively Net to projected $XX in impact basis

Our share sales diluted guidance, to $X.XX shares XX%. range to full-year XX%, tax are weighted fourth and million. rate to comparable And XXXX. $X.XX XX% now in is expected outstanding results store on per of gains average projected earnings year-to-date we're $X.XX to compared in the XXX of be quarter approximately XX% our to Based be and to about forecasting

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

Barbara Rentler

encouraged above-plan by our Adam. you, Thank sales year-to-date. We're

a in are on our confident are great for stores assortment believe chain negatively bargains branded how season. well-positioned As said, find Adam of affect may holiday as remains uncertainty our the congestion will a fourth and broad the customers industry-wide business retailer in we noted, That value supply we quarter.

open to with you to up closures, like retail and future. market have. and questions forward, point, the Moving focus for consumer's on our and prospects call retail may of number confident the continued respond share convenience, make gains along this increasing value -- recent bankruptcies, us the about At in we'd large any

Operator

We'll for to [Operator a pause Q&A just compile ]. moment roster. Thank instructions you. the

have from the line We question first our with Matthew Boss JPMorgan. coming of

Your line is open.

Matthew Boss

on Thanks. the quarter. And nice congrats

you to characterize gains tied XX% closures X-year cited, of elaborate and quarters comp. that that share Could straight X product convenience you're how and XX% the you would given availability in market with best bankruptcies Barbara, then to value marketplace you on And seeing. So, the today.

Michael Hartshorn

about the closures as On healthy and hi. you we're very Michael given gains We share of market prospects future share on very Matthew, clearly gains, are significant convenience. of opportunity number bankruptcies. about more and retail further during consumer share It's mentioned, market in retail and longer-term, pandemic, even gained confident Hartshorn. We're our market ahead for focused, us. the value a of sector with the the excited

Barbara Rentler

closures. creating it's market way, but store good And about a time COVID not overall good, right over will even product a others bullish goods. more in now, terms expect get -- as more be in it with favorable, are category, we would after settles, that but every on to of availability. it's Matthew, time market really One good buyer. that are I to But you the would Maybe as put very retail some feel inconsistent, availability, a this areas

Matthew Boss

luck. of Best great. That's

Operator

Thank you.

Altschwager with our coming next of Baird. line question have the We Mark from

line Your is open.

Mark Altschwager

maintaining more some backdrop, just Adam. you with how you. the for the offset you expense to value thinking curious to Thanks and the about ongoing seeing the are are or question, taking I'm strong inflationary and while lever freight pressures. this opportunities raise more welcome, Thank proposition, of still ticket

Barbara Rentler

really Sure. our built mainstream Look, other model discount. is provide a and of retailers, pricing off then we

know retail on going and understand I not wouldn't where of of very continue we point, cases, this In would I at we're more forum, is that aware distribution fine. all And definitely once retails. levels in the say yeah, with this would pricing We some what we cases, with time adjust in different absolutely With it's as elaborate really higher all new we've it. it's that, experiment experimenting different been but quite some areas in we So pricing it closely. in at are watch And fine. we organization. over but don't to

Operator

you. Thank

the from Paul with our of line Citi. Lewis question have We next coming

Your open. line is

Paul Lewis

Hey, Thanks. guys.

referenced You that I quarter-to-date, you're if consumer comment continue. on was was fourth demand. ongoing curious a of strength if that seeing

supply you curious will XQ. or degree And what think XQ far that big referenced your thus good in fourth in saw if picture, be I'm to congestion quarter greater also business I'm chain than hurting industry-wide and Thanks. in congestion, that's ultimately worsening you for into you if a You wondering 'XX. either

Adam Orvos

Hi Paul.

