Ross Stores (ROST) 23 Aug 182018 Q2 Earnings call transcript

Good afternoon, and welcome to the Ross Stores Second Quarter 2018 Earnings Release Conference Call. The call will begin with prepared comments by management followed by a question-and-answer session. [Operator instructions] Before we get started, on behalf of Ross Stores, I would like to note that the comments made on this call will contain forward-looking statements regarding expectations about future growth and financial results, including sales and earnings forecasts and other matters that are based on the company’s current forecast of aspects of its future business. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from historical performance or current expectations. Risk factors are included in today’s press release and the company’s fiscal 2017 Form 10-K and fiscal 2018 Form 10-Q and 8-K’s on file with the SEC.

to Officer. call like Rentler, to would Executive Chief I turn over the Barbara Now

afternoon. Good

me Joining the of Executive by call Vice Vice Operating President, and our President our on Prevention; Afterwards, President, Officer; happy and call O’Sullivan, a may for Loss review begin Financial Michael Gary our Chief Finance year. President and and Investor Cribb, Hartshorn, followed Call, today have. performance, Chief Group We’ll our and John Relations. Vice Vice quarter we’ll Legal; Stores Kao, to today President, Executive are Connie Executive any Michael and second fiscal respond second-half outlook questions with be to Officer; you

pleased growth for XXXX and ended with the $XXX $XXX As million XXXX. for in August in weeks from noted above-plan up $X.XX Net for from earnings per XX share second the prior are earnings quarter. the Earnings year. XX $X.XX, up the X, ended weeks today’s press were we million, XX, the sales July were release,

$X.XX weeks The weeks the increased share billion. quarter July store August $X.X X% of growth including XX was August XX, X% a of the second XX-week X, on XXXX. legislation. same-store X% ended XXXX per for results, earnings X, reform rose to benefit from quarter over the for sales Comparable ended for Total top sales second XX tax ended period XXXX. This sales gain the

saw and markets. geographic second quarter, categories we For strength broad-based merchandise across the

than by and higher packaway-related leverage costs higher timing unfavorable of year on a merchandise and wage combination XX.X% margin this expenses, than was offset margin of more investments. down as So buying costs, better occupancy were and freight year’s last expected gross operating of from

share fiscal year-to-date X% first-half earnings million per benefit XXXX. $X.X of up ended The per from Sales $X.XX last up rose up $X.XX for $XXX included earnings X% reform with XX, were a July the earnings legislation. were of the $XXX in weeks versus year-to-date year. XXXX, gain from results months sales the Net tax share $X.XX, six million, billion, X% store first For XXXX. from to comparable XX

the to total Average we inventories X%, year. up dd’s due were was growth as in a X% total prior operating As part posted XXrd-week another while leading inventories XX% to growth, quarter, quarter inventories year-to-date. solid the XX%, consolidated second over of calendar packaway also were in-store in strong ended to of profit the percentage year. compared shift, up DISCOUNTS last sales

program to the the dd’s Ross quarter. locations our remains eight in opening new second of Turning expansion store DISCOUNTS with on and schedule XX

We adding XXXX, a also in XX continue of dd’s project and locations of Ross approximately XX DISCOUNTS. comprised total to XXX

XX plans reflect to stores. our do As usual, or numbers relocate these older not about close

addition, that existing we noted store trade include in potential [ph] can today’s In that markets in densities research result number or] locations, factors increases and release, is indicates suburban a projected a penetration as from our further large new of as increase population X,XXX. are of X,XXX both [new based the we from growth. and and press in to previous on This long-term raising of target our up areas

higher can of versus store country, of stores XXX chain dd’s provides Dress As believe we about units. up X,XXX, This DISCOUNTS for considerable the growth with locations a X,XXX that Ross previous ultimately projection now across our result, of and a from opportunities. potential us become can to that long-term Less target XXX grow our prior about

and guidance. on details further second Now on Michael Hartshorn second-half will our provide results color our quarter

