Jumia’s losses narrow on strong sales growth

Gross merchandise volume (GMV) at Africa-focused internet retailer Jumia, which floated on the NYSE two months ago, stood at €240 million during the first three months of 2019, up 58% year-on-year. GMV is the total value of merchandise sold through its marketplace, including third-party sales. Adjusted EBITDA loss as a percentage of GMV narrowed from 19.8% (€30.2 million) to 16.4% (€39.5 million) between Q1 2018 and Q1 2019.

The importance of first-party sales to Jumia continues to decline – accounting for 15.6% of total revenue in Q1 2019, down from 19.8% during Q1 2018, as growth in revenues from third-party sellers (from commissions, fulfillment, marketing etc.), accelerates. Jumia had 4.3 million active customers (who placed an order on its marketplace during the previous 12 months) in the first quarter of 2019, up from 3.0 million during the year-earlier period.

In a conference call, Jumia co-founder and CEO Sacha Poignonnec commented: “We’re seeing a lot of appetite from sellers, which include international brands, to start operating and distributing their goods and services in Africa. We have in particular a lot of discussions with sellers who are already present in Africa, notably in the FMCG sector.”

Safae Damir, head of investor relations, said that while Jumia had “no short-term plan for geographical expansion,” its long-term goal was to follow the example of Amazon.com and Alibaba by expanding into multiple segments. Having announced a €50 million investment in Jumia by Mastercard earlier this year, the internet retailer revealed that it would be partnering with the financial services provider “on a number of initiatives, including the development and marketing of co-branded products (cards, virtual cards and quick response codes)” in order to further develop its JumiaPay service.

If you want to read Jumia’s quarterly financial report, click here

To listen to its conference call, click here