focused increasingly worried very areas, When see price see are came about the healthy quarter, We across seeing But and healthy value. government the and that demand one continued geographies, relatively to for can were stimulus. us we variant receding strong retail, Delta with across consumer a also a into very is we've the merchandise you we consumer. on

chartered to the On including goods. our been freight we market and own of rate holiday selling a purchasing the enough sure times. we've taken for have number we've to make actions We ocean ocean at move ourselves our period, vessel, to front, capacity adjusting ready freight ordering

port. wouldn't freight with squarely points. our to out the margin and for offset goods Merchant about on congestion is in right port weren't the getting on we that, margins that I impact You see by certainly, impacted basis the quarter. the third in comment that can was focused down ocean XX the of merchant able the quarter margin now

Paul Lewis

by What you margin Thanks. you merch Can piece. XX said And separate pure ocean versus -- ocean. points. was the merchandise margin, down you that impacted said is basis and the the

Adam Orvos

actually freight of for of turns than inventory ahead margin our out with as break merch separately. Ocean more and wouldn't sales our is quarter selling in better faster the ended full-price We we had included that plan up -- we expected Merch margin. plan. the ahead

Barbara Rentler

opportunities would the create I for in chain to a then more closeout supply congestion. It say And the should us [Indiscernible] future. it's

Paul Lewis

All Good luck. guys. right. Thanks,

Operator

you. Thank

our Bank Lorraine We the from Hutchinson question next coming with line of of have America.

open. is line Your

Lorraine Hutchinson

holiday, into focus Thank next vendors on but good to product want receipt timing your and said to I you of wanted risk you the on. in of to vis are what a spring you time be categories it's vis any year, just hearing around ahead a really and the focus I then going -a from availability, you. Barbara, know buyer, -

Barbara Rentler

concerns. Receipt we appropriate longer receipt in just have I vessels, a lead of that, chartering as it timing building but actions times, But ahead the to taken we've to all goods holiday? get Not have some with said, port. whether given, everything we the timing, think concerns. through Michael pertains

think for terms about aggressive we have gotten spring, goods. of product placing vendors I very in think As

gain vendors it's really there's think some some strategy that have concerns, the taken making need so in for holiday, think bigger But very timing I their to think of and vendor time of terms commitments, market much terms to it's taken some looking this on in who the in share are -- is have and we risks frame, a but in again, we've take. But Again, we is. what terms not we of given. I access

Lorraine Hutchinson

you. Thank

Operator

you. Thank

Greenberger next have coming line Stanley. of from We our with Kimberly question the Morgan

open. is line Your

Kimberly Greenberger

up so Lorraine's I wanted Great. on just Okay. Thanks to much. follow question.

about of call it your just and I you of of understand next little weeks feeling could. Just selling. -- other could short-term. just holiday, inventory to color currently about of Barbara, a give us for about of levels X couple your ask here, bit questions do the Would and want a make How in-stock I if wanted you holidays on you the And then here to sort are if sure feel just you I I clearly. middle how position November,

Michael Hartshorn

quarter in we as X risk down that, have receipts we continue risk the guidance at like inventory ended our next X%. on lot inventories X%, the of not where of currently, And a some in-store a but and to Barbara product. Home is weeks. in X% average be, flow them good areas position fresh There a reflected that could given, now Kimberly, to are and with We to about there wanted mentioned, between we we're which they're in shape. be

Kimberly Greenberger

area concentrated import, more and Okay. in Got those direct would or or direct that you stuck it either receipt of would are on impacting Home, of be items be is have, in -- vessels? imports be the more it would it. because the would call And that ocean the going ports a where risk that's

Michael Hartshorn

Correct.

Kimberly Greenberger

Great. Okay.

Michael Hartshorn

six in left mainly We're ports. weeks stuck

Kimberly Greenberger

Okay. Mainly stuck in port.

Okay. Perfect. That is great.

Michael or to quarter, Okay. this. then, the on wants address whoever Adam, And

if I'm the a the per basket taken regard And wondering just retail increases Thanks is in then, competitively talk unit if What's and know at you've versus at there have talked about pricing, so look you much. just the that? taken not some your transaction. about You up on if can your -- question thoughts peers, surgical any following but at and some price if larger longer-term, you size. versus I'm there I'm on peers you're a some that. pricing driving wondering it sure units categories. with to sitting looking of are I recently where you average have rebenchmarked look

Adam Orvos

Adam. This is Yes.