Barbara. you, Thank

quarter results. second with start Let’s our

gain increase the in an Our and average traffic was basket. X% by comparable sales driven store higher

was in of gains a packaway-related Cost from increase These were a while expenses the occupancy Selling, legal better XXX by XX the operating XX XX cost points, margin basis due quarter basis basis of costs. in more of second basis sold basis matter. XX an levered X year, quarter point general points and second administrative goods unfavorable was down distribution costs points, Merchandise the it costs than in higher increase increased benefit a than and and margin XX points of basis for point the a of period. points respectively. anniversarying XXXX and to forecast. offset last from buying timing XX.X% While expenses by basis the freight basis increased and in from quarter rose wage XX XX point also

months the billion During stock remain million X.X six price common purchase $XXX million shares, for on million, to million total We respectively, a we repurchased $X.XXX in XXXX, fiscal X.X $XXX of second of buyback of respectively. quarter and of year. for and a first the total and track stock

Let’s guidance. turn now our to second-half

sales the same-store per forecast both year are to and be to in perform up we by XXXX quarters, sales of in with earnings line to third If robust guidance, continue our this to for ago. forecasted weeks $X.XX, $X.XX the sales XX grow X, Given fourth November a comparisons for X%. from X% the in share periods range $X.XX multi-year to ending

per taxes X, from year’s per to share deferred a in quarter, are from XX XXrd-week $X.XX XXXX, of to of February in one-time the fourth and $X.XX a last share included XXXX. $X.XX projected which For the revaluation $X.XX compared weeks benefit to ending be earnings $X.XX

statement operating guidance. Total third X%. Now provide EPS I’ll sales quarter grow to for our projected are to assumptions X%

deleveraging our forecasted expectation perform expenses investments, if line occupancy freight This Ross in store with Operating higher the is the decline range and be period, compared to in XX open XX.X%. new projected year margin of XX.X%, dd’s and from to to last XX.X% XX sales as reflects pressure on year’s ongoing We locations. comparable DISCOUNTS for expect some wage during this well as guidance. and XX including to other stores only

$X expect interest of We about income net million.

Based X% diluted to be Thanksgiving to sales average projected on results compared ended up weighted be to be Our XX February ending second-half year XXXX $X.XX, be first-half shift. – end earlier $XXX to increase, are the to for tax week of now range versus to X, we expect the XXXX. due approximately in-store shares February and share quarter, $X.XX the XXrd-week At XX%, expected year, our million. X% same-store is $X.XX XX this per the prior project share weeks as of we the weeks calendar the of about levels and outstanding inventory the guidance XX% rate to per to for a is to earnings X, in

turn closing comments. to for back Now, Barbara the call I’ll

Michael. I for earlier, and XXXX you, as quarter To up, expectations. our sum first-half exceed of Thank results second mentioned both to continued the

the of to projections we hope outperform Looking have year, ahead we as once for sometime now. to our balance again the

in However, future. six proven That sector to online, in optimism the both very we face over likely brick-and-mortar to well our retail perform said, competitive will the that stronger months and of and ability confidence a our our about strength the fuel prior landscape, continues the next off-price year this comparisons remain and space,

growth about are Finally, our updated very excited longer-term prospects. we

point, X,XXX increase we’d over respond questions store Our XX% you locations this current potential have. us At to and base. our new call up offers might any the like target to open of

[Operator Instructions] JPMorgan. comes Matthew first question Your from from Boss

Thanks, great.

the fully embedded us the we to cost headwind your front, fixed that wage this until year? quarter? basis versus on think hurdle best then in the the wage pressure it freight so about lap next margin, help On to is that X% second of the quarter back-half year the you’ve in points the XX And gross think of raises this the

Hartshorn. Michael XX% freight above higher in high, are enforcement on shortage it’s similar driver of we that tracking end freight then increased and the the On comment obviously, to we we’ll of are Matt, at we on prices a were in that wouldn’t into the is wage regulation first-half And Hi, year. Built at increase, second the slightly the our guidance, including quarter. up comment year. what contributing saw industry pressure and number the on of XXXX, there factors a cost, three-year pressures, back-half the drivers. Trucker or diesel

just Great. And then follow-up. a

think we positive the nice sets really As the multi-year long-term store about in given just change a and today. which sequential,

the of footage growth X% we your Just think growth, annual with base? anything about the square potential governors the to to governor given X% the Just as on in historically increase terms any in sort growth to think annual about maybe long-term?

