World Markets

African e-commerce firm Jumia cuts Q1 losses but shares slip

Credit: REUTERS/TEMILADE ADELAJA

African e-commerce firm Jumia Technologies AG said on Tuesday that cost discipline and "selective" usage growth helped it cut first-quarter losses for the fifth consecutive quarter.

By Libby George

LAGOS, May 11 (Reuters) - African e-commerce firm Jumia Technologies AG JMIA.N said on Tuesday that cost discipline and "selective" usage growth helped it cut first-quarter losses for the fifth consecutive quarter.

Jumia's chief executive, Sacha Poignonnec, said the 24% narrowing in losses was evidence that its path to profitability was on track.

Jumia, the first Africa-focused tech startup to list on the New York Stock Exchange, aims to sell fewer expensive one-off products such as electronics and more inexpensive, frequently ordered items such as beauty and cleaning supplies.

The adjusted loss before interest, tax, depreciation and amortization narrowed to 27 million euros ($32.85 million), compared with a loss of 35.6 million in the first quarter of 2020. Average order value slid 16% to 24.9 euros.

"All the work that we have done is paying off and we are in a very good position to accelerate the growth," Poignonnec told Reuters.

Jumia shares were down 5.1% at $22.27 in late morning in New York, well below the all-time peak of $65.51 hit on Feb. 10.

The shares have gyrated dramatically since listing at $14.50 on April 26, 2019. They rose shortly after listing to $49.77 but later plunged close to $2 a share after a negative short-seller report.

Poignonnec brushed off the volatility and said the long-term strategy would keep investors happy.

Jumia has raised more than $570 million over the past six months, which Poignonnec said would be used for gradual investments in core businesses, including improving payment platform JumiaPay and other technology platforms and expanding in existing markets.

Jumia warned that the COVID-19 pandemic could hit consumer confidence and spending power.

While the pandemic boosted business for e-retailers in other regions, such as Amazon.com Inc AMZN.O and Alibaba 9988.HK, Jumia's revenue fell due to 2020 lockdowns. It warned that renewed curfews and lockdowns in countries including Morocco and Kenya created disruptions, especially for food delivery business.

($1 = 0.8220 euro)

(Reporting by Libby George in Lagos Editing by Matthew Lewis)

((Libby.George@thomsonreuters.com; +234 809 065 5059 ; Reuters Messaging: libby.george@thomsonreuters.com))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

JMIA AMZN

Other Topics

US Markets

Latest World Markets Videos

    IMF's Georgieva: Poorer Nations Hit by Climate, Pandemic

    IMF Managing Director Kristalina Georgieva says poorer nations are struggling with pandemic-fueled debt and desperately need help. She speaks to Bloomberg's Haslinda Amin following an IMF panel. (Source: Bloomberg)

    3 days ago

    Reuters

    Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

    Learn More