JJill Inc (JILL) 2023 Q1 法說會逐字稿

Good morning. My name is Jale, and I will be your conference operator today. At this time, I would like to welcome everyone to the J.Jill First Quarter 2023 Earnings Conference Call. On today's call are Claire Spofford, President and Chief Executive Officer; and Mark Webb, Executive Vice President, Chief Financial Officer and Chief Operating Officer. (Operator Instructions)

早上好。我叫 Jale，今天我將擔任你們的會議操作員。此時此刻，我歡迎大家參加 J.Jill 2023 年第一季度收益電話會議。出席今天電話會議的有總裁兼首席執行官克萊爾·斯波福德 (Claire Spofford)；執行副總裁、首席財務官兼首席運營官馬克·韋伯 (Mark Webb)。 （操作員說明）

Before we begin, I need to remind you that certain comments made during these remarks may constitute forward-looking statements and are made pursuant to and within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 as amended. Such forward-looking statements are subject to both known and unknown risks and uncertainties that could cause actual results to differ materially from such statements. Those risks and uncertainties are described in the press release and J.Jill's SEC filings. The forward-looking statements on this recording are as of June 7, 2023, and J.Jill does not undertake any obligation to update these forward-looking statements.

在開始之前，我需要提醒您，這些言論中的某些評論可能構成前瞻性陳述，並且是根據經修訂的 1995 年《私人證券訴訟改革法案》的安全港條款並在其含義範圍內做出的。此類前瞻性陳述受到已知和未知的風險和不確定性的影響，可能導致實際結果與此類陳述存在重大差異。這些風險和不確定性在新聞稿和 J.Jill 向 SEC 提交的文件中進行了描述。本錄音中的前瞻性陳述截至 2023 年 6 月 7 日，J.Jill 不承擔更新這些前瞻性陳述的任何義務。

Finally, J.Jill may refer to certain adjusted or non-GAAP financial measures during these remarks. A reconciliation schedule showing the GAAP versus non-GAAP financial measures is available in the press release issued on June 7, 2023. If you do not have a copy of today's press release, you may obtain one by visiting the Investor Relations page of the website at jjill.com. I will now turn the call over to Claire. Please go ahead.

最後，J.Jill 在這些言論中可能會提到某些調整後或非公認會計準則的財務指標。顯示 GAAP 與非 GAAP 財務指標的調節表可在 2023 年 6 月 7 日發布的新聞稿中找到。如果您沒有今天的新聞稿副本，您可以通過訪問網站的投資者關係頁面獲取一份在jjill.com。我現在將把電話轉給克萊爾。請繼續。

Thank you, operator, and hello, everyone. Thank you for joining us this morning. I will begin our discussion by reviewing highlights from our first quarter performance, and we will then provide an update on a few of our strategic initiatives before turning the call over to Mark to review our financial performance and outlook in more detail.

謝謝接線員，大家好。感謝您今天早上加入我們。我將首先回顧我們第一季度業績的亮點，然後我們將提供一些戰略舉措的最新信息，然後再將電話轉給馬克，以更詳細地回顧我們的財務業績和前景。

In the first quarter, we delivered sales in line with our expectations as we anniversaried a strong comparison to last year, and we exceeded our outlook for profitability, reflecting our ongoing execution of our disciplined operating model which generates healthy cash flow from operations.

第一季度，我們的銷售額符合我們的預期，因為與去年相比，我們的周年紀念日表現強勁，並且我們超出了我們的盈利預期，反映出我們持續執行嚴格的運營模式，該模式從運營中產生了健康的現金流。

In addition, we successfully completed the refinancing of our term loan and ABL facility this spring. We believe through the disciplines we now have in place, along with our enhanced financial flexibility with the completion of our debt refinancing, we are well positioned to navigate the current environment and remain focused on positioning J.Jill for long-term success.

此外，我們今年春季成功完成了定期貸款和 ABL 融資的再融資。我們相信，通過我們現有的紀律，以及完成債務再融資而增強的財務靈活性，我們能夠很好地應對當前的環境，並繼續專注於為 J.Jill 取得長期成功。

During the quarter, we continued to stay close to our customer and remain agile to react and respond to her evolving spending behavior amidst the current environment, including adjusting our marketing and promotional plans to deliver the sales and inventory results. Our latest customer insight study reveals that concerns around inflationary pressures remained high. We saw that play out in Q1 in her spending behavior in terms of both units per transaction and frequency. We continue to see strength in the newness we delivered and in categories like dresses and within our Pure Jill and Wearever sub-brands, but we did see some softening within certain categories, particularly in our basics business.

