10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended November 2, 2019

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________________ to _____________________

Commission File Number: 001-38026

J.Jill, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware	45-1459825
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
4 Batterymarch Park, Quincy, MA 02169	02169
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (617) 376-4300

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	JILL	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒  No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

Securities registered pursuant to Section 12(g) of the Act: None

As of December 12, 2019, the registrant had 44,034,608 shares of common stock, $0.01 par value per share, outstanding.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Balance Sheets (Unaudited)	2
	Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited)	3
	Consolidated Statement of Shareholders’ Equity (Unaudited)	4
	Consolidated Statements of Cash Flows (Unaudited)	5
	Notes to Consolidated Financial Statements (Unaudited)	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22
Item 4.	Controls and Procedures	22
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	23
Item 1A.	Risk Factors	23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23
Item 3.	Defaults Upon Senior Securities	23
Item 4.	Mine Safety Disclosures	23
Item 5.	Other Information	23
Item 6.	Exhibits	23
Exhibit Index		24
Signatures		25

1

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

J.Jill, Inc.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in thousands, except share data)

	November 2, 2019			February 2, 2019
Assets
Current assets:
Cash	$	16,958		$	66,204
Accounts receivable		7,684			4,007
Inventories, net		81,420			77,349
Prepaid expenses and other current assets		26,391			27,734
Total current assets		132,453			175,294
Property and equipment, net		113,224			118,044
Intangible assets, net		120,730			136,177
Goodwill		108,597			197,026
Operating lease assets, net		218,008			—
Other assets		1,544			447
Total assets	$	694,556		$	626,988
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	50,966		$	55,012
Accrued expenses and other current liabilities		44,639			45,306
Current portion of long-term debt		2,799			2,799
Current portion of operating lease liabilities		31,372			—
Total current liabilities		129,776			103,117
Long-term debt, net of discount and current portion		236,450			237,464
Deferred income taxes		33,934			41,842
Operating lease liabilities, net of current portion		216,324			—
Other liabilities		2,000			30,770
Total liabilities		618,484			413,193
Commitments and contingencies (see Note 9)
Shareholders’ Equity
Common stock, par value $0.01 per share; 250,000,000 shares authorized; 44,034,608 and 43,672,418 shares issued and outstanding at November 2, 2019 and February 2, 2019, respectively		440			437
Additional paid-in capital		123,986			121,635
Accumulated (deficit) earnings		(48,354	)		91,723
Total shareholders’ equity		76,072			213,795
Total liabilities and shareholders’ equity	$	694,556		$	626,988

The accompanying notes are an integral part of these consolidated financial statements.

2

J.Jill, Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE INCOME (LOSS) (UNAUDITED)

(in thousands, except share and per share data)

	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	November 2, 2019		November 3, 2018		November 2, 2019			November 3, 2018
Net sales	$	166,085	$	174,106	$	523,281		$	535,360
Costs of goods sold		59,137		58,643		194,736			182,901
Gross profit		106,948		115,463		328,545			352,459
Selling, general and administrative expenses		97,972		101,589		308,115			299,248
Impairment of goodwill		—		—		88,428			—
Impairment of indefinite-lived intangible assets		—		—		7,000			—
Operating income (loss)		8,976		13,874		(74,998	)		53,211
Interest expense, net		4,826		4,698		14,852			14,368
Income (loss) before provision for income taxes		4,150		9,176		(89,850	)		38,843
Income tax provision		1,763		2,488		132			10,412
Net income (loss) and total comprehensive income (loss)	$	2,387	$	6,688	$	(89,982	)	$	28,431
Net income (loss) per common share attributable to common shareholders:
Basic	$	0.05	$	0.16	$	(2.06	)	$	0.67
Diluted	$	0.05	$	0.15	$	(2.06	)	$	0.64
Weighted average number of common shares outstanding:
Basic		43,838,667		42,953,173		43,653,178			42,674,957
Diluted		43,950,702		44,475,793		43,653,178			44,199,800

The accompanying notes are an integral part of these consolidated financial statements.

3

J.Jill, Inc.

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY (UNAUDITED)

(in thousands, except common share data)

							Additional			Accumulated			Total
	Common Stock						Paid-in			Earnings			Shareholders’
	Shares			Amount			Capital			(Deficit)			Equity
Balance, February 2, 2019		43,672,418		$	437		$	121,635		$	91,723		$	213,795
Adoption of ASU 2016-02 (1)		—			—			—			59			59
Special cash dividend ($1.15 per share)		—			—			—			(50,154	)		(50,154	)
Vesting of restricted stock units		734,474			7			(7	)		—			—
Shares withheld for net-share settlement of equity-based compensation		(239,117	)		(2	)		(1,266	)		—			(1,268	)
Forfeiture of restricted stock awards		(69,978	)		(1	)		1			—			—
Equity-based compensation		—			—			1,202			—			1,202
Net income		—			—			—			4,366			4,366
Balance, May 4, 2019		44,097,797		$	441		$	121,565		$	45,994		$	168,000
Vesting of restricted stock units		—			—			—			—			—
Forfeitable dividend		—			—			107			—			107
Forfeiture of restricted stock awards		(92,685	)		(1	)		1			—			—
Equity-based compensation		—			—			1,214			—			1,214
Net loss		—			—			—			(96,735	)		(96,735	)
Balance, August 3, 2019		44,005,112		$	440		$	122,887		$	(50,741	)	$	72,586
Vesting of restricted stock units		50,434			0			(0	)		—			—
Shares withheld for net-share settlement of equity-based compensation		(14,829	)		(0	)		(35	)		—			(35	)
Forfeitable dividend		—			—			7			—			7
Forfeiture of restricted stock awards		(6,109	)		(0	)		0			—			—
Equity-based compensation		—			—			1,128			—			1,128
Net income		—			—			—			2,387			2,387
Balance, November 2, 2019		44,034,608		$	440		$	123,986		$	(48,354	)	$	76,072

(1) See Note 2 for additional detail regarding adoption of new accounting standards.

							Additional					Total
	Common Stock						Paid-in		Accumulated			Shareholders’
	Shares			Amount			Capital		Earnings			Equity
Balance, February 3, 2018		43,752,790		$	437		$	117,393	$	61,486		$	179,316
Adoption of ASU 2014-09		—			—			—		(288	)		(288	)
Vesting of restricted stock units		6,410			1			—		—			1
Equity-based compensation		—			—			760		—			760
Net income		—			—			—		11,258			11,258
Balance, May 5, 2018		43,759,200		$	438		$	118,153	$	72,456		$	191,047
Vesting of restricted stock units		3,192			—			—		—			—
Forfeiture of restricted stock awards		(18,359	)		(1	)		—		—			(1	)
Equity-based compensation		—			—			1,083		—			1,083
Net income		—			—			—		10,485			10,485
Balance, August 4, 2018		43,744,033		$	437		$	119,236	$	82,941		$	202,614
Vesting of restricted stock units		3,724			—			—		—			—
Equity-based compensation		—			—			1,111		—			1,111
Net income		—			—			—		6,688			6,688
Balance, November 3, 2018		43,747,757		$	437		$	120,347	$	89,629		$	210,413

The accompanying notes are an integral part of these consolidated financial statements.

4

J.Jill, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(in thousands)

	For the Thirty-Nine Weeks Ended
	November 2, 2019			November 3, 2018
Net (loss) income	$	(89,982	)	$	28,431
Operating activities:
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		28,301			27,397
Impairment of goodwill and indefinite-lived intangible assets		95,428			—
Impairment of long-lived assets		2,064			—
Loss on disposal of fixed assets		85			87
Gain on liquidation of inventory		(1,274	)		—
Noncash amortization of deferred financing and debt discount costs		1,250			1,196
Equity-based compensation		3,544			2,954
Deferred rent liability		(133	)		(99	)
Deferred income taxes		(7,908	)		(3,812	)
Changes in operating assets and liabilities:
Accounts receivable		(3,677	)		(2,777	)
Inventories		(4,797	)		1,747
Prepaid expenses and other current assets		(1,662	)		(4,958	)
Accounts payable		(4,102	)		(3,032	)
Accrued expenses		(60	)		44
Operating lease assets and liabilities		718			—
Other noncurrent assets and liabilities		(108	)		2,850
Net cash provided by operating activities		17,687			50,028
Investing activities:
Purchases of property and equipment		(13,493	)		(14,017	)
Net cash used in investing activities		(13,493	)		(14,017	)
Financing activities:
Repayments on long-term debt		(2,099	)		(2,099	)
Payments of withholding tax on net-share settlement of equity-based compensation plans		(1,301	)		—
Special dividend paid to shareholders		(50,154	)		—
Forfeitable dividend		114			—
Net cash used in financing activities		(53,440	)		(2,099	)
Net change in cash		(49,246	)		33,912
Cash:
Beginning of Period		66,204			25,978
End of Period	$	16,958		$	59,890

The accompanying notes are an integral part of these consolidated financial statements.

5

J.Jill, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. Description of Business

J.Jill, Inc., “J.Jill” or the “Company”, is a premier omnichannel retailer and nationally recognized women’s apparel brand committed to delighting customers with great wear-now product. The brand represents an easy, thoughtful and inspired style that reflects the confidence of remarkable women who live life with joy, passion and purpose. J.Jill offers a guiding customer experience through more than 280 stores nationwide and a robust E-commerce platform. J.Jill is headquartered outside Boston.

2. Summary of Significant Accounting Policies

Basis of Presentation

Our interim consolidated financial statements are unaudited. All significant intercompany balances and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted, in accordance with the rules of the Securities and Exchange Commission (the “SEC”). In the opinion of management, these interim consolidated financial statements contain all normal and recurring adjustments necessary to state fairly the financial position and results of operations of the Company. The consolidated balance sheet as of February 2, 2019 is derived from the audited consolidated balance sheet as of that date. The unaudited results of operations for the thirteen and thirty-nine weeks ended November 2, 2019 are not necessarily indicative of future results or results to be expected for the full year ending February 1, 2020 (“Fiscal Year 2019”). You should read these statements in conjunction with our audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended February 2, 2019.

Significant changes to our accounting policies as a result of adopting Accounting Standards Update (“ASU”) 2016-02 – Leases (Topic 842) are discussed below in “Significant Accounting Policies Update” and Note 10.

Recently Adopted Accounting Policies

In February 2016, the FASB issued ASU 2016-02 – Leases (Topic 842), which supersedes FASB Accounting Standards Codification (“ASC”) Topic 840 – Leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. The standard was adopted using the modified retrospective approach as of February 3, 2019 with an immaterial cumulative adjustment to retained earnings. See “Significant Accounting Policies Update” and Note 13 for a discussion of our updated policies related to leases and disclosures related to the impact of this standard.

In July 2018, the FASB issued ASU 2018-09 – Codification Improvements, which facilitates amendments to a variety of topics to clarify, correct errors in, or make minor improvements to the accounting standards codification. The effective date of the standard is dependent on the facts and circumstances of each amendment. Some amendments do not require transition guidance and will be effective upon the issuance of this standard. The standard was adopted as of February 3, 2019, and it had no material impact on our consolidated financial statements and related disclosures.

In June 2018, the FASB issued ASU 2018-07 – Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The Company adopted the standard as of February 3, 2019, and it had no impact on our consolidated financial statements and related disclosures.

Recently Issued Accounting Pronouncements

In November 2018, the FASB issued ASU 2018-18 – Collaborative Arrangements (Topic 808), which clarifies the interaction between Topic 808 and Topic 606, Revenue from Contracts with Customers. The provisions of ASU 2018-18 are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Company will be required to adopt this standard in the first quarter of Fiscal Year 2020. This standard is not expected to have a material impact on our consolidated financial statements and related disclosures.

6

In September 2018, the FASB issued ASU 2018-15 – Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The amendment is intended to address aspects of the guidance issued in the amendments in ASU 2015-05 – Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. ASU 2018-15 intends to improve an entities ability to evaluate the accounting for fees paid by a customer in a cloud computing arrangement that is a service contract. The provisions of ASU 2018-15 are effective for fiscal years beginning after December 15, 2019. The Company plans to adopt these standards using a prospective approach and is evaluating the impact that adopting ASU 2018-15 will have on its consolidated financial statements and related disclosures.

Significant Accounting Policies Update

Adoption of ASC Topic 842: Leases

The Company adopted ASU 2016-02- Leases (Topic 842) and related amendments, as of February 3, 2019, using the modified retrospective approach. The modified retrospective approach provides a method for recording existing leases at adoption with a cumulative adjustment to retained earnings. The Company elected the package of practical expedients which permits the Company to not reassess (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for any expired or existing leases as of the effective date.

The Company applied a portfolio approach to effectively account for the operating lease liabilities and operating lease assets; the Company did not have financing leases. The Company excludes leases with an initial term of 12 months or less from the application of Topic 842. The Company did not elect the hindsight practical expedient; therefore, upon adoption, the Company used the remaining lease term of the current lease, option or extension.

Adoption of the new standard resulted in the recording of operating lease assets and operating lease liabilities of $223.3 million and $250.5 million, respectively, on the Company’s consolidated balance sheet as of February 3, 2019. The difference between the approximate value of the operating lease assets and liabilities is attributable to deferred rent, deferred rent incentives, leasehold interests and prepaid rent. There was no material impact on the Company’s consolidated statement of operations and comprehensive income or consolidated statements cash flows. The Company’s comparative periods continue to be presented and disclosed in accordance with legacy guidance in Topic 840.

Operating Leases

The Company determines if an arrangement is a lease at inception. Lease agreements will typically exist with lease and non-lease components, which are generally accounted for separately.

The Company recognizes operating lease liabilities equal to the present value of the lease payments and operating lease assets representing the right to use the underlying asset for the lease term. The lease expense for lease payments is recognized on a straight-line basis over the lease term.

As the Company’s leases do not provide an implicit rate, the Company will use an incremental borrowing rate based on the information available at lease commencement in determining the present value of lease payments. The operating lease assets include any lease payments made prior to lease commencement and are reduced by any lease incentives.

Under Topic 842, for any new leases entered into, the Company will assess if it is reasonably certain to exercise lease options to extend or terminate the lease for inclusion (or exclusion) in the lease term when the Company measures the lease liability. The depreciable life of any assets and leasehold improvements are limited by the expected lease term.

