Ross Stores Inc. said Tuesday that quarterly profit rose 12% on strong sales of its home furnishings and back-to-school gear.
The Newark, Calif.-based retailer reported net income of $50.5 million, or 65 cents a share, in the fiscal third quarter ended Nov. 1, compared with $45.1 million, or 57 cents, a year earlier.
Analysts, on average, had expected earnings of 65 cents a share.
Revenue increased 12% to $977 million, while sales at stores open at least a year, a key retail measure, rose 2%.
Business benefited from sturdy sales in home goods and the back-to-school segments of juniors, shoes and accessories, Ross said. The company does not break out sales by category.
Ross Stores, which sells name-brand apparel and other merchandise at low-ball prices, has racked up nine straight years of sales and earnings growth and has set its sights on a nationwide expansion that ultimately could triple its stable of 573 Ross stores.
In the short term, though, Ross will launch a new chain -- dubbed dd's discounts -- where goods and apparel will be priced below Ross store prices.
Chief Executive Michael Balmuth reiterated plans to open 10 dd's discounts stores on the West Coast next year. He said the chain would target "the needs of lower-income households," which he called the fastest-growing demographic market in the United States.
The company also restated previous fourth-quarter earnings-per-share guidance in the range of 85 cents to 88 cents. Analysts are expecting 87 cents.
Ross shares fell 43 cents to $52.17 on Nasdaq.