本季度，我們繼續與客戶保持密切聯繫，並保持敏捷性，以應對當前環境下不斷變化的消費行為，包括調整我們的營銷和促銷計劃以提供銷售和庫存結果。我們最新的客戶洞察研究顯示，人們對通脹壓力的擔憂仍然很高。我們在第一季度的每筆交易單位數和頻率方面看到了她的消費行為。我們繼續看到我們提供的新穎性以及連衣裙等類別以及我們的 Pure Jill 和 Wearever 子品牌的優勢，但我們確實看到某些類別的軟化，特別是在我們的基本業務中。

With respect to our channel performance, we continue to see relative strength in stores, while both channels or our customer become more discerning with their purchases, the impact was felt more broadly within direct where we also experienced a higher level of returns. While our return rate is higher than our historical average, it is relatively in line with the industry and to be expected, given the strength we have seen in categories such as dresses, where return rates are typically higher.

就我們的渠道表現而言，我們繼續看到商店的相對優勢，而渠道或我們的客戶對購買的判斷力變得更加挑剔，我們在直接範圍內更廣泛地感受到了影響，我們也經歷了更高水平的回報。雖然我們的退貨率高於歷史平均水平，但考慮到我們在連衣裙等退貨率通常較高的類別中看到的實力，它相對符合行業且符合預期。

As part of our commitment to responding in season to manage our inventory balances, we took select actions where appropriate and maintain the controlled approach to the breadth and depth of promotions. We were pleased to end the period with a well-positioned inventory balance in line with our strategy as the freight tailwinds we expected offset the surgical markdown actions taken.

作為我們承諾及時響應以管理庫存餘額的一部分，我們在適當的情況下採取了有選擇的行動，並在促銷的廣度和深度上保持了受控的方法。我們很高興以符合我們戰略的良好庫存平衡結束這一時期，因為我們預期的貨運順風抵消了所採取的外科手術降價行動。

Turning now to the progress we're making against our strategic initiatives. First, with respect to our focus on customer growth and the modernization of our brand and value proposition. While our top line performance was impacted by the factors I just reviewed, we were encouraged to see continued results in Q1 from our size inclusivity initiatives with productive growth in this segment across both channels. In addition, while our size inclusivity initiative continues to be a pathway to growth with that customer, we were also pleased to see that our Wearever sub-brand is resonating with younger new-to-brand customers who are looking for clothing to wear to work. As we look ahead, we will continue to leverage our portfolio of sub-brands to lean into areas that are resonating with both new and existing customers.

現在談談我們在戰略舉措方面所取得的進展。首先，關於我們對客戶增長以及品牌和價值主張現代化的關注。雖然我們的營收業績受到我剛剛回顧的因素的影響，但我們很高興地看到我們的規模包容性計劃在第一季度持續取得成果，並且該領域在兩個渠道的生產力增長。此外，雖然我們的尺碼包容性舉措仍然是與該客戶共同成長的途徑，但我們也很高興看到我們的 Wearever 子品牌與正在尋找工作服裝的年輕新品牌客戶產生了共鳴。展望未來，我們將繼續利用我們的子品牌組合，進軍與新老客戶產生共鳴的領域。

Moving next to our focus on expanding our store base. During Q1, following the success of our Granger, Indiana opening in Q4, we opened 2 new stores in South Windsor, Connecticut and Mashpee, Massachusetts. We've been thrilled with the initial response to these openings, especially as we welcome back many prior customers to J.Jill. Approximately half of the customers we've seen in the initial weeks at our South Windsor and Mashpee store are reactivated customers. As we look forward, we're excited to continue to explore opportunities to expand our footprint over time as the economics make sense.

