Jumia Grows Gross Profit by 94 Percent in Q2, 2019

• Jumia Grows Gross Profit by 94 Percent in Q2, 2019

Jumia Technologies, Africa’s No. 1 online retailer, reported an impressive gross profit for the quarter ended June 30, 2019.

The Amazon of Africa grew gross profit by 94 percent in the second quarter of the year, Sacha Poignonnec, the company’s co-chief executive officer, disclosed this during a media briefing in Lagos.

He said the company continued its strong growth of top-line drivers, delivery of cost efficiency improvements and focus on its payment platform, JumiaPay.

“We continue to deliver on our financial strategy of generating strong growth of our top-line drivers, while accelerating monetization, driving cost efficiencies and developing JumiaPay.

“During the second quarter of 2019, our Gross Merchandise Volume (GMV) increased by 69 per cent year-on-year and our Gross profit grew by 94 per cent.

“Our adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) loss as a percentage of GMV decreased by 562 basis points (5.62 percentage points) and our operating loss, amounting to €66.7 million, decreased as a percentage of GMV by 148 basis points (1.48 percentage points).

“These results reflect our continued focus on offering a relevant and engaging online shopping and lifestyle destination for consumers, while providing our sellers with an attractive value proposition and a platform to grow their businesses,” he said.

According to Poignonnec, Jumia’s customers grew from 3.2 million recorded a year ago and 4.3 million at the end of the first quarter to 4.8 million in the second quarter of the year.

He attributed the improvement to price and convenience as Jumia is gradually becoming preferred online e-commerce company for customers across Africa.

Jumia shares plunged from over $46 a share in April to $11.52 as of 6:33 pm Nigerian time on Monday.

Citron Research, a US-based research firm, had accused Jumia of fraud in February, saying the company inflated its number.

Jumia’s stock price started dropping immediately, five months later it has not stopped falling, especially after the company admitted regularities in its numbers two weeks ago.