Jumia Technologies (JMIA) 14 May 212021 Q1 Earnings call transcript

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Jumia's results conference call for the first quarter of 2021. [Operator Instructions] I would now like to turn the call over to Safae Damir, Head of Investor Relations for Jumia. Please go ahead.

you. Thank everyone. morning, Good joining for for XXXX first earnings call. us you our today quarter Thank are and Maillet-Mezeray, Sacha and today us With Poignonnec Jumia; well Co-CEOs Jeremy as as Antoine CFO. of Co-Founders Hodara, being webcast website. This call is on IR our section the corporate of also

may in start these the differ safe only today. materially our speak remind that would to harbor. may forward-looking by covering will Actual today results or will We obligation expectations the from discussions revise you our Moreover, as include undertake We We statements. forward-looking statements to indicated statements. like those update to publicly forward-looking these statements. of no

please some to XX, Factors section see For of of a on results risk of our cause differ annual factors discussion XX-F March forward-looking that on report as the published actual today, the could from Form XXXX. Risk the expressed statements

in not In IFRS. addition, financial certain on measures this to call, accordance with refer will reported we

financial measures find measures available Investor can You that, corresponding Relations which to website. our I'll on press in IFRS is our Sacha. With reconciliations release, the to over earnings hand these of non-IFRS financial

you. Thank you today. welcome, Thank and everyone. you us joining Thank for very much,

details logistics, to to We to talk the payments, of platform, chose sellers sellers, is connect profitability. the We founded do the to set And address spent towards the ago, built this and decided it we business our upfront. know vision we then uniquely adapted which like the into a performance, understanding think go markets, path on X few About Jumia in in years first like clear that important years as markets. QX we can question our to an the is specifics dynamics consumers, Jumia to consumers we the years XXXX, we this Before we make following turns with it the over the commerce made scaling X our profitable. and sure would past to fast business and we've as of ago, on the and I easier shareholders, wanted and months. about would make growing of Africa. progress we we we We strategy. offering, our believe scales, XX of that as because recent instead good for our very that

have significantly We very category are increased as product relevant part that and diversified of to consumers our lives. daily exposure our mix their categories to

gross XX% orders. We have now also posted to increased profitability, after profit of positive On penetration the of XX% X we've JumiaPay of fulfillment. of quarters GMV, consecutive

can logistics. we are that I money confidently now think making after we say

For countries, terms X are in a consecutive are quarters, this well particular been all we loss have absolute no EBITDA number have And tailwind from adjusted which also we And as multiple and tech G&A been before has aware, achieved reducing progress quarters. breakeven with our you expenses of year-over-year. in COVID-XX.

that you we Page X today, X, EUR quarters, we million If our look strong strengthened if X have years and changed course, of And QX loss than are raising significantly XX% we proceeds which to very completely can turn our very balance sheet, are of XXXX we year which Page between XX have Finally, and recent strategic under ago. now. where a look past economics you at the see if have it's That's less control. the at unit where XXXX, And in EBITDA total been you ago net much months, is us year X. what in you a million, an flexibility. a over take see ago, we of on gives a $XXX

percentage X profitable. business by the X increased continue our the value as last basis are order points. is to we EUR of much towards that more a see can smaller, down orders in gone everyday by but Fulfillment have years. profit expense categories, You drive as almost GMV XXX the product margin Gross

which now in gross XXXX. are at consistently fulfillment, a orders EUR standing And contribution generating Our is QX positive we after fulfillment X.XX after profit expenses. have

much you If down, you see continue that go those to to orders marketing less take generate.

increased efficiency, have per sales the and factor a We advertising the of XXXX. order X since marketing by

We the in QX for in we progress focus are now very And is where way, reaching in pleased very economics. us, points with unit this in a clear. are

Flipping more position continue that good resources to growth, Page What accelerate are in milestones means priorities next and now deliver JumiaPay. We for growth. the quarters. few behind put our X, to accelerate a usage very usage to are: profitability