接下來我們將重點放在擴大我們的商店基礎上。在第一季度，繼第四季度印第安納州格蘭傑店成功開業後，我們在康涅狄格州南溫莎和馬薩諸塞州馬什皮開設了 2 家新店。我們對這些空缺職位的初步反應感到非常興奮，特別是我們歡迎許多老客戶回到 J.Jill。最初幾週，我們在南溫莎和馬什皮商店見到的顧客中大約有一半是重新激活的顧客。展望未來，我們很高興能夠在經濟合理的情況下繼續探索擴大我們足蹟的機會。

Finally, with respect to strengthening our omnichannel capabilities. With our store openings underway, it is even more important that we continue to enhance our systems and leverage our capabilities across our channels. We have just begun the rollout of our new POS system, which we plan to complete by the end of fiscal 2023. We will be implementing the system into our stores through a phased approach throughout the year, helping to ensure a smooth transition for both our associates and customers.

最後，關於加強我們的全渠道能力。隨著我們新店的開業，更重要的是我們繼續增強我們的系統並利用我們跨渠道的能力。我們剛剛開始推出新的 POS 系統，計劃在 2023 財年年底前完成。我們將在全年分階段將該系統實施到我們的商店中，幫助確保我們的業務和業務順利過渡員工和客戶。

As a reminder, one of the benefits we expect to see from our new POS system is the improvement in more seamless transactions across channels and positions us to further enhance our omnichannel capabilities over time.

提醒一下，我們期望從新 POS 系統中看到的好處之一是跨渠道交易更加無縫，並使我們能夠隨著時間的推移進一步增強我們的全渠道能力。

In summary, we're pleased with how we've continued to execute against our model and our strategic initiatives, particularly in light of the evolving consumer backdrop. We remain focused on operating the business with the same discipline around inventory and expense management that have supported our progress to date. Our updated guidance for fiscal 2023, which Mark will discuss in more detail in a moment, reflects a more cautious view on the consumer as well as a wider range of scenarios with respect to our promotional activity should the environment warranted. We're committed to taking actions in season to maintain clean inventory bounces, but we remain focused on optimizing our profitability and will be as narrow and shallow with promotions as appropriate. Now I will turn the call over to Mark to discuss our financial performance in more detail.

總之，我們對我們如何繼續執行我們的模式和戰略舉措感到滿意，特別是考慮到不斷變化的消費者背景。我們仍然專注於以與庫存和費用管理相同的紀律來運營業務，這些紀律支持了我們迄今為止的進展。我們更新的 2023 財年指引（馬克稍後將更詳細地討論）反映了對消費者更加謹慎的看法，以及在環境允許的情況下我們的促銷活動的更廣泛的場景。我們致力於在旺季採取行動，以保持庫存乾淨反彈，但我們仍然專注於優化我們的盈利能力，並將酌情進行狹窄和淺薄的促銷活動。現在我將把電話轉給馬克，更詳細地討論我們的財務業績。

Thank you, Claire, and good morning, everyone. Overall, we delivered a better-than-expected first quarter despite what proved to be a more challenging price-sensitive customer as the strength of our operating model delivered solid adjusted EBITDA and generated strong cash from operations. In addition, as disclosed in April, we successfully refinanced our funded debt during the quarter reducing principal outstanding by approximately $50 million and extending maturity out to May of 2028. Both Moody's and S&P ratings agencies recognize this accomplishment and issued upgrades on both the corporate rating of J.Jill and the term loan itself. And lastly, as announced last month, we successfully extended our asset-backed lending facility, aligning its maturity with the term loan in 2028.

謝謝克萊爾，大家早上好。總體而言，儘管事實證明對價格敏感的客戶更具挑戰性，但我們第一季度的業績好於預期，因為我們運營模式的優勢帶來了穩健的調整後 EBITDA 並從運營中產生了強勁的現金。此外，正如 4 月份披露的那樣，我們在本季度成功為融資債務進行了再融資，未償還本金減少了約 5000 萬美元，並將到期日延長至 2028 年 5 月。穆迪和標準普爾評級機構都認可了這一成就，併升級了兩家公司的評級J.Jill 和定期貸款本身。最後，正如上個月宣布的那樣，我們成功延長了資產支持貸款安排，使其期限與 2028 年的定期貸款一致。

Now for an overview of results for the first quarter. Total company comparable sales for the first quarter decreased 3% compared to last year's very strong recovery driven plus 24% comp. Total company sales for the quarter were $149 million, down 5% compared to Q1 2022. As Claire mentioned in her remarks, we did see some evidence during the quarter of macroeconomic impacts on the consumer across our channels.

