Ross Stores Posts 3% Rise in Earnings
Discount apparel retailer Ross Stores Inc. on Tuesday said first-quarter earnings rose 3% as cost controls and new-store openings offset the effects of chilly weather and the war in Iraq.
Newark, Calif.-based Ross, which sells branded apparel at discount prices with the slogan “Dress for Less,” said net income for the quarter ended May 3 rose to $49.3 million, or 63 cents a share, from $47.7 million, or 59 cents, a year earlier.
Sales rose 7% from a year earlier, to $820 million. But sales at stores open at least a year fell 3%.
Ross shares climbed 27 cents to $39.61 on Nasdaq.
Off-price retailers such as Ross and larger rival TJX Cos., which operates TJ Maxx stores, have been luring budget-conscious customers away from pricier department stores in the weak economy, but harsh weather and the war in Iraq muted shopping activity during the first quarter.
Lower incentive plan costs and better than expected store payroll and benefit expenses helped cut selling, general and administrative expenses as a percentage of sales. That partially offset lower margins on goods sold, the company said.
Same-store sales are expected to rise 3% to 4% in the second half of 2003, Ross said.