This summary is based on the fourth quarter fiscal 2007 earnings call conducted by Ross Stores, Inc. (ROST) on March 19, 2008.

Management:

Vice Chairman of the Board, President, Chief Executive Officer: Michael A. Balmuth
Chief Financial Officer, Senior Vice President, Corporate Secretary: John G. Call
Chairman of the Board: Norman A. Ferber
Executive Vice President and Chief Operations Officer: Gary L. Cribb
Executive Vice President, Chief Administrative Officer: Michael O''Sullivan

Key Investors Issues

- EPS were 70 cents a share compared to 66 cents a share last year.
- Net earnings were $94.5 million compared to $93.1 million a year earlier.
- Sales rose 3% to $1.65 billion.

Fourth Quarter Highlights

Earnings per share for the 13 weeks ended February 2, 2008 were 70 cents per share, compared to 66 cents per share for the 14 weeks ended February 3, 2007.

- Net earnings totaled $94.5 million, compared to $93.1 million in the prior year period.
- Sales increased 3% to $1.652 billion, with comparable store sales up 2% over the prior year. The northwester sectors were the strongest regions in the quarter and the year, while dresses, home, and shoes were the best performing merchandise categories.

- The company continued to strengthen merchandise offerings by expanding the assortment in accessories as well as home and gift-giving categories.
- Operating margin was 9% compared to 9.3% for the 14 week prior year quarter. The company estimates that last year’s 53rd week added about 55 basis points to the 2006 fourth quarter operating margin, so while it realized an improvement in merchandise gross margin in the fourth quarter of 2007, it was more than offset by the deleveraging effect on occupancy and selling, general and administrative costs of one less week of sales in this year’s fourth quarter compared to 2006.

Fiscal 2007 Highlights

- For the 52 weeks ended February 2, 2008, earnings per share were $1.90 compared to $1.70 for the 53 weeks ended February 3, 2007.
- Net earnings were $261.1 million compared to $241.6 million in 2006.
- Total sales rose 7% to a record $5.975 billion, with same-store sales up 1% on top of a 4% gain in 2006.

- Operating margin increased about five basis points to 7%. The company estimates that the 53rd week added approximately 20 basis points to profit margins in 2006.
- Gross margin improvement of about 20 basis points was largely driven by an increase in merchandise gross margin. Again, the comparison to 2006, which had the extra week, contributed to the deleveraging effect in 2007 on occupancy and selling, general, and administrative costs.
- The company finished 2007 with average in-store inventories down about 9% and expects inventories will be down in the mid to high single digits throughout 2008.

- The company added 93 net new stores in 2007, a 12% increase, including 67 Ross Dress for Less and 26 dd’s DISCOUNTS. This growth was partially driven by the real estate acquisition of about 40 former Albertson sites in late 2006.
- The company ended 2007 with 890 stores, including 838 Ross Dress for Less and 52 dd’s DISCOUNTS locations. It doubled the size of dd’s DISCOUNTS chain in 2007 with 26 new stores, including entry into three new markets - Florida, Texas, and Arizona - where it operates 16 locations.
- While existing 26 comparable stores in California performed in line with expectations in 2007, the new stores opened, particularly in newer markets, under-performed targets. In 2007, the drag on earnings from dd’s was about 40 basis points.

- Cash flows from operations funded $236 million in capital expenditures to open 93 net new stores and make ongoing distribution network, infrastructure, and systems investments.
- Solid financial position and healthy cash flows also enabled to continue long-term practice of returning capital to shareholders through both stock repurchase and dividend programs.
- The company repurchased 6.9 million shares of common stock for an aggregate of $200 million and completed two-year, $400 million program. The company ended 2007 with 134.1 million shares of common stock issued and outstanding.

- Board of directors approved a new two-year $600 million stock repurchase program. This is a 50% increase over the prior program.
- The board also approved a 27% increase to quarterly cash dividend to $0.095 per share, which is 14th consecutive annual dividend increase.

Fiscal 2008 Outlook

- Forecast for same-store sales is to decline 4% to 5% in March, followed by a 7% to 8% increase in April, which is aided by the extra selling day.
- Operating margin for the first quarter is projected to be flat to down 20 basis points and the company continues to forecast earnings per share in the range of 52 cents to 54 cents. This compares to 48 cents in the prior year.
- Underlying assumptions for 2008 also includes store growth of 8% for the year, including 65 to 70 net new Ross and five dd’s DISCOUNTS.

Key questions from the fourth quarter earnings call conducted by Ross Stores, Inc. on March 19, 2008.

Jeff Black (Lehman Brothers): What your CapEx budget is for 2008?

John G. Call: We are looking at 2008 to spend about $250 million. The biggest piece of that increase is the build-out of a distribution center in southern California.