include number. careful we longer annual growth Yes, number, like distinguish changed. The if Matthew, number real new constraints it’s we constraints change between store sort over store but about and of versus way long-term O’Sullivan. potential stores a the to The per availability the I’d of Michael I new really give the year per it guess, haven’t think also doesn’t stores potential and be opening released longer-term, the they store on you long-term year. today operational the estate us, number runway of which the

a you XXX from I at planning per of that store So we’ll perspective, about continue new assume rate should year. a think, openings

Great color.

of question Tunick Bank from Your Brian Canada. Royal next from comes

what now the add maybe though, back-half sort into do margin growing? a year, seeing that the are think drill little And think last expansion biggest I congrats us then Barbara, could Great, more help down merchandise of quarter? the through little? you maybe, thanks. my you for the of versus I’ll in Thank you in-store coming Curious, you well. you’re very as if inventories can guess, hindsight here And even opportunities are Michael, a the if you performance drivers category much. that

quarter. the said I one see the see really first more really get our when there’ll apparel in clearly within big back-half. Brian, I as category second as quarter, it how we quarter, gift-giving, even the to from performance, broad-based. specific point quarter was box. the this see a the performance that’s within from But improved. obviously, emphasis in the don’t note, Obviously, business as you to see I fourth at was on And in second gift-giving. opportunity, But be more broad-based every I that it the

it specific focused So category. one in we don’t have

on and margins. inventory Brian, specifically

the a seeing shift. all, increases of the XXrd-week inventory First you’re function year calendar this are of

what this back of in Thanksgiving drive the earlier, sales, happens is to the the it we that to same at school holiday, the with is quarter end match drives QX receipts which closer to which which quarter-end. So earlier means happens is

buying better a when will That in comes continue of lower improvement, be and In merch by markdowns the the biggest above-plan it it margin. driven terms was quarter. our for resulted margin to to that sales combination opportunity of

very Thanks Great. much.

from Lynch. question Merrill Lorraine from next America comes Bank Your of Hutchinson

gross the know Thank the you. points of expect Can out pressure. Thank the this back distribution basis I I timing wanted you margin? you to of called you particular timing positive the XX that expense follow-up points first when XX come increase? about packaway. into from to quarter in you. on basis of talk And

Lorraine. Sure,

– we D.C. a is was packaway were to point and quarter, we merchandise up, accounting costs So first so we levels store got fixed the that reversed, the driven our and deleverage credit What happened procure packaway in cost. XX process and second that completely capitalize quarter by packaway is In basis timing. all P&L. includes the to the the packaway

notice of flowed that the from our to guidance through $X.XX high-end guidance we the above the You’ll through year. the

no in guidance, So back-half. there’s impact versus the our

Thank you.

comes next Kimberly from Stanley. question Greenberger from Morgan Your

a to dd’s who do Wonderful. the congratulations. or talk that just looks the have inventory. sheet, Secondarily, the improvement or lastly, internally so And relative at possible expectations? tracking closed division? of I’m it’s at just on the in-store if the in-store year? I dd’s that Is be a you you in sort at details had analysis would the understand inventory, end you profit able end if Would your if with any of team balance of division. changed that’s was the have you with for profile then wondering potential? on much you there’s outside, the it – can compared I QX the of for the us for assistance share Barbara, don’t profit sort And a example, to the earlier. And average to apples-to-apples store to long-term know to Thanks. of us you of the way wondering basis wondering week have about on I’m did you look quarter? Thank the if third-party nice at average O’Sullivan, your Ross an Michael and about a that might how of Michael, talked profitability versus a additional last here inventory analysis?

and model your on in assess And store to longer-term did Kimberly, and individual question, team and that So, well of estate part actual our internal now used trends, store individual that analyze we a based productivity changes we they little roll experience. the model model, and periodically, – team proven the our while modeling, first tested new up real a external They – been that our store demographic a real fairly store has locations. estate since to also use upon and potential, our upon that. update model estimate based locations it’s

