Ross 2011 Annual Report Download - page 5

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3
We remain excited about our long-term
opportunities for store growth and continue to
believe Ross can grow to at least 1,500 stores and
dd’s DISCOUNTS can eventually become a chain
of about 500 stores. This means that combined,
we have the potential to almost double the size of
our Company domestically.
Improved Profits and Continued
Growth at dd’s DISCOUNTS
dd’s DISCOUNTS continued to deliver solid
sales gains in 2011. It also generated significant
increases in operating profit compared to 2010,
when this business realized its first year of
positive earnings.
Similar to Ross, dd’s DISCOUNTS has benefited
by delivering a faster flow of fresh and exciting
product to our stores while operating on lower
inventory levels. Its improved performance also
reflects that dd’s DISCOUNTS’ value-focused
merchandise offerings continue to resonate
well with its target customer.
Healthy Cash Flows Continued to
Self-Fund Growth and Enhance
Stockholder Returns
Operating cash flows in 2011 continued to
provide the necessary resources to fund new
store growth and infrastructure improvements.
We invested $416 million of capital during the year,
including approximately $235 million to open new
locations and renovate existing stores, and about
$181 million mainly for distribution infrastructure
and information technology projects. We ended
fiscal 2011 with $650 million in cash and short-term
investments and $150 million in long-term debt.
For fiscal 2012, capital expenditures are expected
to increase to approximately $450 million to support
our plans for store growth as well as our investment
over the next three years in two new distribution
centers. Operating cash flows are projected to
self-fund this anticipated higher spending level.
During 2011, we continued to return cash to our
stockholders through both our stock repurchase
and dividend programs. In January 2011, our
Board of Directors approved a new two-year
repurchase program for up to $900 million of
common stock, as well as a 38% increase in the
quarterly cash dividend. A total of $450 million
of common stock, or about 11.3 million shares,
was repurchased in fiscal 2011.
In November 2011, we announced a two-for-one
stock split. More recently, in January 2012 our
Board of Directors raised the quarterly cash
dividend 27%, which represented the 18th
consecutive annual increase since the program
was initiated in 1994.