ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from __________
to __________
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Commission file number:
0-14678
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Delaware
|
|
94-1390387
|
(State or other jurisdiction of incorporation or
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(I.R.S. Employer Identification No.)
|
organization)
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||
5130 Hacienda Drive, Dublin, California
|
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94568-7579
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(Address of principal executive offices)
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(Zip Code)
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||
Registrant's telephone number, including area code
|
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(925) 965-4400
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||
Former name, former address and former fiscal year, if
|
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N/A
|
changed since last report.
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|
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Three Months Ended
|
|
Six Months Ended
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||||||||||||
($000, except stores and per share data, unaudited)
|
August 1, 2015
|
|
|
August 2, 2014
|
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August 1, 2015
|
|
|
August 2, 2014
|
|
||||
Sales
|
$
|
2,968,270
|
|
|
$
|
2,729,566
|
|
|
$
|
5,906,418
|
|
|
$
|
5,410,159
|
|
|
|
|
|
|
|
|
|
||||||||
Costs and Expenses
|
|
|
|
|
|
|
|
||||||||
Cost of goods sold
|
2,119,480
|
|
|
1,944,017
|
|
|
4,186,935
|
|
|
3,852,202
|
|
||||
Selling, general and administrative
|
435,226
|
|
|
395,225
|
|
|
844,524
|
|
|
775,027
|
|
||||
Interest expense (income), net
|
1,652
|
|
|
(95
|
)
|
|
3,655
|
|
|
(200
|
)
|
||||
Total costs and expenses
|
2,556,358
|
|
|
2,339,147
|
|
|
5,035,114
|
|
|
4,627,029
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings before taxes
|
411,912
|
|
|
390,419
|
|
|
871,304
|
|
|
783,130
|
|
||||
Provision for taxes on earnings
|
153,273
|
|
|
150,858
|
|
|
330,460
|
|
|
299,656
|
|
||||
Net earnings
|
$
|
258,639
|
|
|
$
|
239,561
|
|
|
$
|
540,844
|
|
|
$
|
483,474
|
|
|
|
|
|
|
|
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||||||||
Earnings per share
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.64
|
|
|
$
|
0.58
|
|
|
$
|
1.33
|
|
|
$
|
1.16
|
|
Diluted
|
$
|
0.63
|
|
|
$
|
0.57
|
|
|
$
|
1.32
|
|
|
$
|
1.15
|
|
|
|
|
|
|
|
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||||||||
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|
|
|
|
|
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||||||||
Weighted average shares outstanding (000)
|
|
|
|
|
|
|
|
||||||||
Basic
|
404,760
|
|
|
415,130
|
|
|
406,211
|
|
|
416,514
|
|
||||
Diluted
|
407,693
|
|
|
419,305
|
|
|
409,562
|
|
|
421,213
|
|
||||
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Dividends
|
|
|
|
|
|
|
|
||||||||
Cash dividends declared per share
|
$
|
0.1175
|
|
|
$
|
0.1000
|
|
|
$
|
0.2350
|
|
|
$
|
0.2000