Certain of the Company’s retail operating leases include variable rental payments based on a percentage of retail sales over contractual levels. Variable rental payments are recognized in the consolidated statement of operations and comprehensive income in the period in which the obligation for those payments are incurred. If such variable operating leases arise that include incentives from landlords in the form of cash, the Company will record the full amount of the incentive when specific performance criteria are met as a deferred liability. The deferred liability is amortized into income as a reduction of rent expense over the term of the applicable lease, including options to extend if they are reasonably certain to be exercised. The Company recognized those liabilities to be amortized within a year as a current liability and those greater than a year as a long-term liability. For purposes of recognizing these incentives and rental expenses on a straight-line basis, the Company uses the date it obtains the legal right to use and control the lease asset to begin amortization, which is generally when the Company takes possession of the asset.

7

3. Revenues

Disaggregation of Revenue

The Company sells its products directly to consumers and the Company earns royalties under its credit card agreement. The following table presents disaggregated revenues by source (in thousands):

	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	November 2, 2019		November 3, 2018		November 2, 2019		November 3, 2018
Retail	$	94,748	$	104,840	$	301,008	$	319,080
Direct		71,337		69,266		222,273		216,280
Net revenues	$	166,085	$	174,106	$	523,281	$	535,360

Contract Liabilities

The Company recognizes a contract liability when it has received consideration from the customer and has a future obligation to the customer. Total contract liabilities consisted of the following (in thousands):

	November 2, 2019		February 2, 2019
Contract liabilities:
Signing bonus	$	541	$	647
Unredeemed gift cards		4,934		7,081
Total contract liabilities(1)	$	5,475	$	7,728

(1) Included in accrued expenses and other current liabilities on the Company's consolidated balance sheet. The short-term portion of the signing bonus is included in accrued expenses on the consolidated balance sheet as of November 2, 2019.

For the thirteen and thirty-nine weeks ended November 2, 2019, the Company recognized approximately $2.0 million and $8.5 million of revenue related to gift card redemptions and breakage, respectively. For the thirteen and thirty-nine weeks ended November 3, 2018, the Company recognized approximately $2.1 million and $8.2 million of revenue related to gift card redemptions and breakage, respectively. Revenue recognized consists of gift cards that were part of the unredeemed gift card balance at the beginning of the period as well as gift cards that were issued during the period.

Performance Obligations

The Company has a remaining performance obligation of $0.5 million for a signing bonus related to the private label credit card agreement. The Company will recognize revenue over the remaining life of the contract as follows (in thousands):

	Fiscal Year 2019		Fiscal Year 2020		Thereafter
Signing bonus	$	35	$	141	$	365

This disclosure does not include revenue related to performance obligations from unredeemed gift cards, as substantially all gift cards are redeemed in the first year of issuance.

8

4. Other Income

The Company filed an insurance claim as a result of a cargo vessel fire on or about January 8, 2019, where contents of two containers carried J.Jill inventory. In July 2019, it was determined that the inventory onboard the cargo vessel was nonsalable and the insurance claim was settled for $3.3 million. The Company recorded a gain of $2.4 million on insurance proceeds in selling, general and administrative expenses in the consolidated statement of operations and comprehensive income (loss) for the thirty-nine weeks ended November 2, 2019.  

5. Asset Impairments

Long-lived Asset Impairments

In the second quarter of Fiscal Year 2019, the Company reduced the net carrying value of certain long-lived assets to their estimated fair value, determined using a discounted cash flows method. These impairment charges arose from the Company’s decision to vacate and sublease one floor of the corporate headquarters located in Quincy, Massachusetts. The Company incurred impairment charges of $0.3 million on leasehold improvements and $1.8 million on the right-of-use asset. The impairment charges were recorded in selling, general and administrative expenses in the consolidated statement of operations and comprehensive income (loss).

Goodwill and Other Indefinite-lived Intangible Asset Impairments

In the second quarter of Fiscal Year 2019, the Company reduced comparable sales outlook for the second quarter that led to a reduced full year forecast of earnings for Fiscal Year 2019. The Company concluded that these factors, as well as the decrease in stock price represented indicators of impairment and required the Company to test goodwill and indefinite-lived intangible assets for impairment during the second quarter of Fiscal Year 2019 (the “Impairment Test”).

The Company performed the Impairment Test using a quantitative approach with the assistance of an independent valuation firm. The Impairment Test was performed using the income approach (or discounted cash flows method) for goodwill and the relief-from-royalty method for indefinite-lived intangible assets. The estimated fair values of goodwill and indefinite-lived intangible asset were below carrying values resulting in an $88.4 million impairment of goodwill and a $7.0 million impairment of the Company’s tradename (indefinite-lived intangible asset).The Company will perform their annual impairment assessment during the fourth quarter of Fiscal Year 2019 and may incur further impairments based on the results of that assessment which may be material.

6. Restructuring Costs

In July 2019, the Company implemented a restructuring plan (the “2019 Restructuring Plan”) focused on cost reduction initiatives designed to execute against long-term strategies. The 2019 Restructuring Plan included headcount reductions primarily at the Company’s corporate headquarters in Quincy, Massachusetts and at the facility in Tilton, New Hampshire.

As a result of the 2019 Restructuring Plan, the Company recorded $1.6 million of restructuring costs in selling, general and administrative expenses in the consolidated statements of operations and comprehensive income. All restructuring costs have been incurred in the second quarter of Fiscal Year 2019 and payments are anticipated to be complete in the fourth quarter of Fiscal Year 2020, ending on January 30, 2021.

The following table summarizes the activity of the restructuring costs discussed above and related accruals recorded in accrued other and other current liabilities on the consolidated balance sheet (in thousands):

	February 3, 2019		Charges Incurred		Cash Payments		Adjustments		November 2, 2019
Employee separation costs	$	—	$	1,402	$	828	$	—	$	574
Other		—		195		101		—		94
Total restructuring costs	$	—	$	1,597	$	929	$	—	$	668

9

7. Debt

The components of the Company’s outstanding Term Loan were as follows (in thousands):

	November 2, 2019			February 2, 2019
Term Loan	$	243,278		$	245,378
Discount on debt and debt issuance costs		(4,030	)		(5,115	)
Less: Current portion		(2,799	)		(2,799	)
Net long-term debt	$	236,450		$	237,464

The Company was in compliance with all financial covenants as of November 2, 2019.

8. Income Taxes

The Company recorded an income tax expense of $1.8 million and $0.1 million for the thirteen and thirty-nine weeks ended November 2, 2019, respectively, and income tax expense of $2.5 million and $10.4 million during the thirteen and thirty-nine weeks ended November 3, 2018, respectively. The effective tax rates were 42.5% and (0.1)% in the thirteen and thirty-nine weeks ended November 2, 2019, respectively, and 27.1% and 26.8% in the thirteen and thirty-nine weeks ended November 3, 2018, respectively.

The effective tax rate for the thirteen and thirty-nine weeks ended November 2, 2019 differs from the federal statutory rate of 21% primarily due to the impact of recurring items including §162(m) officer compensation limitation, stock compensation and state income taxes. The effective tax rate for the thirty-nine weeks ended November 2, 2019 was also impacted by the goodwill impairment charge of $88.4 million. The effective tax rate for the thirteen and thirty-nine weeks ended November 3, 2018 exceeded the federal statutory rate of 21.0% primarily due to §162(m) officer compensation limitation, stock compensation and state income taxes.

9. Earnings Per Share

The following table summarizes the computation of basic and diluted net income per share attributable to common shareholders (in thousands, except share and per share data):

	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	November 2, 2019		November 3, 2018		November 2, 2019			November 3, 2018
Numerator
Net income (loss) attributable to common shareholders:	$	2,387	$	6,688	$	(89,982	)	$	28,431
Denominator
Weighted average number of common shares outstanding, basic:		43,838,667		42,953,173		43,653,178			42,674,957
Dilutive effect of stock options and restricted shares:		112,035		1,522,620		—			1,524,843
Weighted average number of common shares outstanding, diluted:		43,950,702		44,475,793		43,653,178			44,199,800
Net (loss) income per common share attributable to common shareholders, basic:	$	0.05	$	0.16	$	(2.06	)	$	0.67
Net (loss) income per common share attributable to common shareholders, diluted:	$	0.05	$	0.15	$	(2.06	)	$	0.64

The weighted average common shares for the diluted earnings per share calculation exclude the impact of outstanding equity awards if the assumed proceeds per share of the award is in excess of the related fiscal period’s average price of the Company’s common stock. Such awards are excluded because they would have an antidilutive effect. There were 4,000,014 and 3,183,761 for the thirteen and thirty-nine weeks ended November 2, 2019, and 1,083,876 and 847,600 for the thirteen and thirty-nine weeks ended November 3, 2018, such awards excluded.

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10. Equity-Based Compensation

Equity-based compensation expense was $1.1 million and $3.5 million for the thirteen and thirty-nine weeks ended November 2, 2019, and $1.1 million and $2.9 million for the thirteen and thirty-nine weeks ended November 3, 2018.

Special Dividend

On March 6, 2019, the Company’s Board of Directors declared a special cash dividend (the “Special Dividend”) of $1.15 per share payable to shareholders of record as of March 19, 2019, of which $50.2 million was paid on April 1, 2019 to shareholders.

In connection with the Special Dividend, pursuant to anti-dilution provisions in the 2017 Omnibus Equity Incentive Plan (the “2017 Plan”), the Company adjusted outstanding equity awards in order to prevent dilution of such awards. Accordingly, the Company adjusted the number of outstanding unvested restricted stock units (“RSUs”) as of the payment date of the dividend with an additional number of RSUs (“Dividend Equivalent Units” or “DEUs”) equal to the quotient obtained by dividing (x) the product of the number of unvested RSUs as of the record date by the amount of the dividend per share, by (y) the fair market value of share on the payment date of the Special Dividend. The DEUs will follow the same vesting pattern as the RSUs. For holders of outstanding options as of March 19, 2019, the option strike price on such options was reduced by the per share amount of the Special Dividend. Holders of unvested Restricted Stock Awards (“RSAs”) received a forfeitable $1.15 per share dividend on unvested RSAs as of March 19, 2019.

11. Related Party Transactions

For both the thirteen and thirty-nine weeks ended November 2, 2019 and November 3, 2018, the Company incurred an immaterial amount of related party transactions.

12. Commitments and Contingencies

Legal Proceedings

The Company is subject to various legal proceedings that arise in the ordinary course of business. Although the outcome of such proceedings cannot be predicted with certainty, management does not believe that the Company is presently party to any legal proceedings the resolution of which management believes would have a material adverse effect on the Company’s business, financial condition, operating results or cash flows. The Company establishes reserves for specific legal matters when the Company determines that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable.

13. Operating Leases

As of November 2, 2019, the Company leased certain retail stores, a distribution center, and office space. As of that same date, the Company did not have any financing leases and no operating leases contained any material residual value guarantees or material restrictive covenants. Certain of the Company’s retail operating leases include variable rental payments based on a percentage of retail sales over contractual levels.

Some retail leases include one or more options to renew, with renewal terms that can extend the lease term from one to fifteen years. The Company’s distribution center has renewal terms that can extend the lease term up to twenty years. The exercise of lease renewal options is at the Company’s sole discretion. As of November 2, 2019, the Company included options to renew that are reasonably certain to be exercised in the operating lease assets and liabilities.

As described in Note 2, the Company adopted Topic 842 as of February 3, 2019. Under this guidance the Company did not record any deferred lease liabilities as of November 2, 2019. The Company maintained a tenant incentive liability of $1.3 million as of November 2, 2019, related to certain variable retail leases. Under legacy guidance, Topic 840, the Company recorded a deferred lease liability of $11.9 million and maintained a tenant improvement incentive liability of $19.1 million as of February 2, 2019.

The components of lease expense were as follows (in thousands):

Lease Cost	Classification	For the Thirteen Weeks Ended November 2, 2019		For the Thirty-Nine Weeks Ended November 2, 2019
Operating lease cost	SG&A Expenses	$	12,054	$	35,426
Variable lease cost	SG&A Expenses		976		2,516
Total lease cost		$	13,030	$	37,942

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Forthe thirteen and thirty-nine weeks ended November 2, 2019, total common area maintenance expense was $3.6 million and $10.7 million, respectively. Forthe thirteen and thirty-nine weeks ended November 3, 2018, total rental expense was $11.6 million and $35.2 million, respectively,and common area maintenance expense was $3.6 million and $10.6 million, respectively, exclusive of contingent rental expense recorded of $0.4 million and $1.0 million, respectively.

The Company used an incremental borrowing rate on February 3, 2019, for operating leases that commenced prior to that date. The incremental borrowing rate is estimated based upon (1) the financial condition and credit rating of the Company and its peers, (2) the term of the lease, (3) the nature of the underlying asset, and (4) the relative economic environment.

For the thirteen and thirty-nine weeks ended November 2, 2019, operating lease liabilities arising from obtaining operating lease assets was $9.6 million and $19.2 million, respectively.

For the thirteen and thirty-nine weeks ended November 2, 2019, the total cash paid for amounts included in the measurement of operating lease liabilities was $12.1 million and $35.8 million, respectively.

Lease Term and Discount Rate	November 2, 2019
Weighted-average remaining lease term (in years)
Operating leases		7.2
Weighted-average discount rate
Operating leases		6.5	%

Maturities of lease liabilities as of November 2, 2019 were as follows (in thousands):

Fiscal Year	Operating Leases(1)
2019	$	7,413
2020		47,428
2021		46,893
2022		42,671
2023		39,374
Thereafter		132,172
Less: Imputed interest		68,255
Present value of lease liabilities	$	247,696

(1) There were no operating leases with legally binding minimum lease payments for leases signed but for which the Company has not taken possession.

Under Topic 840, future minimum rental payments required under all non-cancellable operating lease obligations as of February 2, 2019 were as follows (in thousands):

Fiscal Year
2019	$	49,399
2020		46,512
2021		43,872
2022		39,369
2023		36,459
Thereafter		110,376
Total	$	325,987

14. Barter Arrangement

The Company entered into a bartering arrangement with Evergreen Trading, a vendor, where the Company provided inventory in exchange for media credits. During Q3 of fiscal 2019, the Company exchanged $3.3 million of inventory for certain media credits. To account for the exchange, the Company recorded the transfer of the inventory asset as a reduction of inventory offset by a $2.5 million decrease in reserves and an increase to a prepaid media asset of $2.0 million which is included in “Prepaid and other current assets” and “Other assets” on the accompanying consolidated balance sheet. A gain of $1.3 million was recorded upon shipment of the inventory. The Company had $2.0 million of unused media credits remaining as of November 2, 2019 that will be used over five years.

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The Company accounted for this barter transactions under ASC Topic No. 606 “Revenue from Contract with Customers.” Barter transactions with commercial substance are recorded at the estimated fair value of the products exchanged, unless the products received have a more readily determinable estimated fair value. Revenue associated with barter transaction is recorded at the time of the exchange of the related assets.