So really estimates. these what’s driven that’s updated

favorable today’s and The these be looking that I is, you well-documented. roll driving other are customer markets. in were our to our say, new a provided business. release in trends higher opportunities point given up, would at I think, are estimates estimates make And existing that that demographic won’t trends the surprised fairly strong the are represent I would and base, demographic

wall about that, four profitability. that Kimberly, terms dd’s similar in Ross’s profitability, And say I would to it’s is of all

Inventories just back-to-school year on in and impact increase focus that shift The Kimberly, calendar would up that slightly. calendar is actually the earlier been to planned X% inventories. on shift. have the with

the with been have shift, So we – slightly. without up calendar would

Great. Thanks so much.

Your from next from Trussell question Deutsche Bank. comes Paul

Good lead, discuss versus how there was was afternoon. the discuss an a from comp apparel major I I lastly, to you And mentioned the wondered in think, composition. standpoint? UPT could weather? also regions across the in that versus believe I you due in quarter you non-apparel AUR mentioned category And quarter? you a the increase basket. Could traffic spread then if

Sure.

The comp higher remarks, the driven higher was was was mentioned transaction, year. AUR So compared basket flat and units by basket. on the per traffic entirely as larger in components, for to us by we last driven X% our

merchandise relatively similar non-apparel was the of terms and her categories. In mentioned growth performance, Apparel as in sales Barbara across for remarks, were broad-based quarter. merchandise

then major last for last sales In of performance do geographically, terms quarter several Texas chain year. markets sales newer above versus The chain the Midwest the average. the weather, in were throughout no our our and very California – to growth was country. strong relatively the with regional Florida in markets, and strong line comp the line, weather, were with continued impact against and average over years. well Of

color. of luck. Thank you for the Best

Lejuez Citigroup. Your from comes next Paul question from

guys. thanks, Hey,

incremental about haven’t us urban can the I’m markets, potential? that Ross little suburban XXX your the that the On Are Also about plan, long-term talk today Thanks. you in between and about Ross you curious new if as there just any Stores a you long-term markets curious more new markets bit heard about can maybe you’re think that yet? just mix new versus quarter, thinking share we that with during performance your of existing locations?

on that for versus existing continue we – dominant new will continue we’ll openings the Paul, of store share expect of would new the markets markets, be – to existing mix that several So years. if the the

Beyond of this we market that, about really timing point. wouldn’t openings at the comment specific new

how we first urban coming suburban, detail. we track on Paul, well, do of that trend mean, quarter. is quarter-to-quarter, say, and change we will out not then, a And trends versus in it the see wouldn’t I I breakout from

one about year’s your Maybe if this could curious year expectations? class to and just relative previous more. openings. and new years sneak What store you’re I your versus I’m Thanks. this seeing

Paul. Sure,

is the Our productivity estate very new the this average in about above our to store XX% new of to store at Ross store chain. years, to continues track it’s of performance couple average where year. or an And last similar the real XX%

Good guys. Thanks, luck.

Paul. Thanks,

Suisse. question from Your Michael Binetti next from comes Credit

quarter, changes guess, bit what help how to breaks here. little points on if about in But also SG&A? us accounting? could and your third think, help could for back-half Hey, harder our basis about first swung implies thinking that to compared margin forecast XXX about Lorraine’s think in gross I since question XXX for between it’s packaway. quarter. line plan can guys, quarter that accounting a a about operating how the you in of a from I I before. item taking thanks margin the we the down you get second us And Do the little Michael, help then us around follow-up related packaway for compression questions to points think guidance assumes a little basis

Sure.