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Stores open at end of period
|
1,424
|
|
|
1,338
|
|
|
1,424
|
|
|
1,338
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
($000, unaudited)
|
August 1, 2015
|
|
|
August 2, 2014
|
|
|
August 1, 2015
|
|
|
August 2, 2014
|
|
||||
Net earnings
|
$
|
258,639
|
|
|
$
|
239,561
|
|
|
$
|
540,844
|
|
|
$
|
483,474
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
||||||||
Change in unrealized loss on investments, net of tax
|
(25
|
)
|
|
(14
|
)
|
|
(107
|
)
|
|
(47
|
)
|
||||
Comprehensive income
|
$
|
258,614
|
|
|
$
|
239,547
|
|
|
$
|
540,737
|
|
|
$
|
483,427
|
|
($000, unaudited)
|
August 1, 2015
|
|
|
January 31, 2015
|
|
|
August 2, 2014
|
|
|||
Assets
|
|
|
|
|
|
||||||
Current Assets
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
630,288
|
|
|
$
|
696,608
|
|
|
$
|
549,784
|
|
Short-term investments
|
999
|
|
|
500
|
|
|
—
|
|
|||
Accounts receivable
|
88,443
|
|
|
73,278
|
|
|
85,218
|
|
|||
Merchandise inventory
|
1,509,752
|
|
|
1,372,675
|
|
|
1,258,820
|
|
|||
Prepaid expenses and other
|
129,819
|
|
|
106,778
|
|
|
115,953
|
|
|||
Deferred income taxes
|
10,732
|
|
|
12,951
|
|
|
14,090
|
|
|||
Total current assets
|
2,370,033
|
|
|
2,262,790
|
|
|
2,023,865
|
|
|||
|
|
|
|
|
|
||||||
Property and Equipment
|
|
|
|
|
|
||||||
Land and buildings
|
1,083,430
|
|
|
952,428
|
|
|
626,708
|
|
|||
Fixtures and equipment
|
2,091,316
|
|
|
1,933,383
|
|
|
1,760,417
|
|
|||
Leasehold improvements
|
889,893
|
|
|
854,572
|
|
|
827,073
|
|
|||
Construction-in-progress
|
95,178
|
|
|
293,715
|
|
|
416,810
|
|
|||
|
4,159,817
|
|
|
4,034,098
|
|
|
3,631,008
|
|
|||
Less accumulated depreciation and amortization
|
1,870,339
|
|
|
1,760,346
|
|
|
1,651,720
|
|
|||
Property and equipment, net
|
2,289,478
|
|
|
2,273,752
|
|
|
1,979,288
|
|
|||
|
|
|
|
|
|
||||||
Long-term investments
|
2,613
|
|
|
3,110
|
|
|
3,660
|
|
|||
Other long-term assets
|
162,180
|
|
|
160,669
|
|
|
160,727
|
|
|||
Total assets
|
$
|
4,824,304
|
|
|
$
|
4,700,321
|
|
|
$
|
4,167,540
|
|
|
|
|
|
|
|
||||||
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
||||||
Current Liabilities
|
|
|
|
|
|
||||||
Accounts payable
|
$
|
1,044,875
|
|
|
$
|
1,000,700
|
|
|
$
|
967,915
|
|
Accrued expenses and other
|
405,629
|
|
|
385,325
|
|
|
367,451
|
|
|||
Accrued payroll and benefits
|
225,153
|
|
|
256,141
|
|
|
189,585
|
|
|||
Income taxes payable
|
—
|
|
|
17,202
|
|
|
7,170
|
|
|||
Total current liabilities
|
1,675,657
|
|
|
1,659,368
|
|
|
1,532,121
|
|
|||
|
|
|
|
|
|
||||||
Long-term debt
|
395,793
|
|
|
395,562
|
|
|
149,708
|
|
|||
Other long-term liabilities
|
287,406
|
|
|
279,500
|
|
|
283,584
|
|
|||
Deferred income taxes
|
78,934
|
|
|
86,681
|
|
|
52,800
|
|
|||
|
|
|
|
|
|
||||||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
||||||
Stockholders’ Equity
|
|
|
|
|
|
||||||
Common stock
|
4,087
|
|
|
4,149
|
|
|
4,204
|
|
|||
Additional paid-in capital
|
1,080,108
|
|
|
1,013,607
|
|
|
978,748
|
|
|||
Treasury stock
|
(224,194
|
)
|
|
(160,600
|
)
|
|
(159,164
|
)
|
|||
Accumulated other comprehensive income
|
223
|
|
|
330
|
|
|
342
|
|
|||
Retained earnings
|
1,526,290
|
|
|
1,421,724
