J.Jill profits down, expects 'slightly positive' sales in 2019
U.S. women's fashion retailer J.Jill reported a decrease in net income in the fourth quarter of 2018, capping off a year that has seen the embattled Massachusetts-based firm work hard at improving sales.
In a release on Wednesday, J.Jill said total net sales for the fifty-two weeks ended February 2, 2019 were $706.3 million versus $698.1 million.
Comparable sales increased by 0.9% -- the latter including direct-to-consumer sales, which represented 41% of revenues, according to the Quincy-based firm.
For the twelve-month period, net income decreased to $30.5 million from $55.4 million in 2017, following a better-than-expected fourth quarter in 2018, which best analysts expectations.
For the fourth quarter, J.Jill said it had net income of $2.1 million, or 5 cents a share, down from $29.3 million, or 67 cents a share, in the year-earlier period, when it enjoyed a tax benefit.
For the three-month period, sales fell to $170.9 million from $188.7 million, when analysts were predicting sales of $171 million and EPS of 3 cents, according to MarketWatch. The quarterly result signalled an improvement in the company, said J.Jill CEO, Linda Heasley, in a statement
“Our fourth quarter results demonstrate continued progress on our near-term initiatives," said Heasley.
"I am especially pleased by our year-over-year gross margin improvement for the quarter, driven by cleaner, leaner inventories and a reduction in promotional activity. For the year, we delivered on our near-term initiatives, including elevating our customer engagement, heightening our focus on balancing the assortment and managing inventory, and in the second half of the year relying less on promotional activities as we improve profitable sell-throughs.”
Looking ahead, J.Jill said it intends to cut back further on promotional activity as it tries to stem the sales bleed in to the first half of 2019.
As a result, the company expects comparable sales to be flat with total sales expected to be slightly positive. Diluted earnings per share are expected to be in the range of $0.66 to $0.70
Shares of J. Jill Inc. soared some 10% on Wednesday.
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