Ross Stores (ROST) 10-K risk factor changes: FY2019 vs FY2019

Our Annual Report on Form 10-K for fiscal [removed: 2018,] [added: 2019,] and information we provide in our Annual Report to Stockholders, press releases, and other investor communications, including those on our corporate website, may contain forward-looking statements with respect to anticipated future [removed: events] [added: events, including the rapidly developing challenges with] and our [removed: projected growth,] [added: plans and responses to the COVID-19 pandemic and related economic disruptions, our] financial performance, operations, [removed: and] competitive [removed: position] [added: position, and our projected growth,] that are [added: all] subject to risks and uncertainties that could cause our actual results to differ materially from those forward-looking statements and from our prior expectations and projections.

[removed: Competitive] [added: Competitive] pressures in the apparel and home-related merchandise retailing industry are [removed: high.][added: high.]

The substantial sales growth in e-commerce within the last decade has also encouraged the entry of many new competitors, new business models, and an increase in competition from established companies looking for ways to create successful on-line [removed: off-price] shopping alternatives.

[removed: Unexpected] [added: Unexpected] changes in the level of consumer spending on or preferences for apparel and home-related merchandise could adversely affect [removed: us.][added: us.]

It is very challenging to successfully do this well and consistently across our diverse merchandise categories and in the multiple markets in which we operate throughout the United [removed: States.][added: States and its territories.]

[removed: Adverse] [added: Adverse] and/or unseasonable weather may affect shopping patterns and consumer demand for seasonal apparel and other merchandise, and may result in temporary store closures and disruptions in deliveries of merchandise to our [removed: stores.][added: stores.]

Unseasonable weather and prolonged, extreme temperatures, [removed: and] [added: as well as] events such as storms, affect consumers’ buying patterns and willingness to shop, and may adversely affect the demand for merchandise in our stores, particularly in apparel and seasonal merchandise.

[removed: We] [added: We] are subject to impacts from the macro-economic environment, financial and credit markets, and geopolitical conditions that affect consumer confidence and consumer disposable [removed: income.][added: income.]

Consumer spending habits for the merchandise we sell are affected by many factors, including [added: the reaction and repercussions from the COVID-19 pandemic,] prevailing economic conditions, recession and fears of recession, levels of unemployment, salaries and wage rates, housing costs, energy and fuel costs, income tax rates and the timing of tax refunds, inflation, consumer confidence in future economic conditions, consumer perceptions of personal well-being and security, availability of consumer credit, consumer debt levels, and consumers’ disposable income.

[removed: Adverse] [added: The COVID-19 pandemic, or other potential, adverse] developments in any of these areas could reduce demand for our merchandise, decrease our inventory turnover, cause greater markdowns, and negatively affect our sales and margins.

[removed: In] [added: In] order to achieve our planned gross margins, we must effectively manage our inventories, markdowns, and inventory [removed: shortage.][added: shortage.]

If our [removed: sales plans significantly differ from] actual [removed: demand,] [added: demand is lower than our sales plans,] we may experience [removed: higher] [added: excess] inventory levels and need to take markdowns on excess or slow-moving inventory, resulting in decreased profit margins.

[removed: If we make packaway purchases that] do not align with consumer preferences at the later time of release to our stores, we could have significant inventory markdowns.

[removed: We] [added: We] depend on the market availability, quantity, and quality of attractive brand name merchandise at desirable discounts, and on the ability of our buyers to purchase merchandise to enable us to offer customers a wide assortment of merchandise at competitive [removed: prices.][added: prices.]

Because a significant portion of the apparel and other goods we sell is originally manufactured in other countries, changes in U.S. tariffs, trade relationships, or tax [removed: policies] [added: policies, and natural disasters, or public health issues such as the current COVID-19 pandemic (or other, future pandemics),] that reduce the supply or increase the relative cost of imported goods, could also result in disruptions to our existing supply relationships.

[removed: Information] [added: Information] or data security breaches, including cyber-attacks on our transaction processing and computer information systems, could result in theft or unauthorized disclosure of customer, credit card, employee, or other private and valuable information that we handle in the ordinary course of our business, disrupt our operations, damage our reputation, and increase our [removed: costs.][added: costs.]

[removed: Disruptions] [added: Disruptions] in our supply chain or in our information systems could impact our ability to process sales and to deliver product to our stores in a timely and cost-effective [removed: manner.][added: manner.]

[removed: An excessive rate of technological change could detract from the effectiveness of] adoption, and could make it more difficult for us to realize benefits from new technology.

Such disruptions may result from: [added: public health issues such as the current COVID-19 pandemic (or other, future pandemics),] damage or destruction to our distribution [removed: centers;] [added: centers,] weather-related [removed: events;] [added: events,] natural [removed: disasters;] [added: disasters,] trade [removed: restrictions; tariffs;] [added: restrictions, tariffs,] third-party strikes or ineffective cross dock [removed: operations;] [added: operations,] work stoppages or [removed: slowdowns;] [added: slowdowns,] shipping capacity [removed: constraints;] [added: constraints,] supply or shipping [removed: interruptions or costs;] [added: interruptions,] or other factors beyond our control.

[removed: We] [added: We] need to obtain acceptable new store sites with favorable consumer demographics to achieve our planned [removed: growth.][added: growth.]

[removed: To] [added: To] achieve growth, we need to expand in existing markets and enter new geographic [removed: markets.][added: markets.]

[removed: Consumer] [added: Consumer] problems or legal issues involving the quality, safety, or authenticity of products we sell could harm our reputation, result in lost sales, and/or increase our [removed: costs.][added: costs.]

Although our vendor arrangements typically place contractual responsibility on the vendor for resulting liability and we generally rely on our vendors to provide authentic merchandise that matches the stated quality [removed: attributes,] [added: attributes] and complies with applicable product safety and other laws, vendor non-compliance with [removed: consumer product safety laws may subject us to product recalls, make certain products unsalable, or require us to incur significant compliance costs.]

[removed: An] [added: An] adverse outcome in various legal, regulatory, or tax matters could damage our reputation or brand and increase our [removed: costs.][added: costs.]

These may include lawsuits, inquiries, demands, or other claims or proceedings by governmental entities and private plaintiffs, including those relating to employment and employee benefits (including classification, employment rights, discrimination, [added: harassment,] wage and hour, and retaliation), securities, real estate, tort, commercial, consumer protection, privacy, product compliance and safety, advertising, comparative pricing, intellectual property, tax, escheat, and whistle-blower claims.

We continue to be involved in a number of employment-related lawsuits, including [removed: class] [added: class/representative] actions which are primarily in California.

Significant judgment is required in evaluating and estimating our tax provisions and [removed: accruals] [added: reserves] for legal claims.

[removed: Damage] [added: Damage] to our corporate reputation or brands could adversely affect our sales and operating [removed: results.][added: results.]

[removed: We must] [added: Our inability to] continually attract, train, and retain associates with the retail talent necessary to execute our off-price retail [removed: strategies.][added: strategies along with labor shortages, increased turnover, or increased labor costs could adversely affect our operating results.]

Like other retailers, we face challenges in recruiting and retaining sufficient talent in our buying organization, management, stores, [added: distribution centers,] and other key areas.

[removed: We] [added: We] must effectively advertise and market our [removed: business.][added: business.]

[removed: We] [added: We] are subject to risks associated with selling and importing merchandise produced in other [removed: countries.][added: countries.]

To the extent that our vendors are located overseas or rely on overseas sources for a large portion of their products, any event causing a disruption of imports, including the imposition of import restrictions, war, [removed: and] acts of [removed: terrorism] [added: terrorism, natural disasters, or public health issues such as the current COVID-19 pandemic (or other, future pandemics)] could adversely affect our business.

Although we have implemented policies and procedures to facilitate [removed: our] compliance with laws and regulations relating to doing business in foreign markets and importing merchandise, and to monitor our suppliers, this does not guarantee that suppliers and other third parties with whom we do business will not violate such laws and regulations or our policies.

[removed: Changes] [added: Changes] in U.S. tax or trade policy regarding apparel and home-related merchandise produced in other countries could adversely affect our [removed: business.][added: business.]

