US: Ross Stores books 19% jump in Q3 earnings
By Leonie Barrie | 18 November 2011
- Q2 profit up 19% to $144.0m from $121.4m
- Sales increased 9% to $2.046bn
- Comparable store sales up 5%
Value retailer Ross Stores Inc has booked a 19% hike in third quarter earnings, helped by "above-plan" sales to shoppers seeking bargains.
"Our strong revenue gains continue to be driven mainly by our ability to deliver compelling bargains on a wide assortment of exciting name brand fashions for the family and the home to today's increasingly value-focused consumers," explained vice chairman and CEO Michael Balmuth.
"In addition, operating our business on lower in-store inventories is driving faster turns and lower markdowns, which continues to benefit profit margins."
Operating margin in the quarter grew around 45 basis points to 10.9%, driven by a 40 basis point reduction in selling, general and administrative expenses. Cost of goods sold as a percent of sales fell 5 basis points from the prior year.
Looking ahead, Balmuth said: "The ongoing uncertainty in the macro-economic environment as well as the possibility of an even more competitive than usual holiday season, keep us somewhat cautious in our outlook for the balance of the year.
"As a result, although we hope to do better, we are maintaining our prior fourth quarter forecast for both sales and earnings."
Sectors: Apparel, Finance, Retail
Companies: Ross Stores
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