But the components, freight. reflects SG&A. margin gross on versus So ongoing the we the from breakout don’t pressure margin

quarter expenses be the $XX only pressure second And deleveraging in mentioned, run second we relatively also is an I if And to in terms the one-time purposes, the above us, will we back-half. flat seen our for reflects on marketplace perform expect and be, I we’ve store impact of investments The also what’s dependent line and bonuses. occupancy predict assume in it’s went year-to-date. some or in and wage to we expect comparable and the investments at in bonuses the with As packaway available for to on other thing hit paid we for us sales guidance. the would on heavier in It obviously back-half DC, quarter. how the wage because highly because then hour one-time sales that it’s be will hardest the modeling

you back-half to aren’t clarify be bonuses paid of a to total in the an the – pressure just more went than So the one-time present front-half back-half? in $XX hour XQ. wages those the bonuses as in even and But the one-time will

wages $XX in will bonuses No, went the the have the quarter. we only one-time impact quarter. hit second as a second The bigger to

our impact more benefits increased back-half the will also that We the first-half. lease than

influences was more to just on thinking a you’re go increases Would sneak some one strategy generally and about around from but know to I mentioned the But bit where on competitors, could I that as speak you are mind helping sector. the in that. merchandise your have little know your different AUR I AUR, how queues we hearing from flat. with the If take it. it the customer of that you Okay. mix you to you

there’s about there you mind for back-half of So us AUR if think you opportunity that just telling an the to Thanks. and would the year? through how improve

Sure. On completely of of business. mix AUR, function a it’s

lot a recent flat mix expectation and the our several and business. is even based going so the on last move been it’ll slightly the whole be of for years for down it quarters forward, Over slightly, up the doesn’t It’s trend, to us.

Okay. Thanks a lot, guys.

Your Bob from Drbul from Guggenheim. next question comes

just think competitive afternoon. good business wondering could comment Hi, it. bit your guess, today? I you it’s think back-half And do benefiting that closures all But around little that new you to and discussed it I do have how was opening you that And I couple if closures parts the you’ve store a year? at guess, about store plan the in earlier? the of impacted competitive a store

think new really no. we store I have of they given retailers where Bob, really tailwind. in openings, openings. any Go like store closures we on nice have think But don’t most don’t in material about So, store about comp changed how And ahead. terms think our think would retailers, our new putting how are say performance. of year, that the closures we store of or other I about a impact

And or the been a overall? has comp to there comp, variation on both the Ross similar dd versus they are the

profitability then this, In the on quarter impact view. sales terms happy pretty in margin dd’s a the perform but dd’s of continued point of overall announced trends well on sales of and plan. the to And packaway second similar in credit for but dd’s Ross the very quarter, with first-half to and second of year margins, actually, the and sort terms we from above

Thank very much. you Okay.

Siegel comes Nomura from question Simeon next Instinet. The from

the and results. guys, afternoon, Good on congrats Thanks.

the dd can? to perform larger there analysis, the how Ross, you any As revenue average towards for and were international compared thoughts dd’s footprint? as store, to new Thanks. you Just does you if look the store

Sure, Simeon.

a of In terms on analysis the This of was no. States. international, focused just United piece

saying We potential have we’re X,XXX X,XXX. stores at this the is point, and long-term

So, obviously, a lot growth of there.

on the So focused only very United States.

the it average of concept the on newer It’s million, the so say, on we maturity Ross, about a Suffice disclose specific the chain. is average based on the to $X it’s of don’t that chain so less. it’s or south stores, Simeon, for newer store dd’s.

in it’s color quality the obviously, the a But just percentage then by any quarter, and I any quarter? you Any shift decline think other number in this maybe And on – of the timing. Michael. moving Thanks, market? the available on inventory in Okay. Thanks. color mentioned packaway

decision supply plus fluctuated lot it’s off I and No. think say, availability no to again, of really How to There’s when number broad. it I of we the still we our lot So really there The and But a to there’s change in pack see lot process. regular we’re But much in of of to availability it’s in what away? the marketplace. packaway packaway? merchants a what market, QX. based there’s decide would the in packaway? a fuels it’s a is of lot – plentiful And

luck the of Best of the Thanks. rest for year. Okay.

Your comes Shapiro next from Retail Marni from question Tracker.

on Hey, wages want Are you a everybody, great and get you – did well across as just wages. up company? at and the D.C. clarification in-store, one to quarter level as the congratulations I take first-half.. on the

we the Marni, it Yes, company. up took across

tends malls Okay, off-price to then curious do you’re of more well And past with new finding things the as and – the to type you’re even the there dd’s similar that stores? Ross follow-up that Have I’m shift do the great. of store in locations better when outlets may you in just one well into Stores? or shopping considered expand or scenario space the are local just looking of like the centers are across hadn’t a new of looking versus or any – mix family Board, Have dd’s types be in that if expansion. on And that?

