Off-price retailer Ross Stores has reported a 7.9% drop in fourth-quarter profit, weighed down by lower sales and promotions.
Net earnings reached $218 million for the 13 weeks to February 1, compared to $236.6 million in the same period of the prior year. Sales edged down 0.7% to $2.74 billion from $2.76 billion last year, while comparable store sales climbed 2%.
Vice chairman and CEO Michael Balmuth said: “Our fourth quarter sales performed in line with our guidance, with earnings that were slightly better-than-expected primarily due to above-plan merchandise gross margin.
“Despite a very promotional retail environment throughout the holiday season, customers responded favorably to the compelling bargains we offered on a wide assortment of fresh and exciting name brand fashions and gifts.”
During the full year, however, earnings increased 6.4% to $837.3 million from $786.8 million in the prior year period, while sales reached $10.23 billion, up 5.2% from $9.72 billion.
The company expects fiscal 2014 earnings per share to be $4.05-4.21, up from $3.88 in fiscal 2013, and sales are forecast to grow 1% to 2%.
“As we enter 2014, in addition to our own challenging multi-year sales and earnings comparisons, we also continue to face ongoing uncertainty in the macro-economic and retail climates,” Balmuth added.
“While we remain well-positioned as an off-price retailer, these likely headwinds have prompted us to stay somewhat cautious in our outlook.”
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