These risks could adversely affect our [removed: revenues,] [added: revenues and expenses,] increase our effective tax rates, and reduce our profitability.

[removed: We] [added: We] may experience volatility in revenues and [removed: earnings.][added: earnings.]

[removed: A] [added: A pandemic,] natural or man-made disaster in California or in another region where we have a concentration of stores, offices, or a distribution center could harm our [removed: business.][added: business.]

Our corporate headquarters, Los Angeles buying office, [removed: three] [added: nine] distribution [removed: centers, three warehouses,] [added: centers/warehouses,] and approximately 23% of our stores are located in California.

Natural or other disasters, such as [added: the current COVID-19 pandemic (or other, future pandemics),] earthquakes and hurricanes, tornadoes, floods, or other extreme weather and climate conditions, or fires, explosions, and acts of war or terrorism, or public health [removed: issues (such as epidemics),] [added: issues,] in any of our markets could disrupt our operations or our supply chain, or could shut down, damage, or destroy our stores or distribution facilities.

The current, major health pandemic from the novel coronavirus (COVID-19) is severely and adversely affecting our sales and our operations, and will have serious adverse effects on our business and our financial condition.

The United States and other countries are experiencing a major global health pandemic related to the outbreak of a novel strain of coronavirus (COVID-19), and related, severe disruptions to retail operations and supply chains and to general economic activities, as the affected regions take increasingly dramatic action in an effort to slow down the spread of the disease.

As the COVID-19 pandemic continues, many of our customers are impacted by recommendations and/or mandates from federal, state, and local authorities to stay home ("shelter in place" or "safer at home") and to avoid non-essential social contact and gatherings of people, and to self-quarantine.

In recent weeks starting in March 2020, we have experienced a broad-based deceleration in sales trends from consumer response to the COVID-19 pandemic throughout the country.

Governmental authorities in affected regions are taking increasingly dramatic action in an effort to slow down the spread of the disease.

As part of a growing number of retailers across the country, we have temporarily closed all store locations effective March 20, 2020 through April 3, 2020.

We have closed our buying and corporate offices, and our distribution centers, for the same period, and we have instituted “work from home” measures for many of our associates.

We are monitoring the situation and will reopen stores as conditions permit; however, extended or further closures may be required nationally, regionally, or in specific locations.

The situation is unprecedented and rapidly changing, and has unknown duration and severity.

This significant reduction in customer visits to our stores will result in a loss of sales and profits and have material adverse effects to our financial condition.

In addition, the COVID-19 pandemic will potentially adversely affect our ability to adequately staff our stores and our distribution, merchant, and other support operations.

Further, the COVID-19 pandemic is currently severely impacting China and other countries, which may also adversely affect our ability to access and ship products from the impacted countries.

A prolonged, widespread pandemic will adversely impact global economies and financial markets, which will result in an economic downturn that will reduce demand for our products.

The extent of the impact from the COVID-19 pandemic on our business and financial results will depend largely on future developments, including the duration and spread of the outbreak within the U.S., the response by all levels of government in their efforts to contain the outbreak and to mitigate the economic disruptions, and the related impact on consumer confidence and spending, all of which are highly uncertain and cannot be predicted.

Such impacts are expected to adversely affect our profitability, cash flows, financial results, and our capital resources.

If we make packaway purchases that

An excessive rate of technological change could detract from the effectiveness of

consumer product safety laws may subject us to product recalls, make certain products unsalable, or require us to incur significant compliance costs.

At the time of this filing, more than 40 million residents in California are under governmental orders to stay at home (“shelter in place” or “safer at home”) and to avoid non-essential social contact and gatherings of people.

The duration of this situation is unknown, and it is severely and adversely affecting our sales and our financial results.

In recent weeks starting in March 2020, we have experienced a broad-based deceleration in sales trends from consumer response to the COVID-19 pandemic throughout the country.

Governmental authorities in affected regions are taking increasingly dramatic action in an effort to slow down the spread of the disease.

As part of a growing number of retailers across the country, we have temporarily closed all store locations effective March 20, 2020 through April 3, 2020.

We have closed our buying and corporate offices, and our distribution centers, for the same period, and we have instituted “work from home” measures for many of our associates.

We are monitoring the situation and will reopen stores as conditions permit; however, extended or further closures may be required nationally, regionally, or in specific locations.

The situation is unprecedented and rapidly changing, and has unknown duration and severity.

We have already temporarily suspended our stock repurchase program.

In March 2020, we borrowed $800 million from our revolving credit facility to add to our cash balances in order to provide enhanced financial flexibility due to uncertain market conditions arising from the impact of the COVID-19 pandemic.

[removed: Overview][added: Overview]

Ross is the largest off-price apparel and home fashion chain in the United States with [removed: 1,480] [added: 1,546] locations in [removed: 38] [added: 39] states, the District of Columbia, and Guam, as of February [removed: 2, 2019.][added: 1, 2020.]

We also operate [removed: 237] [added: 259] dd’s DISCOUNTS stores in [removed: 18] [added: 19] states as of February [removed: 2, 2019] [added: 1, 2020] that feature a more moderately-priced assortment of first-quality, in-season, name brand apparel, accessories, footwear, and home fashions for the entire family at savings of 20% to 70% off moderate department and discount store regular prices every day.

Our sales and earnings gains in [removed: 2018] [added: 2019] continued to benefit from efficient execution of our off-price model throughout all areas of our business.

We refer to our fiscal years ended February [added: 1, 2020, February] 2, 2019, [added: and] February 3, [removed: 2018, and January 28, 2017] [added: 2018] as fiscal [removed: 2018,] [added: 2019,] fiscal [removed: 2017,] [added: 2018,] and fiscal [removed: 2016,] [added: 2017,] respectively.

Fiscal [removed: 2018] [added: 2019] and [removed: 2016] [added: 2018] were each 52-week years.

[removed: Results] [added: Results] of [removed: Operations][added: Operations]

The following table summarizes the financial results for fiscal [added: 2019,] 2018, [removed: 2017,] and [removed: 2016:][added: 2017:]

| | | [added: | | | | 2019 | | | | | |] 2018 | | | | [removed: 2017] | | [added: 2017] | | [removed: 2016] | | | [added: |]

| [removed: Sales] [added: Sales] | | | | | | | | | | | | | [added: | | | | | | | | | | |]

| Sales (millions) | | [added: | | | | $ | 16,039 | | | | |] $ | 14,984 | | | [added: | |] $ | 14,135 | | | [removed: $] | [removed: 12,867] | [removed: |]

| Sales growth | | [added: | | | | 7.0 | | % | | | |] 6.0 | | % | | [added: | |] 9.9 | | % | | [removed: 7.8] | | [removed: % |]

| Comparable store sales growth (52-week basis) | | [removed: 4] | | [removed: %] | | [added: 3 | | % | | | |] 4 | | % | | [added: | |] 4 | | % | [added: | | |]

| [removed: Costs] [added: Costs] and expenses (as a percent of [removed: sales)] [added: sales)] | | | | | | | | | | | | | [added: | | | | | | | | | | |]

| Cost of goods sold | | [added: | | | | 71.9 | | % | | | |] 71.6 | | % | | [added: | |] 71.0 | | % | | [removed: 71.3] | | [removed: % |]

| Selling, general and administrative | | [added: | | | | 14.7 | | % | | | |] 14.8 | | % | | [added: | |] 14.5 | | % | | [removed: 14.7] | | [removed: % |]

| Interest (income) expense, net | | [removed: (0.1] | | [removed: )%] | | [removed: 0.1] [added: (0.1)] | | [added: % | | | | (0.1) | |] % | | [added: | |] 0.1 | | % | [added: | | |]

| [removed: Earnings] [added: Earnings] before taxes (as a percent of [removed: sales)] [added: sales)] | | [added: | | | | 13.5 | | % | | | |] 13.7 | | % | | [added: | |] 14.4 | | % | | [removed: 13.9] | | [removed: % |]

| [removed: Net] [added: Net] earnings (as a percent of [removed: sales)] [added: sales)] | | [added: | | | | 10.4 | | % | | | |] 10.6 | | % | | [added: | |] 9.6 | | % | | [removed: 8.7] | | [removed: % |]

[added: Stores.] Total stores open at the end of fiscal [added: 2019,] 2018, [removed: 2017,] and [removed: 2016] [added: 2017] were [added: 1,805,] 1,717, [removed: 1,622,] and [removed: 1,533,] [added: 1,622,] respectively.