現在概述第一季度的業績。與去年強勁的複蘇驅動力相比，第一季度公司可比銷售額下降了 3%，同比下降了 24%。該季度公司總銷售額為 1.49 億美元，比 2022 年第一季度下降 5%。正如克萊爾在她的講話中提到的，我們確實在本季度看到了宏觀經濟對我們各個渠道的消費者產生影響的一些證據。

Store sales for Q1 were down 2% versus Q1 2022 on 2% fewer stores. In stores, customers responded to full price, which drove a higher average unit retail, but was offset by lower units sold per transaction primarily driven by markdown units. Direct sales as a percentage of total sales were 45% in the quarter. Compared to the first quarter of fiscal 2022, direct sales were down 8%, primarily due to an increase in markdown sales penetration and higher online returns driven in part by strong sales and higher returning categories, such as dresses.

與 2022 年第一季度相比，第一季度的商店銷售額下降了 2%，原因是商店數量減少了 2%。在商店中，顧客對全價做出反應，這推動了平均零售單位的增加，但被主要由降價單位推動的每筆交易銷售單位的減少所抵消。本季度直接銷售佔總銷售額的比例為 45%。與 2022 財年第一季度相比，直銷下降了 8%，這主要是由於降價銷售滲透率的提高以及在線退貨率的提高，部分原因是銷售強勁和退貨率較高的類別（例如連衣裙）。

Q1 total company gross profit was $108 million, down $1.9 million compared to Q1 2022. Q1 gross margin was 72%, up 230 basis points over Q1 2022. Elevated freight costs have now abated, resulting in a gross margin rate benefit of approximately 250 basis points compared to last year. SG&A expenses were $82 million compared to $86 million last year. Investments in selling costs and marketing were more than offset by lower depreciation and amortization and management incentive accruals. Adjusted EBITDA was $32 million in the quarter, up 2% compared to $31 million in Q1 2022. Please refer to today's press release for a reconciliation of adjusted EBITDA.

第一季度公司總毛利潤為 1.08 億美元，比 2022 年第一季度下降 190 萬美元。第一季度毛利率為 72%，比 2022 年第一季度增長 230 個基點。貨運成本上漲現已有所緩解，導致毛利率效益提高約 250 個基點與去年相比積分。 SG&A 費用為 8,200 萬美元，而去年為 8,600 萬美元。銷售成本和營銷方面的投資被較低的折舊和攤銷以及管理激勵應計費用所抵消。本季度調整後 EBITDA 為 3200 萬美元，比 2022 年第一季度的 3100 萬美元增長 2%。請參閱今天的新聞稿，了解調整後 EBITDA 的調節表。

As I mentioned, during the quarter, we successfully refinanced our funded debt as a result of the extinguishment of both the priming term loan and subordinated tick (sic) [term] loan in place in September of 2020, we incurred a $12.7 million loss on refinancing, which impacted our reported net income for the period.

正如我提到的，在本季度，由於 2020 年 9 月終止了啟動定期貸款和次級蜱（原文如此）[定期]貸款，我們成功地為我們的融資債務進行了再融資，我們蒙受了 1270 萬美元的損失再融資，這影響了我們報告的當期淨利潤。

Turning to cash flow. We generated $8 million of cash from operations in Q1 and following the successful refinancing of the term loan, ended the quarter with $28 million in cash and 0 borrowings against the ABL. We continue to focus on tight inventory management. And as mentioned last quarter, the supply chain disruption that began in the back half of 2021 is now behind us. And shipments this year are largely on time versus being late or delayed last year. Inventories at end of Q1 are down 15% compared to the end of Q1 2022 with higher on-hand units being offset by lower units in transit due to those delayed and longer shipping times last year.

轉向現金流。我們第一季度的運營產生了 800 萬美元的現金，在定期貸款成功再融資後，本季度末現金為 2800 萬美元，ABL 借款為零。我們繼續關注嚴格的庫存管理。正如上季度提到的，2021 年下半年開始的供應鏈中斷現已成為過去。今年的發貨基本上準時，而不是去年的延遲或延遲。與 2022 年第一季度末相比，第一季度末的庫存下降了 15%，現有庫存量的增加被去年延遲和運輸時間較長導致的在途庫存量的減少所抵消。

Capital expenditures in the quarter were about $3 million compared to about $700,000 last year. We continue to make good progress with our POS initiative, which has just begun rollout and will be completed later in the year, and we opened 2 stores in the first quarter, resulting in 245 stores to end the quarter.

