Ross Stores Inc. (NASDAQ:ROST) Q3 2019 Earnings Conference Call - Final Transcript
Nov 21, 2019 • 04:15 pm ET
Good afternoon, and welcome to the Ross Stores Third Quarter 2019 Earnings Release Conference Call. The call will begin with prepared comments by management, followed by 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, new store openings 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 2018 Form 10-K and fiscal 2019 Form 10-Q and 8-Ks on file with the SEC.
Now, I'd like to turn the call over to Barbara Rentler, Chief Executive Officer.
Good afternoon. Joining me on our call today are Michael Hartshorn, Group President and Chief Operating Officer; Travis Marquette, Group Senior Vice President and Chief Financial Officer; and Connie Kao, Vice President, Investor Relations.
We'll begin our call today with a review of our third quarter performance, followed by our outlook for the remainder of the year. Afterwards we'll be happy to respond to any questions you may have.
As noted in today's press release, we are pleased that our third quarter results were ahead of our expectations. Earnings per share for the period were $1.03, up from $0.91 last year. Net earnings grew to $371 million from $338 million in the prior year. Total sales of third quarter increased 8% to $3.8 billion with comparable store sales, up a strong 5% on top of last year's 3% gain.
For the third quarter, we saw broad-based strength across both merchandise departments and geographic regions with children's and the Midwest performing the best. We also continue to see improving sales trends in our ladies apparel business. While this area becomes less important as we move into the fourth quarter, we believe the actions we are taking here will lead to ongoing improvement during the holiday selling season and then into 2020.
Operating margin were 12.4% was above plan mainly due to better-than-expected sales and merchandise margin. For the first nine months of fiscal 2019, earnings per share were $3.32, up from $3.06 last year. Net earnings were $1.2 billion versus $1.1 billion in the first nine months of 2018.
Sales year-to-date rose 7% to $11.6 billion with comparable stores, up 3% on top of a 3% gain last year. As we ended the third quarter total consolidated inventories were, up 10% over the prior year, while packaway was 39% of the total, compared to 41% last year. Average in-store inventories at the end of the period were up 3%.
Dd's DISCOUNTS continue to perform well with robust above plan growth in both sales and operating profit.
Turning to our store expansion program, we opened 30 new Ross and 12 dd's