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News Release

J. Crew Group, Inc. Announces Second Quarter Fiscal 2009 Results

Second Quarter Revenues of $357.6 Million Second Quarter Diluted Earnings Per Share of $0.29

NEW YORK, Aug. 27 /PRNewswire-FirstCall/ -- J. Crew Group, Inc. (NYSE: JCG) today announced financial results for the three months (second quarter) and six months (first six months) ended August 1, 2009.

Second Quarter highlights:

    --  Revenues increased 6% to $357.6 million.  Store sales (Retail and
        Factory) increased 7% to $259.1 million, with comparable store sales
        decreasing 5%.  Comparable store sales decreased 0.4% in the second
        quarter of fiscal 2008.  Direct sales (Internet and Phone) increased by
        6% to $88.2 million.  Direct sales increased 12% to $83.2 million in the
        second quarter of fiscal 2008.
    --  Gross margin increased to 41.2% of revenues from 41.0% of revenues in
        the second quarter of fiscal 2008.
    --  Operating income increased 2% to $32.2 million, or 9.0% of revenues,
        compared to $31.5 million, or 9.4% of revenues, in the second quarter of
        fiscal 2008.  Operating income in the second quarter of fiscal 2009
        includes charges of approximately $2.6 million related to
        underperforming stores and lease termination actions.  Operating income
        in the second quarter of fiscal 2008 included approximately $3.0 million
        of costs related to our Direct channel systems upgrades.

    --  Net income was $18.6 million, or $0.29 per diluted share, compared to a
        net income of $18.1 million, or $0.28 per diluted share, in the second
        quarter of fiscal 2008.

Millard Drexler, J. Crew's Chairman and CEO stated: "We are and have been on a long term mission to be recognized for our quality, style, design and service. This mission puts 'taking care of our customers' front and center in every part of our business -- our products, our service, our store environments and our web site. While we are pleased with our second quarter results, we always have our eye on where our customer is headed and the need to constantly challenge ourselves to be creative and innovative."

First Six Months highlights:

    --  Revenues increased 4% to $703.3 million.  Store sales increased 6% to
        $499.8 million, with comparable store sales decreasing 5%.  Comparable
        store sales increased 1% in the first six months of fiscal 2008.  Direct
        sales decreased 0.3% to $183.5 million.  Direct sales increased 14% to
        $184.1 million in the first six months of fiscal 2008.
    --  Gross margin decreased to 41.7% of revenues from 44.0% of revenues in
        the first six months of fiscal 2008.  The decrease in gross margin is
        primarily related to increased markdowns as a result of beginning of
        fiscal year inventory levels.
    --  Operating income decreased 20% to $67.5 million, or 9.6% of revenues,
        compared to $84.6 million, or 12.5% of revenues, in the first six months
        of fiscal 2008.  Operating income in the first six months of fiscal 2009
        includes charges of approximately $4.9 million related to our workforce
        reduction, underperforming stores and lease termination actions.
        Operating income in the first six months of fiscal 2008 included
        approximately $3.0 million of costs related to our Direct channel
        systems upgrades.

    --  Net income was $39.1 million, or $0.61 per diluted share, compared to a
        net income of $48.6 million, or $0.76 per diluted share, in the first
        six months of fiscal 2008.

Balance Sheet highlights as of August 1, 2009:

    --  Cash and cash equivalents were $204.3 million at the end of the second
        quarter compared to $113.4 million at the end of the second quarter of
        fiscal 2008.

    --  Inventories at the end of the second quarter were $195.3 million
        compared to $197.8 million at the end of the second quarter of fiscal
        2008.  Inventory per square foot at the end of the second quarter
        decreased 11% compared to the end of the second quarter of fiscal 2008.

Guidance

The Company currently expects third quarter fiscal 2009 diluted earnings per share in the range of $0.30 to $0.33.

Conference Call Information

A conference call to discuss second quarter results is scheduled for today, August 27, 2009, at 4:30 PM Eastern Time. Investors and analysts interested in participating in the call are invited to dial (877) 407-0784 approximately ten minutes prior to the start of the call. The conference call will also be webcast live at www.jcrew.com. A replay of this call will be available until September 3, 2009 and can be accessed by dialing (877) 660-6853 and entering account number 3055 and conference ID number 330853.

About J. Crew Group, Inc.

J. Crew Group, Inc. is a nationally recognized multi-channel retailer of women's, men's and children's apparel, shoes and accessories. As of August 27, 2009, the Company operates 242 retail stores (including 216 J. Crew retail stores, 9 crewcuts stores and 17 Madewell stores), the J. Crew catalog business, jcrew.com and 78 factory outlet stores. Additionally, certain product, press release and SEC filing information concerning the Company are available at the Company's website www.jcrew.com.

Forward-Looking Statements:

Certain statements herein are "forward-looking statements" made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the Company's current expectations or beliefs concerning future events and actual results of operations may differ materially from historical results or current expectations. Any such forward-looking statements are subject to various risks and uncertainties, including the strength of the economy, changes in the overall level of consumer spending or preferences in apparel, our ability to compete with other retailers, the performance of the Company's products within the prevailing retail environment, our strategy and expansion plans, systems upgrades, reliance on key personnel, trade restrictions, political or financial instability in countries where the Company's goods are manufactured, postal rate increases, paper and printing costs, availability of suitable store locations at appropriate terms and other factors which are set forth in the Company's Form 10-K and in all filings with the SEC made by the Company subsequent to the filing of the Form 10-K. The Company does not undertake to publicly update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.