The was based looking trends type locations. the to So, of we already opportunities. types increasing those have, at upon how Marni, are of analysis demographic of locations really but the no, in the that nothing number different terms of out call

from comes question next from Hofkin Blair. Your William Daniel

afternoon. Good

first question on Just a environment. the

one the What others, you two years quarter you competitive few something are expecting seeing very We obviously, on of the and for you’re are haven’t been the back on your promotion? competitive cautious you your there what typical the strong in in conservatism? environment. seeing? more that second-half for you hearing be so just on Is And second-half? this guidance last else news to Is terms of promotional the to that much causes

the competitive, So between but thinking the environment and And strong is in we feeling are are online it how brick-and-mortar. comparison. back-half we about in up in-store still up and multi-year very we that are competitive terms remains we’re that, of against against

put So when comparisons, environment came the we competitive multi-year together, that’s the how we those up with the guidance.

so X% hope and and in in to better XXXX year. like That a up been And against a this X% Barbara it’s in we’re they has XXXX. in QX X% we’ve a – We XXXX Dan, QX. plan up were comp QX, to done think this And, and this do business then for plan always comparisons. robust prudent our were very a a it’s we against playbook. against of seven the said, comp QX in mentioned multi-year way. We XXXX up in

factor a the the that’s Yep, any sort competitive maybe that safe say to in bigger intensification environment? than of

that’s correct. Yes,

gross later. Maybe what Okay. follow-up an if is that and causes margin it packaway time. the have the what you accounting, is in topic that caps in Is here? that What gross just that should more I play reverses increase it margin unit just what one helps on then period could

exactly that’s how works. Yes, it

right. Best All much. Thanks of very Okay. luck.

Your from from Loop question next comes Champine Capital. Laura

can nationwide reasonable for think And example? you Ross that enter regions? that to us expectation contemplate base Does being your the about like for previously timeframe in all store about would beyond It’s question. you new what my you be what said. grow a to taking for for Northeast, regions the Thanks

expansion it the yes, Laura, United States. contemplates across So, nationally

assume nationally. now, we’re that and a As in XX expand right this reminder we states,

of of for timing enter comment when In would we that on we wouldn’t markets, reasons. terms new competitive

Got it. you. Thank

Jamie Your next question Bernstein. from comes Merriman from

an of But you’re mix much. traditional talked maybe demographics seeing purchased. And looking of I a longer-term same – past, have in question. the maybe you category? increasing they seeing purchasing Thanks. from something number from very curious, just or that in I’m core soft new the are younger customers about of those brand has new terms customers customer slightly and come you demographics. Thanks brands for you Are either

we do think younger we we Yes, well millennials. with the Sure. well demographic, we feel with and do

brands. brand customer brands think of I of open be big to would are married mix, said, but quite that more them. bit But they’re is that brands strong very trying the brands. as open trying little not It say, important different terms still on a the certain to would are strong to very quite In I are being brands. that – labels is become bit that to they’re curve young cases some the big still and brands It’s guess. eventually little as brands in brands traditional, just still perhaps that more other would my bigger But are not types the

much. Great. Thanks very

Fargo. question from Ike from Boruchow Wells comes next Your

for on Congrats ones Michael, solid a two quarter. you. quick everyone. Hey,

First on is model. the

three the again, and then for QX was? worsened takes versus you – on comp QX first-half months the laying curious puts or has there? where creating have you is fourth that to calendar one you’re to been was, to from are just ago, say freight the just the from kind that where saying And for then, some your would impact worsen On your the of noise, are just because freight out what revenue headwind imply two that And view growth the clarify, fair should it back-half, shits quarter?