|
|
|
1,325,197
|
|
|||
Total stockholders’ equity
|
2,386,514
|
|
|
2,279,210
|
|
|
2,149,327
|
|
|||
Total liabilities and stockholders’ equity
|
$
|
4,824,304
|
|
|
$
|
4,700,321
|
|
|
$
|
4,167,540
|
|
|
Six Months Ended
|
||||||
($000, unaudited)
|
August 1, 2015
|
|
|
August 2, 2014
|
|
||
Cash Flows From Operating Activities
|
|
|
|
||||
Net earnings
|
$
|
540,844
|
|
|
$
|
483,474
|
|
Adjustments to reconcile net earnings to net cash provided
by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
128,729
|
|
|
110,670
|
|
||
Stock-based compensation
|
29,881
|
|
|
25,095
|
|
||
Deferred income taxes
|
(5,528
|
)
|
|
(9,934
|
)
|
||
Tax benefit from equity issuance
|
37,431
|
|
|
24,061
|
|
||
Excess tax benefit from stock-based compensation
|
(37,352
|
)
|
|
(23,755
|
)
|
||
Change in assets and liabilities:
|
|
|
|
||||
Merchandise inventory
|
(137,077
|
)
|
|
(1,665
|
)
|
||
Other current assets
|
(38,097
|
)
|
|
(34,536
|
)
|
||
Accounts payable
|
64,802
|
|
|
189,896
|
|
||
Other current liabilities
|
111
|
|
|
(12,101
|
)
|
||
Other long-term, net
|
6,627
|
|
|
(9,414
|
)
|
||
Net cash provided by operating activities
|
590,371
|
|
|
741,791
|
|
||
|
|
|
|
||||
Cash Flows From Investing Activities
|
|
|
|
||||
Additions to property and equipment
|
(193,108
|
)
|
|
(253,350
|
)
|
||
Increase in restricted cash and investments
|
(73
|
)
|
|
(7,043
|
)
|
||
Purchases of investments
|
(718
|
)
|
|
—
|
|
||
Proceeds from investments
|
602
|
|
|
12,022
|
|
||
Net cash used in investing activities
|
(193,297
|
)
|
|
(248,371
|
)
|
||
|
|
|
|
||||
Cash Flows From Financing Activities
|
|
|
|
||||
Excess tax benefit from stock-based compensation
|
37,352
|
|
|
23,755
|
|
||
Issuance of common stock related to stock plans
|
11,312
|
|
|
9,318
|
|
||
Treasury stock purchased
|
(63,601
|
)
|
|
(37,605
|
)
|
||
Repurchase of common stock
|
(351,515
|
)
|
|
(277,391
|
)
|
||
Dividends paid
|
(96,942
|
)
|
|
(84,881
|
)
|
||
Net cash used in financing activities
|
(463,394
|
)
|
|
(366,804
|
)
|
||
|
|
|
|
||||
Net (decrease) increase in cash and cash equivalents
|
(66,320
|
)
|
|
126,616
|
|
||
|
|
|
|
||||
Cash and cash equivalents:
|
|
|
|
||||
Beginning of period
|
696,608
|
|
|
423,168
|
|
||
End of period
|
$
|
630,288
|
|
|
$
|
549,784
|
|
|
|
|
|
||||
Supplemental Cash Flow Disclosures
|
|
|
|
||||
Interest paid
|
$
|
8,982
|
|
|
$
|
4,834
|
|
Income taxes paid
|
$
|
322,294
|
|
|
$
|
299,762
|
|
Restricted Assets ($000)
|
August 1, 2015
|
|
|
January 31, 2015
|
|
|
August 2, 2014
|
|
|||
Prepaid expenses and other
|
$
|
19,719
|
|
|
$
|
19,713
|
|
|
$
|
22,766
|
|
Other long-term assets
|
56,125
|
|
|
56,107
|
|
|
55,737
|
|
|||
Total
|
$
|
75,844
|
|
|
$
|
75,820
|
|
|
$
|
78,503
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
August 1, 2015
|
|
|
August 2, 2014
|
|
|
August 1, 2015
|
|
|
August 2, 2014
|
|
Ladies
|
30
|
%
|
|
31
|
%
|
|
30
|
%
|
|
31
|
%
|
Home Accents and Bed and Bath
|
23
|
%
|
|
22
|
%
|
|
23
|
%
|
|
22
|
%
|
Men's
|
14
|
%
|
|
14
|
%
|
|
13
|
%
|
|
13
|
%
|
Shoes
|
13
|
%
|
|
13
|
%
|
|
13
|
%
|
|
13
|
%
|
Accessories, Lingerie, Fine Jewelry, and Fragrances
|
13
|
%
|
|
12
|
%
|
|
13
|
%
|