本季度的資本支出約為 300 萬美元，而去年約為 70 萬美元。我們的 POS 計劃繼續取得良好進展，該計劃剛剛開始推出，將於今年晚些時候完成，我們在第一季度開設了 2 家商店，到本季度末開設了 245 家商店。

Turning to our outlook. As Claire discussed, we are updating our full year outlook to reflect a more cautious view of the consumer based on current trends as well as a wider range of scenarios with respect to our promotional cadence given the ongoing uncertainty around the macroeconomic environment moving forward and our commitment to managing in-season inventory, balancing our goals to drive profit and end fiscal periods clean with minimal excess carryforward.

轉向我們的展望。正如克萊爾所討論的，我們正在更新我們的全年展望，以反映基於當前趨勢的消費者更加謹慎的看法，以及考慮到未來宏觀經濟環境的持續不確定性和我們的促銷節奏的更廣泛的情況。致力於管理當季庫存，平衡我們的目標，以提高利潤並以最小的超額結轉乾淨地結束財政期。

Given this, we now expect adjusted EBITDA to be down in the mid-single digits as a percent compared to last year, including an approximate $2 million benefit from the 53rd week. Our updated outlook for the year reflects first quarter results as well as an updated expectation for the remainder of the year. For the second quarter, we expect sales to be down versus Q2 2022 in the mid-single digits and adjusted EBITDA to be in the range of $26 million and $31 million.

鑑於此，我們現在預計調整後的 EBITDA 將比去年下降中個位數，其中包括第 53 週帶來的約 200 萬美元的收益。我們更新的今年展望反映了第一季度的業績以及今年剩餘時間的更新預期。對於第二季度，我們預計銷售額將較 2022 年第二季度下降個位數，調整後 EBITDA 將在 2600 萬美元至 3100 萬美元之間。

With respect to the second half of the year, we are maintaining a prudent outlook and expect similar top line year-over-year trends to continue in the third quarter. Given this, along with our expectation that the tailwinds from freight favorability will decline considerably as well as our ongoing commitment to managing in-season inventories we expect profitability to be most pressured in the third quarter with expected improvement in fourth quarter given easier comparisons to last year from both a sales and profitability perspective as well as the benefit of the 53rd week.

對於下半年，我們保持審慎的前景，並預計第三季度將繼續保持類似的同比趨勢。鑑於此，加上我們預計貨運有利因素將大幅下降，以及我們對管理季節性庫存的持續承諾，我們預計第三季度的盈利能力將面臨最大壓力，而與去年相比，第四季度的盈利能力預計將有所改善從銷售額和盈利能力以及第 53 週的效益來看，今年的表現都非常出色。

Regarding store count, we still expect flat store count to end 2023 with any openings offset by closures. And with respect to full year capital, we expect to spend about $18 million with investments focused on technology, stores capital and the completion of the POS project late in 2023.

關於商店數量，我們仍然預計 2023 年底商店數量將持平，任何新開業的商店都會被關閉的商店所抵消。就全年資本而言，我們預計將花費約 1800 萬美元，重點投資於技術、商店資本以及 2023 年底完成 POS 項目。

Thank you, and I will now hand it back to the operator for questions.

謝謝您，我現在將其交還給接線員以供提問。

(Operator Instructions) Your first question comes from the line of Dana Telsey of Telsey Advisory Group.

（操作員說明）您的第一個問題來自 Telsey Advisory Group 的 Dana Telsey。

Can you expand a little bit on the more discerning consumer. Did the cadence of the quarter, did you become more discerning, was it both in stores and online? And then can you talk a little bit about the new systems that are being put in place, when do we begin to see the full effect of that. And then with the new refinancing that you have, how are you thinking about interest expense and the go forward on the balance sheet.

