Most areas in Africa where Jumia operates have lifted their
lockdown restrictions, but some countries like Morocco and Kenya still have
curfews. Jumia said while these measures didn't lead to meaningful changes in
consumer behavior, its supply and logistics chain -- especially for its food
delivery business JumiaFood -- was disrupted.
Jumia, which raised more than $570 million over the past six
months to strengthen its balance sheet, posted first-quarter revenues of €27.4
million. This is a 6% drop from the €29.3 million that it reported in Q1 2020.
Its operating loss for Q1 2021 came to €33.7 million, while its more forgiving
adjusted EBITDA loss stood at €27.0 million. The two numbers fell by 23% and
24%, respectively, on a year-over-year basis as the company continues its slow
march toward profitability.
Jumia has never turned a profit, but its co-CEOs Jeremy
Hodara and Sacha Poignonnec have made it clear in the past that the company
wants that to change. It was also a point of reference in their investor
comments today.
“Our first-quarter results reflect solid progress towards
profitability. The drivers remain consistent: selective and disciplined usage
growth, gradual monetization, and continued cost discipline. The first quarter
of 2021 was the sixth consecutive quarter of positive gross profit after
fulfillment expense, which reached €6.2 million, more than doubling
year-over-year, while Adjusted EBITDA loss contracted by 24% year-over-year,
reaching €27.0 million,” they said in a statement.
In addition to falling losses, Jumia had other positive
metrics to share. The giant e-tailer saw its active customer base grow 7%
year-over-year to 6.9 million. And orders also increased by 3% to 6.6 million,
a reversal of the declining trend observed over the preceding two quarters.
However, the total worth of goods sold via Jumia this quarter (GMV) was just
€165.0 million, a 13% decrease from the €189.6 million it recorded in Q1 2020.
The company's gross profit also reached €20.4 million in
2020, representing a year-over-year gain of 11% from €18.4 million in Q1 2020.
Jumia narrows losses, as its payment service grows in
financial results
Jumia cited two reasons for this drop. One was currency
devaluation of Nigeria's naira, Egypt's pound and Kenya's shilling against the
euro, the currency in which it reports. According to the company, the trio
dropped 15%, 9% and 19%, respectively, against the euro in Q1 2021. And second,
the company's best-performing product category (phones and electronics) did
poorly. In Q1 2020, those items accounted for 45% of its GMV volume, which fell
to 37% this quarter.
JumiaPay, the payments arm of the company, continued to post
modest growth. This time last year the product processed 2.3 million
transactions worth €35.5 million. In Q1 2021, JumiaPay transactions rose 6.7%,
to 2.4 million transactions on a year-on-year basis. The recent quarter's total
payment volume also grew 21% to €42.9 million.
Per the report, Jumia has broadened the capabilities of its
payment product. It now offers SMEs on the continent access to short-term
credit by leveraging business and transactional data of its sellers to
pre-score credit on an anonymized basis. The company said it disbursed 380
loans in Q1 2021, up 90% from Q1 2020. These loans were given to 291 sellers
across its platform, representing a 62% increase from the number of sellers
that accessed last year's loans.
Jumia reported €485.6 million of unrestricted cash at the
end of the first quarter of 2021. This includes gross proceeds of about €205
million it secured from the offering completed on March 30, 2021, and €88
million cash booked in April 2021.
Africa e-tailer Jumia reports first full-year results post
NYSE IPO
Before today’s earnings call, Jumia was trading at $21.60
per share. Since the market opened this morning and at the time of this
writing, the company’s share price has increased by around 3.2% to just over
$24.21. It seems investors remain optimistic about the company's growth,
especially its payments arm and its plans to achieve profitability, despite
continued operating and adjusted EBITDA losses.
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