|
13
|
%
|
Children's
|
7
|
%
|
|
8
|
%
|
|
8
|
%
|
|
8
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
($000)
|
|
August 1, 2015
|
|
|
January 31, 2015
|
|
|
August 2, 2014
|
|
|||
Cash and cash equivalents
|
|
|
|
|
|
|
||||||
Level 1
|
|
$
|
630,288
|
|
|
$
|
696,608
|
|
|
$
|
549,784
|
|
|
|
|
|
|
|
|
||||||
Investments
|
|
|
|
|
|
|
||||||
Level 2
|
|
3,612
|
|
|
3,610
|
|
|
3,660
|
|
|||
|
|
|
|
|
|
|
||||||
Restricted cash and cash equivalents
|
|
|
|
|
|
|
||||||
Level 1
|
|
$
|
72,076
|
|
|
$
|
71,992
|
|
|
$
|
74,586
|
|
|
|
|
|
|
|
|
||||||
Restricted investments
|
|
|
|
|
|
|
||||||
Level 1
|
|
$
|
3,768
|
|
|
$
|
3,828
|
|
|
$
|
3,805
|
|
Level 2
|
|
—
|
|
|
—
|
|
|
112
|
|
|||
|
|
|
|
|
|
|
($000)
|
August 1, 2015
|
|
|
January 31, 2015
|
|
|
August 2, 2014
|
|
|||
Level 1
|
$
|
82,953
|
|
|
$
|
81,926
|
|
|
$
|
79,753
|
|
Level 2
|
12,842
|
|
|
12,128
|
|
|
13,638
|
|
|||
Total
|
$
|
95,795
|
|
|
$
|
94,054
|
|
|
$
|
93,391
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
||||||||||||
($000)
|
August 1, 2015
|
|
|
August 2, 2014
|
|
|
|
August 1, 2015
|
|
|
August 2, 2014
|
|
||||
Restricted stock
|
$
|
9,395
|
|
|
$
|
8,550
|
|
|
|
$
|
17,969
|
|
|
$
|
16,502
|
|
Performance awards
|
5,537
|
|
|
3,960
|
|
|
|
10,642
|
|
|
7,485
|
|
||||
Employee stock purchase plan
|
662
|
|
|
550
|
|
|
|
1,270
|
|
|
1,108
|
|
||||
Total
|
$
|
15,594
|
|
|
$
|
13,060
|
|
|
|
$
|
29,881
|
|
|
$
|
25,095
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
||||||||||||
Statements of Earnings Classification ($000)
|
August 1, 2015
|
|
|
August 2, 2014
|
|
|
|
August 1, 2015
|
|
|
August 2, 2014
|
|
||||
Cost of goods sold
|
$
|
7,420
|
|
|
$
|
7,085
|
|
|
|
$
|
14,483
|
|
|
$
|
13,263
|
|
Selling, general and administrative
|
8,174
|
|
|
5,975
|
|
|
|
15,398
|
|
|
11,832
|
|
||||
Total
|
$
|
15,594
|
|
|
$
|
13,060
|
|
|
|
$
|
29,881
|
|
|
$
|
25,095
|
|
(000, except per share data)
|
Number of
shares
|
|
|
Weighted
average
grant date
fair value
|
|
|
Unvested at January 31, 2015
|
6,982
|
|
|
$
|
24.01
|
|
Awarded
|
1,830
|
|
|
51.95
|
|
|
Released
|
(2,480
|
)
|
|
16.71
|
|
|
Forfeited
|
(354
|
)
|
|
29.43
|
|
|
Unvested at August 1, 2015
|
5,978
|
|
|
$
|
33.61
|
|
(000, except per share data)
|
Number of
shares
|
|
|
Weighted average
exercise price
|
|
|
Weighted average remaining contractual term
|
|
Aggregate intrinsic value
|
|
||
Outstanding at January 31, 2015
|
1,038
|
|
|
$
|
7.05
|
|
|
|
|
|
||
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
(594
|
)
|
|
6.95
|
|
|
|
|
|
|||
Forfeited
|
—
|
|
|
—
|
|
|
|
|
|
|||
Outstanding at August 1, 2015, all vested
|
444
|
|
|
$
|
7.19
|
|
|
0.89
|
|
$
|
20,402
|
|
|
|
|
|
Options outstanding and exercisable
|
|||||||||||
Exercise price range
|
|
Number of shares
|
|
|
Remaining life
|
|
Exercise price
|
|
|||||||
$
|
5.90
|
|
to
|
$
|
6.89
|
|
|
118
|
|
|
0.65
|
|
$
|
6.68
|
|
6.95
|
|
to
|
6.95
|
|
|
161
|
|
|
0.62
|
|
6.95
|
|
|||
7.04
|
|
to
|
7.63
|
|
|
61
|
|
|
0.55
|
|
7.19
|
|
|||
7.66
|
|
to
|
7.66
|
|
|
7
|
|
|
1.21
|
|
7.66
|
|
|||
8.19
|
|
to
|
8.19
|
|
|
97
|
|
|
1.81
|
|
8.19
|
|
|||
$
|
5.90
|
|
to
|
$
|
8.19
|
|
|
444
|
|
|
0.89
|
|
$
|
7.19