15. Subsequent Event

On December 5, 2019, the Company announced the departure of President, CEO and Director, Linda Heasley effective immediately, after serving over a year and a half in the role. Ms. Heasley will be succeeded as Chief Executive Officer on an interim basis by James Scully, who currently serves on the Board of Directors of J.Jill, Inc., effective December 5, 2019.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The followingdiscussionand analysisshouldbe read in conjunctionwith our consolidatedfinancial statementsand relatednotestheretoincludedelsewherein thisQuarterly Reporton Form 10-Q. The followingdiscussioncontainsforward-looking statementsthatreflectour plans,estimatesand assumptions.Our actualresultscoulddiffermateriallyfrom thosediscussedin theforward-lookingstatements.Factorsthatcouldcausesuch differencesare discussedin the sectionsof thisQuarterly Report on Form 10-Q titled“Risk Factors” and “Special Note Regarding Forward-Looking Statements”.

Weoperateon a 52- or 53-weekfiscalyearthatends on theSaturdaythatisclosestto January31. Each fiscalyeargenerallyiscomprisedof four13-weekfiscalquarters,althoughin theyearswith 53 weeks, thefourth quarterrepresentsa 14-weekperiod. The fiscal years ending February 1, 2020 (“Fiscal Year 2019”) and fiscal year ended February 2, 2019 (“Fiscal Year 2018”) are both comprisedof 52 weeks.

Overview

J.Jill is a premier omnichannel retailer and nationally recognized women’s apparel brand committed to delighting customers with great wear-now product. The brand represents an easy, thoughtful and inspired style that reflects the confidence of remarkable women who live life with joy, passion and purpose. J.Jill offers a guiding customer experience through more than 280 stores nationwide and a robust E-commerce platform. J.Jill is headquartered outside Boston.

FactorsAffectingOur OperatingResults

Variousfactorsareexpectedto continueto affectour resultsof operationsgoing forward,includingthe following:

OverallEconomic Trends. Consumer purchases of clothing and other merchandise generally decline during recessionary periods and other periods when disposable income is adversely affected, and consequently our results of operations may be affected by general economic conditions. For example, reduced consumer confidence and lower availability and higher cost of consumer credit may reduce demand for our merchandise and may limit our ability to increase or sustain prices. The growth rate of the market could be affected by macroeconomic conditions in the United States.

Consumer Preferencesand Fashion Trends. Our ability to maintain our appeal to existing customers and attract new customers depends on our ability to anticipate fashion trends. During periods in which we have successfully anticipated fashion trends, we have generally had more favorable results.

Competition. The retail industry is highly competitive and retailers compete based on a variety of factors, including design, quality, price and customer service. Levels of competition and the ability of our competitors to more accurately predict fashion trends and otherwise attract customers through competitive pricing or other factors may impact our results of operations.

Our Strategic Initiatives. The ongoing implementation of strategic initiatives will continue to have an impact on our results of operations.  These initiatives include our E-commerce site, which was re-platformed in Fiscal Year 2017, and our initiative to upgrade and enhance our information systems. Although initiatives of this nature are designed to create growth in our business and continuing improvement in our operating results, the timing of expenditures related to these initiatives, as well as the achievement of returns on our investments, may affect our results of operation in future periods.

Pricingand Changes in Our MerchandiseMix. Our product offering changes from period to period, as do the prices at which goods are sold and the margins we are able to earn from the sales of those goods. The levels at which we are able to price our merchandise are influenced by a variety of factors, including the quality of our products, cost of production, prices at which our competitors are selling similar products and the willingness of our customers to pay for products.

Potential Changes in Tax Laws and/or Regulations.  Changes in tax laws in any of the multiple jurisdictions in which we operate, or adverse outcomes from tax audits that we may be subject to in any of the jurisdictions in which we operate, could adversely affect our business, financial condition and operating results.  Additionally, any potential changes with respect to tax and trade policies, tariffs and government regulations affecting trade between the U.S. and other countries could adversely affect our business, as we source the majority of our merchandise from manufacturers located outside of the U.S.

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How We Assessthe Performanceof Our Business

In assessingtheperformanceof our business,we considera varietyof financialand operatingmetrics, includingGAAPand non-GAAPmeasures,includingthefollowing:

Net salesconsists primarily of revenues, net of merchandise returns and discounts, generated from the sale of apparel and accessory merchandise through our retail channel and direct channel. Net sales also include shipping and handling fees collected from customers and royalty revenues and marketing reimbursements related to our private label credit card agreement. Revenue from our retail channel is recognized at the time of sale and revenue from our direct channel is recognized upon shipment of merchandise to the customer.

Net sales are impacted by the size of our active customer base, product assortment and availability, marketing and promotional activities and the spending habits of our customers. Net sales are also impacted by the migration of single-channel customers to omnichannel customers who, on average, spend nearly three times more than single-channel customers.

Totalcompanycomparablesalesincludes net sales from our full-price stores that have been open for more than 52 weeks and from our direct channel. This measure highlights the performance of existing stores open during the period, while excluding the impact of new store openings and closures. When a store in the total company comparable store base is temporarily closed for remodeling or other reasons, it is included in total company comparable sales only using the full weeks it was open. Certain of our competitors and other retailers may calculate total company comparable sales differently than we do. As a result, the reporting of our total company comparable sales may not be comparable to sales data made available by other companies.

Number of storesreflects all stores open at the end of a reporting period. In connection with opening new stores, we incur pre-opening costs. Pre-opening costs include expenses incurred prior to opening a new store and primarily consist of payroll, travel, training, marketing, initial opening supplies and costs of transporting initial inventory and fixtures to store locations, as well as occupancy costs incurred from the time of possession of a store site to the opening of that store. These pre-opening costs are included in selling, general and administrative expenses and are generally incurred and expensed within 30 days of opening a new store.

Gross profitisequalto our netsaleslesscostsof goods sold.Gross profitas a percentageof our netsalesis referredto as grossmargin.

Costs of goods soldincludes the direct costs of sold merchandise, inventory shrinkage, and adjustments and reserves for excess, aged and obsolete inventory. We review our inventory levels on an ongoing basis to identify slow-moving merchandise and use product markdowns to liquidate these products. Changes in the assortment of our products may also impact our gross profit. The timing and level of markdowns are driven by customer acceptance of our merchandise. Certain of our competitors and other retailers may report costs of goods sold differently than we do. As a result, the reporting of our gross profit and gross margin may not be comparable to other companies.

The primary drivers of the costs of goods sold are raw materials, which fluctuate based on certain factors beyond our control, including labor conditions, transportation or freight costs, energy prices, currency fluctuations and commodity prices. We place orders with merchandise suppliers in United States dollars and, as a result, are not exposed to significant foreign currency exchange risk.

Selling,generaland administrativeexpensesinclude all operating costs not included in costs of goods sold. These expenses include all payroll and related expenses, occupancy costs, information systems costs and other operating expenses related to our stores and to our operations at our headquarters, including utilities, depreciation and amortization. These expenses also include marketing expense, including catalog production and mailing costs, warehousing, distribution and shipping costs, customer service operations, consulting and software services, professional services and other administrative costs.

Our historical revenue growth has been accompanied by increased selling, general and administrative expenses. The most significant increases were in occupancy costs associated with retail store expansion, and in marketing and payroll investments.

Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA represents net income plus net interest expense, provision (benefit) for income taxes, depreciation and amortization, equity-based compensation expense, write-off of property and equipment, and other non-recurring expenses, primarily consisting of outside legal and professional fees associated with certain non-recurring transactions and events. We present Adjusted EBITDA on a consolidated basis because management uses it as a supplemental measure in assessing our operating performance, and we believe that it is helpful to investors, securities analysts and other interested parties as a measure of our comparative operating performance from period to period. We also use Adjusted EBITDA as one of the primary methods for planning and forecasting overall expected performance of our business and for evaluating on a quarterly and annual basis actual results against such expectations. Further, we recognize Adjusted EBITDA as a commonly used measure in determining business value and as such, use it internally to report results. Adjusted EBITDA margin represents, for any period, Adjusted EBITDA as a percentage of net sales.

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While we believe that Adjusted EBITDA is useful in evaluating our business, Adjusted EBITDA is a non-GAAP financial measure that has limitations as an analytical tool. Adjusted EBITDA should not be considered an alternative to, or substitute for, net income (loss), which is calculated in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate Adjusted EBITDA differently or not at all, which reduces the usefulness of Adjusted EBITDA as a tool for comparison. We recommend that you review the reconciliation and calculation of Adjusted EBITDA and Adjusted EBITDA margin to net income, the most directly comparable GAAP financial measure, below and not rely solely on Adjusted EBITDA or any single financial measure to evaluate our business.

Reconciliationof Net Incometo AdjustedEBITDAand Calculationof AdjustedEBITDAMargin

The followingtableprovidesa reconciliationof netincometo AdjustedEBITDAand thecalculation of AdjustedEBITDAmarginfortheperiodspresented.

	For the Thirteen Weeks Ended						For the Thirty-Nine Weeks Ended
(in thousands)	November 2, 2019			November 3, 2018			November 2, 2019			November 3, 2018
Statements of Operations Data:
Net income (loss)	$	2,387		$	6,688		$	(89,982	)	$	28,431
Interest expense, net		4,826			4,698			14,852			14,368
Income tax (benefit) provision		1,763			2,488			132			10,412
Depreciation and amortization		9,458			9,149			28,307			27,398
Equity-based compensation expense(a)		1,128			1,111			3,544			2,954
Write-off of property and equipment (b)		71			59			85			87
Impairment of goodwill and indefinite-lived intangible assets		—			—			95,428			—
Impairment of long-lived assets(c)		—			—			2,064			—
Other non-recurring expenses (d)		—			—			(740	)		1,346
Adjusted EBITDA	$	19,633		$	24,193		$	53,690		$	84,996
Net sales	$	166,085		$	174,106		$	523,281		$	535,360
Adjusted EBITDA margin		11.8	%		13.9	%		10.3	%		15.9	%

(a) Representsexpensesassociatedwith equityincentiveinstrumentsgrantedto our management and board of directors. Incentive instrumentsareaccountedforas equity-classifiedawardswith therelatedcompensationexpenserecognizedbasedon fairvalueatthedateof thegrants.

(b) Representsnet gain or losson thedisposalof fixedassets.

(c) Represents impairment of long-lived assets related to the change in use of a right-of-use asset.

(d) Represents items management believes are not indicative of ongoing operating performance. For the thirty-nine weeks ended November 2, 2019, these expenses are primarily composed of a gain from insurance proceeds and restructuring costs. For the thirty-nine weeks ended November 3, 2018, these expenses include costs related to a CEO transition.

Items Affecting Comparability of Financial Results

Impairment losses. Our Fiscal Year 2019 year to date results reflect goodwill and intangible asset impairment losses of $95.4 million. We had no impairment losses in Fiscal Year 2018. See Note 5, Asset Impairments, in Item I, Financial Statements, for additional information on these impairment losses.

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Resultsof Operations

Thirteen weeks ended November 2, 2019 Compared to Thirteen weeks ended November 3, 2018

The followingtablesummarizesour consolidatedresultsof operationsfortheperiodsindicated:

	For the Thirteen Weeks Ended										Change from the Thirteen Weeks Ended November 3, 2018 to the Thirteen Weeks
	November 2, 2019					November 3, 2018					Ended November 2, 2019
(in thousands)	Dollars		% of Net Sales			Dollars		% of Net Sales			$ Change			% Change
Net sales	$	166,085		100.0	%	$	174,106		100.0	%	$	(8,021	)		(4.6	)%
Costs of goods sold		59,137		35.6	%		58,643		33.7	%		494			0.8	%
Gross profit		106,948		64.4	%		115,463		66.3	%		(8,515	)		(7.4	)%
Selling, general and administrative expenses		97,972		59.0	%		101,589		58.3	%		(3,617	)		(3.6	)%
Operating income		8,976		5.4	%		13,874		8.0	%		(4,898	)		(35.3	)%
Interest expense, net		4,826		2.9	%		4,698		2.7	%		128			2.7	%
Income before provision for income taxes		4,150		2.5	%		9,176		5.3	%		(5,026	)		(54.8	)%
Income tax provision (benefit)		1,763		1.1	%		2,488		1.4	%		(725	)		(29.1	)%
Net income	$	2,387		1.4	%	$	6,688		3.8	%	$	(4,301	)		(64.3	)%

Net Sales

Net sales forthe thirteen weeks ended November 2, 2019 decreased $8.0 million, or 4.6%, to $166.1 from $174.1 million for the thirteen weeks ended November 3, 2018.At theend of thosesameperiods,we operated 290 and 275 retail stores, respectively. The decrease in total net sales versus the prior year was driven by a decrease in retail comparable store sales of -7.0% .

Our retailchannel contributed 57.0% of our netsalesin the thirteen weeks ended November 2, 2019 and 60.2% in the thirteen weeks ended November 3, 2018.Our directchannel contributed 43.0% of our netsalesin the thirteen weeks ended November 2, 2019 and 39.8% in the thirteen weeks ended November 3, 2018.

Gross Profitand Costs of Goods Sold

Gross profitforthe thirteen weeks ended November 2, 2019 decreased $8.5 million, or 7.4%, to $106.9 from $115.5 million for the thirteen weeks ended November 3, 2018.The gross margin for the thirteen weeks ended November 2, 2019 was 64.4% compared to 66.3% for the thirteen weeks ended November 3, 2018, driven by added promotions, markdowns and liquidation actions to clear certain goods in the thirteen weeks ended November 2, 2019.

Selling,Generaland AdministrativeExpenses

Selling,generaland administrativeexpensesforthe thirteen weeks ended November 2, 2019 decreased $3.6 million, or 3.6%, to $98.0 from $101.6 million for the thirteen weeks ended November 3, 2018. The decrease was primarily driven by expense reduction actions taken in the second quarter ended August 3, 2019, which included a reduction in headcount, lower management incentive costs, and lower marketing costs.

As a percentageof netsales,selling,generaland administrativeexpenses were 59.0% for the thirteen weeks ended November 2, 2019 compared to 58.3% forthe thirteen weeks ended November 3, 2018.  

InterestExpense, Net

Interest expense, net, consists of interest expense on the Term Loan, partially offset by interest earned on cash. Interestexpenseforthe thirteen weeks ended November 2, 2019 increased $0.1 million, or 2.7%, to $4.8 million from $4.7 million for the thirteen weeks ended November 3, 2018.

