{"id":20974,"date":"2024-08-08T10:36:22","date_gmt":"2024-08-08T05:06:22","guid":{"rendered":"https:\/\/thecatalystonline.in\/thecatalyst\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\/"},"modified":"2026-08-11T20:06:56","modified_gmt":"2026-08-11T14:36:56","slug":"jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth","status":"publish","type":"post","link":"https:\/\/thecatalystonline.in\/thecatalyst\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\/","title":{"rendered":"Jumia plans to raise more than $100 million in secondary shares to drive stalled user growth"},"content":{"rendered":"\r\n<p id=\"speakable-summary\">African e-commerce company Jumia is selling 20 million American depositary shares over the next couple of weeks, TechCrunch has learned. The at-the-market transaction is to take advantage of strong results despite a volatile market.\u00a0<\/p>\r\n\r\n\r\n\r\n<p>Given Jumia\u2019s share price of around $5.70 when the stock market opened on Tuesday, the e-commerce company could potentially raise approximately $100 million through its new share offering. However, the final amount will depend on the share price, which has since dropped to $4.90. This decline, from around $11 as of Monday following a 200% rally in the last three months, may be attributed to shareholders reacting unfavorably to news of dilution, the impact of global carry trades, or both.<\/p>\r\n\r\n\r\n\r\n<p>It\u2019s not the first time Jumia has taken this approach. Between 2020 and 2021, the e-tailer raised almost $600 million through the sale of secondary shares.<\/p>\r\n\r\n\r\n\r\n<p>CEO Francis Dufay, who is\u00a0<a href=\"https:\/\/techcrunch.com\/2022\/11\/18\/jumia-to-cut-products-and-overheads-as-new-management-chase-profits\/\">undertaking his first secondary share sale<\/a>, said on a call with TechCrunch that this time, Jumia is raising this money to accelerate its business after making significant progress on cost management and efficiency.<\/p>\r\n\r\n\r\n\r\n<p>\u201cThe new funding will be used to expand our supply chain network, particularly by enhancing logistics to reach smaller cities and broadening our overall network,\u201d Dufay remarked. \u201cWe also plan to invest in technology, focusing on marketing and vendor technology, which we believe will significantly impact growth. Bottom line, after deep, fundamental, hard work on cost and efficiency, we believe the time is right to shift the cursor towards growing and invest some extra money so we can scale the company faster and break even faster.\u201d<\/p>\r\n\r\n\r\n\r\n<h2 id=\"h-breaking-past-the-2-million-mark\" class=\"wp-block-heading\">Breaking past the 2 million mark<\/h2>\r\n\r\n\r\n\r\n<p>Specifically, the funds will improve Jumia\u2019s cash position, which currently stands at $92.8 million (comprising $45.1 million in cash and cash equivalents and $47.7 million in term deposits and other financial assets) from its Q2 2024, its\u00a0<a href=\"http:\/\/chrome-extension\/\/efaidnbmnnnibpcajpcglclefindmkaj\/https:\/\/s23.q4cdn.com\/836376591\/files\/doc_financials\/2024\/q2\/Jumia-EX-99-1-Q2-2024_08062024.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">most recent financial report<\/a>. That\u2019s compared to the platform\u2019s liquidity position of $120.6 million in Q4 2023 and $101.5 million in Q1 2024.\u00a0<\/p>\r\n\r\n\r\n\r\n<p>The funds raised will also be used for other purposes, including customer acquisition, product assortment, supply retention and adding more vendors to its marketplace.<\/p>\r\n\r\n\r\n\r\n<p>Jumia\u2019s active customer base has hovered around two million for several quarters. The number represents a 6.0% quarter-over-quarter compared to Q1 2024 and flat year-over-year growth between Q2 2023 and Q2 2024.\u00a0\u201cOur customer base is still relatively small, around two million active consumers per quarter, while we work in markets with over 600 million people. So we can do much more on the customer base,\u201d said Dufay.<\/p>\r\n\r\n\r\n\r\n<p>Subsequently, orders increased 7% year over year to 4.8 million. Jumia ascribes the growth to the diversification of its product assortment, another area it intends to double down on with the new capital raised.\u00a0<\/p>\r\n\r\n\r\n\r\n<p>However, despite the increase in orders, Jumia\u2019s GMV and revenue declined 5% and 17% year-over-year to $170.1 million and $36.5 million, respectively. As with most of Jumia\u2019s financial reports, since\u00a0<a href=\"https:\/\/techcrunch.com\/2022\/11\/18\/jumia-to-cut-products-and-overheads-as-new-management-chase-profits\/\">new management took over<\/a>\u00a0in Q4 2022, a recurring theme has been that these numbers typically highlight a year-over-year improvement on a constant currency basis but fluctuate in dollar terms due to devaluation. For instance, Jumia\u2019s GMV in constant currency grew 35.0% year-over-year while revenue increased 15%.\u00a0<\/p>\r\n\r\n\r\n\r\n<p>\u201cThe devaluation that happened both in our two biggest potential markets, Egypt and Nigeria, at the end of Q1 had a significant impact on our revenues quarter over quarter,\u201d Dufay said. \u201cHowever, we have seen some signs of stabilization and a sharp reduction of the spread between the official and parallel market rates. More importantly, our ability to drive GMV growth in constant currency illustrates that our value proposition is working.