J. Jill, Inc.

Hello and welcome to the JJL Inc. Q4 2023 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session, and if you would like to ask a question during this time, simply press star 1 on your telephone keypad. I will now turn the conference over to Claire Spofford, Chief Executive Officer and President.

Please go ahead. Thank you, Operator, and hello, everyone.

Thank you for joining us this morning. We are pleased with our strong end to 2023, capping off another year of great progress for J. Jill as a result of disciplined execution of our operating model. For the fourth quarter, we delivered adjusted EBITDA above the prior year, supported by strong gross margin performance. As we discussed on our third quarter call, we started to see our customer become somewhat more discerning with their spend, and we had prepared for a slightly higher promotional holiday period, which did play out. However, through strong execution, solid customer reception for our winter assortment and spring preview in the latter half of the quarter, as well as tightly managed expenses, we delivered Q4 results above our expectations. Our performance throughout the year, including during the fourth quarter, is a testament to our team effectively leveraging our loyal customer base and to their ongoing focus on consistently delivering against our objectives amidst a volatile consumer environment. For the year, we delivered sales of $605 million and an adjusted EBITDA margin of 18.6% while generating $46 million in free cash flow in line with our recent annual trends. During the year, we made great progress on strengthening our financial and operational foundation while planting the seeds for future growth. We successfully refinanced our debt, enhanced our omni-channel capabilities with the rollout of our POS system and refinements to our website. delivered our first net new store opening year in over three years, and continued to identify and test new concepts within our assortment with capsules, including pure gel elements and wherever works. We also effectively managed our customer acquisition strategies and costs to support our customer file. Our customer file remained healthy, and we saw nice growth from our best customer segment for the year. which partially offset the impact we had from our more cost-conscious cohort, given the dynamic macro environment she was navigating. Average customer spend increased versus the prior year, supported by growth in frequency and full price penetration. And we continued to benefit from our ongoing customer insight work. As a result, we've been able to not only strengthen our relationships with new and existing customers, but also identify areas of opportunities for enhanced focus and growth, as seen with our inclusive sizing offering and capsule launches, including the Wherever Works collection. Through offering quality fabrications and an assortment that celebrates the totality of who she is, we are able to deliver the experience our customer expects from J. Jill. With this stronger foundation in place, we believe we are well positioned to continue to deliver on our financial objectives while supporting our growth initiatives. While we are maintaining a cautious view on the macro backdrop as we move into 2024, we plan to continue to execute and leverage our proven, disciplined operating model while further supporting our plans to drive mid- and long-term profitable growth. In 2024, we plan to continue to invest in our omnichannel foundation. Building off of the completion of the POS rollout in 2023, we have launched our OMS project, Through the new POS and OMS systems, we will have greater Omni capabilities ramping in 2025, which we believe will further enhance our customer shopping experience and enable us to benefit even further from our balanced operating model. In addition, we expect to open up to five net new stores in 2024. As we've discussed previously, with only 244 stores, we have significant opportunity for further store growth. but plan to take a very measured and fiscally responsible approach to our openings in the near and medium term. Finally, we plan to continue to strengthen our customer file through new marketing strategies, including an upcoming summer campaign that we believe will help to increase brand awareness and drive new customer acquisition. As I have said before, we have a great loyal customer with tremendous opportunity to increase our brand awareness and to welcome new customers to J. Jill through the strength of our brand equity our assortment, and overall customer experience. Before I close, I also wanted to highlight our upcoming impact report that we will be publishing later this spring. We continue to build upon our history of empowering women, prioritizing responsible environmental stewardship, and contributing to the communities in which we operate, and we look forward to sharing this progress in our report. We are very proud of the work we have done to date with the Compassion Fund, which has donated over $24 million in grants and in-kind donations over the last 20 years, and continues to focus on empowering and supporting underserved women and helping them establish a better life for themselves, their children, and their families. In summary, fiscal 2023 marked another year of great progress for J. Jill as we continued to strengthen our foundation and position the brand for long-term profitable growth. As we enter 2024, we plan to build on this progress by executing and leveraging our model while investing in enhanced Omni capabilities, store growth, and marketing to drive further brand awareness and customer acquisition. I want to thank our teams and stakeholders for their support and dedication to J. Jill. We believe we are just scratching the surface of the tremendous opportunity that lies ahead for our brand, and we look forward to driving even more value and delivering on our objectives in both the near and long term. With that, I will now turn the call over to Mark to discuss our results and outlook in more detail.