The number of stores at the end of fiscal [added: 2019,] 2018, [removed: 2017,] and [removed: 2016] [added: 2017] increased by [removed: 6%,] [added: 5%,] 6%, and 6% from the respective prior years.

| [removed: Store Count] | [added: | | Store Count | | | 2019 | | | | | |] 2018 | | | [added: | | |] 2017 | | | [removed: 2016] | | [added: |]

| [added: | | |] Beginning of the period | [added: | | 1,717 | | | | | |] 1,622 | | | [added: | | |] 1,533 | | | [removed: 1,446] | | [added: |]

| [added: | | |] Opened in the period | [added: | | 98 | | | | | |] 99 | | | [added: | | |] 96 | | | [removed: 93] | | [added: |]

| [added: | | |] Closed in the period | [removed: (4] | [removed: )] | [added: (10)] | [removed: (7] | [removed: )] | [added: 1] | [removed: (6] | [removed: )] | [added: (4) | | | | | | (7) | | | | | |]

| [added: | | |] End of the period | [added: | | 1,805 | | | | | |] 1,717 | | | [added: | | |] 1,622 | | | [removed: 1,533] | | [added: |]

| [added: | | |] Selling square footage at the end of the period (000) | [added: | | 37,900 | | | | | |] 36,300 | | | [added: | | |] 34,700 | | | [removed: 33,300] | | [added: |]

[added: Sales.] Sales for fiscal [removed: 2018] [added: 2019] increased [removed: $0.8] [added: $1.1] billion, or [removed: 6.0%,] [added: 7.0%,] compared to the prior year due to the opening of [removed: 95] [added: 88] net new stores during [removed: 2018] [added: 2019] and a [removed: 4%] [added: 3%] increase in comparable store sales (defined as stores that have been open for more than 14 complete months).

Sales for fiscal [removed: 2017] [added: 2018] increased [removed: $1.3] [added: $0.8] billion, or [removed: 9.9%,] [added: 6.0%,] compared to the prior year due to the opening of [removed: 89] [added: 95] net new stores during [removed: 2017] [added: 2018] and a 4% increase in sales from comparable [removed: stores, and the impact of the 53rd week.][added: stores.]

Our sales mix is shown below for fiscal [added: 2019,] 2018, [removed: 2017,] and [removed: 2016:][added: 2017:]

| | | [added: | | | | 2019 | | | | | |] 2018 | | | [removed: 2017] | | | [removed: 2016] [added: 2017] | | [added: |]

| Ladies | | [added: | | | | 26 | | % | | | |] 26 | [added: |] % | | [removed: 27] | [removed: %] | [added: 27] | [removed: 28] | % |

| Home Accents and Bed and Bath | | [removed: 26] | [removed: %] | | [added: | 25 | | % | | | |] 26 | [added: |] % | | [removed: 25] | [added: | 26 | |] % |

| Men’s | | [removed: 14] | [removed: %] | | [removed: 13] | [added: 14 | | % | | | | 14 | |] % | | [added: | |] 13 | [added: |] % |

| Accessories, Lingerie, Fine Jewelry, and Fragrances | | [removed: 13] | [removed: %] | | [added: | 13 | | % | | | |] 13 | [added: |] % | | [added: | |] 13 | [added: |] % |

| Shoes | | [removed: 13] | [removed: %] | | [added: | 13 | | % | | | |] 13 | [added: |] % | | [added: | |] 13 | [added: |] % |

| Children’s | | [removed: 8] | [removed: %] | | [added: | 9 | | % | | | |] 8 | [added: |] % | | [added: | |] 8 | [added: |] % |

| Total | | [removed: 100] | [removed: %] | | [added: | 100 | | % | | | |] 100 | [added: |] % | | [added: | |] 100 | [added: |] % |

We intend to address the competitive climate for off-price apparel and home goods by pursuing and refining our existing strategies and by continuing to strengthen our [added: merchant] organization, diversify our merchandise mix, and more fully develop our systems to improve [removed: regional and local] [added: our] merchandise offerings.

Although our strategies and store expansion program contributed to sales gains in fiscal [added: 2019,] 2018, [removed: 2017,] and [removed: 2016,] [added: 2017,] we cannot be sure that they will result in a continuation of sales growth or in an increase in net earnings.

Current Material Development – the COVID-19 Pandemic is Disrupting Our Business

The United States and other countries are experiencing a major global health pandemic related to the outbreak of a novel strain of coronavirus, COVID-19.

Governmental authorities in affected regions are taking increasingly dramatic action in an effort to slow down the spread of the disease.

As part of a growing number of retailers across the country, we have temporarily closed all store locations effective March 20, 2020 through April 3, 2020.

We have closed our buying and corporate offices, and our distribution centers, for the same period, and we have instituted “work from home” measures for many of our associates.

We are monitoring the situation and will reopen stores as conditions permit; however, extended or further closures may be required nationally, regionally, or in specific locations.

Given the unprecedented uncertainty of this situation, including the unknown duration and severity of the pandemic and the unknown overall impact on consumer demand, we are unable to forecast the full impact on our business; however, we now expect that impacts from the COVID-19 pandemic and the related economic disruption will have a material adverse impact on our consolidated results of operations, consolidated financial position, and consolidated cash flows in fiscal 2020.

To preserve our financial liquidity, and out of an abundance of caution, we are temporarily suspending our stock repurchase program, and in mid-March 2020 we borrowed $800 million from our revolving credit facility, which bears interest at LIBOR plus 0.75% (currently 1.61%), to add to our cash balances.

In addition, we are reducing our expense, inventory receipts, and capital expenditure plans.

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| | | | 1 Includes the temporary closure of a store impacted by a weather event. | | | | | | | | | | | | | | | | | | | | |

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As part of a growing number of retailers across the country, we have temporarily closed all store locations effective March 20, 2020 through April 3, 2020, in response to the COVID-19 pandemic.

We have closed our buying and corporate offices, and our distribution centers, for the same period, and we have instituted “work from home” measures for many of our associates.

Given the unprecedented uncertainty of this situation, including the unknown duration and severity of the pandemic, which may require extended and further store closures nationally, regionally, or in specific locations, and the unknown overall impact on consumer demand, we are unable to forecast the full impact on our business; however, we now expect that impacts from the COVID-19 pandemic and the related economic disruption will have a material adverse impact on our consolidated results of operations, consolidated financial position, and consolidated cash flows in fiscal 2020.

These increases were partially offset by a 10 basis point improvement in merchandise gross margin and a five basis point reduction in buying costs.

Interest (income) expense, net. In fiscal 2019, net interest income improved by $7.9 million compared to 2018 primarily due to lower interest expense on long-term debt due to the repayment of the Series A 6.38% unsecured Senior Notes in December 2018 and higher capitalized interest primarily related to the construction of our Brookshire, Texas distribution center.

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In November 2019, we resolved uncertain tax positions with a state tax authority.

As a result, we recognized a tax benefit of approximately $10.0 million in the Consolidated Statement of Earnings.

This reduced tax rate resulted in a benefit of $24.9 million in fiscal 2017.

We recorded an additional tax benefit of $55.2 million due to the remeasurement of our deferred tax assets and liabilities in fiscal 2017.

Earnings per share. Diluted earnings per share in fiscal 2019 was $4.60, which included a per share benefit of approximately $0.02 primarily related to the favorable resolution of a tax matter, compared to $4.26 in the prior year, which included a per share benefit of approximately $0.07 from the favorable resolution of a tax matter.

As previously noted, the United States and other countries are experiencing the COVID-19 pandemic and related economic disruptions.

Governmental authorities in affected regions are taking increasingly dramatic action in an effort to slow down the spread of the disease.

As part of a growing number of retailers across the country, we have temporarily closed all store locations effective March 20, 2020 through April 3, 2020.

We have closed our buying and corporate offices, and our distribution centers, for the same period, and we have instituted “work from home” measures for many of our associates.

