CLAIM #536 · Ross Stores Inc (ROST) · 2022Q3 earnings call · Nov 16, 2022 · due Dec 31, 2023
“I would say also, keep in mind, with lower incentive costs that had benefited our profitability this year, will reset the baseline next year. And thus, incentives will be a headwind in SG&A.”
Michael Hartshorn · COO
How to check this claim
Look at: Year-over-year change in incentive compensation expense within SG&A, fiscal 2023 vs fiscal 2022
It came true if: Incentive compensation costs increase year-over-year in fiscal 2023 (i.e., act as a headwind to SG&A ratio)
Where: Company commentary on SG&A drivers (10-K MD&A / earnings call transcripts, fiscal 2023 quarterly and year-end calls)
In context
“hat we have for the holidays. And any conservatism would be based on the macroeconomic environment and what we think is going to be a very, very promotional holiday. In terms of the flow-through for next year, as you would expect, operating margin improvements will be highly dependent on sustained strong sales growth over time and then how quickly some of the inflationary cost pressures subside. But I'd say, over the longer term, we think we can achieve gradual improvement in profitability. As for 2023 specifically, we're in the midst of our budgeting process for next year currently. And we'll be able to provide an update on our year-end call when we'll have a better sense of the macro economy entering the year and to the opportunities we have in places like ocean and domestic freight. I would say also, keep in mind, with lower incentive costs that had benefited our profitability this year, will reset the baseline next year. And thus, incentives will be a headwind in SG&A. Operator: And our next question comes from the line Adrienne Yih with Barclays. Adrienne Yih-Tennant: Barbara, can you talk about the buying environment and how much better it has gotten perhaps in the past 60 to 90 days since last quarter? And then how long does it take from, say, a contract negotiation to being able to get that product ready and available for sale in your stores? Barbara Rentler: Sure. Yes, the buying environment has gotten even better, broader, more brands, [ more ] classification. So it has -- absolutely, in the last 60 to 90 days, more vendors want to move more merchandise and also some new resources that perhaps we weren't doing business with before also want us to purchase the merchandise. So yes, there's a lot of supply out there. Adrienne, just say the second”
Verify independently
SEC filings for ROST ↗ · Claim quote is verbatim from the 2022Q3 earnings call.