Ross 2007 Annual Report Download - page 41

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39
Effects of inflation or deflation. Wedonotconsidertheeffectsofinationordeationtobematerialtoournancialposition
and results of operations.
New Accounting Pronouncements
SFAS No. 157, “Fair Value Measurements” (“SFAS No. 157”), is effective for fiscal years beginning after November 15, 2007. SFAS
No. 157 defines fair value, establishes a framework for measuring fair value and expands required disclosures about fair value
measurements. We do not believe the adoption of SFAS No. 157 will have a material impact on our operating results or financial
position.
SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“SFAS No. 159”) is effective for fiscal years
beginning after November 15, 2007. SFAS No. 159 establishes a fair value option under which entities can elect to report certain
financial assets and liabilities at fair value, with changes in fair value recognized in earnings. We do not believe the adoption of
SFAS No. 159 will have a material impact on our operating results or financial position.
Forward-Looking Statements
Our Annual Report on Form 10-K for fiscal 2007, and information we provide in our Annual Report to Stockholders, press
releases, telephonic reports and other investor communications including on our website, may contain a number of forward-
looking statements regarding, without limitation, planned store growth, new markets, expected sales, projected earnings
levels,capitalexpendituresandothermatters.Theseforward-lookingstatementsreectourthencurrentbeliefs,projections
and estimates with respect to future events and our projected financial performance, operations and competitive position. The
words “plan,” “expect,” “anticipate,” “estimate,” “believe,” “forecast,” “projected,” “guidance,” “looking ahead” and similar
expressions identify forward-looking statements.
Future economic and industry trends that could potentially impact revenue, profitability, and growth remain difficult to predict.
As a result, our forward-looking statements are subject to risks and uncertainties which could cause our actual results to differ
materially from those forward-looking statements and our previous expectations and projections. Refer to Item 1A in this Annual
Report on Form 10-K for a more complete discussion of risk factors for Ross and dd’s DISCOUNTS. The factors underlying our
forecasts are dynamic and subject to change. As a result, any forecasts or forward-looking statements speak only as of the date
theyaregivenanddonotnecessarilyreectouroutlookatanyotherpointintime.Wedonotundertaketoupdateorrevise
these forward-looking statements.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
We are exposed to market risks, which primarily include changes in interest rates. We do not engage in financial transactions for
trading or speculative purposes.
Weoccasionallyuseforwardcontractstohedgeagainstuctuationsinforeigncurrencyprices.Wehadnooutstandingforward
contracts as of February 2, 2008.
Interest that is payable on our revolving credit facilities is based on variable interest rates and is, therefore, affected by changes
in market interest rates. In addition, lease payments under certain of our synthetic lease agreements are determined based
on variable interest rates and are, therefore, affected by changes in market interest rates. As of February 2, 2008, we had
no borrowings outstanding under our revolving credit facilities. In addition, we issued notes to institutional investors in two
series: Series A for $85.0 million accrues interest at 6.38% and Series B for $65.0 million accrues interest at 6.53%. The amount
outstanding under these notes as of February 2, 2008 is $150.0 million.
A hypothetical 100 basis point increase in prevailing market interest rates would not have materially impacted our consolidated
nancialposition,resultsofoperations,orcashowsasofandfortheyearendedFebruary2,2008.Wedonotconsiderthe
potentiallossesinfutureearningsandcashowsfromreasonablypossible,neartermchangesininterestratestobematerial.