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Stores.

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Sales.

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Cost of goods sold.

and a five basis point decrease in distribution expenses.

The improvements were partially offset by a 25 basis point increase in freight costs and higher buying costs of five basis points.

Selling, general and administrative expenses.

Interest expense (income), net.

In fiscal 2017, net interest expense decreased by $8.8 million compared to 2016 primarily due to an increase in interest income.

Taxes on earnings.

This rate reduction resulted in an increase to our earnings per share of approximately $0.70 for fiscal 2018.

For fiscal 2017, the rate reduction, along with the remeasurement of deferred taxes, resulted in an increase to our earnings per share of approximately $0.21.

Net earnings.

Earnings per share.

Diluted earnings per share in fiscal 2017 was $3.55, which included a per share benefit of approximately $0.21 from tax reform and $0.10 from the 53rd week, compared to $2.83 in fiscal 2016.

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See Note A.

typically packaway remains in storage less than six months.

We regularly review the adequacy of credit available to us from all sources and expect to be able to maintain adequate trade credit, bank lines, and other credit sources to meet our capital and liquidity requirements, including lease payment obligations, in 2019.

We estimate that existing cash balances, cash flows from operations, bank credit lines, and trade credit are adequate to meet our operating cash needs and to fund our planned capital investments, repayment of debt, common stock repurchases, and quarterly dividend payments for at least the next twelve months.

| | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Operating leases (rent obligations) | 549,929 | | | | 1,067,555 | | | | 750,137 | | | | 621,057 | | | | 2,988,678 | | |

| New York buying office ground lease² | 5,883 | | | | 12,835 | | | | 13,898 | | | | 954,616 | | | | 987,232 | | |

| Purchase obligations | 2,528,656 | | | | 33,405 | | | | 8,546 | | | | 806 | | | | 2,571,413 | | |

| Total contractual obligations | $ | 3,097,150 | | | $ | 1,204,159 | | | $ | 789,456 | | | $ | 1,834,917 | | | $ | 6,925,682 | |

This liability is excluded from the schedule above as the timing of payments cannot be reasonably estimated.

Senior notes.

Operating leases.

We currently lease all but two of our store locations.

We also lease five warehouse facilities and two buying offices.

In addition, we have a ground lease related to our New York buying office.

Except for certain leasehold improvements and equipment, these leased locations do not represent long-term capital investments.

Two of our leased warehouses are in Carlisle, Pennsylvania with leases expiring in 2019 and 2020, one is in Fort Mill, South Carolina, with the lease expiring in 2024, one is in Rock Hill, South Carolina, with the lease expiring in 2028, and one is in Shafter, California, with the lease expiring in 2029.

We had no outstanding forward contracts as of February [removed: 2, 2019.][added: 1, 2020.]

As of February [removed: 2, 2019,] [added: 1, 2020,] we had no borrowings outstanding under our revolving credit facility.

As of February [removed: 2, 2019,] [added: 1, 2020,] we have one outstanding series of unsecured 6.53% Series B Senior Notes due December 2021 with an aggregate principal amount of $65 million.

[removed: Interest is receivable] [added: We receive interest] on our short- and long-term investments.

A hypothetical 100 basis point increase or decrease in prevailing market interest rates would not have a material impact on our consolidated financial position, results of operations, cash flows, or the fair values of our short- and long-term investments as of and for the year ended February [removed: 2, 2019.][added: 1, 2020.]

Ross is the largest off-price apparel and home fashion chain in the United States, with [removed: 1,480] [added: 1,546] locations in [removed: 38] [added: 39] states, the District of Columbia, and Guam, as of February [removed: 2, 2019.][added: 1, 2020.]

We also operate [removed: 237] [added: 259] dd’s DISCOUNTS stores in [removed: 18] [added: 19] states as of February [removed: 2, 2019.][added: 1, 2020.]

The merchant, store field, and distribution [removed: organizations] [added: operations] for Ross and dd’s DISCOUNTS are [removed: separate and distinct.][added: separate.]

The two chains share certain [removed: other] corporate and support services.

We refer to our fiscal years ended February [added: 1, 2020, February] 2, 2019, [added: and] February 3, [removed: 2018, and January 28, 2017] [added: 2018] as fiscal [removed: 2018,] [added: 2019,] fiscal [removed: 2017,] [added: 2018,] and fiscal [removed: 2016,] [added: 2017,] respectively.

Fiscal [removed: 2018] [added: 2019] and [removed: 2016] [added: 2018] were each 52-week years.

[removed: Merchandising,] [added: Merchandising,] Purchasing, and [removed: Pricing][added: Pricing]

[added: Merchandising.] Our merchandising strategy incorporates a combination of off-price buying techniques to purchase advance-of-season, in-season, and past-season merchandise for both Ross and dd’s DISCOUNTS.

Our merchandise offerings include, but are not limited to, apparel (including footwear and accessories), small furniture, home accents, bed and bath, beauty, toys, luggage, gourmet food, cookware, [added: jewelry] and watches.

[added: Purchasing.] We have a combined network of about [removed: 8,000] [added: 7,500] merchandise vendors and manufacturers for both Ross and dd’s DISCOUNTS and believe we have adequate sources of first-quality merchandise to meet our requirements.

We purchase the vast majority of our merchandise directly from manufacturers, and we have not experienced [removed: any] difficulty in obtaining sufficient merchandise inventory.

For most orders, only one delivery is made to one of our [removed: six] distribution centers.

Close-outs can be shipped to stores in-season, allowing us to get in-season goods into our stores at great [removed: values] [added: values,] or can be stored as packaway merchandise.

In fiscal [removed: 2018,] [added: 2019,] we continued our emphasis on this important sourcing strategy in response to compelling opportunities available in the marketplace.

Packaway accounted for approximately 46% [removed: and 49%] of total inventories as of February [removed: 2, 2019] [added: 1, 2020] and February [removed: 3, 2018, respectively.][added: 2, 2019.]

At the end of fiscal [removed: 2018,] [added: 2019,] we had approximately [removed: 850] [added: 900] merchants for Ross and dd’s DISCOUNTS combined.

Ross and dd’s DISCOUNTS buyers have on average seven years of experience, including merchandising positions with other retailers such as Bloomingdale’s, Burlington Stores, [removed: Foot Locker,] Kohl’s, Lord & Taylor, Macy’s, [removed: Nordstrom,] Saks, and [removed: TJX.][added: Target.]

[added: Pricing.] Our policy is to sell brand name merchandise at Ross that is priced 20% to 60% below most department and specialty store regular prices.

This strategy enables us to offer customers [added: consistently low prices and compelling value.]

[removed: Stores][added: Stores]

As of February [removed: 2, 2019,] [added: 1, 2020,] we operated a total of [removed: 1,717] [added: 1,805] stores comprised of [removed: 1,480] [added: 1,546] Ross stores and [removed: 237] [added: 259] dd’s DISCOUNTS stores.

While our stores promote a self-service, [removed: treasure hunt] [added: treasure-hunt] shopping experience, the layouts are designed to enhance customer convenience in their merchandise presentation, dressing rooms, checkout, and merchandise return areas.

[removed: At most stores,] [added: Our stores have] shopping carts and/or baskets [removed: are] available at the entrance for customer convenience.

We provide refunds [added: or store credit] on all merchandise (not used, worn, or altered) returned with a receipt within 30 days.

[removed: Operating Costs][added: Operating Costs]

[removed: Information Systems][added: Information Systems]

[removed: Distribution][added: Distribution]

[removed: We ship all of our merchandise to our stores through these] [added: These] distribution [removed: centers, which] [added: centers] are large, highly automated, and built to suit our specific off-price business model.

We utilize a combination of our [removed: own] [added: own,] and [removed: third-party] [added: third-party,] cross dock facilities to distribute merchandise to stores on a regional basis.

We believe that our distribution centers [added: and warehouses] with their current expansion capabilities will provide adequate processing [added: and storage] capacity to support our current store growth.

[removed: Advertising][added: Advertising]

While television is our primary advertising medium, we continue to [removed: utilize] [added: grow] additional channels, including social [added: and digital] media, to communicate our brand position.