您能否對更挑剔的消費者進行一些擴展？這個季度的節奏，你是否變得更加挑剔，無論是在商店還是在網上？然後您能談談正在實施的新系統嗎？我們什麼時候開始看到其全部效果。然後，通過新的再融資，您如何考慮利息支出和資產負債表上的進展。

Sure. Thanks, Dana. I'll take the first one, and let Mark address the second 2. More discerning consumer, as you know we stay in close contact with our consumer speaking to her regularly about her consumer confidence and her purchase intent. And we have seen continued weariness, honestly, in -- as a reflection of the news that's out there and the general sentiment around the macro environment. So we are being what we feel is appropriately cautious given that. And as Mark said in his remarks, have sort of contemplated continued pressure on that front as we developed our guidance for Q2 and for the remainder of the year. So it's not that we're seeing a big change, but we are seeing continued sentiment around caution in spend.

當然。謝謝，達納。我將討論第一個問題，讓馬克談談第二個問題。 2. 更挑剔的消費者，如您所知，我們與消費者保持密切聯繫，定期與她談論她的消費者信心和購買意向。老實說，我們看到了持續的疲倦，這反映了現有的新聞和宏觀環境的總體情緒。因此，考慮到這一點，我們感到適當謹慎。正如馬克在講話中所說，在我們制定第二季度和今年剩餘時間的指導時，我們已經考慮到了這方面的持續壓力。因此，這並不是說我們看到了重大變化，而是我們看到人們對支出保持謹慎的情緒持續存在。

Thanks, Claire. Dana, I will handle the POS as well as the debt question, the interest question. The POS system, as Claire mentioned in her remarks, is phasing now into the store fleet. We're starting it in a very prudent fashion, and we'll ramp it through really the summer into early Q3 time period. We're currently in about 7 or 8 stores as of this week and that will continue to ramp. And we're excited about the opportunities, both from the operational aspects, as Claire mentioned in her remarks, but the stores environment, the store employees are very excited to get new technology as well. So it's going well. We're in the process of beginning to ramp that up.

謝謝，克萊爾。 Dana，我會處理 POS 以及債務問題、利息問題。正如 Claire 在她的講話中提到的，POS 系統現在正在逐步融入商店。我們正在以非常謹慎的方式啟動它，我們將在整個夏季將其逐步推向第三季度初。截至本週，我們目前擁有大約 7 或 8 家商店，並且這一數量將繼續增加。正如克萊爾在講話中提到的那樣，我們對運營方面的機會感到興奮，但商店環境、商店員工也對獲得新技術感到非常興奮。所以進展順利。我們正在開始加大力度。

For benefits, I would say, late in '23, really 2024 as we really start to operate with the new system in place. The new finance, very excited to have been able to refinance the debt in what has been a pretty challenging market out there. We think it's a testament to the strength of the company that we were able to do so. We had a good process. We were very diligent. We had a good group of lenders that came together, and we're very pleased to put that new piece of paper in place. With respect to the interest on a P&L basis, the fact that we reduced the quantum of funded debt by about $50 million but did see the rate go up, call it, 300 bps the kind of trade out of where the current interest rate environment is, is basically flat on the new debt versus the existing notes that we replaced. So hopefully, that helps answer that question.

就福利而言，我想說的是，23 年末，實際上是 2024 年，因為我們真正開始使用新系統進行運營。新的財務部門非常高興能夠在一個相當具有挑戰性的市場上為債務進行再融資。我們認為，我們能夠做到這一點證明了公司的實力。我們有一個很好的過程。我們非常勤奮。我們有一群優秀的貸款人聚集在一起，我們很高興能落實這份新文件。就損益基礎上的利息而言，事實上，我們將融資債務數量減少了約 5000 萬美元，但確實看到利率上升，稱之為 300 個基點，這種交易脫離了當前的利率環境，新債務與我們替換的現有票據基本持平。希望這有助於回答這個問題。

Your next question comes from the line of Janet Kloppenburg of JJK Research.

您的下一個問題來自 JJK Research 的 Janet Kloppenburg。

Forgive me, I was on mute. I apologize. Did you say, Claire, what the cadence of the business looked like in the first quarter? And did you start to see it slow in March through April, the way most in the industry did. And if you could talk just about the categories of spend where there was strength and where there was weakness. And I may have missed that. I got on about 5 minutes late, so I apologize.

