Modupe Gbadeyanka
By Modupe Gbadeyanka
Leading e-commerce company in Africa, Jumia, said it recorded a gross profit of €2.5 million in the first quarter of 2020.
This was after the fulfilment of all expenses including taxes, levies and others, while its monetisation development increased its gross profit to €18.4 millio, a year-over-year increase of 21 percent.
The Q1 report also emphasised that its operating loss decreased by 4 percent year-over-year within the period, adding that the Gross Merchandise Volume (GMV) was €190 million, a year-over-year decrease of 11 percent compared to GMV adjusted for perimeter changes as well as previously reported improper sales practices of €214 million in the first quarter of 2019.
JumiaPay, the brand’s fintech platform has continued its impressive growth since 2019. It has processed 2.3 million transactions worth $39 million in Q1 2020. The payments product almost matched the 2.4 million transaction volume it recorded in the very busy last quarter of 2019.
Its active consumers also hit 6.4 million, indicating 51 percent a year-over-year growth when compared to the same period in 2019.
The company’s adjusted Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) losses decreased by 10 percent year-over-year.
Orders through the platform grew to 6.4 million, which was 28 percent higher than the same period in previous year.
These were contained in Jumia’s financial results for the quarter ended March 31, 2020 that was released to the public earlier in the week.
The positive results were achieved amid the coronavirus pandemic, which has hammered the global economy since the beginning of 2020.
This, the company 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 virus pandemic.
The company’s Total Portfolio Value (TPV) reached €35.5 million, a year-over-year, which was 71 percent, taking on-platform TPV penetration from 10 per cent in the first quarter of 2019 to 19 percent in the first quarter of 2020.
Besides, JumiaPay transactions reached 2.3 million, a year-over-year increase of 77 percent, representing 35 percent on-platform penetration in terms of orders.
The report said: “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.
“We believe the COVID-19 pandemic proves that e-commerce has a key role to play in helping consumers safely access essential goods and providing an efficient distribution channel for brands and sellers, at a time when offline channels are disrupted. We are more than ever confident about the relevance of Jumia and the gradual adoption of e-commerce by both consumers and sellers.
“In 2019, we focused on what is proving to be crucial to navigate this crisis: affordable, high purchase frequency product categories and cost efficiency. We are driving Annual Active Consumers growth, which was up 51 percent year-over-year, and orders, up 28 percent, at the same time as reducing sales and advertising expense by 25 percent over the same period.
“Our adjusted EBITDA loss decreased by 10 percent year-over-year, reaching the lowest level in the past six quarters, as we make progress on our path to profitability.”