[removed: Trademarks][added: Trademarks]

[removed: Employees][added: Employees]

As of February [removed: 2, 2019,] [added: 1, 2020,] we had approximately [removed: 88,100] [added: 92,500] total employees, which includes both [removed: full] [added: full-] and part-time employees.

[removed: Competition][added: Competition]

[removed: Available Information][added: Available Information]

We operate distribution processing facilities where we receive and ship all of our merchandise to our stores.

An additional distribution center in Brookshire, Texas is currently under construction and expected to open in 2021.

We also operate warehouse facilities for packaway storage.

Merchandising.

Purchasing.

Pricing.

consistently low prices and compelling value.

We own and operate six distribution processing facilities—three in California, one in Pennsylvania, and two in South Carolina.

We own four and lease five other warehouse facilities for packaway storage.

We also use other third-party facilities, including three warehouses, for storage of packaway inventory.

Like many retailers, we have been named in [removed: class] [added: class/representative] action lawsuits, primarily in California, alleging violation of wage and hour laws and consumer protection laws.

[removed: Class] [added: Class/representative] action litigation remains pending as of February [removed: 2, 2019.][added: 1, 2020.]

Actions filed against us may include commercial, product and product safety, consumer, intellectual property, [added: environmental,] and labor and employment-related claims, including lawsuits in which private plaintiffs or governmental agencies allege that we violated federal, state, and/or local laws.

We believe that the resolution of our pending [removed: class] [added: class/representative] action litigation and other currently pending legal and regulatory proceedings will not have a material adverse effect on our financial condition, results of operations, or cash flows.

[removed: FORM 10-K][added: FORM 10-K]

| | | [added: | | | |] (Mark one) | | [added: | | | | | | |]

| [removed: X] [added: ☒] | | [added: | | | |] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | | [added: | | | | | | |]

| | | [removed: For] [added: | | | | For] the fiscal year ended February [removed: 2, 2019] [added: 01, 2020] | | [added: | | | | | | |]

| [added: ☐] | | [added: | | | |] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | | [added: | | | | | | |]

| | | [added: | | | |] For the transition period from ________ to ________ | | [added: | | | | | | |]

[removed: Ross] [added: Ross] Stores, [removed: Inc.][added: Inc.]

| [removed: Delaware] [added: Delaware] | | [removed: 94-1390387] | [added: | | | | | | 94-1390387 | | | | | | | | | | | |]

| (State or other jurisdiction of incorporation or organization) | | [added: | | | | | | |] (I.R.S. Employer Identification No.) | [added: | | | | | | | | | | |]

| [removed: 5130] [added: 5130] Hacienda Drive, Dublin, [removed: California] [added: California] | | [removed: 94568-7579] | [added: | | | | | | 94568-7579 | | | | | | | | | | | |]

| (Address of principal executive offices) | | [added: | | | | | | |] (Zip Code) | [added: | | | | | | | | | | |]

| Registrant’s telephone number, including area code | | [removed: (925) 965-4400] | [added: | | | | | | (925) | | | 965-4400 | | | | | | | | |]

| Title of each class | | [added: | Trading symbol | | |] Name of each exchange on which registered | [added: | |]

| [removed: Common] [added: Common] stock, par value [removed: $.01] [added: $.01] | | [removed: Nasdaq] [added: | ROST | | | Nasdaq] Global Select [removed: Market] [added: Market] | [added: | |]

[removed: None][added: None]

Yes [removed: X] [added: ý] No [added: o]

Yes [added: ☐] No [removed: X][added: ý]

Indicate by check mark whether the registrant has submitted electronically [removed: and posted on its corporate Web site, if any,] every Interactive Data File required to be submitted [removed: and posted] pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit [removed: and post] such files).

Large accelerated filer [removed: X] [added: ý] Accelerated filer [added: o] Non-accelerated filer [added: o] (Do not check if a smaller reporting company)

Smaller reporting company [added: ☐] Emerging growth company [added: ☐]

The aggregate market value of the voting common stock held by non-affiliates of the Registrant as of August [removed: 4, 2018] [added: 3, 2019] was [removed: $32,578,316,211,] [added: $36,753,366,881,] based on the closing price on that date as reported by the NASDAQ Global Select Market®.

The number of shares of Common Stock, with $.01 par value, outstanding on March [removed: 11, 2019] [added: 9, 2020] was [removed: 368,247,009.][added: 355,896,821.]

Portions of the Proxy Statement for the Registrant’s [removed: 2019] [added: 2020] Annual Meeting of Stockholders, which will be filed on or before June [removed: 3, 2019,] [added: 1, 2020,] are incorporated herein by reference into Part III.

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Yes ý No o

Yes ý No o

Yes ☐ No ý

Ross Stores, Inc.

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10-K 1 rost-20190202x10k.htm 10-K

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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

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| --- | --- | --- | --- | --- |

| [PART II](#s77F9857911B3A418D8369CD2005D20A4) | | | | |

| [PART IV](#s942743D139136E55D7289CD207ED3AAA) | | | | |

| | | [Signatures](#s5435343396E6B246315C9CD2084F0F62) | | [60](#s5435343396E6B246315C9CD2084F0F62) |

At February [removed: 2, 2019,] [added: 1, 2020,] we operated a total of [removed: 1,717] [added: 1,805] stores, of which [removed: 1,480] [added: 1,546] were Ross stores in [removed: 38] [added: 39] states, the District of Columbia, and Guam, and [removed: 237] [added: 259] were dd’s DISCOUNTS stores in [removed: 18] [added: 19] states.

During fiscal [removed: 2018,] [added: 2019,] we opened [removed: 75] [added: 74] new Ross stores and closed [removed: four] [added: eight] existing stores.

During fiscal [removed: 2018,] [added: 2019,] we opened 24 new dd’s DISCOUNTS [removed: stores and] [added: stores,] closed [removed: no] [added: one] existing [removed: stores.][added: store, and temporarily closed one store impacted by a weather event.]

During fiscal [removed: 2018,] [added: 2019,] no one store accounted for more than 1% of our sales.

Our real estate strategy in [removed: 2019] [added: 2020] is to primarily open stores in states where we currently operate, to increase our market penetration and leverage overhead and advertising expenses as a percentage of sales in each market.

We also expect to continue our store expansion in newer markets in [removed: 2019.][added: 2020.]

The following table summarizes the locations of our stores by state/territory as of February [removed: 2, 2019] [added: 1, 2020] and February [removed: 3, 2018.][added: 2, 2019.]

| State/Territory | | [added: | | | | February 1, 2020 | | | | | |] February 2, 2019 | | [removed: February 3, 2018] |

| Alabama | | [added: | | | | 24 | | | | | |] 24 | | [removed: 23] |

| Arizona | | [added: | | | | 82 | | | | | |] 80 | | [removed: 78] |

| Arkansas | | [removed: 8] | | [added: | | 9 | | | | | |] 8 | [added: | |]

| California | | [added: | | | | 417 | | | | | |] 400 | | [removed: 379] |

| Colorado | | [added: | | | | 38 | | | | | |] 37 | | [removed: 34] |

| Delaware | | [added: | | | | 3 | | | | | |] 3 | | [removed: 2] |

| District of Columbia | | [added: | | | | 2 | | | | | |] 2 | | [removed: 1] |

| Florida | | [added: | | | | 221 | | | | | |] 205 | | [removed: 195] |

| Georgia | | [added: | | | | 64 | | | | | |] 61 | | [removed: 59] |

| Guam | | [removed: 2] | | [added: | | 2 | | | | | |] 2 | [added: | |]

| Hawaii | | [added: | | | | 22 | | | | | |] 22 | | [removed: 20] |

| Idaho | | [added: | | | | 12 | | | | | |] 12 | | [removed: 11] |

| Illinois | | [added: | | | | 83 | | | | | |] 79 | | [removed: 67] |

| Indiana | | [added: | | | | 20 | | | | | |] 15 | | [removed: 14] |

| Iowa | | [added: | | | | 6 | | | | | |] 6 | | [removed: 4] |

| Kansas | | [added: | | | | 12 | | | | | |] 12 | | [removed: 11] |

| Kentucky | | [removed: 11] | | [added: | | 15 | | | | | |] 11 | [added: | |]