ProvisionforIncome Taxes

The provisionforincometaxes was $1.8 million for the thirteen weeks ended November 2, 2019compared to $2.5 million for the thirteen weeks ended November 3, 2018.Our effectivetaxratesforthesameperiods were 42.5% and 27.1%,respectively. The higher tax rate was driven by the impact of recurring items including §162(m) officer compensation limitation, stock compensation and state income taxes.

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Thirty-nine weeks ended November 2, 2019 Compared to Thirty-nine weeks ended November 3, 2018

The followingtablesummarizesour consolidatedresultsof operationsfortheperiodsindicated:

	For the Thirty-Nine Weeks Ended											Change from the Thirty-Nine Weeks Ended November 3, 2018 to the Thirty-Nine Weeks
(in thousands)	November 2, 2019						November 3, 2018					Ended November 2, 2019
	Dollars			% of Net Sales			Dollars		% of Net Sales			$ Change			% Change
Net sales	$	523,281			100.0	%	$	535,360		100.0	%	$	(12,079	)		(2.3	)%
Costs of goods sold		194,736			37.2	%		182,901		34.2	%		11,835			6.5	%
Gross profit		328,545			62.8	%		352,459		65.8	%		(23,914	)		(6.8	)%
Selling, general and administrative expenses		308,115			58.9	%		299,248		55.9	%		8,867			3.0	%
Impairment of goodwill		88,428			16.9	%		—		—			88,428			100.0	%
Impairment of indefinite-lived intangible assets		7,000			1.3	%		—		—			7,000			100.0	%
Operating (loss) income		(74,998	)		(14.4	)%		53,211		9.9	%		(128,209	)		(240.9	)%
Interest expense, net		14,852			2.8	%		14,368		2.7	%		484			3.4	%
(Loss) income before provision for income taxes		(89,850	)		(17.2	)%		38,843		7.3	%		(128,693	)		(331.3	)%
Income tax provision (benefit)		132			-			10,412		1.9	%		(10,280	)		(98.7	)%
Net (loss) income	$	(89,982	)		(17.2	)%	$	28,431		5.3	%	$	(118,413	)		(416.5	)%

Net Sales

Net sales for the thirty-nine weeks ended November 2, 2019 decreased $12.1 million, or 2.3%, to $523.3 from $535.4 million for the thirty-nine weeks ended November 3, 2018.At theend of both of thosesameperiods,we operated 290 and 275 retail stores, respectively. The decrease in net sales was due to total company comparable sales of -3.8%.

Our retailchannel contributed 57.5% of our netsalesin the thirty-nine weeks ended November 2, 2019 and 59.6% in the thirty-nine weeks ended November 3, 2018.Our directchannel contributed 42.5% of our netsalesin the thirty-nine weeks ended November 2, 2019 and 40.4% in the thirty-nine weeks ended November 3, 2018.

Gross Profitand Costs of Goods Sold

Gross profitfor the thirty-nine weeks ended November 2, 2019 decreased $24.0 million, or 6.8%, to $328.5 from $352.5 million for the thirty-nine weeks ended November 3, 2018.The gross margin for the thirty-nine weeks ended November 2, 2019 was 62.8% compared to 65.8% for the thirty-nine weeks ended November 3, 2018, largely driven by added promotions, markdowns, and liquidation actions to clear certain goods.

Selling,Generaland AdministrativeExpenses

Selling,generaland administrativeexpensesfor the thirty-nine weeks ended November 2, 2019 increased $8.9 million, or 3.0%, to $308.1 million from $299.2 million for the thirty-nine weeks ended November 3, 2018. The increase was driven by (a) a $5.5 million increase in sales related expenses with higher distribution and store expenses partially offset by lower marketing expense, and (b) $4.6 million for technology initiatives the majority of which was related to a specific technology initiative which was paused in the second quarter of Fiscal Year 2019 ended August 3, 2019. The increases were offset by a $1.2 million reduction in general and administrative expenses driven by the expense reduction actions taken in the second quarter of Fiscal Year 2019 and $0.9 from lower management compensation and recruiting expense.

As a percentageof netsales,selling,generaland administrativeexpenses were 58.9% for the thirty-nine weeks ended November 2, 2019 compared to 55.9% for the thirty-nine weeks ended November 3, 2018.  

InterestExpense, Net

Interest expense, net, consists of interest expense on the Term Loan, partially offset by interest earned on cash. Interestexpensefor the thirty-nine weeks ended November 2, 2019 increased $0.5 million, or 3.4%, to $14.9 from $14.4 million for the thirty-nine weeks ended November 3, 2018. The increase was driven by higher interest rates and a reduction of interest earned on cash.

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ProvisionforIncome Taxes

The provisionforincometaxes was a provision of $0.1 million for the thirty-nine weeks ended November 2, 2019compared to a provision of $10.4 million for the thirty-nine weeks ended November 3, 2018. Our effectivetaxratesforthesameperiods were         -0.1% and 26.8%,respectively. The tax provision in the thirty-nine weeks ended November 2, 2019 was driven by the treatment of the impairment of goodwill and indefinite-lived intangible assets.

Liquidityand CapitalResources

General

Our primary sources of liquidity and capital resources are cash generated from operating activities and availability under our ABL credit agreement, dated as of May 8, 2015, by and among Jill Holdings LLC, Jill Acquisition LLC, certain subsidiaries from time to time party thereto, the lenders party thereto and CIT Finance LLC as the administrative agent and collateral agent, as amended on May 27, 2016 by Amendment No. 1 thereto (the “ABL Facility”) and subsequently amended by Amendment No. 3 on June 12, 2019 to extend the maturity of the agreement. Our primary requirements for liquidity and capital are working capital and general corporate needs, including merchandise inventories, marketing, including catalog production and distribution, payroll, store occupancy costs and capital expenditures associated with opening new stores, remodeling existing stores and upgrading information systems and the costs of operating as a public company. We believe that our current sources of liquidity and capital will be sufficient to finance our continued operations for at least the next 12 months. There can be no assurance, however, that our business will generate sufficient cash flows from operations or that future borrowings will be available under our ABL Facility or otherwise to enable us to service our indebtedness, or to make capital expenditures in the future. Our future operating performance and our ability to service or extend our indebtedness will be subject to future economic conditions and to financial, business, and other factors, many of which are beyond our control.

Capital expenditures were $13.5 million for the thirty-nine weeks ended November 2, 2019 compared to $14.0 million for the thirty-nine weeks ended November 3, 2018.  The decrease in capital expenditures in Fiscal Year 2019 was due primarily to a decrease in technology projects, partially offset by an increase in spending on store investments.

Cash Flow Analysis

The followingtableshows our cashflowsinformationfortheperiodspresented:

	For the Thirty-Nine Weeks Ended
(in thousands)	November 2, 2019			November 3, 2018
Net cash provided by operating activities	$	17,687		$	50,028
Net cash used in investing activities		(13,493	)		(14,017	)
Net cash used in financing activities		(53,440	)		(2,099	)

Net Cash providedby OperatingActivities

Net cash provided by operatingactivitiesduring the thirty-nine weeks ended November 2, 2019 was $17.7 million.Key elementsof cash providedby operatingactivitieswere (i)netlossof $90.0 million,(ii)adjustmentsto reconcilenetincometo netcashprovidedby operatingactivitiesof $122.6 million,primarilydrivenby impairment of goodwill and indefinite lived intangible assets, depreciationand amortization, partially offset by deferred income taxes, and (iii) an increase in netoperatingassetsand liabilitiesof $(14.9) million,primarilydrivenby higher inventory and accounts receivable levels as well as lower accounts payable.

Net cash provided by operatingactivitiesduring the thirty-nine weeks ended November 3, 2018 was $50.0 million.Key elements of cashprovidedby operatingactivitieswere (i)netincomeof $28.4 million, and (ii)adjustmentsto reconcilenet incometo netcashprovidedby operatingactivitiesof $27.7 million,primarilydrivenby depreciation and amortization and equity based compensation and noncash amortization of deferred financing and debt discount costs, partially offset by deferred income taxes, and (iii) an increase in netoperatingassetsand liabilitiesof $6.1 million,primarily driven by prepaid expenses and other current assets as well as accounts payable and accounts receivable, partially offset by other noncurrent assets and liabilities and inventory.

Net Cash used in InvestingActivities

Net cash used in investingactivitiesduring the thirty-nine weeks ended November 2, 2019 was $13.5 million,representingpurchasesof propertyand equipmentrelatedinvestments in storesand information systems.

19

Net cashused in investingactivitiesduringthe thirty-nine weeks ended November 3, 2018was $14.0 million,representingpurchasesof propertyand equipmentrelatedinvestments in storesand information systems.

Net Cash usedin FinancingActivities

Net cash used infinancingactivitiesduring the thirty-nine weeks ended November 2, 2019 was $53.4 million,which was driven primarily by the special dividend paid to shareholders.

Net cash used in financing activities during the thirty-nine weeks ended November 3, 2018 was $2.1 million, which was the scheduled repayment of our Term Loan.

Dividends

On April 1, 2019 the Company paid a special cash dividend of $50.2 million to the shareholders of J.Jill, Inc.

The payment of cash dividends in the future, if any, will be at the discretion of our board of directors and will depend upon such factors as earnings levels, capital requirements, restrictions imposed by applicable law, our overall financial condition, restrictions in our debt agreements, including our Term Loan and ABL Facility, and any other factors deemed relevant by our board of directors. As a holding company, our ability to pay dividends depends on our receipt of cash dividends from our operating subsidiaries, which may further restrict our ability to pay dividends as a result of restrictions on their ability to pay dividends to us under our Term Loan, our ABL Facility and under future indebtedness that we or they may incur.

CreditFacilities

At November 2, 2019 and February 2, 2019 therewere no loanamountsoutstandingundertheABLFacility. At November 2, 2019 and February 2, 2019 the Company had outstandinglettersof creditin theamountsof $1.7 million and $1.8 million, respectively, and had a maximum additional borrowing capacity of $38.3 million and $38.2, million respectively.

ContractualObligations

The Company’s contractual obligations consist primarily of long-term debt obligations, interest payments, operating leases and purchase orders for merchandise inventory. These contractual obligations impact the Company’s short-term and long-term liquidity and capital resource needs. During the thirty-nine weeks ended November 2, 2019, there were no material changes in the contractual obligations as of February 2, 2019.

Contingencies

We are subject to various legal proceedings that arise in the ordinary course of business. Although the outcome of such proceedings cannot be predicted with certainty, management does not believe that we are presently party to any legal proceedings the resolution of which management believes would have a material adverse effect on our business, financial condition, operating results or cash flows. We establish reserves for specific legal matters when we determine that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable.

Off-Balance Sheet Arrangements

We arenot a partyto any off-balancesheetarrangements.

CriticalAccounting Policiesand SignificantEstimates

The mostsignificantaccountingestimatesinvolvea high degreeof judgmentor complexity.Management believestheestimatesand judgmentsmostcriticalto thepreparationof our consolidatedfinancialstatementsand to theunderstandingof our reportedfinancialresultsincludethosemadein connectionwith revenuerecognition, includingaccountingforgiftcardbreakageand estimatedmerchandisereturns;estimatingthevalueof inventory;impairmentassessmentsforgoodwilland otherindefinite-livedintangibleassets,and long-livedassets;and estimatingequity-basedcompensationexpense.Management evaluatesitspoliciesand assumptionson an ongoing basis.

20

Our significantaccountingpoliciesrelatedto these accountsin thepreparationof our consolidatedfinancialstatementsaredescribed under the heading “Management Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Significant Estimates” in our Annual Reporton Form10-K for the fiscal year ended February 2, 2019. As of the date of this filing, there were no significant changes to any of the critical accounting policies and estimates previously described in our Annual Report on Form 10-K, except for the effects of the adoption of ASC Topic 842 – Leases. Refer to Note 2 to our unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q, under header, “Significant Accounting Policies Update” for the effects and disclosures of adoption.

Recent Accounting Pronouncements

Refer to Note 2 to our unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q, for recently adopted accounting standards, including the dates of adoption and estimated effects on our results of operations, financial position or cash flows.

Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are generally identified by the use of forward-looking terminology, including the terms “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and, in each case, their negative or other various or comparable terminology. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management and expected market growth are forward-looking statements.

These forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. All written and oral forward-looking statements made in connection with this Quarterly Report on Form 10-Q that are attributable to us or persons acting on our behalf are expressly qualified in their entirety by the Risk Factors set forth in our Annual Report on Form 10-K for the year ended February 2, 2019 and other cautionary statements included therein and herein.

These forward-looking statements reflect our views with respect to future events as of the date of this Quarterly Report on Form 10-Q and are based on assumptions and subject to risks and uncertainties. Given these uncertainties, you should not place undue reliance on these forward-looking statements. These forward-looking statements represent our estimates and assumptions only as of the date of this Quarterly Report on Form 10-Q and, except as required by law, we undertake no obligation to update or review publicly any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this Quarterly Report on Form 10-Q. We anticipate that subsequent events and developments will cause our views to change. We qualify all of our forward-looking statements by these cautionary statements.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

InterestRate Risk

We aresubjectto interestrateriskin connectionwith borrowingsundertheTermLoan and ABLFacility, which bearinterestatvariableratesequalto LIBORplusa marginas definedin therespectiveagreements describedabove. As of November 2, 2019, therewas no outstandingbalanceundertheABLFacility,and $1.7 millionlettersof creditoutstanding.The undrawn borrowingavailabilityundertheABLFacilitywas $38.3 millionand theamountoutstandingundertheTermLoan had decreasedto $243.3 millionas a resultof the scheduled repayments. We currentlydo not engagein any interestratehedgingactivity.Based on theinterestrateon theABLFacilityat November 2, 2019, and thescheduleof outstandingborrowingsunderour TermLoan, a 10% changein our currentinterestrate would affectnetincomeby $1.3 millionduringFiscal Year2019.

Impactof Inflation

Our resultsof operationsand financialconditionarepresentedbasedon historicalcost.Whileitisdifficult to accuratelymeasuretheimpactof inflationdue to theimprecisenatureof theestimatesrequired,we believethe effectsof inflation,ifany, on our resultsof operationsand financialconditionhave been immaterial.We cannot assureyou our businesswillnot be affectedin thefutureby inflation.

Item 4. Controls and Procedures

Evaluation of DisclosureControlsand Procedures

We maintaindisclosurecontrolsand proceduresthataredesignedto providereasonableassurancethat informationrequiredto be disclosedin thereportswe fileor submitundertheSecuritiesExchange Act of 1934, as amended,isrecorded,processed,summarizedand reportedwithinthetimeperiodsspecifiedin theSEC’s rulesand forms,and thatsuch informationisaccumulatedand communicatedto our management,includingour ChiefExecutiveOfficerand ChiefFinancialOfficer,to allowtimelydecisionsregardingrequireddisclosure.