Let of that me jump the first on question. in part

Our by size given per we units basket, did of strong a number And AUR sales. was selling, then the in traffic increase -- the comps the in were of was we by as have by a decline driven driven slight above-plan slight mentioned, full-price transaction. which primarily in better there There quarter. driven

Barbara Rentler

And not as higher it's areas some in we In retails, issue, said pricing I definitely pertains with it fine. then, some to the and working, it's areas experimenting are fine. it's

AUR With goes their I once on fine-tune mainstream again, seeing new sits. other to is understand we're what QX know of expecting after we'll it. consider compressed would retailers mainstream really the really really as as to the and we customer's But time think time. we take, trying into merchants period a we as customer But And comfortable, that, accept. what we retail, get And retailers. accept this see larger there need QX, the do would to I step. say, willing into get we we Kimberly, where adjusting what are ready we not pricing trying promote, watch there's in to as out things that over things, get to both to continue but willing you that, don't enter to and

Kimberly Greenberger

Barbara. Thanks, sense. perfect Makes Perfect.

Operator

you. Thank

coming have question line our from next of with Haskett. Gordon the Chuck Grom We

line Your is open.

Chuck Grom

of if impact, on any couple particularly trends of the had and thoughts but you in very could first and strong, the much. stayed wondering comp your any And confirm impact, just has like the sounds if September I to weeks It guys was think Thanks speak the early there October, of to quarter? weather wanted adverse that. trend November? you

Adam Orvos

I that. take Adam. This can is

trends. And quarter. were weather strong was comment comps -quarter impact we throughout And So very wouldn't the -- immaterial in the really, intra no quarter. on

Chuck Grom

Thank Got you. it.

Operator

Thank you.

We question coming Michael Credit have Binetti line our next with Suisse. of from the

Your line open. is

MichaelBinetti

in Thanks my the fourth what look for -- you that and guys I'm build guidance, business guys. the curious, what here. taking questions at to you're as just seeing Hey, quarter. helped X% a you X% are for you guidance

to X%. last X quarters the prior was think I X%

what based today. us next then first X-year should you to visibility And into you help then Just you with earlier, you that incremental built much going into thinking a guys how know looks it's you that's guess, out, give into help the look have -- of you headwind -- and any question I you year, directional in on just quarter. maybe to still you just first change can be about about up us how won't how that half you idea I in we third number But it. Paul's roll, maybe the if fourth half of baked think as the relative Michael, an quarter, understand freight -- when if some to contracts but when think know what

Michael Hartshorn

Michael. Sure,

we it and What we I have see above half expect both Let uncertain about in we'd generally prudent is On between freight hope includes that. me also related not sales leverage. ongoing trends freight how next the is impact that in is it's dedication we guidance think extraordinary -- with be was to view the cautious XX through than our includes wage-related due difference congestion, in it's estimates, to The expect we throughout I a the to to Obviously, distribution our of not worse the large above centers pandemic. also and to points point would acknowledge first congestion. talk our incentives we'd will say have congestion. estimates. XX on the costs these after QX. freight associates subside exceed the believe conservative these to potential supply-chain guidance. at this comp guidance That elevated the Obviously, fourth-quarter probably stores estimate, the holiday QX it as would unpredictable year given of expect our to to always pressure then basis times, significantly of and

In have, budget finish as that say more what terms in up up year-end of impact could cycle. our call to we'll wrapping our we

MichaelBinetti

that. could I If Okay. follow

As point that freight at to like you half the you look at first enough initiatives some do this the are in that pressure Barb, of with, the success AUR have -- are feel seeing as you needed? combat you

Barbara Rentler

No.

slower to probably I think now, then and we and where make the we AUR, can are make moves. continue that you is -- test

that what like we understand really So retailers. looks mainstream in

MichaelBinetti

it. Got

lot, a thanks Okay, everybody

Operator

Thank you.

next the Jay of Sole line from have We with question our coming UBS.

