Pan-African E-commerce Company, Jumia has reported a Gross profit after Fulfillment expense reaching a record €2.5 million in its first Quarter 2020 results. This was a record growth compared to less than €0.1 million in the first quarter of 2019.
Jumia’s operating loss decreased by 4% to €43.7 million in the first quarter of 2020 from €45.5 million in the first quarter of 2019, as Adjusted EBITDA loss decreased by €4 million or 10% over the same period. This decrease was driven by an increase in their Gross Profit after Fulfillment Expense and a reduction in Sales & Advertising expense.
Adjusted EBITDA loss was €35.6 million in the first quarter of 2020, which is the lowest level in the past 6 quarters, demonstrating meaningful progress on our path to profitability.
Annual Active Consumers reached 6.4 million in the first quarter of 2020 (up 51% compared to the first quarter of 2019), Orders reached 6.4 million (up 28%), while their Sales & Advertising expense decreased by 25% over the same period.
Jumia’s Gross Merchandise Value (GMV) — the total amount of goods sold over the period was €190 million, a year-over-year decrease of 11% compared to GMV adjusted for perimeter changes as well as previously reported improper sales practices of €214 million in the first quarter of 2019 – A trajectory that they attributed to the continued effects from the business mix rebalancing initiated in 2019 as well as the supply and logistics disruption caused by the COVID-19 pandemic.
“The onset of the COVID-19 pandemic in the first quarter of 2020 brought about a complex combination of health, economic and operational challenges. Our first priority was to help our employees, consumers and communities stay safe. On the operational side, we took prompt action to ensure business continuity and adjust our logistics to meet high standards of safety and hygiene”, commented Jeremy Hodara and Sacha Poignonnec, Co-Chief Executive Officers of Jumia.
JumiaPay Transactions increased by 77% from 1.3 million in the first quarter of 2019 to 2.3 million in the first quarter of 2020. 35% of Orders placed on the Jumia platform in the first quarter of 2020 were paid for using JumiaPay, compared to 26% in the first quarter of 2019.
The strong growth of JumiaPay was partly attributable to the ramp-up of JumiaPay operations in Ghana and Morocco which were newly launched in the first quarter of 2019, and Kenya where they launched JumiaPay in the second quarter of 2019. It was also a result of increasing penetration of JumiaPay in the countries where it was already live in the first quarter of 2019, driven by continued education of consumers around payment and enhancements of the JumiaPay value proposition.
As of March 31, 2020, JumiaPay was live in 7 markets: Nigeria, Egypt, Morocco, Ivory Coast, Ghana, Kenya and Tunisia.
Currently, only the digital services offered via the JumiaPay app, such as airtime recharge, utility bills payments, transport ticketing etc., are monetized by charging a commission to the relevant third-party service provider featured on the JumiaPay app.
While the E-Commerce reported a cash balance of €191 million at the end of Q1 2020, there was no mention of the company’s share price which has been a downward spiral since it started trading.
Jumia’s shares began trading at US$14.50 at the New York Stock Exchange in April 2019 and one point, soared up more than three times its IPO launch price to U$49.77 but later tumbled when Citron Research’s Andrew Left released a report describing the company as a “fraud” with worthless stock.
Jumia shares are currently trading at US$4.25 (At the time of publishing)
While there are speculations that the company could go private, Jumia has been on a restructuring mode in the continent closing several business units having suspended its E-Commerce business in Cameroon, Tanzania and Rwanda.
Rocket Internet, the German tech investor behind Jumia, Africa’s largest E-Commerce platform sold its remaining stake on the firm. The company held an 11% stake on Jumia as of 8th Nov 2019.