Q1 Report: Jumia Records Increase in Gross Profit as cost discipline, monetization drives growth
Jumia has released its 2021 quarter one report, recording 11% year-on-year gross profit increase, as adjusted EBITDA loss decreased by 24% year-over-year.
The report by the company also showed a sixth consecutive quarter of positive Gross Profit After Fulfillment Expense, which reached €6.2 million, more than doubling YoY. According to Jumia, the report is a reflection of a solid progress towards profitability, with gradual monetization and cost discipline as major drivers.
“Our first quarter results reflect solid progress towards profitability. The drivers remain consistent: selective and disciplined usage growth, gradual monetization and continued cost discipline.The first quarter of 2021 was the sixth consecutive quarter of positive gross profit after fulfillment expense, which reached €6.2million, more than doubling year-over-year, while Adjusted EBITDA loss contracted by 24% year-over-year, reaching €27.0 million. Our strategy to increase our exposure to everyday product categories continues to yield positive results, enhancing the relevance of our marketplace for consumers”, commented Jeremy Hodara and Sacha Poignonnec, Co-Chief Executive Officers of Jumia.
Jumia also disclosed that it made significant steps towards the $10billion market capitalization. “We have raised over $570m over the past 6 months, strengthening our balance sheet & increasing our strategic flexibility. We are confident we have all the right ingredients to continue to build a growing business across both our e-commerce and fintech activities.”
As contained in the report, Jumia is making significant inroads in payment and fintech, with 37% of Orders in the Q1 of 2021 completed using JumiaPay. The report revealed that Total Payment Volume on JumiaPay increased by 21% from €35.5million in the first quarter of 2020 to €42.9million in the first quarter of 2021. On a constant currency basis, TPV increased by 35% year-over-year. On-platform penetration of JumiaPay as a percentage of GMV increased to 26.0% in the first quarter of 2021 from18.7% in the first quarter of 2020.
JumiaPay Transactions increased by 7% from 2.3 million in the first quarter of 2020 to 2.4million in the first quarter of202.
Overall, 36.7% of Orders placed on the Jumia platform in the first quarter of 2021 were completed using JumiaPay, compared to 35.5% in the first quarter of 2020. Jumia Food and on-demand services accounted for 22% of orders and 9% of GMV in the first quarter of 2021.
Likewise, annual active consumers reached 6.9 million in the first quarter of 2021, up 7% year-over-year, as the platform continued to acquire new consumers and engage existing ones. Orders reached 6.6 million, up 3% year-over-year, a reversal of the declining trend observed over the prior two quarters.
Jumia also recorded operating loss of €33.7million in the first quarter of 2021
decreasing by 23% on a year-over-year basis demonstrating meaningful progress on the brand’s path to profitability. GMV was €165.0 million, down 13% on a year-over-year basis and 5% on a constant currency basis.