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
||||||||||||||||||||
Shares in (000s)
|
Basic EPS
|
|
|
Effect of
dilutive
common stock
equivalents
|
|
|
Diluted
EPS
|
|
|
|
Basic EPS
|
|
|
Effect of
dilutive
common
stock
equivalents
|
|
|
Diluted
EPS
|
|
||||||
August 1, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Shares
|
404,760
|
|
|
2,933
|
|
|
407,693
|
|
|
|
406,211
|
|
|
3,351
|
|
|
409,562
|
|
||||||
Amount
|
$
|
0.64
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.63
|
|
|
|
$
|
1.33
|
|
|
$
|
(0.01
|
)
|
|
$
|
1.32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
August 2, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Shares
|
415,130
|
|
|
4,175
|
|
|
419,305
|
|
|
|
416,514
|
|
|
4,699
|
|
|
421,213
|
|
||||||
Amount
|
$
|
0.58
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.57
|
|
|
|
$
|
1.16
|
|
|
$
|
(0.01
|
)
|
|
$
|
1.15
|
|
($000)
|
|
August 1, 2015
|
|
|
January 31, 2015
|
|
|
August 2, 2014
|
|
|||
6.38% Series A Senior Notes due 2018
|
|
$
|
84,889
|
|
|
$
|
84,873
|
|
|
$
|
84,857
|
|
6.53% Series B Senior Notes due 2021
|
|
64,872
|
|
|
64,861
|
|
|
64,851
|
|
|||
3.375% Senior Notes due 2024
|
|
246,032
|
|
|
245,828
|
|
|
—
|
|
|||
Total
|
|
$
|
395,793
|
|
|
$
|
395,562
|
|
|
$
|
149,708
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
||||||||||||
($000)
|
August 1, 2015
|
|
|
August 2, 2014
|
|
|
|
August 1, 2015
|
|
|
August 2, 2014
|
|
||||
Interest expense on long-term debt
|
$
|
4,642
|
|
|
$
|
2,430
|
|
|
|
$
|
9,284
|
|
|
$
|
4,860
|
|
Other interest expense
|
303
|
|
|
303
|
|
|
|
644
|
|
|
644
|
|
||||
Capitalized interest
|
(3,193
|
)
|
|
(2,731
|
)
|
|
|
(6,002
|
)
|
|
(5,502
|
)
|
||||
Interest income
|
(100
|
)
|
|
(97
|
)
|
|
|
(271
|
)
|
|
(202
|
)
|
||||
Interest expense (income), net
|
$
|
1,652
|
|
|
$
|
(95
|
)
|
|
|
$
|
3,655
|
|
|
$
|
(200
|
)
|
|
Three Months Ended
|
|
|
Six Months Ended
|
||||||||||||
|
August 1, 2015
|
|
|
August 2, 2014
|
|
|
|
August 1, 2015
|
|
|
August 2, 2014
|
|
||||
Sales
|
|
|
|
|
|
|
|
|
||||||||
Sales (millions)
|
$
|
2,968
|
|
|
$
|
2,729
|
|
|
|
$
|
5,906
|
|
|
$
|
5,410
|
|
Sales growth
|
8.7
|
%
|
|
7.0
|
%
|
|
|
9.2
|
%
|
|
6.3
|
%
|
||||
Comparable store sales growth
|
4
|
%
|
|
2
|
%
|
|
|
5
|
%
|
|
2
|
%
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Costs and expenses (as a percent of sales)
|
|
|
|
|
|
|
|
|
||||||||
Cost of goods sold
|
71.4
|
%
|
|
71.2
|
%
|
|
|
70.9
|
%
|
|
71.2
|
%
|
||||
Selling, general and administrative
|
14.7
|
%
|
|
14.5
|
%
|
|
|
14.3
|
%
|
|
14.3
|
%
|
||||
Interest expense (income), net
|
0.0
|
%
|
|
0.0
|
%
|
|
|
0.1
|
%
|
|
0.0
|
%
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Earnings before taxes (as a percent of sales)
|
13.9
|
%
|
|
14.3
|
%
|
|
|
14.7
|
%
|
|
14.5
|
%
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net earnings (as a percent of sales)
|
8.7
|
%
|
|
8.8
|
%
|
|
|
9.2
|
%
|
|
8.9
|
%
|
|
Three Months Ended
|
|
|
Six Months Ended
|
||||||||
Store Count
|
August 1, 2015
|
|
|
August 2, 2014
|
|
|
|
August 1, 2015
|
|
|
August 2, 2014
|
|
Beginning of the period
|
1,399
|
|
|
1,309
|
|
|
|
1,362
|
|
|
1,276
|
|
Opened in the period
|
27