Our management,underthesupervisionof our ChiefExecutiveOfficerand ChiefFinancialOfficer, evaluatedtheeffectivenessof our disclosurecontrolsand procedures(asdefinedin Rules 13a-15(e)and 15d-15(e)undertheSecuritiesExchange Act of 1934, as amended)as of theend of theperiodcoveredby this Quarterly Reporton Form-10-Q.Based on thatevaluation,our ChiefExecutiveOfficerand ChiefFinancialOfficer have concludedthatas of theend of theperiodcoveredby thisQuarterly Reporton Form-10-Q,our disclosure controlsand procedureswere effectiveto providesuch reasonableassurance.

Changes to Internal Control over Financial Reporting

There were no significant changes in our internal control over financial reporting, (as defined in Rules 13a-15(e) and 15d-15(e) under the Act) during thefiscal quarter ended November 2, 2019.

Limitationson the Effectivenessof Controlsand Procedures

In designingand evaluatingour disclosurecontrolsand procedures,our managementrecognizesthatany controlsand procedures,no matterhow welldesignedand operated,can provideonly reasonable,not absolute, assuranceof achievingthedesiredcontrolobjectives.In addition,thedesignof disclosurecontrolsand proceduresmustreflectthefactthatthereareresourceconstraintsand our managementisrequiredto apply judgmentin evaluatingthebenefitsof possiblecontrolsand proceduresrelativeto theircosts.The designof any disclosurecontrolsand proceduresalsoisbasedin partupon certainassumptionsaboutthelikelihoodof future events,and therecan be no assurancethatany designwillsucceedin achievingitsstatedgoalsunderallpotential futureconditions.

22

PART II—OTHER INFORMATION

Item 1. Legal Proceedings

We are subject to various legal proceedings that arise in the ordinary course of business. Although the outcome of such proceedings cannot be predicted with certainty, management does not believe that we are presently party to any legal proceedings the resolution of which management believes would have a material adverse effect on our business, financial condition, operating results or cash flows. We establish reserves for specific legal matters when we determine that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable.

Item 1A. Risk Factors

Factors that could cause our actual results to differ materially from those in this report are described under the heading “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. The following risk factor was updated from those risk factors disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended February 2, 2019.

Changes in our credit ratings may limit our access to capital markets and adversely affect our liquidity.

The credit rating agencies periodically review our capital structure and the quality and stability of our earnings. Any downgrades to our long-term credit ratings could result in reduced access to the credit and capital markets and higher interest costs on future financings. The future availability of financing will depend on a variety of factors such as economic and market conditions, the availability of credit and our credit ratings, as well as the possibility that lenders could develop a negative perception of us. There is no assurance that we will be able to obtain additional financing on favorable terms or at all.

There were no other material changes. However, additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations and we may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

The exhibits listed on the Exhibit Index are filed or furnished as part of this Quarterly Report on Form 10-Q.

23

Exhibit Index

Exhibit Number	Description
3.1	Certificate of Incorporation of J.Jill, Inc. (incorporated by reference from Exhibit 3.1 to the Company’s Form 10-K, filed on April 28, 2017 (File No. 0001-38026))
3.2	Bylaws of J.Jill, Inc. (incorporated by reference from Exhibit 3.2 to the Company’s 10-K, filed on April 28, 2017 (File No.001-38026))
31.1	Certification of Principal Executive Officer required by Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Principal Financial Officer required by Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

* Furnished herewith.

24

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	J.Jill, Inc.
Date: December 12, 2019	By:	/s/ James Scully
		James Scully
		Interim Chief Executive Officer
Date: December 12, 2019	By:	/s/ Mark Webb
		Mark Webb
		Executive Vice President and Chief Financial Officer

25

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS AMENDED, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, James Scully, certify that:

1. I have reviewed this Quarterly Report of J.Jill, Inc. (the “Company”) on Form 10-Q for the period ended November 2, 2019;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Securities Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: December 12, 2019	By:	/s/ James Scully
		James Scully
		Interim Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS AMENDED, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Mark Webb, certify that:

1. I have reviewed this Quarterly Report of J.Jill, Inc. (the “Company”) on Form 10-Q for the period ended November 2, 2019;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Securities Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: December 12, 2019	By:	/s/ Mark Webb
		Mark Webb
		Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of J.Jill, Inc. (the “Company”) on Form 10-Q for the period ended November 2, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: December 12, 2019	By:	/s/ James Scully
		James Scully
		Interim Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of J.Jill, Inc. (the “Company”) on Form 10-Q for the period ended November 2, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: December 12, 2019	By:	/s/ Mark Webb
		Mark Webb
		Executive Vice President and Chief Financial Officer

XML

Earnings Per Share - Additional Information (Detail) - shares	3 Months Ended		9 Months Ended
	Nov. 02, 2019	Nov. 03, 2018	Nov. 02, 2019	Nov. 03, 2018
Earnings Per Share [Abstract]
Antidilutive equity awards excluded from the computation of diluted earnings per share	4,000,014	1,083,876	3,183,761	847,600

XML

Operating Leases - Schedule of Lease Terms and Discount Rate (Detail)	Nov. 02, 2019
Leases [Abstract]
Weighted-average remaining lease term (in years), Operating leases	7 years 2 months 12 days
Weighted-average discount rate, Operating leases	6.50%

XML

Summary of Significant Accounting Policies

9 Months Ended

Nov. 02, 2019

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Basis of Presentation

Our interim consolidated financial statements are unaudited. All significant intercompany balances and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted, in accordance with the rules of the Securities and Exchange Commission (the “SEC”). In the opinion of management, these interim consolidated financial statements contain all normal and recurring adjustments necessary to state fairly the financial position and results of operations of the Company. The consolidated balance sheet as of February 2, 2019 is derived from the audited consolidated balance sheet as of that date. The unaudited results of operations for the thirteen and thirty-nine weeks ended November 2, 2019 are not necessarily indicative of future results or results to be expected for the full year ending February 1, 2020 (“Fiscal Year 2019”). You should read these statements in conjunction with our audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended February 2, 2019.

Significant changes to our accounting policies as a result of adopting Accounting Standards Update (“ASU”) 2016-02 – Leases (Topic 842) are discussed below in “Significant Accounting Policies Update” and Note 10.

Recently Adopted Accounting Policies

In February 2016, the FASB issued ASU 2016-02 – Leases (Topic 842), which supersedes FASB Accounting Standards Codification (“ASC”) Topic 840 – Leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. The standard was adopted using the modified retrospective approach as of February 3, 2019 with an immaterial cumulative adjustment to retained earnings. See “Significant Accounting Policies Update” and Note 13 for a discussion of our updated policies related to leases and disclosures related to the impact of this standard.

In July 2018, the FASB issued ASU 2018-09 – Codification Improvements, which facilitates amendments to a variety of topics to clarify, correct errors in, or make minor improvements to the accounting standards codification. The effective date of the standard is dependent on the facts and circumstances of each amendment. Some amendments do not require transition guidance and will be effective upon the issuance of this standard. The standard was adopted as of February 3, 2019, and it had no material impact on our consolidated financial statements and related disclosures.

In June 2018, the FASB issued ASU 2018-07 – Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The Company adopted the standard as of February 3, 2019, and it had no impact on our consolidated financial statements and related disclosures.

Recently Issued Accounting Pronouncements

In November 2018, the FASB issued ASU 2018-18 – Collaborative Arrangements (Topic 808), which clarifies the interaction between Topic 808 and Topic 606, Revenue from Contracts with Customers. The provisions of ASU 2018-18 are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Company will be required to adopt this standard in the first quarter of Fiscal Year 2020. This standard is not expected to have a material impact on our consolidated financial statements and related disclosures.

In September 2018, the FASB issued ASU 2018-15 – Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The amendment is intended to address aspects of the guidance issued in the amendments in ASU 2015-05 – Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. ASU 2018-15 intends to improve an entities ability to evaluate the accounting for fees paid by a customer in a cloud computing arrangement that is a service contract. The provisions of ASU 2018-15 are effective for fiscal years beginning after December 15, 2019. The Company plans to adopt these standards using a prospective approach and is evaluating the impact that adopting ASU 2018-15 will have on its consolidated financial statements and related disclosures.

Significant Accounting Policies Update

Adoption of ASC Topic 842: Leases

The Company adopted ASU 2016-02- Leases (Topic 842) and related amendments, as of February 3, 2019, using the modified retrospective approach. The modified retrospective approach provides a method for recording existing leases at adoption with a cumulative adjustment to retained earnings. The Company elected the package of practical expedients which permits the Company to not reassess (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for any expired or existing leases as of the effective date.

The Company applied a portfolio approach to effectively account for the operating lease liabilities and operating lease assets; the Company did not have financing leases. The Company excludes leases with an initial term of 12 months or less from the application of Topic 842. The Company did not elect the hindsight practical expedient; therefore, upon adoption, the Company used the remaining lease term of the current lease, option or extension.

Adoption of the new standard resulted in the recording of operating lease assets and operating lease liabilities of $223.3 million and $250.5 million, respectively, on the Company’s consolidated balance sheet as of February 3, 2019. The difference between the approximate value of the operating lease assets and liabilities is attributable to deferred rent, deferred rent incentives, leasehold interests and prepaid rent. There was no material impact on the Company’s consolidated statement of operations and comprehensive income or consolidated statements cash flows. The Company’s comparative periods continue to be presented and disclosed in accordance with legacy guidance in Topic 840.

Operating Leases

The Company determines if an arrangement is a lease at inception. Lease agreements will typically exist with lease and non-lease components, which are generally accounted for separately.

The Company recognizes operating lease liabilities equal to the present value of the lease payments and operating lease assets representing the right to use the underlying asset for the lease term. The lease expense for lease payments is recognized on a straight-line basis over the lease term.

As the Company’s leases do not provide an implicit rate, the Company will use an incremental borrowing rate based on the information available at lease commencement in determining the present value of lease payments. The operating lease assets include any lease payments made prior to lease commencement and are reduced by any lease incentives.

Under Topic 842, for any new leases entered into, the Company will assess if it is reasonably certain to exercise lease options to extend or terminate the lease for inclusion (or exclusion) in the lease term when the Company measures the lease liability. The depreciable life of any assets and leasehold improvements are limited by the expected lease term.

Certain of the Company’s retail operating leases include variable rental payments based on a percentage of retail sales over contractual levels. Variable rental payments are recognized in the consolidated statement of operations and comprehensive income in the period in which the obligation for those payments are incurred. If such variable operating leases arise that include incentives from landlords in the form of cash, the Company will record the full amount of the incentive when specific performance criteria are met as a deferred liability. The deferred liability is amortized into income as a reduction of rent expense over the term of the applicable lease, including options to extend if they are reasonably certain to be exercised. The Company recognized those liabilities to be amortized within a year as a current liability and those greater than a year as a long-term liability. For purposes of recognizing these incentives and rental expenses on a straight-line basis, the Company uses the date it obtains the legal right to use and control the lease asset to begin amortization, which is generally when the Company takes possession of the asset.

XML

Consolidated Statement of Shareholders' Equity - USD ($) $ in Thousands		Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Earnings (Deficit) [Member]
Beginning balance at Feb. 03, 2018		$ 179,316	$ 437	$ 117,393	$ 61,486
Beginning balance, shares at Feb. 03, 2018			43,752,790
Adoption of ASU | ASU 2014-09 [Member]		(288)			(288)
Vesting of restricted stock units		1	$ 1
Vesting of restricted stock units, shares			6,410
Equity-based compensation		760		760
Net income (loss)		11,258			11,258
Ending Balance at May. 05, 2018		191,047	$ 438	118,153	72,456
Ending balance, shares at May. 05, 2018			43,759,200
Beginning balance at Feb. 03, 2018		179,316	$ 437	117,393	61,486
Beginning balance, shares at Feb. 03, 2018			43,752,790
Net income (loss)		28,431
Ending Balance at Nov. 03, 2018		210,413	$ 437	120,347	89,629
Ending balance, shares at Nov. 03, 2018			43,747,757
Beginning balance at May. 05, 2018		191,047	$ 438	118,153	72,456
Beginning balance, shares at May. 05, 2018			43,759,200
Vesting of restricted stock units, shares			3,192
Forfeiture of restricted stock awards		(1)	$ (1)
Forfeiture of restricted stock awards, shares			(18,359)
Equity-based compensation		1,083		1,083
Net income (loss)		10,485			10,485
Ending Balance at Aug. 04, 2018		202,614	$ 437	119,236	82,941
Ending balance, shares at Aug. 04, 2018			43,744,033
Vesting of restricted stock units, shares			3,724
Equity-based compensation		1,111		1,111
Net income (loss)		6,688			6,688
Ending Balance at Nov. 03, 2018		210,413	$ 437	120,347	89,629
Ending balance, shares at Nov. 03, 2018			43,747,757
Beginning balance at Feb. 02, 2019		$ 213,795	$ 437	121,635	91,723
Beginning balance, shares at Feb. 02, 2019		43,672,418	43,672,418
Adoption of ASU | ASU 2016-02 [Member]	[1]	$ 59			59
Special cash dividend ($1.15 per share)		(50,154)			(50,154)
Vesting of restricted stock units			$ 7	(7)
Vesting of restricted stock units, shares			734,474
Shares withheld for net-share settlement of equity-based compensation		(1,268)	$ (2)	(1,266)
Shares withheld for net-share settlement of equity-based compensation, shares			(239,117)
Forfeiture of restricted stock awards			$ (1)	1
Forfeiture of restricted stock awards, shares			(69,978)
Equity-based compensation		1,202		1,202
Net income (loss)		4,366			4,366
Ending Balance at May. 04, 2019		168,000	$ 441	121,565	45,994
Ending balance, shares at May. 04, 2019			44,097,797
Beginning balance at Feb. 02, 2019		$ 213,795	$ 437	121,635	91,723
Beginning balance, shares at Feb. 02, 2019		43,672,418	43,672,418
Net income (loss)		$ (89,982)
Ending Balance at Nov. 02, 2019		$ 76,072	$ 440	123,986	(48,354)
Ending balance, shares at Nov. 02, 2019		44,034,608	44,034,608
Beginning balance at May. 04, 2019		$ 168,000	$ 441	121,565	45,994
Beginning balance, shares at May. 04, 2019			44,097,797
Forfeitable dividend		107		107
Forfeiture of restricted stock awards			$ (1)	1
Forfeiture of restricted stock awards, shares			(92,685)
Equity-based compensation		1,214		1,214
Net income (loss)		(96,735)			(96,735)
Ending Balance at Aug. 03, 2019		72,586	$ 440	122,887	(50,741)
Ending balance, shares at Aug. 03, 2019			44,005,112
Vesting of restricted stock units			$ 0	0
Vesting of restricted stock units, shares			50,434
Shares withheld for net-share settlement of equity-based compensation		(35)	$ 0	(35)
Shares withheld for net-share settlement of equity-based compensation, shares			(14,829)
Forfeitable dividend		7		7
Forfeiture of restricted stock awards			$ 0	0
Forfeiture of restricted stock awards, shares			(6,109)
Equity-based compensation		1,128		1,128
Net income (loss)		2,387			2,387
Ending Balance at Nov. 02, 2019		$ 76,072	$ 440	$ 123,986	$ (48,354)
Ending balance, shares at Nov. 02, 2019		44,034,608	44,034,608

[1] See Note 2 for additional detail regarding adoption of new accounting standards.

