Operating margin was 15.1% for the first quarter, down slightly from last year, as higher freight costs and wage-related investments offset an improvement in merchandise gross margin and favorable timing of packaway-related expenses.
Looking ahead into the second quarter, the company expects same-store sales growth of 1-2% and EPS of $0.95-$0.99. The EPS estimate includes the benefit from lower taxes, partially offset by the shift in packaway expenses.
For fiscal 2018, Ross Stores raised its EPS guidance to a range of $3.92-$4.05 from the previously forecasted range of $3.86-$4.03. The revised EPS outlook includes the benefit from lower taxes.
During the first quarter, the Dublin, California-based company bought back 3.3 million shares of common stock for an aggregate of $255 million. As planned, Ross Stores remains on track to repurchase a total of $1.075 billion in common stock during fiscal 2018.
Shares of Ross Stores ended Thursday’s regular trading session up 0.42% at $82.96 on the Nasdaq. The stock had been trading between $52.85 and $85.66 for the past 52 weeks.