|
|
|
30
|
|
|
|
64
|
|
|
67
|
|
Closed in the period
|
(2
|
)
|
|
(1
|
)
|
|
|
(2
|
)
|
|
(5
|
)
|
End of the period
|
1,424
|
|
|
1,338
|
|
|
|
1,424
|
|
|
1,338
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
August 1, 2015
|
|
|
August 2, 2014
|
|
|
August 1, 2015
|
|
|
August 2, 2014
|
|
Ladies
|
30
|
%
|
|
31
|
%
|
|
30
|
%
|
|
31
|
%
|
Home Accents and Bed and Bath
|
23
|
%
|
|
22
|
%
|
|
23
|
%
|
|
22
|
%
|
Men's
|
14
|
%
|
|
14
|
%
|
|
13
|
%
|
|
13
|
%
|
Shoes
|
13
|
%
|
|
13
|
%
|
|
13
|
%
|
|
13
|
%
|
Accessories, Lingerie, Fine Jewelry, and Fragrances
|
13
|
%
|
|
12
|
%
|
|
13
|
%
|
|
13
|
%
|
Children's
|
7
|
%
|
|
8
|
%
|
|
8
|
%
|
|
8
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
Three Months Ended
|
|
|
Six Months Ended
|
||||||||||||
($000)
|
August 1, 2015
|
|
|
August 2, 2014
|
|
|
|
August 1, 2015
|
|
|
August 2, 2014
|
|
||||
Interest expense on long-term debt
|
$
|
4,642
|
|
|
$
|
2,430
|
|
|
|
$
|
9,284
|
|
|
$
|
4,860
|
|
Other interest expense
|
303
|
|
|
303
|
|
|
|
644
|
|
|
644
|
|
||||
Capitalized interest
|
(3,193
|
)
|
|
(2,731
|
)
|
|
|
(6,002
|
)
|
|
(5,502
|
)
|
||||
Interest income
|
(100
|
)
|
|
(97
|
)
|
|
|
(271
|
)
|
|
(202
|
)
|
||||
Interest expense (income), net
|
$
|
1,652
|
|
|
$
|
(95
|
)
|
|
|
$
|
3,655
|
|
|
$
|
(200
|
)
|
|
Six Months Ended
|
||||||
($000)
|
August 1, 2015
|
|
|
August 2, 2014
|
|
||
Cash provided by operating activities
|
$
|
590,371
|
|
|
$
|
741,791
|
|
Cash used in investing activities
|
(193,297
|
)
|
|
(248,371
|
)
|
||
Cash used in financing activities
|
(463,394
|
)
|
|
(366,804
|
)
|
||
Net (decrease) increase in cash and cash equivalents
|
$
|
(66,320
|
)
|
|
$
|
126,616
|
|
($000)
|
Less than
one year
|
|
|
1 - 3
years
|
|
|
3 - 5
years
|
|
|
After 5
years
|
|
|
Total¹
|
|
|||||
|
|
|
|
||||||||||||||||
Senior notes
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
85,000
|
|
|
$
|
315,000
|
|
|
$
|
400,000
|
|
Interest payment obligations
|
18,105
|
|
|
36,210
|
|
|
27,398
|
|
|
43,805
|
|
|
125,518
|
|
|||||
Operating leases (rent obligations)
|
446,099
|
|
|
860,058
|
|
|
579,727
|
|
|
491,984
|
|
|
2,377,868
|
|
|||||
New York buying office ground lease
²
|
6,418
|
|
|
12,835
|
|
|
12,835
|
|
|
955,777
|
|
|
987,865
|
|
|||||
Purchase obligations
|
2,046,400
|
|
|
13,351
|
|
|
—
|
|
|
—
|
|
|
2,059,751
|
|
|||||
Total contractual obligations
|
$
|
2,517,022
|
|
|
$
|
922,454
|
|
|
$
|
704,960
|
|
|
$
|
1,806,566
|
|
|
$
|
5,951,002
|
|
|
Amount of Commitment Expiration Per Period
|
|
|
||||||||||||||||
|
Less than 1
year |
|
|
|
|
|
|
|
|
Total amount
committed |
|
||||||||
($000)
|
|
1 - 3 years
|
|
|
3 - 5 years
|
|
|
After 5 years
|
|
|
|||||||||
Revolving credit facility
|
$
|
—
|
|
|
$
|
600,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
600,000
|
|
Total commercial commitments
|
$
|
—
|
|
|
$
|
600,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
600,000
|
|
•
|
Competitive pressures in the apparel and home-related merchandise retailing industry are high.
|
•
|
Unexpected changes may occur in the level of consumer spending on or preferences for apparel or home-related merchandise.
|
•
|
