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Jumia Technologies, Africa’s leading e-commerce platform, reported a challenging third quarter, ending September 30, 2024, with a $20.1m operating loss.
The 12-year-old company stated this in its financial report released on Thursday.
The e-commerce giant attributed its $20.1m loss to persistent macroeconomic pressures that have impacted consumer demand and operating costs across its markets.
This quarter’s results marked a slight deterioration from the $18.3m operating loss recorded in Q3 2023.
Despite a year-over-year revenue decrease of 13 per cent to $36.4m, the company demonstrated resilience in constant currency, achieving a 9 per cent revenue rise as well as a 29 per cent growth in gross merchandise volume over last year’s figures.
Adjusted EBITDA, a measure of operating performance that excludes certain non-cash and non-operating items, reached a loss of $17m, a 15 per cent increase from the $14.8m recorded in the same quarter last year.
However, the company continued to implement strategies to strengthen its cash position, notably raising an additional $71.8m from an at-the-market offering in August.
This boost brought Jumia’s liquidity to $164.6m, underscoring its focus on navigating economic headwinds while stabilizing its finances.
Commenting on the result, the Chief Executive Officer, Francis Dufay, stated, “In the third quarter, we continued to strengthen the underlying fundamentals of the business.
“We saw growth in both quarterly active customers, up 1 per cent year-over-year, and orders, up 4 per cent over the prior year, as we continue to focus on diversifying our supply and strengthening the Jumia value proposition.
“We are encouraged to see continued resilience in our usage and business fundamentals despite the significant first quarter currency depreciation headwinds in Nigeria and Egypt that continue to impact reported GMV and topline revenue.
The CEO noted the company took several major operational steps in the quarter, including improvements to our logistics network and the consolidation of our warehouse footprint to enable greater efficiencies and increase supply capacity.
While these changes negatively impacted operations and expenses in the third quarter, he stated that the company believes that these efforts position us well to scale and drive profitable growth as we expand our footprint beyond the major cities (“upcountry”).
“We also recently decided to cease operations in South Africa and Tunisia in order to better allocate our resources to markets with stronger growth potential.
“While these updates will have a near-term impact on our operations and financial performance, we believe that our efforts position the business well to scale on our path to profitability.”
Further, Dufay mentioned that the company is committed to taking a disciplined approach to managing our operations.
“The proceeds of our recent capital raise will help to accelerate our growth trajectory. However, we are committed to accelerating our strategy in a disciplined manner that avoids excess spending and will position the business for profitable growth over the long term.”
