Jumia Technologies AG

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Jumia's results conference call for the first quarter of 2022. At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a question and answer session. I would now like to turn the call over to Safa Demir, head of investment relations for Jumia. Please go ahead.

Thank you. Good morning, everyone. Thank you for joining us today for our first quarter 2022 earnings call. With us today are Sacha Poignonek and Jeremy Odara, co-founders and co-CEOs of Jumia, and Antoine Maillet-Médret, CFO. This call is also being webcast on the IR section of our corporate website. We will start by covering the safe harbor. We would like to remind you that our discussions today will include forward-looking statements. actual results may differ materially from those indicated in the forward-looking statements. Moreover, these forward-looking statements may speak only to our expectations as of today. We undertake no obligation to publicly update or revise these statements. For a discussion of some of the risk factors that could cause actual results to differ from the forward-looking statements expressed today, please see the risk factors section of our annual report on Form 20F as published on April 29, 2022, as well as our other submissions with the SEC. In addition, on this call, we will refer to certain financial measures not reported in accordance with IFRS. You can find reconciliations of these non-IFRS financial measures to the corresponding IFRS financial measures in our earnings press release which is available on our investor relations website. With that, I'll hand over to Sacha.

Thank you very much. Welcome, everyone, and thanks for joining us today. Before going into the specifics of performance, I would like to briefly remind you of our current strategy on page three. We are currently focused on scaling our platform in order to build a fast-growing and profitable business in e-commerce and fintech in Africa. We have built very strong foundations for our platform tailored to the specifics of our markets in Africa. The marketplace, the logistics platform, JumiaPay, payment and fintech solutions. We played the long game from the very beginning to position us for long-term growth and profitability. With this in place, we focused on building robust unit economics. The sequencing here is very important. We wanted to first set solid unit economics for the business before accelerating growth. We reached the important milestone of positive order contribution after logistic cost, and it's now been the case for 10 consecutive quarters. In parallel, we strengthened our balance sheets, raising 570 million dollars in 2021 and 2020 and we worked on enhancing the diversity and the relevance of our marketplace and now two-thirds of our gmv is coming from everyday product categories on that basis a strong platform strong unit economics we are now scaling the business towards profitability the free key building blocks to achieve profitability. Number one, accelerating usage growth. Number two, accelerating monetization. And number three, improving cost efficiency. Of course, junior pay remains a priority for us to drive the long-term value creation. Now, let's go into our quarterly highlights. In Q1, we've delivered strongly on each of those building blocks. Page four. Accelerating usage growth. In Q1, we posted the fastest year-on-year GMV and older growth of the past nine quarters, 27% and 40% respectively. Next page. Accelerating monetization. Excluding consumer incentives, which are marketing investments, revenue and gross profit, year-over-year growth rate, also reached their highest levels over the past nine quarters, 56% and 31%. Number three, next page, improving cost efficiency. Sales and advertising per order and as a percentage of GMV both reached their best levels of the past four quarters, $2 per order and 7.5% of GMV. And this improvement is taking place while we are accelerating usage growth. Consumer incentives efficiency. Consumer incentives are accounted for as revenue deduction. This efficiency is also improving sequentially, reaching 15% in Q1 compared to 18% in the third and fourth quarters of 2021. This is very much in line with what we communicated to the market in our last release. Back then, we said that the focus for sales advertising over the subsequent quarters would be to increase the efficiency, and that's exactly what we achieved in Q1. Finally, before going into more details, we move to page seven, our adjusted EBD loss. We have, of course, been closely monitoring the fundamental macro and market shifts which have been taking place over the past few months and which are still unfolding We are very confident in our path and execution towards profitability. In terms of adjusted EBDA, we believe we are past the peak of quarterly adjusted EBDA loss that was reached in Q4 2021. We also reiterate the guidance of 200 to 220 million adjusted EBDA loss for the full year of 2022. Starting from 2023, we expect to begin decreasing the adjusted BDA loss on a year-over-year basis. Now, I'll hand over to Jeremy to give more color and highlights of our Q1 results.