Jumia Q12024 operating loss declines 71% to $8mn

NYSE-listed Jumia, a leading e-commerce platform in Africa, reported an operating loss of $8 million for the first quarter of 2024, down 71 percent from a loss of $28 million in Q12023.

Revenue was up 19 percent YoY to $49 million and Gross merchandise value increased five percent to $181 million, says an official release.

“Jumia is off to a strong start to the year," says Francis Dufay, Chief Executive Officer, Jumia. "Following a transformational 2023, we continued to execute against our strategic priorities focused on strengthening our core business and improving cash efficiency while establishing a leaner organisation primed for growth. Our efforts drove a five percent year-over-year and 39 percent constant currency improvement in GMV in the quarter while order growth and average order value (AOV) also expanded, a clear sign that our strategy is working.

“Disciplined expense management and further streamlining of our logistics network reduced our quarterly cash burn to $19.1 million from $22 million in the first quarter of 2023. Efforts to orient spend toward more efficient marketing channels along with reductions in customer discounts also helped attract a stickier and higher quality customer base, driving a 300 basis-point improvement in repurchase rates versus the prior year.

“Our success is more notable when considered against the challenging macro environment in Africa. Significant currency devaluations in some of our largest markets impacted both purchasing power and supply availability, making for a difficult operating environment. However, our ability to secure sufficient inventory and offer a diversified product assortment at competitive prices continues to keep consumers engaged on our platform.

Importantly, we are also beginning to see early signs of general stabilisation in select markets, leaving us hopeful that conditions will continue to improve. For example, despite the volatile conditions, we are seeing order growth in Nigeria and Ghana, illustrating Jumia’s value proposition. Additionally, in Egypt, the government floated the Egyptian pound and significantly increased interest rates, resulting in higher U.S. dollar inflows from foreign investors.

"We have proven that with the right team and the right strategy, growth does not require heavy spending. Rather, a deep understanding and appreciation of the African e-commerce market, along with a targeted growth strategy leaves us well positioned to drive continued growth in 2024 and beyond.”

As of March 31, 2024, the company’s liquidity position was $101.5 million including $28.6 million in cash and cash equivalents and $72.8 million in term deposits and other financial assets, the release added.

Maintains 2024 outlook
Jumia has maintained its 2024 outlook to further reduce cash utilisation compared to FY2023, and an increase in both orders and GMV, excluding the potential impact of foreign exchange.