NEW YORK — A healthy back-to-school season helped lift Ross Stores Inc. to double-digit increases in sales and earnings in the third quarter.

Elsewhere in the world of mass retailing, ShopKo generated a 9.9 percent increase in net income despite a sales retreat, and Stein Mart’s losses ballooned as it paid the price for a change in its promotional strategy with a deeper loss.

During the three months ended Nov. 1, Ross, the Newark, Calif.-based off-pricer enjoyed a 12 percent increase in net income to $50.5 million, or 65 cents a diluted share, from $45.1 million, or 57 cents, in the year-ago quarter. The third-quarter EPS mark matched consensus estimates as well as company guidance furnished on Nov. 6 when Ross reported October sales.

Revenues rose slightly more than earnings, gaining 12.3 percent to $976.9 million from $870.2 million. Comparable-store sales rose 2 percent during the quarter.

“Business benefited from strong same-store sales gains in our home departments and the back-to-school categories of juniors, shoes and accessories,” commented Michael Balmuth, vice chairman and chief executive officer, in a statement. “In addition, continued effective control of both inventories and expenses contributed to the stable operating margins and healthy earnings growth for the period.”

Balmuth said Ross is holding to its forecast of a same-store sales increase of 3 to 4 percent during the fourth quarter, which should translate to earnings per share of between 85 and 88 cents.

He added that the firm remains “on track” with its plan to open the first 10 DD’s Discount stores during the second half of fiscal 2004. The stores will be on the West Coast and instrumental in producing estimated store unit growth of 14 percent in 2004.

Net income for the nine months rose 8.4 percent to $154.4 million, or $1.99 a diluted share, from $142.4 million, or $1.78, in the 2002 period. Sales just missed the double-digit increase level, ascending 9.9 percent to $2.82 billion from $2.57 billion. Comps were flat.

Ross is the nation’s second largest apparel off-pricer, behind The TJX Cos. It operates 573 units, 63 more than one year ago.

As one might expect from a quarter when, as reported, Wal-Mart Stores missed Wall Street consensus estimates by 1 cent, other mass merchants were faced with promotional and expense pressures that took a toll on the bottom line.Among the discounters and off-pricers reporting results recently:

STEIN MART

Slumping net and comparable-store sales and store closing costs forced Stein Mart Inc. to a wider third-quarter loss.

For the three months ended Nov. 1, the Jacksonville, Fla.-based off-price retail chain reported a net loss of $10.4 million, or 25 cents a diluted share. That compares with last year’s narrower loss of $3.8 million, or 9 cents. Excluding the impact of store closings during the quarter, Stein Mart would have reported a net loss of 11 cents a share.

Net sales for the period dropped 5.1 percent to $315.9 million from $332.8 million a year ago, and comparable-store sales receded 5.8 percent.

“Our third quarter was really a trip through uncharted waters,” said chief executive officer Michael Fisher on a conference call with analysts. “For starters, we closed eight stores in the span of one week in September. Those stores were half of the group we announced in May we would close this year for lack of profitability. We also eliminated full-price coupons and we knew it would be difficult as we anniversaried against last year’s comparable-store sales.”

Fisher said fourth-quarter sales will continue to suffer disadvantageous comparisons with last year when Stein Mart issued “almost daily coupons” in November and December. However, he added that an encouraging response to the firm’s merchandise assortment and first national TV campaign should lead to improvements in January.

Stein Mart expects to end the current fiscal year with 261 units and to open between 10 and 12 next year.

Overall, for the first nine months of the fiscal year, Stein Mart recorded a net loss of $11.7 million, or 28 cents, versus last year’s profits of $10.3 million, or 25 cents. Net sales for the period declined 5 percent to $950 million from $1 billion a year ago as comps were down 7 percent.

SHOPKO STORES

Third-quarter profits rose at ShopKo Stores Inc. despite declines in overall and same-store sales.

For the 13 weeks ended Nov. 1, the Green Bay, Wis.-based discounter saw earnings rise 9.9 percent to $964,000, or 3 cents a diluted share, from $877,000, also 3 cents, last year.Sales for the period slid 1.4 percent to $758.5 million from $769.6 million last year. Comparable-store sales fell 1.3 percent.

An $89.4 million reduction in debt helped boost profitability.

Sales in the company’s core ShopKo segment slid 2.7 percent to $568.5 million from $584.1 million last year, and comps slumped by the same percentage. Sam Duncan, president and chief executive officer, said during the company conference call, “Unseasonably warm weather impacted sales, particularly in seasonable apparel categories such as outerwear and sweaters.”

At Pamida, sales rose 2.4 percent to $190 million and were up 3.3 percent on a comp basis.

For the 39-week period earnings came in at $7.6 million, or 26 cents, against a loss of $177.5 million, or $6.07 a diluted share, last year. Excluding the effect of an accounting change, earnings in last year’s quarter would have been $8.6 million.

Sales for the period fell 2.2 percent to $2.23 billion from $2.28 billion last year.

ShopKo operates 361 units, including 220 Pamida stores, in 23 Western and Midwestern states.

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