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Ross Stores earnings witness 14 percent growth in FY15

By Prachi Singh

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Management |REPORT

Ross Stores reported earnings per share for the fourth quarter ended January 30, 2016 of 0.66 dollar, up 10 percent from the prior year, on net earnings that rose 6 percent to 264 million dollars. For the fiscal year, earnings per share rose 14 percent to 2.51 dollars, while net earnings increased 10 percent to 1.021 billion dollars.

“We are pleased with our sales and earnings results for the fourth quarter, which exceeded our expectations despite the highly promotional holiday selling environment and our most challenging sales comparisons from the prior year. Fourth quarter operating margin was 12.7 percent compared to 13.1 percent in the prior year due to the timing of packaway-related costs. For the 2015 fiscal year however, operating margin rose 10 basis points to a record 13.6 percent,” said Barbara Rentler, CEO of Ross Stores.

Sales up in Q4 and FY, declares dividend

Sales for the fiscal 2015 fourth quarter grew 7 percent to 3.251 billion dollars, with comparable store sales up 4 percent versus a 6 percent gain last year. Sales for the 2015 fiscal year grew 8 percent to 11.940 billion dollars, with comparable store sales up 4 percent.

The company's Board of Directors also recently approved an increase in the quarterly cash dividend to 0.135 dollar per share, up 15 percent on top of an 18 percent increase last year.

“The continued growth of our shareholder payouts reflects our ongoing confidence in the company's ability to generate significant amounts of cash after funding our growth and the other capital needs of our business. We have repurchased stock as planned every year since 1993 and raised our cash dividend annually since its inception in 1994,” added Rentler.

Fiscal 2016 guidance

For the 52-week fiscal year ending January 28, 2017, the company is projecting same store sales to grow 1 percent to 2 percent and earnings per share of 2.59 dollars to 2.71 dollars, up 3 percent to 8 percent from 2.51 dollars in fiscal 2015.

For the first quarter ending April 30, 2016, comparable store sales are forecast to be up 1 percent to 2 percent with earnings per share projected to be flat to up 4 percent to 0.69 dollar to 0.72 dollar. This compares to EPS of 0.69 dollar in the first quarter of 2015, the strongest period last year, when comparable sales rose 5 percent and EPS grew 19 percent.

Ross Stores