What were the main drivers of sales growth in fiscal year 2002?

Sales growth was driven by a combination of factors: a 7% increase in comparable store sales, the opening of 55 net new stores, and the full-year impact of store openings from the previous year. The company also saw strong performance in its 'home' businesses, which was a key contributor to comparable store sales growth.

How did Ross Stores manage its costs and expenses?

Ross Stores improved its cost of goods sold ratio in fiscal 2002 compared to 2001, largely due to better leverage on buying, distribution, occupancy, and depreciation costs, which were favorably impacted by the comparable store sales increase. Merchandise margins also improved due to lower markdowns and better shortage results, though this was partially offset by higher freight costs and a sharper pricing strategy. General, selling, and administrative expenses as a percentage of sales decreased slightly due to higher leverage on store payroll and operating costs.

What is the company's outlook for store expansion?

Ross Stores plans significant expansion in fiscal year 2003, forecasting approximately $150 million in capital expenditures. This investment is intended to fund the opening of about 66 new stores, along with remodels, expansions, and investments in store and merchandising systems, distribution centers, and central office operations.

How did the company manage its liquidity and capital resources?

The company demonstrated strong liquidity, with net cash provided by operating activities increasing substantially to $332.4 million in fiscal 2002. This cash flow, along with bank credit facilities and trade credit, was used to fund operations, capital expenditures, and a robust stock repurchase program. The company also declared regular quarterly dividends.

ROST 10-K FY2003 Annual Report — Revenue, Net Income, EPS

Summary

Ross Stores, Inc. (ROST) reported a strong fiscal year ending February 1, 2003, demonstrating robust sales growth and profitability. Total sales increased by a significant 18% to $3.53 billion, driven by a healthy 7% comparable store sales growth and the successful opening of 55 net new stores. This expansion, particularly into new markets, contributed to a substantial increase in selling square footage. The company also improved its cost structure, with the cost of goods sold as a percentage of sales decreasing due to better leverage on buying, distribution, and occupancy costs, alongside improved merchandise margins. Profitability saw a notable increase, with net earnings rising to $201.2 million, a 30% increase year-over-year. Diluted earnings per share grew by 32% to $2.52, benefiting from both the increase in net earnings and a reduction in weighted average shares outstanding due to share repurchases. The company maintained a strong liquidity position, with operating cash flows significantly increasing to $332.4 million. Looking ahead, Ross Stores plans further expansion with a capital expenditure forecast of approximately $150 million for fiscal 2003 to support the opening of around 66 new stores and investments in its infrastructure.

Key Highlights

1Total sales grew by 18% to $3.53 billion in fiscal year 2002.
2Comparable store sales increased by 7%, indicating healthy performance in existing locations.
3Net earnings increased by 30% to $201.2 million.
4Diluted earnings per share rose by 32% to $2.52.
5The company expanded its store base by opening 55 net new stores, ending the year with 507 locations.
6Cash flow from operating activities surged to $332.4 million, up from $242.9 million in the prior year.
7Capital expenditures are planned at approximately $150 million for fiscal year 2003 to support continued store growth.

ROSS STORES, INC. Annual Report, Year Ended Feb 1, 2003

Summary

Key Highlights

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