Sure, Ike.

at a end back-half, of versus third total that pronounced that The do the standpoint, say specific revenue by even for more sales We’ll the first-half comparison will the the We comparison It’s a fourth point one thing quarter. I a in the is, helps that though fiscal fiscal quarter. and from the quarter. fourth point in it’s off restated revenue in us given targets is haven’t total the impacted by by

in we of to we similar be the second the freight, that. other to somewhat do to it terms to saw and business plan expect at In But it’s a slight year. how increase or what cover It found is elevated the in we quarter. very we offsets

into And on level Michael, that a for just at understand? item any high there line to us visibility is XXXX

next no. until point, this We wouldn’t At give we comment year’s guidance.

Thanks.

Your next from Dana Advisory from Telsey Group. comes question Telsey

Good afternoon, everyone.

how As new store new you. acceleration the growth in growth? distribution store does to And you Thank long-term many handle you about center store does need this next openings? new do think number How to thinking are needs of of target, order it capacity? up? the you And that entail type come an store of about terms in capacity when distribution the

So, another Dana, another that up additional then pace was No, new the additional store for question store would in we obviously capacity openings. few anticipate need of about I DC part as beyond terms don’t expect need of stores. Last pace not will the we distribution open years. capacity, new your major openings to change. that And of longer-term, we of would

opened expect few I would year. years, Over last the we’ve that stay it per XXX approximately number. that will around new about stores

you is more mix? Barbara, landscape? question. Thank in merchandise, important about one of a your Just think off-price part more as made you any you. And for becoming seeing that that changes are

see again, it’s near-term. business bulk of assortments of comes a our sits our The close-outs businesses, issues primarily Close-outs of from the any where portion as in are makeup assortments. branded the don’t availability such we basically, home. on and But the really of couple bulk in our

So we changing. a don’t really mix see

you. Thank

question next Stichter from comes from Jefferies. Janine Your

Hi, thanks very much.

of categories some the into. about ask newer to pushing you’re wanted Just

there give can on categories, before. there? you’ve opportunity? an still color then called be you it is color on think, like feel maybe you where the beauty and underpenetrated may performance Thanks. And some I Any up

repeat part the I missed the the of question. Could just first you part. first

Sure.

past? in of think, on you’ve color beauty into, Just categories can the any out some on newer you called that there? you’ve performance pushed give the the Just I

of her out I beauty Obviously, shifted is we as opportunity that feel the missed lot beauty. business of department Okay, an has stores. of

sounds in happen growth we our the So real lot but that, be, I a feel Beauty think, there’s potential it’s I broad-based, growth, is I always of market. there. think, that’s it I a major think trend a most broad-based. and biggest the that to And After like know shift of like one. from probably

that. So we do feel good about

you. Thank Great.

from Cowen. Kernan John from comes question next Your

behalf afternoon. Zuber This Krista is Good of John. on

merchandise you two I Just answered. have Most quick ours fiscal XXXX. previously guided flat for believe questions. of margin to been

I So the has if sales, same-store guidance to then And secondly, beating just consistently for that was the X%. been holds? still which wondering obviously on X%

and are from second-half, Thank what basket you. the look you into you traffic expecting components? As the

merchandise year we On plan, to guided QX And the will sales flat. and The that we of there exceeded back-half assumes be Sure. the guidance plan We’ve flat. could sales. it relatively frankly, that’s for on some be be if exceed margin, QX ahead based in opportunity. our and

I’d be comp. similar. hasn’t to units last in Your traffic key Traffic second oh, question, the and been – very over a whole couple drivers, through It and expect transaction it of that’s lot. been changed has the composition have per years.

If if may. could I one I fit more, in

going forward? relates capital your run of as the about look And running of to on generation. the that it you. expect sales. up type plans cash model, generally Should Just kind rate Thank X% been flow of at the CapEx if we we is

forecasting around $XXX So on we’re year, million. CapEx, this

edge Over we’ll on the starting distribution bit. that And will new a of years, couple construction, up capacity. center the capital with be next construction

Thank you. All right.

There further call comments. Barbara closing back no Rentler turn questions to will are this I for at time. the over

today your you and a for in Have for joining great Ross Stores. us day. interest Thank

conference This call. concludes today’s

may disconnect. You now