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 prices.
|
•
|
We are subject to impacts from the macro-economic environment, financial and credit markets, and geopolitical conditions that affect consumer confidence and consumer disposable income.
|
•
|
We must continually attract, train, and retain associates with the retail talent necessary to execute our off-price retail strategies.
|
•
|
Unseasonable weather may affect shopping patterns and consumer demand for seasonal apparel and other merchandise.
|
•
|
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. A breach of our data security, or our failure or delay in detecting and mitigating a loss of personal or business information, could result in damage to our reputation, loss of customer confidence, violation (or alleged violation) of applicable laws, and expose us to civil claims, litigation and regulatory action, and to unanticipated costs and disruption of our operations.
|
•
|
Disruptions in our supply chain or in our information systems could impact our ability to process sales and to distribute merchandise to our stores in a timely and cost-effective manner.
|
•
|
Issues involving the quality, safety, or authenticity of products we sell could increase our costs and/or adversely impact our sales.
|
•
|
In order to achieve our planned gross margins, we must effectively manage our inventories, markdowns, and inventory shortage.
|
•
|
We may experience volatility in revenues and earnings.
|
•
|
An adverse outcome in various legal, regulatory, or tax matters could negatively impact our business.
|
•
|
A natural or man-made disaster in California or in another region where we have a concentration of stores or a distribution center could harm our business.
|
•
|
Our labor costs may increase as a result of industry trends and minimum wage requirements.
|
•
|
To achieve growth, we need to expand in existing markets and enter new geographic markets where we are less well known.
|
•
|
We need to obtain acceptable new store sites with favorable demographics to achieve our planned growth.
|
•
|
Damage to our corporate reputation or brands could adversely affect our sales and operating results.
|
•
|
We are subject to risks associated with importing merchandise from other countries.
|
•
|
To support our continuing operations, our new store and distribution center growth plans, and our stock repurchase program and dividend programs, we must maintain sufficient liquidity.
|
|
Total number of
shares
(or units)
purchased
1,2
|
|
|
Average price
paid per share
(or unit)
1
|
|
Total number of
shares
(or units)
purchased as
part of publicly
announced
plans or
programs
|
|
|
Maximum number
(or approximate
dollar value) of
shares (or units)
that may yet be
purchased under
the plans or
programs ($000)
3
|
Period
|
|
|
|
||||||
May
|
|
|
|
|
|
|
|
||
(5/03/2015 - 5/30/2015)
|
874,272
|
|
|
$49.88
|
|
849,594
|
|
|
$1,181,800
|
June
|
|
|
|
|
|
|
|
||
(5/31/2015 - 7/04/2015)
|
1,484,585
|
|
|
$49.28
|
|
1,475,558
|
|
|
$1,109,100
|
July
|
|
|
|
|
|
|
|
||
(7/05/2015 - 8/01/2015)
|
1,165,646
|
|
|
$51.99
|
|
1,165,646
|
|
|
$1,048,500
|
Total
|
3,524,503
|
|
|
$50.33
|
|
3,490,798
|
|
|
|
|
|
ROSS STORES, INC.
