US: Ross Stores Q4 profit down on lower sales
- Q4 profit down 7.9% to $218m
- Sales slip 0.7% to $2.74bn
- Comparable store sales up 2%
Off-price fashion retailer Ross Stores has reported a 7.9% drop in fourth-quarter profit, weighed down by lower sales and promotions.
Net earnings reached US$218m for the 13 weeks to 1 February, compared to $236.6m in the same period of the prior year. Sales edged down 0.7% to $2.74bn from $2.76bn last year, while comparable store sales climbed 2%.
Vice chairman and CEO Michael Balmuth said: "Our fourth quarter sales performed in line with our guidance, with earnings that were slightly better-than-expected primarily due to above-plan merchandise gross margin.
"Despite a very promotional retail environment throughout the holiday season, customers responded favourably to the compelling bargains we offered on a wide assortment of fresh and exciting name brand fashions and gifts."
During the full year, however, earnings increased 6.4% to $837.3m from $786.8m in the prior year period, while sales reached $10.23bn, up 5.2% from $9.72bn.
The company expects fiscal 2014 earnings per share to be $4.05-4.21, up from $3.88 in fiscal 2013, and sales are forecast to grow 1% to 2%.
"As we enter 2014, in addition to our own challenging multi-year sales and earnings comparisons, we also continue to face ongoing uncertainty in the macro-economic and retail climates," Balmuth added.
"While we remain well-positioned as an off-price retailer, these likely headwinds have prompted us to stay somewhat cautious in our outlook."
Value and individualism were top priorities for apparel consumers in 2013 and they proved this with their spending habits. Consumers flocked to retailers like Ross Stores and TJX where they are able ...
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