We will will. ramp JumiaPay. value the well up that same usage the drive We're going support and attractive categories with lifetime to And do no technology you as investments to on and as in sales consumer if gradually. and economics, focus that big advertising bank, good growth

consumers everyday COVID usage, the that outgrow on In even tensions GMV. of on continue focused Jumia. than consumer now. more the terms economic and us we're believe on it's going to categories categories faster will essentials, We pretty orders that more to by the they generated consumers to other spending are on than grow the of clear Also, will make

orders GMV of the We GMV. be will All for currency also consumers, growth. those, some growth think, And have they result, sure fluctuations. as and on than we will greater weigh a

profitability, will not bring but next for quarters, going EBITDA GMV, on breakeven in total of ratios. CapEx. we of will our order Having This study, of we and level. more still profitability on the a case both case as for few into probably geographical the to the said And build-out financial be study than to margin. terms. finally, lower solutions, translate absolute payment the that, focus will local intend than progress XXXX, And by to sellers going EBITDA our a not of that we're seek quarters, In rather EBITDA where adjusted per JumiaPay XXXX small at improving least, be the next percentage to terms loss we consumers. capital the and allocate measure in In is think few for last

allocated additional technology JumiaPay. and this marketing, G&A We will development but be perspective, continue expenses to to CapEx-light the rather of from

Our it's for Today, we business overcome we success And logistics. scalable payments, other in Libre, challenges and of about think in we off-line. we proven the services I We've of has challenging like consumers now are about that I you to we sellers business. to unit and think is tell potential economics, And the adoption the in faster. major ones. more of great distribution any Amazon are delivery control, Mercado e-commerce can think extremely that. our continent well time our model a don't The is huge. E-commerce companies positioned relevant payments. the significantly bit doubt will Africa of all and Africa, where improved very food under there's operationally costs goods drive And is proven marketplace we a Alibaba, and very very the have have Africa and grow built now a our

to Now is in more the who us I over going through walk to details. performance Jeremy, hand of QX

Thanks, Sacha. Hello, everyone.

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QX material and sales shilling quarter EUR XXXX Nigerian It's the euro million the QX XX%, year-over-year, advertising down X% pound to the declining the respectively, in by in XXXX. worth spend was Egyptian and our XXX FX reduced was this we the with noting naira, impact reaching also X% Kenyan As against GMV XX%, QX. XX%, compared that and

X.X year-over-year, and million, GMV advertising So X% year-over-year. while was on was a down X% basis, expense EUR down constant-currency sales

GMV repurchase while ticket Our affordable ultimately mix the to points towards Jumia lower are entry into size everyday dynamics. ecosystem, which categories, shift continues product supporting

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platform. XX and months other XX, the ending outlets March on period For restaurants in X,XXX over convenience our had active we

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you, Thank everyone. Jeremy. Hello,

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Thank guys. Antoine. you, you, Thank

and and we is win station proposition of the Just consumers and opportunity do to Also, which Everything believe about towards did long improving of illustrations built adapted the the what be of know the the business, uniquely very talked couple of our and and heart to of the think to bring serve is in years platform you some huge we before offer intend e-commerce past which communities. know situation and final great I term, at our strategic this long over We're Today, sellers. in better to constantly many that focused our our we have both markets and to we value not on about. which going strongly strengthening The even assets capturing may consumers, convenience food that not of the can you delivery them how Africa. pretty the payment geared the see thoughts we pickup the are network, forward about have term. more closer We're Jumia in questions. to done simple. is and we've we we probably market

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infrastructure to increase orders, The broader but will going allocated by also remain manner, And to on in part we're very moats the we not opportunity those both and will solutions, e-commerce any do summary, we have the a are concept product we Before that and services thoughtful the drive any those will by drive grow confident manner. to the can and probably management the That's the do investments seek AB to unchanged. And we're of in than cost. JumiaPay proof we use right? and development focused on test continue investments to will pilot big GMV payments. the growing And important GMV, of resources are countries on a have as lots very essential consumers, do apply this gradual to develop we discipline way scale establish we for platform before of to now you drive continue we the of we are platform. any much we take to compliance, we in we And investments the excited and In of be which built. and rollout this will will pilots. the advertising platform disciplined, to framework that further way large-scale more capture the Thank markets, growth countries to We're competitive any in relevance our a handful happy of not guided gradual we we've very in tests, and very to in always thoughtful going are we The And people, and initiatives, will technology the The opportunity, in view questions. needs very expenses processes. strengthen and risk sales manner, services, and and our attention, of conduct new an as deployment We of a mindset investments. bank, users. JumiaPay also for introduce and we off the why right? JumiaPay. the at or

