J. Jill Q1: Sales Decline 4.9%, Comps Down 2.7%, Disciplined Operating Model & More

J. Jill, Inc. JILL reported a first-quarter FY23 sales decline of 4.9% year-on-year to $149.42 million, marginally missing the consensus of $149.50 million. Total company comparable sales decreased by 2.7%. Direct to consumer net sales were down 7.7%.

The company recorded an adjusted EPS of $0.96 that beat the consensus of $0.78.

Gross profit fell 1.8% Y/Y to $107.5 million, and the gross margin expanded 230 basis points to 72%. The year-over-year gross margin increase benefited from lower freight costs.

Net income was $4.6 million compared to $14.4 million in the first quarter of fiscal 2022.

JJill held $27.89 million in cash and equivalents at quarter-end. Adjusted EBITDA for the quarter was $31.9 million compared to $31.3 million in the first quarter of fiscal 2022. Adjusted EBITDA margin expanded to 21.3% from 19.9% year-ago.

"As we move into the remainder of the year, we will maintain our disciplined approach to managing the business as we continue to navigate a dynamic environment," said Claire Spofford, President and Chief Executive Officer of J.Jill. 

Outlook: J.Jill Expects Q2 revenues to be down in mid-single-digits year over year, with an adjusted EBITDA Of $26 million-$31 million.

For fiscal 2023, the company now expects annual Adjusted EBITDA dollars to be down mid-single digits compared to fiscal 2022. 

The company continues to expect total capital expenditures of about $18 million and a flat store count to end fiscal 2023.

Price Action: JILL shares are trading higher by 1.8% to $24.18 on the last check Wednesday.