                                                                  Exhibit (1)

                                  J. Crew Group, Inc.
                   Condensed Consolidated Statements of Operations
                                     (Unaudited)

                            Three Months  Three Months  Six Months  Six Months
    (Amounts in thousands,     Ended         Ended        Ended       Ended
     except percentages and  August 1,     August 2,    August 1,   August 2,
     per share amounts)        2009          2008         2009        2008

    Net sales
         Stores              $259,080      $242,280     $499,806    $471,389
         Direct                88,171        83,213      183,531     184,146
                              347,251       325,493      683,337     655,535
    Other                      10,304        10,782       19,988      21,318

    Total Revenues            357,555       336,275      703,325     676,853

    Costs of goods sold,
     buying and occupancy
     costs                    210,327       198,543      410,160     379,234

    Gross Profit              147,228       137,732      293,165     297,619
         As a percent of
          revenues              41.2%         41.0%        41.7%       44.0%

    Selling, general
     administrative expenses  115,016        106,199     225,685     213,040
         As a percent of
          revenues              32.2%          31.6%       32.1%       31.5%

    Operating income           32,212         31,533      67,480      84,579
         As a percent of
          revenues               9.0%           9.4%        9.6%       12.5%

    Interest expense, net       1,078          1,430       2,155       3,800

    Income before income taxes 31,134         30,103      65,325      80,779

    Provision for income taxes 12,524         11,980      26,270      32,155

    Net income                $18,610        $18,123     $39,055     $48,624

    Income per share:
         Basic                  $0.30          $0.29       $0.63       $0.79
         Diluted                $0.29          $0.28       $0.61       $0.76

    Weighted average shares
     outstanding:
         Basic                 62,323         61,693      62,227      61,443
         Diluted               64,326         64,346      63,864      64,171


                                                                  Exhibit (2)

                               J. Crew Group, Inc.
                      Condensed Consolidated Balance Sheets
                                  (Unaudited)

    (In thousands)                          August 1, January 31,   August 2,
                                              2009       2009         2008

    Assets
    Current assets:
       Cash and cash equivalents            $204,274    $146,430    $113,438
       Inventories                           195,295     187,044     197,833
       Prepaid expenses and other current
        assets                                32,158      34,926      39,086
       Income taxes receivable                   963      23,116      20,625
    Total current assets                     432,690     391,516     370,982

    Property and equipment, net              203,223     201,675     183,892

    Other assets                              19,857      20,618      32,798
    Total assets                            $655,770    $613,809    $587,672



    Liabilities and Stockholders' equity
    Current liabilities:
       Accounts payable                     $116,110    $119,719    $117,009
       Other current liabilities              82,207      83,889      75,994
       Current portion of long-term debt       1,028         800           -
       Deferred income taxes, net              4,049       4,049           -
    Total current liabilities                203,394     208,457     193,003

    Long-term debt                            98,715      99,200     100,000

    Deferred credits                          72,185      73,815      73,484

    Other liabilities                          7,001       7,388       7,829

    Stockholders' equity                     274,475     224,949     213,356
    Total liabilities and stockholders'
     equity                                 $655,770    $613,809    $587,672


                                                                  Exhibit (3)

                   Actual and Projected Store Count and Square Footage


    Fiscal 2009

                         Total stores    Number of    Number of   Total stores
                            open at       stores       stores       open at
                          beginning of opened during closed during  end of
                          the quarter   the quarter  the quarter   the quarter

    Quarter
    1st Quarter (Actual)       300          12            2           310
    2nd Quarter (Actual)       310           9            0           319
    3rd Quarter (Projected)    319           2            1           320
    4th Quarter (Projected)    320           1            0           321



    Fiscal 2009                                       Reduction of
                                       Gross square   gross square    Total
                         Total gross     feet for       feet for      gross
                         square feet   stores opened  stores closed  square
                         at beginning   or expanded   or downsized   feet at
                           of the       during the     during the    end of
                          quarter        quarter        quarter    the quarter

    Quarter
    1st Quarter (Actual)    1,864,133     52,185        (8,258)     1,908,060
    2nd Quarter (Actual)    1,908,060     38,166             0      1,946,226
    3rd Quarter (Projected) 1,946,226      9,890        (2,872)     1,953,244
    4th Quarter (Projected) 1,953,244      4,512             0      1,957,756

SOURCE J. Crew Group, Inc.

Company, James S. Scully, Chief Administrative Officer and Chief Financial Officer, +1-212-209-8040; or Investors, Allison Malkin, or Chad Jacobs, or Joe Teklits, all of Integrated Corporate Relations, +1-203-682-8200

Certain statements herein are "forward-looking statements" made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the Company's current expectations or beliefs concerning future events and actual results of operations may differ materially from historical results or current expectations. Any such forward-looking statements are subject to various risks and uncertainties, including the strength of the economy, changes in the overall level of consumer spending or preferences in apparel, the performance of the Company's products within the prevailing retail environment, trade restrictions, political or financial instability in countries where the Company's goods are manufactured, postal rate increases, paper and printing costs, availability of suitable store locations at appropriate terms and other factors which are set forth in the Company's Form 10-K and in all filings with the SEC made by the Company subsequent to the filing of the Form 10-K. The Company does not undertake to publicly update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.