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Jumia(JMIA) - 2024 Q4 - Earnings Call Transcript
JMIAJumia(JMIA)2025-02-21 01:23
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Financial Data and Key Metrics Changes - In Q4 2024, revenue was 45.7million,down2345.7 million, down 23% year-over-year and down 2% on a constant-currency basis [31][32] - Adjusted EBITDA was negative 13.7 million for Q4 2024, compared to negative 0.6millioninQ42023[16][40]−Lossbeforeincometaxfromcontinuingoperationswas0.6 million in Q4 2023 [16][40] - Loss before income tax from continuing operations was 17.6 million in Q4 2024, a slight increase from 17.1millioninQ42023[16][44]−Cashburnforthequarterwas17.1 million in Q4 2023 [16][44] - Cash burn for the quarter was 30.6 million, compared to 26.8millioninQ42023[17]BusinessLineDataandKeyMetricsChanges−CoremarketplacebusinessacceleratedinQ42024,withphysicalgoodsordersgrowingby1826.8 million in Q4 2023 [17] Business Line Data and Key Metrics Changes - Core marketplace business accelerated in Q4 2024, with physical goods orders growing by 18% year-over-year [10] - Marketplace revenue for Q4 was 22.8 million, down 31% year-over-year [33] - Revenue from first-party sales was 22.5millioninQ4,down1422.5 million in Q4, down 14% but up 8% on a constant-currency basis [34] Market Data and Key Metrics Changes - GMV declined 12% in USD but grew 13% year-over-year in constant currency [14] - Average order value for physical goods orders decreased from 45.5 in Q4 2023 to 35.5inQ42024[15]CompanyStrategyandDevelopmentDirection−Thecompanyisfocusingonupcountryexpansionandproductassortmentexpansiontodrivegrowth[20][22]−Jumiaaimstoimproveoperationalefficiencyandachieveprofitabilitybyenhancinglogisticsandcustomerexperience[25][28]−Thecompanyplanstoleverageinternationalsourcingtoexpandproductofferingsataffordableprices[23]Management′sCommentsonOperatingEnvironmentandFutureOutlook−Managementacknowledgedmacroheadwindsaffectingperformancebutexpressedconfidenceinthecompany′sgrowthtrajectory[14][19]−For2025,thecompanyanticipatesphysicalgoodsorderstogrowbetween1535.5 in Q4 2024 [15] Company Strategy and Development Direction - The company is focusing on upcountry expansion and product assortment expansion to drive growth [20][22] - Jumia aims to improve operational efficiency and achieve profitability by enhancing logistics and customer experience [25][28] - The company plans to leverage international sourcing to expand product offerings at affordable prices [23] Management's Comments on Operating Environment and Future Outlook - Management acknowledged macro headwinds affecting performance but expressed confidence in the company's growth trajectory [14][19] - For 2025, the company anticipates physical goods orders to grow between 15% and 20% year-over-year [51] - GMV is projected to be between 795 million and $830 million in 2025, reflecting a year-over-year increase of 10% to 15% [52] Other Important Information - The company streamlined operations by exiting non-strategic markets, consolidating warehouse footprints, and improving logistics capabilities [9][10] - The Net Promoter Score rose to 63 in Q4 2024, indicating improved customer satisfaction [13] Q&A Session Summary Question: Can you provide more color on trends observed in Q1? - Management noted continued progress on order growth and usage, leading to confidence in the guidance of 15% to 20% growth year-over-year [55] Question: What is preventing the company from increasing selection? - Management indicated that the challenge is more on the supply side than demand, focusing on increasing supply and improving vendor experience [58][60] Question: Can you elaborate on the mix between first-party and third-party sales? - Management acknowledged a decline in corporate sales affecting first-party sales and stated that they are pragmatic about the mix, using first-party sales when it provides better value [62][64] Question: What is behind the physical order growth? - Management attributed physical order growth to better assortment, customer experience, and efficient marketing tactics [67] Question: What efficiencies have been gained from consolidating the warehouse footprint? - Management explained that consolidating warehouses has improved efficiency, control, and fulfillment costs, with expectations for greater savings in 2025 [75][76] Question: What is the current fixed cost base as 2025 begins? - Management indicated that while costs have been reduced, there is potential for another 20% efficiency improvement, allowing for processing of 2x to 3x current volumes [80] Question: How does the balance sheet look in terms of inventory strategy? - Management confirmed that increased working capital was aligned with their strategy to enhance supply and vendor relationships, with expectations for moderation in future adjustments [88][90]