| Louisiana | | [removed: 18] | | [added: | | 19 | | | | | |] 18 | [added: | |]

| Maryland | | [added: | | | | 26 | | | | | |] 25 | | [removed: 24] |

| Mississippi | | [removed: 9] | | [added: | | 9 | | | | | |] 9 | [added: | |]

| Missouri | | [added: | | | | 27 | | | | | |] 26 | | [removed: 23] |

| Montana | | [removed: 6] | | [added: | | 6 | | | | | |] 6 | [added: | |]

| Nebraska | | [added: | | | | 5 | | | | | |] 1 | | [removed: 0] |

| Nevada | | [added: | | | | 39 | | | | | |] 39 | | [removed: 37] |

| New Jersey | | [removed: 14] | | [added: | | 14 | | | | | |] 14 | [added: | |]

| New Mexico | | [added: | | | | 18 | | | | | |] 15 | | [removed: 14] |

| North Carolina | | [added: | | | | 48 | | | | | |] 47 | | [removed: 46] |

| North Dakota | | [added: | | | | 3 | | | | | |] 2 | | [removed: 1] |

| Oklahoma | | [removed: 26] | | [added: | | 27 | | | | | |] 26 | [added: | |]

| Oregon | | [added: | | | | 31 | | | | | |] 31 | | [removed: 30] |

| Pennsylvania | | [removed: 48] | | [added: | | 50 | | | | | |] 48 | [added: | |]

| South Carolina | | [added: | | | | 27 | | | | | |] 27 | | [removed: 24] |

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Ohio | | | | | | 5 | | | | | | — | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

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| | | | Moreno Valley, California1 | | | | | | 740,000 | | | | | | Lease | | | | | | | | | | | | | | | | | |

| | | | Moreno Valley, California1 | | | | | | 1,110,000 | | | | | | Lease | | | | | | | | | | | | | | | | | |

| | | | Shafter, California1 | | | | | | 350,000 | | | | | | Lease | | | | | | | | | | | | | | | | | |

| | | | Fort Mill, South Carolina1 | | | | | | 160,000 | | | | | | Lease | | | | | | | | | | | | | | | | | |

| | | | Brookshire, Texas2 | | | | | | 1,850,000 | | | | | | Own | | | | | | | | | | | | | | | | | |

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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | 1 Operated by a third party. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | 2 We are currently in the process of completing the construction of this distribution center with an estimated occupancy of 2021. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

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[removed: Executive] [added: Executive] Officers of the [removed: Registrant][added: Registrant]

| [removed: Name] [added: Name] | | [removed: Age] | | | [removed: Position] | [added: Age | | | | | | Position | | |]

| Michael Balmuth | | [removed: 68] | | | [removed: Executive] [added: | 69 | | | | | |] Chairman of the Board [added: and Senior Advisor] | [added: | |]

| Barbara Rentler | | [removed: 61] | | | [added: | 62 | | | | | |] Chief Executive Officer | [added: | |]

| Brian Morrow | | [removed: 59] | | | [added: | 60 | | | | | |] President and Chief Merchandising Officer, dd’s DISCOUNTS | [added: | |]

| Michael [removed: O’Sullivan] [added: J. Hartshorn] | | [removed: 55] | | | [added: | 52 | | | | | | Group] President and Chief Operating Officer | [added: | |]

| [removed: Michael J. Hartshorn] [added: Travis Marquette] | | [removed: 51] | | | [added: | 48 | | | | | |] Group [removed: Executive] [added: Senior] Vice [removed: President, Finance] [added: President] and [removed: Legal,] Chief Financial Officer [removed: and Principal Accounting Officer] | [added: | |]

Mr. Balmuth has served as [removed: Executive] Chairman of the Board [removed: of Directors] [added: and Senior Advisor] since [removed: 2014.][added: November 2019.]

From [added: 2014 to November 2019, Mr. Balmuth was Executive Chairman of the Board of Directors and from] 1996 to 2014, he was Vice Chairman of the Board of Directors and Chief Executive Officer.

She also served at dd’s DISCOUNTS as Executive Vice President and Chief Merchandising Officer from 2005 to [removed: 2006] [added: 2006,] and Senior Vice President and Chief Merchandising Officer from 2004 to 2005.

Mr. [removed: Fassio] [added: Hartshorn] has served as [added: Group] President and Chief [removed: Development] [added: Operating] Officer since [removed: 2009.][added: August 2019.]

Mr. [removed: Hartshorn] [added: Marquette] has served as Group [removed: Executive] [added: Senior] Vice [removed: President, Finance] [added: President] and [removed: Legal,] Chief Financial Officer since [removed: March] [added: August] 2019.

Previously, he was [added: Group] Executive Vice President, [added: Finance and Legal,] Chief Financial Officer [added: in 2019; Executive Vice President, Chief Financial Officer] from 2018 to [removed: 2019,] [added: 2019;] Group Senior Vice President, Chief Financial Officer from 2015 to [removed: 2018,] [added: 2018;] Senior Vice President and Chief Financial Officer from 2014 to [removed: 2015,] [added: 2015;] and Senior Vice President and Deputy Chief Financial Officer from 2012 to 2014.

[added: He was also Group] Vice President, Finance and Treasurer from 2011 to 2012, and Vice President, Finance and Treasurer from 2006 to 2011.

[removed: PART II][added: PART II]

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Michael Kobayashi | | | | | | 55 | | | | | | President, Operations and Technology | | |

Mr. Kobayashi has served as President, Operations and Technology since August 2019.

Prior to that, he served as Group Executive Vice President, Supply Chain, Merchant Operations, and Technology since 2014.

Previously, he was Executive Vice President, Supply Chain, Allocation, and Chief Information Officer from 2010 to 2014; Group Senior Vice President, Supply Chain and Chief Information Officer from 2008 to 2010; and Senior Vice President and Chief Information Officer from 2004 to 2008.

Before joining Ross in 2004, Mr. Kobayashi was a Partner with Accenture in their Retail and Consumer Goods practice where he spent 18 years in a variety of management consulting roles.

Prior to that, he was Group Senior Vice President and Deputy Chief Financial Officer from 2018 to 2019, and Senior Vice President, Finance from 2017 to 2018.

He was also Senior Vice President, Store Operations from 2015 to 2017, Group Vice President, Store Operations from 2013 to 2015, and Vice President, Store Operations Finance from 2009 to 2013.

Prior to joining Ross in 2008 as Director, Strategic Planning, Mr. Marquette held various consulting and management roles over a 12-year period with Bain & Company, Carter’s Inc., and PricewaterhouseCoopers.

| | | | | | |

| --- | --- | --- | --- | --- | --- |

| Bernie Brautigan | | 54 | | | President, Merchandising, Ross Dress for Less |

| James S. Fassio | | 64 | | | President and Chief Development Officer |

Mr. Brautigan has served as President, Merchandising, Ross Dress for Less since March 2016 with responsibility for the Ladies and Children’s apparel businesses, Shoes, Lingerie, Cosmetics, and Accessories.

Previously he was Group Executive Vice President, Merchandising, Ross Dress for Less from 2014 to 2016.

He was also Executive Vice President of Merchandising at Ross from 2009 to 2014, Senior Vice President and General Merchandise Manager, from 2006 to 2009, and Group Vice President of Shoes from 2003 to 2006.

Prior to Ross, he spent 20 years in various merchandising positions at Macy’s East.

Prior to that, he was Executive Vice President, Property Development, Construction and Store Design from 2005 to 2009 and Senior Vice President, Property Development, Construction and Store Design from 1991 to 2005.

He joined the Company in 1988 as Vice President of Real Estate.

Prior to joining Ross, Mr. Fassio held various retail and real estate positions with Safeway Stores, Inc.

Mr. O’Sullivan has served as President and Chief Operating Officer since 2009 and a member of the Board of Directors since 2014.

From 2005 to 2009, he was Executive Vice President and Chief Administrative Officer, and Senior Vice President, Strategic Planning and Marketing from 2003 to 2005.

