Ross Stores wants to reach a triple-digit goal this year.
The retailer opened 19 locations in nearly six weeks and, repeating a goal from last year, once again wants to add 100 locations by the end of this year. Eleven recently opened locations are under the Ross Dress for Less banner, while the other eight are under the company’s DD’s Discounts brand.
In a Monday announcement, the California-based company said both chains expanded into existing markets in California, Texas and Florida, while DD’s also opened its first store in Wisconsin. Ultimately this year, the company plans to open 75 locations under the Ross banner and 25 DD’s-branded stores.
Last fall, Ross reached a milestone by opening 2,000 physical stores. The California-based company said Monday that it has 1,704 Ross locations and 330 DD’s stores in 40 states. That’s 2,034 locations currently open.
“As we look out over the long term, we remain confident that Ross can grow to 2,900 locations and DD’s Discounts can become a chain of 700 stores given consumers' ongoing focus on value and convenience,” Gregg McGillis, group executive vice president for property development, said in a statement.
Ross reported $5.21 billion in sales in Q4, up from about $5 billion year over year. For the 12 months ending Jan. 28, the retailer posted nearly $18.7 billion in sales, down from $18.9 billion year over year, and a 4% decline in comp store sales.
Net earnings for Q4 were $447 million, up from $367 million year over year. Net earnings for the year were $1.51 billion, down from $1.72 billion year over year. Ross also reported nearly $2.5 billion in long-term debt in 2022, mostly flat from last year.
Over the past three years, Ross faced “a wide range of unprecedented challenges” that included the pandemic, supply chain disruptions and inflation, CEO Barbara Rentler said in February, according to an earnings call transcript.
“These factors have not only negatively impacted our own business, but also our customer’s household budgets, their discretionary income and their shopping behaviors. As a result, our shoppers today are seeking even stronger values when visiting our stores,” Rentler said.
Ross’ 2023 guidance expects that total sales will grow by 2% to 5%. However, comp sales for the year are anticipated to be relatively flat. Based on that forecast, CFO Adam Orvos said the operating margin for the full year will range from 10.3% to 10.7%. This year has 53 weeks for sales reporting purposes.
As consumers remain price sensitive and spend less on discretionary items, Rentler said Ross’ merchants are fine-tuning assortments and the company will continue to adjust its product mix in response to evolving customer preferences.
“Looking ahead, we have significantly increased our focus on strictly controlling inventory and operating expenses throughout the company,” Rentler said. “We strongly believe that these measures will enable us to maximize our potential for both sales and profit growth in 2023 and beyond.”