原諒我，我當時是靜音的。我道歉。克萊爾，你有沒有說過第一季度的業務節奏是什麼樣的？從三月到四月，你是否開始看到它的放緩，就像業內大多數人所做的那樣。如果你能談談哪些支出類別有優勢，哪些領域有弱點。我可能錯過了這一點。我遲到了大約5分鐘，所以我很抱歉。

Thanks, Janet. Sure, of course. So we saw relatively flat sort of consumer sentiment over the course of the quarter, we didn't see a lot of up and down. It was more of a general conservatism that we started to see impacting the business overall. And we did see that in the sense that the consumer indirect was opting more into the markdown inventory a little bit. And Mark spoke to the returns that we've been seeing. We think that, that's a reflection of that consumer sentiment as well.

謝謝，珍妮特。當然，當然。因此，我們在本季度看到消費者信心相對平穩，沒有看到太多的上下波動。我們開始看到，這是一種普遍的保守主義對整體業務的影響。我們確實看到，從某種意義上說，消費者間接選擇更多地進入降價庫存。馬克談到了我們所看到的回報。我們認為，這也反映了消費者的情緒。

That said, to your question about the categories, AURs were up in both channels and the dollars per customer continued to be very strong. She pulled back on frequency and she pulled back on UPTs a little bit. And so we don't think that -- it's an (inaudible) nothing kind of thing. She was being discerning, and she was also choosing to spend in categories where there was more uniqueness, more fashion, more differentiation. So dresses continue to be very strong. Jackets were strong. As I mentioned in my remarks, our Wearever sub-brand was very strong. We're seeing nice traction there with a younger new-to-brand customer who's buying Wearever for work. We think that's a really interesting dynamic that we continue to lean into.

也就是說，對於您關於類別的問題，兩個渠道的 AUR 均有所上升，並且每個客戶的美元仍然非常強勁。她減少了頻率，也減少了 UPT 的數量。所以我們不認為——這是一件（聽不清）沒什麼的事情。她很挑剔，而且還選擇在更獨特、更時尚、更差異化的類別上花錢。因此，連衣裙仍然很強勢。夾克很堅固。正如我在發言中提到的，我們的 Wearever 子品牌非常強大。我們看到，年輕的品牌新客戶對 Wearever 的吸引力很大，他們出於工作目的而購買 Wearever。我們認為這是一個非常有趣的動態，我們將繼續關注。

Where we saw softness was in the less differentiated category. So net basics some of our bottoms programs where she just decided she didn't need to refresh there to the extent that we would like to see her. So it was mixed, but she continued to vote with her dollars on the things that were unique and special. And the absolute price point wasn't necessarily the indicator, it was more of the mix.

我們看到的柔軟度屬於差異較小的類別。因此，網絡基礎知識是我們的一些底部程序，她剛剛決定她不需要刷新到我們希望看到她的程度。所以情況好壞參半，但她繼續用自己的錢投票給那些獨特的東西。絕對價格點不一定是指標，更多的是混合因素。

Okay. Okay. And when you think about the categories that are doing well, the ones you just articulated, how does your inventory comp look. Is it balanced and aligned to those categories? Or are there some adjustments to make? And do you think that AUR can continue to improve?

好的。好的。當您考慮表現良好的類別時，即您剛剛闡明的類別時，您的庫存比較看起來如何。它是否平衡並與這些類別保持一致？或者說有什麼需要調整的地方嗎？您認為AUR還能繼續進步嗎？

Sure. Thanks, Janet. I think we feel like we're well balanced in the inventory. We started to see the softness in basic trends in the back half of last year. And so coming into this year, we had made adjustments to rebalance. We have leaned into those more fashion categories like dresses that continue to have strength. So we feel good coming into Q2 about the balance in the inventory and I think, with regard to AUR, it's at a pretty high level and dollars per customer at a very high level. So we're expecting more of a plateau there, but very healthy on that front.

當然。謝謝，珍妮特。我認為我們感覺庫存非常平衡。去年下半年我們開始看到基本趨勢的疲軟。因此，進入今年，我們做出了調整以進行再平衡。我們已經轉向了那些更時尚的類別，比如繼續保持強勢的連衣裙。因此，進入第二季度，我們對庫存平衡感到滿意，我認為，就 AUR 而言，它處於相當高的水平，每個客戶的美元也處於非常高的水平。因此，我們預計那裡會出現更多的平穩期，但在這方面非常健康。

There are no further questions at this time. This concludes today's conference call. You may now disconnect.

目前沒有其他問題。今天的電話會議到此結束。您現在可以斷開連接。