Before joining Ross, Mr. O’Sullivan was a partner with Bain & Company, providing consulting advice to retail, consumer goods, financial services, and private equity clients since 1991.

He was also Group

[added: General information.] See the information set forth under the caption "Quarterly Financial Data (Unaudited)" under Note K of Notes to Consolidated Financial Statements in Item 8 of this Annual [removed: Report,] [added: Report on Form 10-K,] which is incorporated herein by reference.

There were [removed: 904] [added: 977] stockholders of record as of March [removed: 11, 2019] [added: 9, 2020] and the closing stock price on that date was [removed: $90.74] [added: $94.81] per share.

[added: Cash dividends.] On March [removed: 5, 2019,] [added: 3, 2020,] our Board of Directors declared a quarterly cash dividend of [removed: $0.255] [added: $0.285] per common share, payable on March [removed: 29, 2019.][added: 31, 2020.]

Our Board of Directors declared cash dividends of [removed: $0.225] [added: $0.255] per common share in March, May, August, and November [removed: 2018,] [added: 2019,] cash dividends of [removed: $0.160] [added: $0.225] per common share in [removed: February,] [added: March,] May, August, and November [removed: 2017,] [added: 2018,] and cash dividends of [removed: $0.135] [added: $0.160] per common share in [removed: March,] [added: February,] May, August, and November [removed: 2016.][added: 2017.]

[added: Issuer purchases of equity securities.] Information regarding shares of common stock we repurchased during the fourth quarter of fiscal [removed: 2018] [added: 2019] is as follows:

| [removed: Period] | | [removed: Total number of shares (or] [added: | Period | | | | | | Total number of shares (or] units) [removed: purchased¹] [added: purchased¹] | | | [removed: Average] [added: | | | Average] price paid per share (or [removed: unit)] [added: unit)] | | [removed: Total] [added: | | | | Total] number of shares (or units) purchased as part of publicly announced plans or [removed: programs] [added: programs] | | | [removed: Maximum] [added: | | | Maximum] number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programs [removed: ($000)] [added: ($000)] | | [added: | | | | | | |]

| [added: | | |] November | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] December | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] January | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | |]

| ¹ We acquired [removed: 8,500] [added: 33,389] shares of treasury stock during the quarter ended February [removed: 2, 2019.] [added: 1, 2020.] Treasury stock includes shares acquired from employees for tax withholding purposes related to vesting of restricted stock grants. All remaining shares were repurchased under our publicly announced stock repurchase program. | [added: | |]

In March 2019, our Board of Directors approved a [removed: new,] two-year $2.55 billion stock repurchase program through fiscal 2020.

[removed: Stockholder] [added: Stockholder] Return Performance [removed: Graph][added: Graph]

The graph below compares total stockholder returns over the last five years for our common stock [removed: with] [added: to] the Standard & Poor’s [removed: (“S&P”)] 500 [removed: Index,] [added: Index (“S&P Index”)] and the Dow Jones Apparel Retailers Index.

The cumulative total return listed below assumed an initial investment of $100 and reinvestment of dividends at each fiscal [removed: year end,] [added: year-end,] and measures the performance of this investment as of the last trading day in the month of January for each of the following five years.

[removed: COMPARISON] [added: COMPARISON] OF 5 YEAR CUMULATIVE TOTAL [removed: RETURN][added: RETURN]

[removed: ][added: ]

| | | | | | [removed: Indexed] [added: | | | | | | | Indexed] Returns for Years [removed: Ended] [added: Ended] | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| | | [removed: Base Period] | | | | [added: Base Period] | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Company / Index] [added: Company/Index] | | [removed: 2014] | | | [removed: 2015] | [added: 2015] | | [removed: 2016] | | | [removed: 2017] | [added: 2016] | | [removed: 2018] | | | [removed: 2019] | [added: 2017] | [added: | | | | | 2018 | | | | | | 2019 | | | | | | 2020 | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Dow] [added: Dow] Jones Apparel [removed: Retailers] [added: Retailers] | | [removed: 100] | | | [removed: 121] | [added: 100] | | [removed: 120] | | | [removed: 118] | [added: 99] | | [removed: 134] | | | [removed: 146] | [added: 97] | [added: | | | | | 111 | | | | | | 120 | | | | | | 134 | | | | | | | | | | | | | | | | | | | | | | | | | | |]

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | (11/03/2019 - 11/30/2019) | | | | | | 684,197 | | | | | | $112.94 | | | | | | 684,197 | | | | | | $1,506,818 | | | | | | | | |

| | | | (12/01/2019 - 01/04/2020) | | | | | | 1,103,752 | | | | | | $115.01 | | | | | | 1,103,752 | | | | | | $1,379,870 | | | | | | | | |

| | | | (01/05/2020 - 02/01/2020) | | | | | | 926,215 | | | | | | $117.27 | | | | | | 892,826 | | | | | | $1,275,000 | | | | | | | | |

| | | | Total | | | | | | 2,714,164 | | | | | | $115.26 | | | | | | 2,680,775 | | | | | | $1,275,000 | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | |

| --- | --- | --- |

Due to the current economic uncertainty stemming from the COVID-19 pandemic, we have temporarily suspended our stock repurchase program as of March 2020, and plan to continue to monitor the situation based on business conditions and regard for our financial liquidity needs.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Ross Stores, Inc. | | | | | | 100 | | | | | | 124 | | | | | | 145 | | | | | | 177 | | | | | | 208 | | | | | | 257 | | | | | | | | | | | | | | | | | | | | | | | | | | |

| S&P 500 Index | | | | | | 100 | | | | | | 99 | | | | | | 119 | | | | | | 151 | | | | | | 147 | | | | | | 179 | | | | | | | | | | | | | | | | | | | | | | | | | | |

General information.

Cash dividends.

Issuer purchases of equity securities.

| | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| (11/04/2018 - 12/01/2018) | | 749,726 | | | $94.24 | | 749,726 | | | $197,842 | |

| (12/02/2018 - 01/05/2019) | | 1,352,850 | | | $80.60 | | 1,344,392 | | | $89,500 | |

| (01/06/2019 - 02/02/2019) | | 982,600 | | | $91.09 | | 982,558 | | | $0 | |

| Total | | 3,085,176 | | | $87.26 | | 3,076,676 | | | $0 | |

| |

| --- |

| | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Ross Stores, Inc. | | 100 | | | 136 | | | 169 | | | 198 | | | 242 | | | 284 | |