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Earnings Per Share (Tables)

9 Months Ended

Nov. 02, 2019

Earnings Per Share [Abstract]

Computation of Basic and Diluted Net Income Per Share Attributable to Common Shareholders

The following table summarizes the computation of basic and diluted net income per share attributable to common shareholders (in thousands, except share and per share data):

	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	November 2, 2019		November 3, 2018		November 2, 2019			November 3, 2018
Numerator
Net income (loss) attributable to common shareholders:	$	2,387	$	6,688	$	(89,982	)	$	28,431
Denominator
Weighted average number of common shares outstanding, basic:		43,838,667		42,953,173		43,653,178			42,674,957
Dilutive effect of stock options and restricted shares:		112,035		1,522,620		—			1,524,843
Weighted average number of common shares outstanding, diluted:		43,950,702		44,475,793		43,653,178			44,199,800
Net (loss) income per common share attributable to common shareholders, basic:	$	0.05	$	0.16	$	(2.06	)	$	0.67
Net (loss) income per common share attributable to common shareholders, diluted:	$	0.05	$	0.15	$	(2.06	)	$	0.64

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Summary of Significant Accounting Policies (Policies)

9 Months Ended

Nov. 02, 2019

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

Our interim consolidated financial statements are unaudited. All significant intercompany balances and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted, in accordance with the rules of the Securities and Exchange Commission (the “SEC”). In the opinion of management, these interim consolidated financial statements contain all normal and recurring adjustments necessary to state fairly the financial position and results of operations of the Company. The consolidated balance sheet as of February 2, 2019 is derived from the audited consolidated balance sheet as of that date. The unaudited results of operations for the thirteen and thirty-nine weeks ended November 2, 2019 are not necessarily indicative of future results or results to be expected for the full year ending February 1, 2020 (“Fiscal Year 2019”). You should read these statements in conjunction with our audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended February 2, 2019.

Significant changes to our accounting policies as a result of adopting Accounting Standards Update (“ASU”) 2016-02 – Leases (Topic 842) are discussed below in “Significant Accounting Policies Update” and Note 10.

Recently Adopted Accounting Policies, Recently Issued Accounting Pronouncements and Significant Accounting Policies Update

Recently Adopted Accounting Policies

In February 2016, the FASB issued ASU 2016-02 – Leases (Topic 842), which supersedes FASB Accounting Standards Codification (“ASC”) Topic 840 – Leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. The standard was adopted using the modified retrospective approach as of February 3, 2019 with an immaterial cumulative adjustment to retained earnings. See “Significant Accounting Policies Update” and Note 13 for a discussion of our updated policies related to leases and disclosures related to the impact of this standard.

In July 2018, the FASB issued ASU 2018-09 – Codification Improvements, which facilitates amendments to a variety of topics to clarify, correct errors in, or make minor improvements to the accounting standards codification. The effective date of the standard is dependent on the facts and circumstances of each amendment. Some amendments do not require transition guidance and will be effective upon the issuance of this standard. The standard was adopted as of February 3, 2019, and it had no material impact on our consolidated financial statements and related disclosures.

In June 2018, the FASB issued ASU 2018-07 – Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The Company adopted the standard as of February 3, 2019, and it had no impact on our consolidated financial statements and related disclosures.

Recently Issued Accounting Pronouncements

In November 2018, the FASB issued ASU 2018-18 – Collaborative Arrangements (Topic 808), which clarifies the interaction between Topic 808 and Topic 606, Revenue from Contracts with Customers. The provisions of ASU 2018-18 are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Company will be required to adopt this standard in the first quarter of Fiscal Year 2020. This standard is not expected to have a material impact on our consolidated financial statements and related disclosures.

In September 2018, the FASB issued ASU 2018-15 – Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The amendment is intended to address aspects of the guidance issued in the amendments in ASU 2015-05 – Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. ASU 2018-15 intends to improve an entities ability to evaluate the accounting for fees paid by a customer in a cloud computing arrangement that is a service contract. The provisions of ASU 2018-15 are effective for fiscal years beginning after December 15, 2019. The Company plans to adopt these standards using a prospective approach and is evaluating the impact that adopting ASU 2018-15 will have on its consolidated financial statements and related disclosures.

Significant Accounting Policies Update

Adoption of ASC Topic 842: Leases

The Company adopted ASU 2016-02- Leases (Topic 842) and related amendments, as of February 3, 2019, using the modified retrospective approach. The modified retrospective approach provides a method for recording existing leases at adoption with a cumulative adjustment to retained earnings. The Company elected the package of practical expedients which permits the Company to not reassess (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for any expired or existing leases as of the effective date.

The Company applied a portfolio approach to effectively account for the operating lease liabilities and operating lease assets; the Company did not have financing leases. The Company excludes leases with an initial term of 12 months or less from the application of Topic 842. The Company did not elect the hindsight practical expedient; therefore, upon adoption, the Company used the remaining lease term of the current lease, option or extension.

Adoption of the new standard resulted in the recording of operating lease assets and operating lease liabilities of $223.3 million and $250.5 million, respectively, on the Company’s consolidated balance sheet as of February 3, 2019. The difference between the approximate value of the operating lease assets and liabilities is attributable to deferred rent, deferred rent incentives, leasehold interests and prepaid rent. There was no material impact on the Company’s consolidated statement of operations and comprehensive income or consolidated statements cash flows. The Company’s comparative periods continue to be presented and disclosed in accordance with legacy guidance in Topic 840.

Operating Leases

The Company determines if an arrangement is a lease at inception. Lease agreements will typically exist with lease and non-lease components, which are generally accounted for separately.

The Company recognizes operating lease liabilities equal to the present value of the lease payments and operating lease assets representing the right to use the underlying asset for the lease term. The lease expense for lease payments is recognized on a straight-line basis over the lease term.

As the Company’s leases do not provide an implicit rate, the Company will use an incremental borrowing rate based on the information available at lease commencement in determining the present value of lease payments. The operating lease assets include any lease payments made prior to lease commencement and are reduced by any lease incentives.

Under Topic 842, for any new leases entered into, the Company will assess if it is reasonably certain to exercise lease options to extend or terminate the lease for inclusion (or exclusion) in the lease term when the Company measures the lease liability. The depreciable life of any assets and leasehold improvements are limited by the expected lease term.

Certain of the Company’s retail operating leases include variable rental payments based on a percentage of retail sales over contractual levels. Variable rental payments are recognized in the consolidated statement of operations and comprehensive income in the period in which the obligation for those payments are incurred. If such variable operating leases arise that include incentives from landlords in the form of cash, the Company will record the full amount of the incentive when specific performance criteria are met as a deferred liability. The deferred liability is amortized into income as a reduction of rent expense over the term of the applicable lease, including options to extend if they are reasonably certain to be exercised. The Company recognized those liabilities to be amortized within a year as a current liability and those greater than a year as a long-term liability. For purposes of recognizing these incentives and rental expenses on a straight-line basis, the Company uses the date it obtains the legal right to use and control the lease asset to begin amortization, which is generally when the Company takes possession of the asset.

XML

Document and Entity Information - shares	9 Months Ended
	Nov. 02, 2019	Dec. 12, 2019
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Nov. 02, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Trading Symbol	JILL
Entity Registrant Name	J.Jill, Inc.
Entity Central Index Key	0001687932
Current Fiscal Year End Date	--02-01
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity File Number	001-38026
Entity Tax Identification Number	45-1459825
Entity Address, Address Line One	4 Batterymarch Park
Entity Address, City or Town	Quincy
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02169
City Area Code	617
Local Phone Number	376-4300
Entity Common Stock, Shares Outstanding		44,034,608
Entity Interactive Data Current	Yes
Title of 12(b) Security	Common Stock, $0.01 par value
Security Exchange Name	NYSE
Entity Incorporation, State or Country Code	DE
Document Quarterly Report	true
Document Transition Report	false

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Income Taxes

9 Months Ended

Nov. 02, 2019

Income Tax Disclosure [Abstract]

Income Taxes

8. Income Taxes

The Company recorded an income tax expense of $1.8 million and $0.1 million for the thirteen and thirty-nine weeks ended November 2, 2019, respectively, and income tax expense of $2.5 million and $10.4 million during the thirteen and thirty-nine weeks ended November 3, 2018, respectively. The effective tax rates were 42.5% and (0.1)% in the thirteen and thirty-nine weeks ended November 2, 2019, respectively, and 27.1% and 26.8% in the thirteen and thirty-nine weeks ended November 3, 2018, respectively.

The effective tax rate for the thirteen and thirty-nine weeks ended November 2, 2019 differs from the federal statutory rate of 21% primarily due to the impact of recurring items including §162(m) officer compensation limitation, stock compensation and state income taxes. The effective tax rate for the thirty-nine weeks ended November 2, 2019 was also impacted by the goodwill impairment charge of $88.4 million. The effective tax rate for the thirteen and thirty-nine weeks ended November 3, 2018 exceeded the federal statutory rate of 21.0% primarily due to §162(m) officer compensation limitation, stock compensation and state income taxes.

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Other Income

9 Months Ended

Nov. 02, 2019

Other Income And Expenses [Abstract]

Other Income

4. Other Income

The Company filed an insurance claim as a result of a cargo vessel fire on or about January 8, 2019, where contents of two containers carried J.Jill inventory. In July 2019, it was determined that the inventory onboard the cargo vessel was nonsalable and the insurance claim was settled for $3.3 million. The Company recorded a gain of $2.4 million on insurance proceeds in selling, general and administrative expenses in the consolidated statement of operations and comprehensive income (loss) for the thirty-nine weeks ended November 2, 2019.  

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Commitments and Contingencies

9 Months Ended

Nov. 02, 2019

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

12. Commitments and Contingencies

Legal Proceedings

The Company is subject to various legal proceedings that arise in the ordinary course of business. Although the outcome of such proceedings cannot be predicted with certainty, management does not believe that the Company is presently party to any legal proceedings the resolution of which management believes would have a material adverse effect on the Company’s business, financial condition, operating results or cash flows. The Company establishes reserves for specific legal matters when the Company determines that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable.

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Revenues - Schedule of Contract Liabilities (Detail) - USD ($) $ in Thousands	Nov. 02, 2019	Feb. 02, 2019
Contract liabilities:
Signing bonus	$ 541	$ 647
Unredeemed gift cards	4,934	7,081
Total contract liabilities	$ 5,475	$ 7,728

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Asset Impairments - Additional Information (Detail) $ in Thousands	9 Months Ended
	Nov. 02, 2019 USD ($) Floor
Impairment of long-lived assets	$ 2,064
Impairment of goodwill	88,428
Impairment of indefinite-lived intangible assets	7,000
Leasehold Improvements [Member]
Impairment of long-lived assets	300
Right-of-Use Asset [Member]
Impairment of long-lived assets	$ 1,800
Massachusetts [Member]
Sublease, Number Of Floors | Floor	1

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Related Party Transactions

9 Months Ended

Nov. 02, 2019

Related Party Transactions [Abstract]

Related Party Transactions

11. Related Party Transactions

For both the thirteen and thirty-nine weeks ended November 2, 2019 and November 3, 2018, the Company incurred an immaterial amount of related party transactions.

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Debt

9 Months Ended

Nov. 02, 2019

Debt Disclosure [Abstract]

Debt

7. Debt

The components of the Company’s outstanding Term Loan were as follows (in thousands):

	November 2, 2019			February 2, 2019
Term Loan	$	243,278		$	245,378
Discount on debt and debt issuance costs		(4,030	)		(5,115	)
Less: Current portion		(2,799	)		(2,799	)
Net long-term debt	$	236,450		$	237,464

The Company was in compliance with all financial covenants as of November 2, 2019.

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Revenues

9 Months Ended

Nov. 02, 2019

Revenue From Contract With Customer [Abstract]

Revenues

3. Revenues

Disaggregation of Revenue

The Company sells its products directly to consumers and the Company earns royalties under its credit card agreement. The following table presents disaggregated revenues by source (in thousands):

	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	November 2, 2019		November 3, 2018		November 2, 2019		November 3, 2018
Retail	$	94,748	$	104,840	$	301,008	$	319,080
Direct		71,337		69,266		222,273		216,280
Net revenues	$	166,085	$	174,106	$	523,281	$	535,360

Contract Liabilities

The Company recognizes a contract liability when it has received consideration from the customer and has a future obligation to the customer. Total contract liabilities consisted of the following (in thousands):

	November 2, 2019		February 2, 2019
Contract liabilities:
Signing bonus	$	541	$	647
Unredeemed gift cards		4,934		7,081
Total contract liabilities(1)	$	5,475	$	7,728

(1) Included in accrued expenses and other current liabilities on the Company's consolidated balance sheet. The short-term portion of the signing bonus is included in accrued expenses on the consolidated balance sheet as of November 2, 2019.

For the thirteen and thirty-nine weeks ended November 2, 2019, the Company recognized approximately $2.0 million and $8.5 million of revenue related to gift card redemptions and breakage, respectively. For the thirteen and thirty-nine weeks ended November 3, 2018, the Company recognized approximately $2.1 million and $8.2 million of revenue related to gift card redemptions and breakage, respectively. Revenue recognized consists of gift cards that were part of the unredeemed gift card balance at the beginning of the period as well as gift cards that were issued during the period.

Performance Obligations

The Company has a remaining performance obligation of $0.5 million for a signing bonus related to the private label credit card agreement. The Company will recognize revenue over the remaining life of the contract as follows (in thousands):

	Fiscal Year 2019		Fiscal Year 2020		Thereafter
Signing bonus	$	35	$	141	$	365

This disclosure does not include revenue related to performance obligations from unredeemed gift cards, as substantially all gift cards are redeemed in the first year of issuance.