is open. line Your

Jay Sole

do you stimulus you specific guidance, year Great. play think it of sales. so quarter stimulus. you but -- out got know you much. level, share year. for into first I you it to year, looking a going you do Thank the quarter in with of us just the of want next much how next not kind any think benefit And impact on can high as this what lapping there, out the have might would from first How

Michael Hartshorn

wouldn't Yeah. At we on year. this point, next comment

say after call I've in quarter March. As in and our early we'll the have year-end provide we more fourth guidance wrap-up said, to

Jay Sole

lot shopping an and of adopting just if And Okay. has maybe consumers ask one about pandemic a I of -channel more how be then. may the omni can more talk There's method. changed

department the if like XXX% over and not? it's bit, it's feel up are stores you for income the changed, at like last more at a not, off-price, your a up the growth operating all why up something competitors three Do store where you versus XX%. quarters, little If department look maybe over catching has

Michael Hartshorn

what Catching regard? in up

Jay Sole

outgrown like of them up sales. terms in the just We're way in catching you've that

the taken well. of profit. level up gains you've the market in ultimately more other You maybe but being to getting as be getting could then not closer maybe advantage they're that could catch in terms that sales, share outgrown But mentioned ways an maintain able, competing maybe to use of necessarily and which profitable, same

Michael Hartshorn

Yeah.

we overall, economic We're demand think, supply. of it have to I this is see out. burst how activity where exceeding plays in still

happens to next -- between more when I first if that balance have what quarter quarter demand, think a understand and a of second or supply we it's which we'll see greater year.

point. this say to hard it's at So

Jay Sole

you Thank much. Okay. so

Operator

Thank you.

coming from with next have Marni question We line Tracker. our the Retail Shapiro of

Your line is open.

Marni Shapiro

we able of on with the late have get the were items, touch Christmas-theme X just things. holiday see little back Can you just see strength from still tap Have in a holiday the been about, And in items, bit Congratulations. as in parties, board. to -- to sure the make market, across into that or is on, working, continuing events, able the very -- also and time. a talk type to to in she the can all floor you about guys. of you shift what that consumers year's if last can packaways buying, or rich out you Hey, deliveries then seen have you was

Barbara Rentler

Sure, Marni.

and pandemic, have seen you're bigger for shift back start And going seen a We a glitz, holiday us. and out. with make what dressed-up business, stronger us, the let always as is, been customer big social, always for that's customer -- casual business have we've had for shift looking what business But we me have certainly to during Look, into got seen a we the even big I'm that the -- that, a

greater, sportswear, business still the a seen more so good, make Casual just holiday going shift, both. of work in but she's have that, expand it's is seen to is we that it'll for a she back product, believe also doing, that more we a whether she's bit out into still have and little mainstream very We into shift making whatever or get evening, yeah. and customer and

Marni Shapiro

the bags, as home to going area bags know. work work and home back thinking kinds of she's home of go to the her back and don't in about about What much? to not for those I like

Barbara Rentler

a saying like You're handbag?

Marni Shapiro

ships again or as she Yeah. that into more? going into out-of-home Has she apparel is shifted out and Those well. handbags bigger

Barbara Rentler

think shift, whether products time. where the it's of a a it's on house I or apparel she's long her a replaced anything is leaving lot replenished hasn't taken in those footwear, She whether in side handbag. in

Marni Shapiro

Exactly.

Barbara Rentler

into we're some a Yes, back shift of in those seeing -- businesses.

wants As she [Indiscernible]. out, new goes she

Marni, So in gains. would similar I home been -- relatively say have they whether businesses both it's or sales apparels,

That's of So between both she's kind it. just Apparel now. encouraging. because you worlds is own doesn't toggling --

Marni Shapiro

packaway. Yeah. That makes sense. And then just the on

Barbara Rentler

on it PackAway, because please, it's again. favor, then remind might've -- think Just PackAway me as And the question how me I just holiday I that, back again Tell me a peak. interpreted on in do Marni? your

Operator

Thank you.

question of our We next Capital. Loop Champine Laura coming line with from the have

open. line Your is

Laura Champine

ahead? get you up hold we Should and try would I back, Marni to or prefer fire

Adam Orvos

We'll Marni follow-up later fire ahead. [Indiscernible]. Just with

MichaelBinetti

Okay.