Raymond Our Aaron Kessler from first Instructions] [Operator James. from question is

questions. couple A of

invest. know talked would call as of about It on I other you're seasonality? Or areas that you flexibility cash was -- increased on be more little it's just continue Any we investing the drift that it's like seasonality. it gives else with of should from you looks new level kind the in that recent the I to of to revenues primarily quarter? Is where think revenues. a out base some finally, was specific was just that an First, that use out there looking the to know well those focused this congrats shifting then do areas COVID XP then position. at kind shift just bit is cash, maybe you or of revenues. XP of XP that's lower. a maybe QX invest headwinds, marketplace intentional from bit or away revenues? raises. QX a at in it maybe whether And we down from for you equity on expected some and Is point? to little new Or continues something than that really in just terms And

seasonality Thank you say, Thanks, would Aaron. And year, no special. quarter a QX, very particular that is I Look, the really year. in much. right? nothing beginning It's obviously the of this

So think I on that. that's

coming this some sometime at in point, earlier year. year I it's mid-April, think started every Ramadan and the

special call be year, consumer honestly. year, that So would impact from maybe a sometimes drives there specific this But it I nothing behavior. say, to next out because will an

way of good it's sometimes is certain do not building does able a clear to seller useful relevant because On interesting. It's consumers, act XP in if very in we of are there there or example, objective been is very the we there's seller, us who how a to XP, carry But and particular for very very a now a helpful it's bit than that supplies it's of we address right? right? minus, that drive see to We're plus that solving anywhere XX%, very more level particularly the been lower GMV. not we quarters, are, are it's And a will, well, future where And if number a be And may to you make a relevance. to good or it around as us pretty -- little consumer right, about if could if And to XP increase sometimes a are for our certain as we primarily big to terms it a engage that how of the And are want strategic disruptions, and that supply, a goods, categories. we important on supply no or For is shortage right? or it's be, the we We've for for tool, decide question. comfortable us, of small we And focused this. in it the with. feel marketplace. which shortage very XP. is

us, is something that may do. in for it and go of But important So what's current feel GMV. if we In feel again, we the remains we a up level that with it's know the future, XP QX. necessary, transactions good how the minority to for that's the

the to We know-how have certain of operate XP. level

thing that. for good a to be it's to think us able do I So

course, I food on of features the we all quarters, e-commerce, And growth So And of focused services part And clearly, we usage delivery, platform, products as the that then that, goods, terms may extremely to mention within this JumiaPay. future. the order on. on food by would new And us, good to of extremely course, delivery reassess are same we're intention the few the the our accelerates drive there's we core for be our in working core In marketplace see new are of And and clearly, mean use we're mandate, business, and us physical is and I JumiaPay, right? path that, right? for say, then the going we is right? anywhere physical continue to accelerate future, and for the to e-commerce. and continue, in don't and those growth foreseeable But really goods some but the profitability resources cash, to logistics no in on core that's with new core. of path empowering next for e-commerce a countries on extremely to e-commerce. of our core the focused So focused to clearly, go geographically, thing for near and a lot which profitability innovations within develop and focused the of XX new services JumiaPay. And

well. some So there core. But focus as on the overall investments

you Got about it. Maybe finally, the just overlap. can talk briefly

core delivery maybe food seeing increasing? delivery you're that on-demand, and food the mentioned or that's You retail how the overlap and between

much, the And you few a time. very overlap angles see you fascinating this to see it's take overlap. can growing about to think -- with Yes, can

