Ross Stores October sales dip 2 percent

PLEASANTON, Calif. - Discount retailer Ross Stores Inc. said Thursday that its same-store sales declined 2 percent in October, due to unseasonably warm weather in many of its markets and the ongoing pressure of a challenging economy.

The results were worse than the 0.8 percent drop that analysts had expected, according to a poll by Thomson Reuters.

Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance since it measures growth at existing stores rather than newly opened ones.

Total sales for the four-week period ended Nov. 1 rose 4 percent to $490 million from $470 million in the same period a year earlier.

For the nine months ended Nov. 1, same-store sales rose 3 percent. Total sales for the period jumped 10 percent to $4.75 billion from $4.32 billion.

Ross Stores said it now expects third-quarter earnings to be between 43 cents and 44 cents per share, up from 36 cents in the prior-year quarter.

The company said last month that it expected earnings toward the lower end of its prior forecast of 42 cents to 44 cents per share.

"The quarter is benefiting from favorable shortage results and other expense savings that are offsetting the impact to gross margin from somewhat lower-than-expected sales," said Michael Balmuth, chief executive, in a statement.

Analysts expect a third-quarter profit of 42 cents per share, according to Thomson Reuters.

Ross Stores shares 60 cents, or 2 percent, to $30.59 in morning trading.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.