Are SG&A Here strong is can model level What really is as this really expense that top-line, keeping, goes. I given next an for that I some is impressive, that thought you're to SG&A -- puts level are think that still flat. we and the fairly saying COVID despite we takes hit. expense base look was we that incremental of year? staying at the are start a

Michael Hartshorn

Go ahead. Yeah.

Adam Orvos

be talked standpoint we've say, about clearly from taken consistent biggest and from No. our jump just going We and quarter. within the in Yeah. that the standpoint stores, was incentive DCs it pretty will and and SG&A. COVID those the actions fourth an a are impact throughout 's in our been in I year wage to movers

MichaelBinetti

And Okay. --

Michael Hartshorn

comp obviously, I leverage us helps the significantly. would then, XX the SG&A say And

MichaelBinetti

it. you. Got Thank

Operator

And Thank [Operator instructions please X yourself question ]. only. to do limit you.

question We from with line coming next of have Bob the Guggenheim. Drbul our

open. Your line is

Bob Drbul

Hi. Good afternoon.

seeing you're labor Thanks. maybe could some more give little spend you be us on That that. Maybe would bit and and just if time on insights labor just wage the pressures a of wondering component, sort the availability. Just that helpful.

Michael Hartshorn

for And permanent most market We in some a made the year. It's distribution we've our very centers. Bob. seen competition talent. increases Sure, this wage competitive early

they ahead to are been there distribution really and sure up to in us. staff peak. staff and The good be selling stores. Obviously, holiday well. incentive us place the to we're peak. make have retention We've also we that We're need up can the able where We've some centers also there have hiring We as confident shape. good in get to in we have the we're of incentives a for through peak

that remain with Given to can we'll our about competitive make feel the -- sure and we'll make pay sure can competition, we remain good competitive attract we workforce. talent, really the to we

Bob Drbul

Okay. Thank you.

Operator

Thank you.

the have our Barclays. coming Adrienne from We next of with question line Yih

is Your line open.

Adrienne Yih

top short-stay implication 'XX. Barbara, you on the on remarks, that line you. progress The canceled Congratulations in that, made closeout the Thank orders incrementality of increased you on of in this redeployed the you same on prepared year. either the any the used half buying, could quarter. question and level are said quarter inventory a Adam, I'm buys, comment for earlier that improvement that pressure intending. -- then the stranded during see basis point quarter, or supply And and in a Is from through you seeing just the and freight. fourth you in should be flow that freight first then next clarification XXX carrying were similar, wondering,

Adam Orvos

freight. level have Obviously, start I will making in that be what was answering the we'll on congestion freight -- really I some I'll no with the like. next look of could terms year. cost was what commentary

Adrienne Yih

you. Got

Adam Orvos

first options versus fourth. the different -- quarter

Barbara Rentler

can't retailers floor. to terms then, have selling they're canceled our there goods expectation late of buying, product, is certainly of the as will and the closeout they full get And because in content be that

thinking for through But pack real do would flow a could see for QX now be combination I list we as So apparel you're believe I year. fall, away both. of we on, of that there's what of opportunities QX, QX. guess would that next seasonal

Adrienne Yih

where the question ago, committed Last to Fantastic. Okay. I and and I $XX the mid-teen few is relative that that this maybe others the some recall dollar know number, seem rate? 'XX, average thanks. years today, you're at just are almost hourly a or to Target higher where wondering Walmart, I'm was, had pay. you to the than number would, better average XXXX across a typically, of that end nation. you If range sits where maybe

Michael Hartshorn

We $XX, the chain wage the don't We teens, level is instance, for wage. above base significant is have a average wage, of under specific California, at is portion the well this at disclose a so do but that that baseline. minimum

Adrienne Yih

Thank very and much, of you luck best enough. holiday. Fair for

Operator

Thank you.

BMO question Capital next coming Markets. our line of with have the from Siegel We Simeon

line is open. Your

Simeon Siegel

Hi. Thanks, everyone.