time in So players, as tended purchase the is restaurant, the historical are offer also delivery, very, our obviously, a is Logistics competitive impulsive order for of them for You offer use right? delivery offer that ability be of also of and different a the a to to deliver which class. for right? X and Logistics. giving perspective, in also able instant deliveries, XX-minute cities both, There be them overlap we grocery channel more and the then the a it newcomers nationwide, way the on today be country We be have the not parties, a big purchases, about to we right? we strong And extremely us, that mainly last-mile the say, fast of needs. The and having our will to and people they few to and immediate, more as from. physical want choose very to And vendors, and see, home. e-commerce this are to address But also the I also as consumer more to address to us able to e-commerce And reach consumers of And maybe want you for big to service is FMCG and are give traditional delivery. to of where for to big in a then more in delivery. but to -- a big platforms expand this days' today, find course, delivery marketplace middle right? service convenience in Jumia the e-commerce can third on we're more less they outside instant a the -- of focus impulse, more right? can deliveries purchase, that advantage explore we they're more the is one, from consumers attractive. of past, that many or prepared, they want at the starting more to very vendors think the also great afford goods Many which unplanned both terms are a business for monetization to logistics we something a use shipping you Jumia we and planned, maybe were clients cities, the upper the to more and planned those to use And they vendors go able have cities. way delay consumers maybe side a with observing a it's who So eager be of food also and the And as right? convenience can to from to vendors needs a seeing restaurants, afford to the want who for course, serve which other consumers restaurant goods and And discovering to should

very very not Jumia they our also subscription e-commerce competitive program So the reasons because last have both. members because of well but the advantages as which a it's overall Prime the attractive. very program is advantage use makes right, attractive, but for the of creates to least, food both consumers it for is, course, for attractive And it more then that And delivery.

Stifel. Our Instructions] [Operator Lamont from from next Williams is question

you about on-demand also traditional landscape unit Can had delivery? food competitive the on business? the talk little talk food this And unit bit I could you food the about just on question was economics some then in First of with how e-commerce delivery economics. and compares a delivery the

of course. Yes,

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logistic So the are to this participating consumers cost.

in perspective. are there. all, So who an In of it's business even were before number attractive in who quite we have some And have you been unit our economic operations. players historical countries some of player there them, a of from a acting of in competition, terms there's all

expansion all have And You a few are have obviously you certain who ride-hailing as the Glovo. natural in also like players expand into attempting tried know. some markets have enter to food lot it's companies of hailing are a or Uber a companies Eats who international better active because doing ride local very to we into delivery

so with payments, has brand, the doing very have for XX Jumia who restaurants, the of Jumia a player know lot the offering. a done this leverage, because Jumia and us. got infrastructure the got which think huge, yes, we the business of brand, benefit any experience the we lot. it right, we've relationship we've model. Prime relationship don't a the base, longer obviously, We've subscription the all the of is multi-country which well to And the advertisers, years, And scale those for with we're the than consumer logistics, rather I from is been positioned investments. and But I it's competitive

position feel restaurants. for strong a it's for have consumers that competitive very So effective it's that very we think we value for -- us, something very about. and and And we

Durke] from is [Edgar next Our question Blackrock. from

two only quick got I've questions.

can EUR you you other just is and net XX technical provide it's million and of receivables EUR And just is, then the roughly a GMV, million. second it's from first gross quote, please, XXX XXX increase is question. if that net? your number? or in EUR The your on you million returns, gross, vouchers discounts trade Does can to explain And the the

the for question. Antoine, should please? take you Thank those, Probably you

of receivable showing I increase and revenues the April. collected tranche Yes, accounts It vouchers. that The we includes XX in of net USD May, million. both. offering was third In the can received made that in the we for all of take are

I think question. your maybe

like The And. first is basically. cash one

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like for would conference to This Sacha to closing concludes our remarks. I the turn question-and-answer back session.

next you follow-up best. you for very Thank All questions to much, very and attending, very everyone, to as happy much forward take steps. take Great. Very always, Thank looking the care. and much,

The has concluded. attending for now conference presentation. you today's Thank

now disconnect. may You