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Revenues - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Nov. 02, 2019	Nov. 03, 2018	Nov. 02, 2019	Nov. 03, 2018
Revenue From Contract With Customer [Abstract]
Revenue recognized related to gift card redemptions and breakage	$ 2.0	$ 2.1	$ 8.5	$ 8.2
Signing bonus	$ 0.5		$ 0.5

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Restructuring Costs - Additional Information (Detail) - 2019 Restructuring Plan [Member] $ in Thousands	9 Months Ended
	Nov. 02, 2019 USD ($)
Restructuring Cost And Reserve [Line Items]
Restructuring Costs	$ 1,597
Selling, General and Administrative Expenses [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring Costs	$ 1,600

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Equity-Based Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions		3 Months Ended		9 Months Ended
	Mar. 06, 2019	Nov. 02, 2019	Nov. 03, 2018	Nov. 02, 2019	Nov. 03, 2018	May 04, 2019	Apr. 01, 2019	Mar. 19, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity based compensation expense		$ 1.1	$ 1.1	$ 3.5	$ 2.9
Special cash dividend, per share	$ 1.15					$ 1.15
Cash dividend paid							$ 50.2
Dividend declared, date	Mar. 06, 2019
Dividend payable, date	Apr. 01, 2019
Shareholders of record, date	Mar. 19, 2019
2017 Plan [Member] | Restricted Share Awards ("RSAs") [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Special cash dividend, per share								$ 1.15

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Operating Leases - Schedule of Maturities of Lease Liabilities (Detail) $ in Thousands	Nov. 02, 2019 USD ($)
Leases [Abstract]
2019	$ 7,413
2020	47,428
2021	46,893
2022	42,671
2023	39,374
Thereafter	132,172
Less: Imputed interest	68,255
Operating lease liabilities	$ 247,696

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Debt (Tables)

9 Months Ended

Nov. 02, 2019

Debt Disclosure [Abstract]

Components of Outstanding Term Loan

The components of the Company’s outstanding Term Loan were as follows (in thousands):

	November 2, 2019			February 2, 2019
Term Loan	$	243,278		$	245,378
Discount on debt and debt issuance costs		(4,030	)		(5,115	)
Less: Current portion		(2,799	)		(2,799	)
Net long-term debt	$	236,450		$	237,464

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Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 02, 2019	Nov. 03, 2018	Nov. 02, 2019	Nov. 03, 2018
Income Statement [Abstract]
Net sales	$ 166,085	$ 174,106	$ 523,281	$ 535,360
Costs of goods sold	59,137	58,643	194,736	182,901
Gross profit	106,948	115,463	328,545	352,459
Selling, general and administrative expenses	97,972	101,589	308,115	299,248
Impairment of goodwill			88,428
Impairment of indefinite-lived intangible assets			7,000
Operating income (loss)	8,976	13,874	(74,998)	53,211
Interest expense, net	4,826	4,698	14,852	14,368
Income (loss) before provision for income taxes	4,150	9,176	(89,850)	38,843
Income tax provision	1,763	2,488	132	10,412
Net income (loss) and total comprehensive income (loss)	$ 2,387	$ 6,688	$ (89,982)	$ 28,431
Net income (loss) per common share attributable to common shareholders:
Basic	$ 0.05	$ 0.16	$ (2.06)	$ 0.67
Diluted	$ 0.05	$ 0.15	$ (2.06)	$ 0.64
Weighted average number of common shares outstanding:
Basic	43,838,667	42,953,173	43,653,178	42,674,957
Diluted	43,950,702	44,475,793	43,653,178	44,199,800

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Subsequent Event

9 Months Ended

Nov. 02, 2019

Subsequent Events [Abstract]

Subsequent Event

15. Subsequent Event

On December 5, 2019, the Company announced the departure of President, CEO and Director, Linda Heasley effective immediately, after serving over a year and a half in the role. Ms. Heasley will be succeeded as Chief Executive Officer on an interim basis by James Scully, who currently serves on the Board of Directors of J.Jill, Inc., effective December 5, 2019.

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Description of Business

9 Months Ended

Nov. 02, 2019

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Description of Business

1. Description of Business

J.Jill, Inc., “J.Jill” or the “Company”, is a premier omnichannel retailer and nationally recognized women’s apparel brand committed to delighting customers with great wear-now product. The brand represents an easy, thoughtful and inspired style that reflects the confidence of remarkable women who live life with joy, passion and purpose. J.Jill offers a guiding customer experience through more than 280 stores nationwide and a robust E-commerce platform. J.Jill is headquartered outside Boston.

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Debt - Components of Outstanding Term Loan (Detail) - USD ($) $ in Thousands	Nov. 02, 2019	Feb. 02, 2019
Long Term Debt [Abstract]
Term Loan	$ 243,278	$ 245,378
Discount on debt and debt issuance costs	(4,030)	(5,115)
Less: Current portion	(2,799)	(2,799)
Net long-term debt	$ 236,450	$ 237,464

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Revenues - Schedule of Disaggregated Revenues by Source (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 02, 2019	Nov. 03, 2018	Nov. 02, 2019	Nov. 03, 2018
Disaggregation Of Revenue [Line Items]
Net revenues	$ 166,085	$ 174,106	$ 523,281	$ 535,360
Retail [Member]
Disaggregation Of Revenue [Line Items]
Net revenues	94,748	104,840	301,008	319,080
Direct [Member]
Disaggregation Of Revenue [Line Items]
Net revenues	$ 71,337	$ 69,266	$ 222,273	$ 216,280

XML

Other Income - Additional Information (Detail) $ in Millions	1 Months Ended	9 Months Ended
	Jul. 31, 2019 USD ($)	Nov. 02, 2019 USD ($)	Jan. 08, 2019 Container
Other Income And Expenses [Line Items]
Number of containers | Container			2
Insurance claim settlement amount	$ 3.3
Selling, General and Administrative Expenses [Member]
Other Income And Expenses [Line Items]
Proceeds from insurance claims		$ 2.4

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Earnings Per Share

9 Months Ended

Nov. 02, 2019

Earnings Per Share [Abstract]

Earnings Per Share

9. Earnings Per Share

The following table summarizes the computation of basic and diluted net income per share attributable to common shareholders (in thousands, except share and per share data):

	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	November 2, 2019		November 3, 2018		November 2, 2019			November 3, 2018
Numerator
Net income (loss) attributable to common shareholders:	$	2,387	$	6,688	$	(89,982	)	$	28,431
Denominator
Weighted average number of common shares outstanding, basic:		43,838,667		42,953,173		43,653,178			42,674,957
Dilutive effect of stock options and restricted shares:		112,035		1,522,620		—			1,524,843
Weighted average number of common shares outstanding, diluted:		43,950,702		44,475,793		43,653,178			44,199,800
Net (loss) income per common share attributable to common shareholders, basic:	$	0.05	$	0.16	$	(2.06	)	$	0.67
Net (loss) income per common share attributable to common shareholders, diluted:	$	0.05	$	0.15	$	(2.06	)	$	0.64

The weighted average common shares for the diluted earnings per share calculation exclude the impact of outstanding equity awards if the assumed proceeds per share of the award is in excess of the related fiscal period’s average price of the Company’s common stock. Such awards are excluded because they would have an antidilutive effect. There were 4,000,014 and 3,183,761 for the thirteen and thirty-nine weeks ended November 2, 2019, and 1,083,876 and 847,600 for the thirteen and thirty-nine weeks ended November 3, 2018, such awards excluded.

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Asset Impairments

9 Months Ended

Nov. 02, 2019

Income Statement [Abstract]

Asset Impairments

5. Asset Impairments

Long-lived Asset Impairments

In the second quarter of Fiscal Year 2019, the Company reduced the net carrying value of certain long-lived assets to their estimated fair value, determined using a discounted cash flows method. These impairment charges arose from the Company’s decision to vacate and sublease one floor of the corporate headquarters located in Quincy, Massachusetts. The Company incurred impairment charges of $0.3 million on leasehold improvements and $1.8 million on the right-of-use asset. The impairment charges were recorded in selling, general and administrative expenses in the consolidated statement of operations and comprehensive income (loss).

Goodwill and Other Indefinite-lived Intangible Asset Impairments

In the second quarter of Fiscal Year 2019, the Company reduced comparable sales outlook for the second quarter that led to a reduced full year forecast of earnings for Fiscal Year 2019. The Company concluded that these factors, as well as the decrease in stock price represented indicators of impairment and required the Company to test goodwill and indefinite-lived intangible assets for impairment during the second quarter of Fiscal Year 2019 (the “Impairment Test”).

The Company performed the Impairment Test using a quantitative approach with the assistance of an independent valuation firm. The Impairment Test was performed using the income approach (or discounted cash flows method) for goodwill and the relief-from-royalty method for indefinite-lived intangible assets. The estimated fair values of goodwill and indefinite-lived intangible asset were below carrying values resulting in an $88.4 million impairment of goodwill and a $7.0 million impairment of the Company’s tradename (indefinite-lived intangible asset).The Company will perform their annual impairment assessment during the fourth quarter of Fiscal Year 2019 and may incur further impairments based on the results of that assessment which may be material.

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Barter Arrangement - Additional Information (Detail) - ASU 2014-09 [Member] - Advertising Barter Transactions [Member] - Evergreen Trading [Member] $ in Millions	3 Months Ended
	Nov. 02, 2019 USD ($)
Revenue Initial Application Period Cumulative Effect Transition [Line Items]
Transfer of inventory against media credit	$ 3.3
Prepaid media asset	2.0
Transfer of inventory assets as a reduction of inventory offset by decrease in reserves	(2.5)
Gain recorded upon shipment of inventory	1.3
Unused media credits	$ 2.0
Unused media credit term	5 years

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Operating Leases - Summary of Future Minimum Rental Payments Under Non-Cancelable Operating Lease Obligations (Detail) $ in Thousands	Feb. 02, 2019 USD ($)
Operating Leases Future Minimum Payments Due [Abstract]
2019	$ 49,399
2020	46,512
2021	43,872
2022	39,369
2023	36,459
Thereafter	110,376
Total	$ 325,987

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Earnings Per Share - Computation of Basic and Diluted Net Income Per Share Attributable to Common Shareholders (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 02, 2019	Nov. 03, 2018	Nov. 02, 2019	Nov. 03, 2018
Numerator
Net income (loss) attributable to common shareholders:	$ 2,387	$ 6,688	$ (89,982)	$ 28,431
Denominator
Weighted average number of common shares outstanding, basic:	43,838,667	42,953,173	43,653,178	42,674,957
Dilutive effect of stock options and restricted shares:	112,035	1,522,620		1,524,843
Weighted average number of common shares outstanding, diluted:	43,950,702	44,475,793	43,653,178	44,199,800
Net (loss) income per common share attributable to common shareholders, basic:	$ 0.05	$ 0.16	$ (2.06)	$ 0.67
Net (loss) income per common share attributable to common shareholders, diluted:	$ 0.05	$ 0.15	$ (2.06)	$ 0.64

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Operating Leases - Components of Lease Expense (Detail) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Nov. 02, 2019	Nov. 02, 2019
Leases [Line Items]
Total lease cost	$ 13,030	$ 37,942
SG&A Expenses [Member]
Leases [Line Items]
Operating lease cost	12,054	35,426
Variable lease cost	$ 976	$ 2,516

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Consolidated Statement of Shareholders' Equity (Parenthetical) - $ / shares	May 04, 2019	Mar. 06, 2019
Statement Of Stockholders Equity [Abstract]
Dividend declared (in dollars per share)	$ 1.15	$ 1.15

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Revenues (Tables)

9 Months Ended

Nov. 02, 2019

Revenue From Contract With Customer [Abstract]

Schedule of Disaggregated Revenues by Source

The following table presents disaggregated revenues by source (in thousands):

	For the Thirteen Weeks Ended				For the Thirty-Nine Weeks Ended
	November 2, 2019		November 3, 2018		November 2, 2019		November 3, 2018
Retail	$	94,748	$	104,840	$	301,008	$	319,080
Direct		71,337		69,266		222,273		216,280
Net revenues	$	166,085	$	174,106	$	523,281	$	535,360

Schedule of Contract Liabilities

Total contract liabilities consisted of the following (in thousands):

	November 2, 2019		February 2, 2019
Contract liabilities:
Signing bonus	$	541	$	647
Unredeemed gift cards		4,934		7,081
Total contract liabilities(1)	$	5,475	$	7,728

(1) Included in accrued expenses and other current liabilities on the Company's consolidated balance sheet. The short-term portion of the signing bonus is included in accrued expenses on the consolidated balance sheet as of November 2, 2019.

Schedule of Revenue Recognized Over Remaining Life of Contract

The Company will recognize revenue over the remaining life of the contract as follows (in thousands):

	Fiscal Year 2019		Fiscal Year 2020		Thereafter
Signing bonus	$	35	$	141	$	365

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Operating Leases

9 Months Ended

Nov. 02, 2019

Leases [Abstract]

Operating Leases

13. Operating Leases

As of November 2, 2019, the Company leased certain retail stores, a distribution center, and office space. As of that same date, the Company did not have any financing leases and no operating leases contained any material residual value guarantees or material restrictive covenants. Certain of the Company’s retail operating leases include variable rental payments based on a percentage of retail sales over contractual levels.

Some retail leases include one or more options to renew, with renewal terms that can extend the lease term from one to fifteen years. The Company’s distribution center has renewal terms that can extend the lease term up to twenty years. The exercise of lease renewal options is at the Company’s sole discretion. As of November 2, 2019, the Company included options to renew that are reasonably certain to be exercised in the operating lease assets and liabilities.

As described in Note 2, the Company adopted Topic 842 as of February 3, 2019. Under this guidance the Company did not record any deferred lease liabilities as of November 2, 2019. The Company maintained a tenant incentive liability of $1.3 million as of November 2, 2019, related to certain variable retail leases. Under legacy guidance, Topic 840, the Company recorded a deferred lease liability of $11.9 million and maintained a tenant improvement incentive liability of $19.1 million as of February 2, 2019.

The components of lease expense were as follows (in thousands):

Lease Cost	Classification	For the Thirteen Weeks Ended November 2, 2019		For the Thirty-Nine Weeks Ended November 2, 2019
Operating lease cost	SG&A Expenses	$	12,054	$	35,426
Variable lease cost	SG&A Expenses		976		2,516
Total lease cost		$	13,030	$	37,942

For the thirteen and thirty-nine weeks ended November 2, 2019, total common area maintenance expense was $3.6 million and $10.7 million, respectively. For the thirteen and thirty-nine weeks ended November 3, 2018, total rental expense was $11.6 million and $35.2 million, respectively, and common area maintenance expense was $3.6 million and $10.6 million, respectively, exclusive of contingent rental expense recorded of $0.4 million and $1.0 million, respectively.