\u201d<\/p>\r\n\r\n\r\n\r\n<p>Turning to profitability, Jumia\u2019s adjusted EBITDA loss, which excludes finance costs, decreased 10% to $16.3 million \u2014 in line with the reduction in operating loss, down 8% year-over-year to $20.2 million \u2014 and driven primarily by cost-savings initiatives.\u00a0<\/p>\r\n\r\n\r\n\r\n<p>While\u00a0<a href=\"https:\/\/techcrunch.com\/2024\/05\/07\/jumia-is-back-growing-total-sales-and-orders-in-q1-2024\/\">Jumia<\/a>\u00a0has long used both adjusted EBITDA and operating loss to measure its losses and path to profitability for years, Dufay insisted on the call that the 12-year-old e-commerce platform is keener to report loss before income tax from continuing operations, which includes finance costs, such as the impact of FX and the cost of cash repatriation. Loss before income tax from continuing operations was $22.5 million, down 27% year-over-year.\u00a0<\/p>\r\n\r\n\r\n\r\n<p>\u201cWe\u2019ve emphasized this KPI more over the past quarters due to the currency volatility and the associated costs it creates. Reporting the full picture is essential for companies exposed to such volatility. For instance, Mercado Libre in Latin America also prefers to look at the loss before income tax rather than EBITDA,\u201d said the CEO. \u201cDuring their recent results announcement, they highlighted how currency volatility in Argentina impacts finance costs. Therefore, focusing on loss before income tax offers a more comprehensive view when operating across multiple markets with currency fluctuations.\u201d<\/p>\r\n","protected":false},"excerpt":{"rendered":"<p>African e-commerce company Jumia is selling 20 million American depositary shares over the next couple of weeks, TechCrunch has learned. The at-the-market transaction is to take advantage of strong results despite a volatile market.\u00a0 Given Jumia\u2019s share price of around $5.70 when the stock market opened on Tuesday, the e-commerce company could potentially raise approximately [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":769,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[76,80],"tags":[],"class_list":["post-20974","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industry-news","category-retail-e-commerce"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Jumia plans to raise more than $100 million in secondary shares to drive stalled user growth - Latest Tech News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/thecatalystonline.in\/thecatalyst\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Jumia plans to raise more than $100 million in secondary shares to drive stalled user growth - Latest Tech News\" \/>\n<meta property=\"og:description\" content=\"African e-commerce company Jumia is selling 20 million American depositary shares over the next couple of weeks, TechCrunch has learned. The at-the-market transaction is to take advantage of strong results despite a volatile market.\u00a0 Given Jumia\u2019s share price of around $5.70 when the stock market opened on Tuesday, the e-commerce company could potentially raise approximately [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/thecatalystonline.in\/thecatalyst\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\/\" \/>\n<meta property=\"og:site_name\" content=\"Latest Tech News\" \/>\n<meta property=\"article:published_time\" content=\"2024-08-08T05:06:22+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2026-08-11T14:36:56+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/thecatalystonline.in\/thecatalyst\/wp-content\/uploads\/2024\/07\/image-16.png\" \/>\n\t<meta property=\"og:image:width\" content=\"975\" \/>\n\t<meta property=\"og:image:height\" content=\"548\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"The Catalyst Editorial\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"The Catalyst Editorial\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/thecatalystonline.in\\\/thecatalyst\\\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/thecatalystonline.in\\\/thecatalyst\\\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\\\/\"},\"author\":{\"name\":\"The Catalyst Editorial\",\"@id\":\"https:\\\/\\\/thecatalystonline.in\\\/thecatalyst\\\/#\\\/schema\\\/person\\\/9e3e713b2f3c79dfdaf25069eabd6788\"},\"headline\":\"Jumia plans to raise more than $100 million in secondary shares to drive stalled user growth\",\"datePublished\":\"2024-08-08T05:06:22+00:00\",\"dateModified\":\"2026-08-11T14:36:56+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/thecatalystonline.in\\\/thecatalyst\\\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\\\/\"},\"wordCount\":789,\"publisher\":{\"@id\":\"https:\\\/\\\/thecatalystonline.in\\\/thecatalyst\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/thecatalystonline.in\\\/thecatalyst\\\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/thecatalystonline.in\\\/thecatalyst\\\/wp-content\\\/uploads\\\/2024\\\/07\\\/image-16.png\",\"articleSection\":[\"Industry News\",\"Retail &amp; E-Commerce\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/thecatalystonline.in\\\/thecatalyst\\\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\\\/\",\"url\":\"https:\\\/\\\/thecatalystonline.in\\\/thecatalyst\\\/jumia-plans-to-raise-more-than-100-million-in-secondary-shares-to-drive-stalled-user-growth\\\/\",\"name\":\"Jumia plans to raise more than $100 million in secondary shares to drive stalled user growth - 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