J. Jill’s Direct Business Underperforming

Quincy, MA-based J. Jill Group (Nasdaq: JILL) released preliminary fourth-quarter expectations: The women’s apparel cataloger/retailer expects net sales of approximately $119.0 million, a 4% increase from $114.9 million in sales last year. Comparable store sales are expected to increase 2% for the fourth quarter.

But it’s J. Jill’s direct business that has president/CEO Gordon R. Cooke scratching his head. “Since early November the top-line performance in our direct business has not met our expectations, as we experienced a significant shift of customers toward our retail segment,” Cooke said in a statement. “All of the initiatives that we have been implementing to improve our results in retail –opening stores, aligning our catalog mailing dates with the dates we introduce new retail floor sets, and increasing the amount of novelty items in our merchandising assortments — could potentially be detracting from the performance of our direct segment.”

He then added, “At this point in time we are reassessing our direct segment strategy with an eye toward rightsizing that part of our business as necessary.”

As for retail, the quarter got off to a good start but experienced disappointing sales post-Thanksgiving. “We attribute this weakness primarily to a sluggish retail environment for apparel throughout the holiday selling season. We do not feel the weakness we experienced this quarter is related to any particular issues with our merchandising.”

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