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
Date:
|
September 9, 2015
|
By:
|
/s/Michael J. Hartshorn
|
|
|
|
Michael J. Hartshorn
|
|
|
|
Group Senior Vice President,
Chief
Financial
Officer, and Principal Accounting Officer
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ROSS STORES, INC.
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By:
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/s/J.Call
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John G. Call
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Corporate Secretary
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ROSS STORES, INC.
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By:
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/s/Mark LeHocky
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Mark LeHocky, Senior Vice President
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General Counsel & Corporate Secretary
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ROSS STORES, INC.
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By:
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/s/J.Call
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John G. Call
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Senior Vice President,
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Chief Financial Officer and Corporate Secretary
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ROSS STORES, INC.
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By:
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/s/J.Call
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John G. Call
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Senior Vice President,
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Chief Financial Officer and Corporate Secretary
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1.
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The name of the corporation is ROSS STORES, INC.
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2.
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That a First Restated Certificate of Incorporation of Ross Stores, Inc. (the “Restated Certificate”) was filed by the Secretary of State of Delaware on June 4, 1998 and that said Restated Certificate requires correction as permitted by Section 103 of the General Corporation Law of the State of Delaware.
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3.
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The inaccuracy or defect of said Restated Certificate to be corrected is as follows:
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ROSS STORES, INC., a Delaware corporation
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By:
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/s/Susan L. Thorner
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Susan L. Thorner
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Director, Corporate Affairs and Assistant Secretary
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/s/Deon Riley
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Deon Riley
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Senior Vice President, Human Resources
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I.
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Paragraph 2 of the Employment Agreement is hereby amended by replacing “May 31, 2016” with “May 31, 2018”.
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II.
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The third sentence of Paragraph 2 of the Employment Agreement is amended to read as follows:
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III.
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Paragraph 4(a) of the Employment Agreement is hereby amended by replacing “May 31, 2016” with “March 15, 2015” in subsection (ii) and adding the following new subsection (iii): “and (iii) One Million One Hundred Thousand Dollars ($1,100,000) per annum during the period from March 15, 2015 through May 31, 2018.”
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IV.
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Paragraph 4(i) of the Employment Agreement is hereby amended by adding the phrase “(including claims administration support)” immediately after the phrase “”behavioral health insurance” in the first sentence thereof.
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V.
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Paragraph 4 of the Employment Agreement is hereby amended by adding new subsection (q) at the end thereof as follows:
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VI.
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Paragraph 14 of the Employment Agreement is hereby amended by changing the address of the Company to “5130 Hacienda Drive, Dublin, California 94568.”
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ROSS STORES, INC.
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EXECUTIVE
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/s/George P. Orban
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/s/Michael Balmuth
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By:
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George Orban
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Michael Balmuth
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Chairman of the Compensation Committee
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6/6/15
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5/27/15
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Date
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Date
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1.
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I have reviewed this Quarterly Report on Form 10-Q of Ross Stores, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Date:
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September 9, 2015
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/s/Barbara Rentler
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Barbara Rentler
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Chief Executive Officer
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1.
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I have reviewed this Quarterly Report on Form 10-Q of Ross Stores, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Date:
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September 9, 2015
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/s/Michael J. Hartshorn
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Michael J. Hartshorn
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Group Senior Vice President, Chief Financial Officer, and Principal Accounting Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date:
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September 9, 2015
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/s/Barbara Rentler
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Barbara Rentler
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Chief Executive Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date:
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September 9, 2015
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/s/Michael J. Hartshorn
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Michael J. Hartshorn
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Group Senior Vice President, Chief Financial Officer, and Principal Accounting Officer
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