| S&P 500 Index | | 100 | | | 114 | | | 113 | | | 136 | | | 172 | | | 168 | |

| [added: | | |] ($000, except per share data) | [added: | | 2019 | | | | | |] 2018 | | | | [added: | |] 2017 [removed: 1] | | | [added: ¹] | [added: | |] 2016 | | | | [added: | |] 2015 | | | | [removed: 2014] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Operations] | | | [added: Operations] | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Sales | [added: | | $ | 16,039,073 | | | | |] $ | 14,983,541 | | | [added: | |] $ | 14,134,732 | | | [added: | |] $ | 12,866,757 | | | [added: | |] $ | 11,939,999 | | | [removed: $] | [removed: 11,041,677] | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Cost of goods sold | [added: | | 11,536,187 | | | | | |] 10,726,277 | | | | [added: | |] 10,042,638 | | | | [added: | |] 9,173,705 | | | | [added: | |] 8,576,873 | | | | [removed: 7,937,956] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Percent] [added: | | | Percent] of [removed: sales] [added: sales] | [added: | | 71.9 | | % | | | |] 71.6 | | % | | [added: | |] 71.0 | | % | | [added: | |] 71.3 | | % | | [added: | |] 71.8 | | % | | [removed: 71.9] | | [removed: %] | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Selling, general and administrative | [added: | | 2,356,704 | | | | | |] 2,216,550 | | | | [added: | |] 2,043,698 | | | | [added: | |] 1,890,408 | | | | [added: | |] 1,738,755 | | | | [removed: 1,615,371] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Percent] [added: | | | Percent] of [removed: sales] [added: sales] | [added: | | 14.7 | | % | | | |] 14.8 | | % | | [added: | |] 14.5 | | % | | [added: | |] 14.7 | | % | | [added: | |] 14.6 | | % | | [removed: 14.6] | | [removed: %] | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Interest (income) expense, net | [removed: (10,162] | | [removed: )] [added: (18,106)] | | [added: | | | | (10,162) | | | | | |] 7,676 | | | | [added: | |] 16,488 | | | | [added: | |] 12,612 | | | | [removed: 2,984] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Earnings before taxes | [added: | | 2,164,288 | | | | | |] 2,050,876 | | | | [added: | |] 2,040,720 | | | | [added: | |] 1,786,156 | | | | [added: | |] 1,611,759 | | | | [removed: 1,485,366] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Percent] [added: | | | Percent] of [removed: sales] [added: sales] | [added: | | 13.5 | | % | | | |] 13.7 | | % | | [added: | |] 14.4 | | % | | [added: | |] 13.9 | | % | | [added: | |] 13.5 | | % | | [removed: 13.5] | | [removed: %] | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Provision for taxes on earnings | [added: | | 503,360 | | | | | |] 463,419 | | | | [added: | |] 677,967 | | | | [added: | |] 668,502 | | | | [added: | |] 591,098 | | | | [removed: 560,642] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Net earnings | [added: | | $ | 1,660,928 | | | | |] $ | 1,587,457 | | | [added: | |] $ | 1,362,753 | | | [added: | |] $ | 1,117,654 | | | [added: | |] $ | 1,020,661 | | | [removed: $] | [removed: 924,724] | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Percent] [added: | | | Percent] of [removed: sales] [added: sales] | [added: | | 10.4 | | % | | | |] 10.6 | | % | | [added: | |] 9.6 | | % | | [added: | |] 8.7 | | % | | [added: | |] 8.5 | | % | | [removed: 8.4] | | [removed: %] | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Basic earnings per share² | [added: | | $ | 4.63 | | 5 | | |] $ | 4.30 | | 4 | [added: | |] $ | 3.58 | | 3 | [added: | |] $ | 2.85 | | | [added: | |] $ | 2.53 | | | [removed: $] | [removed: 2.24] | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Diluted earnings per share² | [added: | | $ | 4.60 | | 5 | | |] $ | 4.26 | | 4 | [added: | |] $ | 3.55 | | 3 | [added: | |] $ | 2.83 | | | [added: | |] $ | 2.51 | | | [removed: $] | [removed: 2.21] | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] Cash dividends declared | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] ¹ Fiscal 2017 was a 53-week year; all other fiscal years presented were 52 weeks. | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] ² All per share amounts have been adjusted for the two-for-one stock split effective June 11, 2015. | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] 3 Includes a per share benefit of approximately $0.21 from tax reform legislation enacted in December 2017 and $0.10 from the 53rd week. | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [added: | | |] 4 Includes a per share benefit of approximately $0.70 from tax reform legislation enacted in December 2017 and $0.07 from the favorable resolution of a tax matter. | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

[removed: Selected] [added: Selected] Financial [removed: Data][added: Data]

| ($000, except per share data) | | [added: | | | | 2019 | | | | | |] 2018 | | | | [added: | |] 2017 [removed: 1] | | | [added: ¹] | [added: | |] 2016 | | | | [added: | |] 2015 | | | | [removed: 2014] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Financial Position] [added: Financial Position] | | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Cash and cash equivalents | | [added: | | | | $ | 1,351,205 | | | | |] $ | 1,412,912 | | | [added: | |] $ | 1,290,294 | | | [added: | |] $ | 1,111,599 | | | [added: | |] $ | 761,602 | | | [removed: $] | [removed: 696,608] | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Merchandise inventory | | [added: | | | | 1,832,339 | | | | | |] 1,750,442 | | | | [added: | |] 1,641,735 | | | | [added: | |] 1,512,886 | | | | [added: | |] 1,419,104 | | | | [removed: 1,372,675] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Property and equipment, net | | [added: | | | | 2,653,436 | | | | | |] 2,475,201 | | | | [added: | |] 2,382,464 | | | | [added: | |] 2,328,048 | | | | [added: | |] 2,342,906 | | | | [removed: 2,273,752] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Total assets | | [added: | | | | 9,348,367 | | | 2 | | |] 6,073,691 | | | | [added: | |] 5,722,051 | | | | [added: | |] 5,309,351 | | | | [added: | |] 4,869,119 | | | | [removed: 4,687,370] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Return on average assets | | [added: | | | | 22 | | % | 2 | | |] 27 | | % | | [added: | |] 25 | | % | | [added: | |] 22 | | % | | [added: | |] 21 | | % | | [removed: 22] | | [removed: %] | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Working capital | | [added: | | | | 730,894 | | | 2 | | |] 1,394,535 | | | | [added: | |] 1,224,755 | | | | [added: | |] 1,060,543 | | | | [added: | |] 769,348 | | | | [removed: 590,471] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Current ratio | | [added: | | | | 1.3:1 | | | 2 | | |] 1.7:1 | | | | [added: | |] 1.6:1 | | | | [added: | |] 1.6:1 | | | | [added: | |] 1.5:1 | | | | [removed: 1.4:1] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Long-term debt | | [added: | | | | 312,891 | | | | | |] 312,440 | | | | [added: | |] 396,967 | | | | [added: | |] 396,493 | | | | [added: | |] 396,025 | | | | [removed: 395,562] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Long-term debt as a percent | | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| of total capitalization | | [added: | | | | 9 | | % | | | |] 9 | | % | | [added: | |] 12 | | % | | [added: | |] 13 | | % | | [added: | |] 14 | | % | | [removed: 15] | | [removed: %] | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Stockholders’ equity | | [added: | | | | 3,359,249 | | | | | |] 3,305,746 | | | | [added: | |] 3,049,308 | | | | [added: | |] 2,748,017 | | | | [added: | |] 2,471,991 | | | | [removed: 2,279,210] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Return on average | | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| stockholders’ equity | | [added: | | | | 50 | | % | | | |] 50 | | % | | [added: | |] 47 | | % | | [added: | |] 43 | | % | | [added: | |] 43 | | % | | [removed: 43] | | [removed: %] | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Book value per common share | | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| outstanding at [removed: year-end2] [added: year-end3] | | [added: | | | | $ | 9.42 | | | | |] $ | 8.98 | | | [added: | |] $ | 8.03 | | | [added: | |] $ | 7.01 | | | [added: | |] $ | 6.14 | | | [removed: $] | [removed: 5.49] | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| [removed: Operating Statistics] [added: Operating Statistics] | | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Number of stores opened | | [added: | | | | 98 | | | | | |] 99 | | | | [added: | |] 96 | | | | [added: | |] 93 | | | | [added: | |] 90 | | | | [removed: 95] | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | per common share² | | | $ | 1.02 | | | | | $ | 0.90 | | | | | $ | 0.64 | | | | | $ | 0.54 | | | | | $ | 0.47 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | 5 Includes a per share benefit of approximately $0.02 primarily related to the favorable resolution of a tax matter. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| 2 Fiscal 2019 reflects the impact of adoption of ASU 2016-02, *Leases* (Accounting Standards Codification "ASC" 842) on a modified retrospective basis; all other fiscal years presented were not restated. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| 4 Includes the temporary closure of a store impacted by a weather event. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| per common share² | $ | 0.900 | | | $ | 0.640 | | | $ | 0.540 | | | $ | 0.470 | | | $ | 0.400 | | |

| | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

[removed: Consolidated] [added: Consolidated] Statements of [removed: Earnings][added: Earnings]

| | | [removed: Year Ended] | | | | [added: Year Ended | | | | | |] Year Ended | | | | [added: | |] Year Ended | | | [added: | | | | | | | | | | | | | | | | | |]

| ($000, except per share data) | | [added: | | | | February 1, 2020 | | | | | |] February 2, 2019 | | | | [added: | |] February 3, 2018 | | | | [removed: January 28, 2017] | | | [added: | | | | | | | | | | | | | |]

| [removed: Sales] [added: Sales] | | [added: | | | | $ | 16,039,073 | | | | |] $ | 14,983,541 | | | [added: | |] $ | 14,134,732 | | | [removed: $] | [removed: 12,866,757] | | [added: | | | | | | | | | | | | | |]