Have say I impacts over as if through where waning the expect earlier stimulus. do thinking the a the year. inventory you you're outperforming And guys just then potential we to early about end missed and Did few it. the Sorry you quantified you think and despite you next point to benefit was stimulus, XQ, that quarters. how about cycle from next what Thanks lot. then

Michael Hartshorn

again typically year, we'll comment at next inventory, On year-end. ahead wouldn't we On comment, we don't guide on levels. inventory

Simeon Siegel

think quantified about you I this year? year? this the what you do benefit the have How was stimulus, guess for it

Michael Hartshorn

quantified it's there's because but a developing We'll into demand. stimulus, plans year, move that. hard lot up pent-up parts, next around it's not moving really it as It's customer we of haven't because only end we

Simeon Siegel

Best luck Understood. Thanks a holiday. for lot, of the guys.

Operator

you. Thank

Farato with [ph] Wells next the Ike of our coming Fargo. have from line We question

Your open. line is

Jesse Silverstone

expecting Silverstone guys is to was costs begin be model This everyone. of year, to Ike. forward? going business quantify on you sustain wondering part just next revert, I just that look be when are the a forward And Hi, for timing and COVID and to costs Jesse of or might we to going able be these would able as you to

Adam Orvos

-- cost. would year, I of say, specifically down. we generally, on would expect part will costs permanently to comment but We we wouldn't expect They come COVID next the are wholly not

Jesse Silverstone

you. Thank

Operator

you. Thank

the question from Cowen. next coming Kernan have We of line John our with

is open. Your line

John Kernan

question. for my taking Thanks afternoon. Good Thanks.

picture. margin the on curious Just

was much on points 'XX, You from fourth obviously the for that outperformed you're your the roughly comp a it guidance comp guidance, than and lower base guiding basis margin down XXX pre-COVID even in lower quarter. albeit

biggest think to the vendors, factories, levers are that chain. do across of retail, lot curious, recapture low-teens operating the in Just supply margin what generated your that you you inflation There's a XXXX.

just really recapture more level think Just store quantify you're through going we do comp curious, to -- how that. sales of that is gains it pre-COVID Is you profitability. how comp,

Adam Orvos

John. Sure,

healthy in market As confident for prospects obviously are I of we're retail the very sector our gains. said, share and a in

much here As difficult it's of are to we cost economic burst today, permanent. inflationary of activity how we're versus the experiencing transitory predict sit from headwinds the

will on once those X EPS of ahead Over recovery have share we to X double-digit costs again, opportunity And to dependent expect time, margin large course, we stabilize. we So the where market we when our return long-range, where volume, and sales of to a on believe us. would for be us

Michael Hartshorn

initiatives try do We but it's that our distribution stores including to in of dependent big Company nature largely the be centers, increase the today. the on areas and going inflation transitory to have efficiencies seeing we're in expense, comp. to of our

John Kernan

you. Got it. Thank

Operator

Thank you.

our the Vierengel Northcoast last coming Research. with from Tim question have line of We

line is open. Your

Tim Vierengel

Thank easier you highlight maybe us storefront environment you about Can if more you're print how guys forward. for you. or of then us that or getting thinking unit setup as you. And Thank remind and is growth. look difficult

Michael Hartshorn

comments, we We our ended up we estate on XX stores. wrapped year. -- real said our program as for opened Sure, we the up in front, this

the there good. stores estate program return We And available Overall, annually. historical opening of also of be in we real the expect to to given market said increased that store we annual would supply XXXX sites XXX is expect to of closures. level

Tim Vierengel

Thanks.

that. Sorry, I missed

Operator

closing call There are now to Thank for over queue. back Barbara to turn on I Rentler questions would like remarks. you. no further the any

Barbara Rentler

today holidays. Stores. for us your and Happy Thank you in interest joining for Ross

Operator

Thank Thank you participating. for call. concludes today's conference you. This

disconnect. You may now

Ross Stores (ROST) 19 Nov 212021 Q3 Earnings call transcript