The Company used an incremental borrowing rate on February 3, 2019, for operating leases that commenced prior to that date. The incremental borrowing rate is estimated based upon (1) the financial condition and credit rating of the Company and its peers, (2) the term of the lease, (3) the nature of the underlying asset, and (4) the relative economic environment.

For the thirteen and thirty-nine weeks ended November 2, 2019, operating lease liabilities arising from obtaining operating lease assets was $9.6 million and $19.2 million, respectively.

For the thirteen and thirty-nine weeks ended November 2, 2019, the total cash paid for amounts included in the measurement of operating lease liabilities was $12.1 million and $35.8 million, respectively.

Lease Term and Discount Rate	November 2, 2019
Weighted-average remaining lease term (in years)
Operating leases		7.2
Weighted-average discount rate
Operating leases		6.5	%

Maturities of lease liabilities as of November 2, 2019 were as follows (in thousands):

Fiscal Year	Operating Leases(1)
2019	$	7,413
2020		47,428
2021		46,893
2022		42,671
2023		39,374
Thereafter		132,172
Less: Imputed interest		68,255
Present value of lease liabilities	$	247,696

(1) There were no operating leases with legally binding minimum lease payments for leases signed but for which the Company has not taken possession.

Under Topic 840, future minimum rental payments required under all non-cancellable operating lease obligations as of February 2, 2019 were as follows (in thousands):

Fiscal Year
2019	$	49,399
2020		46,512
2021		43,872
2022		39,369
2023		36,459
Thereafter		110,376
Total	$	325,987

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Consolidated Balance Sheets - USD ($) $ in Thousands	Nov. 02, 2019	Feb. 02, 2019
Current assets:
Cash	$ 16,958	$ 66,204
Accounts receivable	7,684	4,007
Inventories, net	81,420	77,349
Prepaid expenses and other current assets	26,391	27,734
Total current assets	132,453	175,294
Property and equipment, net	113,224	118,044
Intangible assets, net	120,730	136,177
Goodwill	108,597	197,026
Operating lease assets, net	218,008
Other assets	1,544	447
Total assets	694,556	626,988
Current liabilities:
Accounts payable	50,966	55,012
Accrued expenses and other current liabilities	44,639	45,306
Current portion of long-term debt	2,799	2,799
Current portion of operating lease liabilities	31,372
Total current liabilities	129,776	103,117
Long-term debt, net of discount and current portion	236,450	237,464
Deferred income taxes	33,934	41,842
Operating lease liabilities, net of current portion	216,324
Other liabilities	2,000	30,770
Total liabilities	618,484	413,193
Commitments and contingencies (see Note 9)
Shareholders’ Equity
Common stock, par value $0.01 per share; 250,000,000 shares authorized; 44,034,608 and 43,672,418 shares issued and outstanding at November 2, 2019 and February 2, 2019, respectively	440	437
Additional paid-in capital	123,986	121,635
Accumulated (deficit) earnings	(48,354)	91,723
Total shareholders’ equity	76,072	213,795
Total liabilities and shareholders’ equity	$ 694,556	$ 626,988

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Operating Leases (Tables)

9 Months Ended

Nov. 02, 2019

Leases [Abstract]

Components of Lease Expense

The components of lease expense were as follows (in thousands):

Lease Cost	Classification	For the Thirteen Weeks Ended November 2, 2019		For the Thirty-Nine Weeks Ended November 2, 2019
Operating lease cost	SG&A Expenses	$	12,054	$	35,426
Variable lease cost	SG&A Expenses		976		2,516
Total lease cost		$	13,030	$	37,942

Schedule of Lease Terms and Discount Rate

Lease Term and Discount Rate	November 2, 2019
Weighted-average remaining lease term (in years)
Operating leases		7.2
Weighted-average discount rate
Operating leases		6.5	%

Schedule of Maturities of Lease Liabilities

Maturities of lease liabilities as of November 2, 2019 were as follows (in thousands):

Fiscal Year	Operating Leases(1)
2019	$	7,413
2020		47,428
2021		46,893
2022		42,671
2023		39,374
Thereafter		132,172
Less: Imputed interest		68,255
Present value of lease liabilities	$	247,696

(1) There were no operating leases with legally binding minimum lease payments for leases signed but for which the Company has not taken possession.

Summary of Future Minimum Rental Payments Under Non-Cancelable Operating Lease Obligations

Under Topic 840, future minimum rental payments required under all non-cancellable operating lease obligations as of February 2, 2019 were as follows (in thousands):

Fiscal Year
2019	$	49,399
2020		46,512
2021		43,872
2022		39,369
2023		36,459
Thereafter		110,376
Total	$	325,987

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Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 02, 2019	Nov. 03, 2018	Nov. 02, 2019	Nov. 03, 2018
Income Tax Disclosure [Abstract]
Income tax (benefit) expense	$ 1,763	$ 2,488	$ 132	$ 10,412
Effective income tax rate	42.50%	27.10%	(0.10%)	26.80%
U.S. Federal corporate income tax rate	21.00%	21.00%	21.00%	21.00%
Impairment of goodwill			$ 88,428

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Operating Leases - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Nov. 02, 2019	Nov. 03, 2018	Nov. 02, 2019	Nov. 03, 2018	Feb. 02, 2019
Leases [Line Items]
Lessee, operating lease, option to extend			Some retail leases include one or more options to renew, with renewal terms that can extend the lease term from one to fifteen years. The Company’s distribution center has renewal terms that can extend the lease term up to twenty years.
Lessee, operating lease, existence of option to extend			true
Deferred lease liability					$ 11,900,000
Tenant improvement incentive liability					$ 19,100,000
Common area maintenance expense	$ 3,600,000	$ 3,600,000	$ 10,700,000	$ 10,600,000
Rental expense		11,600,000		35,200,000
Contingent rental expense		$ 400,000		$ 1,000,000
Operating lease liabilities arising from obtaining operating lease assets	9,600,000		19,200,000
Operating leases, cash paid for amounts included in the measurement of operating lease liabilities	12,100,000		35,800,000
ASU 2016-02 [Member]
Leases [Line Items]
Deferred lease liability	0		0
Tenant improvement incentive liability	$ 1,300,000		$ 1,300,000
Minimum [Member] | Retail Stores [Member]
Leases [Line Items]
Lessee, operating lease, option to extend lease term	1 year		1 year
Maximum [Member] | Retail Stores [Member]
Leases [Line Items]
Lessee, operating lease, option to extend lease term	15 years		15 years
Maximum [Member] | Distribution Center [Member]
Leases [Line Items]
Lessee, operating lease, option to extend lease term	20 years		20 years

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Operating Leases - Schedule of Maturities of Lease Liabilities (Parenthetical) (Detail) $ in Millions	9 Months Ended
	Nov. 02, 2019 USD ($)
Leases [Abstract]
Minimum operating lease payments for leases signed but not taken possession	$ 0

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Description of Business - Additional Information (Detail)	Nov. 02, 2019 Store
Minimum [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Number of stores	280

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Restructuring Costs (Tables)

9 Months Ended

Nov. 02, 2019

Restructuring And Related Activities [Abstract]

Activity of Restructuring Costs and Related Accruals

The following table summarizes the activity of the restructuring costs discussed above and related accruals recorded in accrued other and other current liabilities on the consolidated balance sheet (in thousands):

	February 3, 2019		Charges Incurred		Cash Payments		Adjustments		November 2, 2019
Employee separation costs	$	—	$	1,402	$	828	$	—	$	574
Other		—		195		101		—		94
Total restructuring costs	$	—	$	1,597	$	929	$	—	$	668

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Nov. 02, 2019	Nov. 03, 2018
Statement Of Cash Flows [Abstract]
Net (loss) income	$ (89,982)	$ 28,431
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	28,301	27,397
Impairment of goodwill and indefinite-lived intangible assets	95,428
Impairment of long-lived assets	2,064
Loss on disposal of fixed assets	85	87
Gain on liquidation of inventory	(1,274)
Noncash amortization of deferred financing and debt discount costs	1,250	1,196
Equity-based compensation	3,544	2,954
Deferred rent liability	(133)	(99)
Deferred income taxes	(7,908)	(3,812)
Changes in operating assets and liabilities:
Accounts receivable	(3,677)	(2,777)
Inventories	(4,797)	1,747
Prepaid expenses and other current assets	(1,662)	(4,958)
Accounts payable	(4,102)	(3,032)
Accrued expenses	(60)	44
Operating lease assets and liabilities	718
Other noncurrent assets and liabilities	(108)	2,850
Net cash provided by operating activities	17,687	50,028
Investing activities:
Purchases of property and equipment	(13,493)	(14,017)
Net cash used in investing activities	(13,493)	(14,017)
Financing activities:
Repayments on long-term debt	(2,099)	(2,099)
Payments of withholding tax on net-share settlement of equity-based compensation plans	(1,301)
Special dividend paid to shareholders	(50,154)
Forfeitable dividend	114
Net cash used in financing activities	(53,440)	(2,099)
Net change in cash	(49,246)	33,912
Cash:
Beginning of Period	66,204	25,978
End of Period	$ 16,958	$ 59,890

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Consolidated Balance Sheets (Parenthetical) - $ / shares	Nov. 02, 2019	Feb. 02, 2019
Statement Of Financial Position [Abstract]
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	44,034,608	43,672,418
Common stock, shares outstanding	44,034,608	43,672,418

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Barter Arrangement

9 Months Ended

Nov. 02, 2019

Barter Arrangement [Abstract]

Barter Arrangement

14. Barter Arrangement

The Company entered into a bartering arrangement with Evergreen Trading, a vendor, where the Company provided inventory in exchange for media credits. During Q3 of fiscal 2019, the Company exchanged $3.3 million of inventory for certain media credits. To account for the exchange, the Company recorded the transfer of the inventory asset as a reduction of inventory offset by a $2.5 million decrease in reserves and an increase to a prepaid media asset of $2.0 million which is included in “Prepaid and other current assets” and “Other assets” on the accompanying consolidated balance sheet. A gain of $1.3 million was recorded upon shipment of the inventory. The Company had $2.0 million of unused media credits remaining as of November 2, 2019 that will be used over five years.

The Company accounted for this barter transactions under ASC Topic No. 606 “Revenue from Contract with Customers.” Barter transactions with commercial substance are recorded at the estimated fair value of the products exchanged, unless the products received have a more readily determinable estimated fair value. Revenue associated with barter transaction is recorded at the time of the exchange of the related assets.

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Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Thousands	Nov. 02, 2019	Feb. 03, 2019
Schedule Of Significant Accounting Policies [Line Items]
Operating lease assets	$ 218,008
Operating lease liabilities	$ 247,696
ASU 2016-02 [Member]
Schedule Of Significant Accounting Policies [Line Items]
Operating lease assets		$ 223,300
Operating lease liabilities		$ 250,500

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Revenues - Schedule of Revenue Recognized Over Remaining Life of Contract (Detail) $ in Thousands	Nov. 02, 2019 USD ($)
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Signing bonus	$ 500
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2019-11-03
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Signing bonus	$ 35
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	3 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-02-02
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Signing bonus	$ 141
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-01-31
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Signing bonus	$ 365
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period

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Restructuring Costs - Activity of Restructuring Costs and Related Accruals (Detail) - 2019 Restructuring Plan [Member] $ in Thousands	9 Months Ended
	Nov. 02, 2019 USD ($)
Restructuring Cost And Reserve [Line Items]
Charges Incurred	$ 1,597
Cash Payments	929
Ending Balance	668
Employee Separation Costs [Member]
Restructuring Cost And Reserve [Line Items]
Charges Incurred	1,402
Cash Payments	828
Ending Balance	574
Other [Member]
Restructuring Cost And Reserve [Line Items]
Charges Incurred	195
Cash Payments	101
Ending Balance	$ 94

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Equity-Based Compensation

9 Months Ended

Nov. 02, 2019

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Equity-Based Compensation

10. Equity-Based Compensation

Equity-based compensation expense was $1.1 million and $3.5 million for the thirteen and thirty-nine weeks ended November 2, 2019, and $1.1 million and $2.9 million for the thirteen and thirty-nine weeks ended November 3, 2018.

Special Dividend

On March 6, 2019, the Company’s Board of Directors declared a special cash dividend (the “Special Dividend”) of $1.15 per share payable to shareholders of record as of March 19, 2019, of which $50.2 million was paid on April 1, 2019 to shareholders.

In connection with the Special Dividend, pursuant to anti-dilution provisions in the 2017 Omnibus Equity Incentive Plan (the “2017 Plan”), the Company adjusted outstanding equity awards in order to prevent dilution of such awards. Accordingly, the Company adjusted the number of outstanding unvested restricted stock units (“RSUs”) as of the payment date of the dividend with an additional number of RSUs (“Dividend Equivalent Units” or “DEUs”) equal to the quotient obtained by dividing (x) the product of the number of unvested RSUs as of the record date by the amount of the dividend per share, by (y) the fair market value of share on the payment date of the Special Dividend. The DEUs will follow the same vesting pattern as the RSUs. For holders of outstanding options as of March 19, 2019, the option strike price on such options was reduced by the per share amount of the Special Dividend. Holders of unvested Restricted Stock Awards (“RSAs”) received a forfeitable $1.15 per share dividend on unvested RSAs as of March 19, 2019.

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Restructuring Costs

9 Months Ended

Nov. 02, 2019

Restructuring And Related Activities [Abstract]

Restructuring Costs

6. Restructuring Costs

In July 2019, the Company implemented a restructuring plan (the “2019 Restructuring Plan”) focused on cost reduction initiatives designed to execute against long-term strategies. The 2019 Restructuring Plan included headcount reductions primarily at the Company’s corporate headquarters in Quincy, Massachusetts and at the facility in Tilton, New Hampshire.

As a result of the 2019 Restructuring Plan, the Company recorded $1.6 million of restructuring costs in selling, general and administrative expenses in the consolidated statements of operations and comprehensive income. All restructuring costs have been incurred in the second quarter of Fiscal Year 2019 and payments are anticipated to be complete in the fourth quarter of Fiscal Year 2020, ending on January 30, 2021.

The following table summarizes the activity of the restructuring costs discussed above and related accruals recorded in accrued other and other current liabilities on the consolidated balance sheet (in thousands):

	February 3, 2019		Charges Incurred		Cash Payments		Adjustments		November 2, 2019
Employee separation costs	$	—	$	1,402	$	828	$	—	$	574
Other		—		195		101		—		94
Total restructuring costs	$	—	$	1,597	$	929	$	—	$	668