Michael Balmuth: As we went in at the end of July, our inventories were higher than we wanted them to be and that has been reflected in our guidance as we ended the third quarter to get us positioned offensively as we come into the back half.
Mark Montagna (C.L. King): The overall buying environment is better than normal. How much longer do you expect this better than normal environment to continue?
Michael Balmuth: How long this will go on ties to how erratic consumer behavior is and it will continue through the rest of this season into early spring. If it does continue to be erratic sales behavior by the customer across the board in retailing, it would continue for some time.
Mark Montagna (C.L. King): What are the year-to-date comparable store sales for Florida, California and Texas?
Gary Cribb: Year to date, California is up 2%. That is on top of 3% from a year ago. Texas is up 1% on top of 8% from a year ago. Florida is trending down 3% versus basically flat a year ago.
Paul Lejuez (Credit Suisse): Were the weaker dd''s stores in new markets, in the Texas and Florida markets?
Michael O’Sullivan: We only have the March opening group to go on. The July opening group is too recent to look at. Within the March opening group, only two of those stores were outside of California. They were in Florida. The March opening group, there were no Texas openings.
Paul Lejuez (Credit Suisse): How did those two markets perform with the new dd''s?
Michael O’Sullivan: The mixed performance was across the board. It was the two Florida and the six California stores. There is no obvious pattern. It is only eight stores and it is early days. As we get further into the year, we will look at the July open group and then the open group that we have coming up in October and we will be able to draw more conclusions.
Paul Lejuez (Credit Suisse): What have the 26 comparable stores within dd''s done?
Michael O’Sullivan: The comparable stores have been performing on plan, so we are comfortable with that. They have been doing well against their plan.
Paul Lejuez (Credit Suisse): Is there anything in your recent history that you have seen happening in the market that is similar to what is going on in Florida right now?
John Call: We know in Florida that there are things internally that we have made mistakes on that we are working to correct as rapidly as we can.
Michael Balmuth: We can not control the outside environment. We look internally at assortments, we look internally at the operation and we focus on what we do best and that is how we have handled it in the past and how we are handling Florida today.
David Mann (Johnson Rice): Can you comment on the performance of the newer Ross Stores this year?
Michael O’Sullivan: The new stores this year have performed in line with new stores over the past couple of years, which as we have said in the past, we are not satisfied with. We want to improve the performance of new stores and some of the initiatives that we have discussed earlier on in the call are aimed at that. We had not expected any improvement this year and they have stayed comparable to the last couple of years.
David Mann (Johnson Rice): Some of the stores that you have opened in the Southeast had struggled. Can you give an update on what progress you are making there?
Michael O’Sullivan: The Southeast has done better than the chain year to date. It has comped better than the chain, so we are pleased with that.
David Mann (Johnson Rice): What are you doing that is driving it to be better or you think it is just a better economy in those areas relative to the rest of the country?
Michael O’Sullivan: We have made some adjustments in the Southeast, but it is more of a regional issue in terms of the economy. There are things that we are doing, but it is going to be a year or two before they bear fruit, so we can not claim the credit for that.
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