Good day and welcome to Jumia March Quarter 2019 Results Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Safae Damir, Head of Investor Relations for Jumia. Please go ahead.

Thank you. Good morning everyone. Thank you for joining us today for our first earnings release with post-IPO. With us today are Sacha Poignonnec, co-founder and co-CEO of Jumia, and Antoine Maillet-Mezeray, 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. In addition, 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 final perspective filed in connection with our initial public offering on April 15, 2019. In addition, on this call we will refer to certain financial measures not reported in accordance with IFRS. You can find reconciliations of this 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'd hand over to Sacha.

Hello everyone. It's a pleasure to speak with you today, and tell you more about Jumia and our first quarterly results. We reached a major milestone for our company in Africa on April 12th when we began trading on the New York Stock Exchange. We know that this is the beginning of the journey, and we look forward to many more earning reports with you over the coming years. We are of course aware of a recent opinion piece that was published. We would like to say upfront that we completely stand by our prospectus, our audited financials and the risk factors. We're very excited about the future and our prospects. We will not be distracted from executing on our strategy, and carrying out our mission by those we seek to create doubts, to profit at our expense, and that of our long term stakeholders. If there are any follow up questions, we are always available. Before getting into our great Q1 results, we’d like to take this opportunity to remind you of our mission, who we are today, and how we plan to build on the success of Jumia. If you'd like to turn your attention to page five please, I will start with our Market Africa. We created Jumia with a passion for Africa, a deep conviction in the strong potential of this market, and that technology could have a very strong and positive impact. Africa is a huge continent with a large commerce market of 1.2 billion people, 450 million Internet users, which is more than half of China. 17 million SMEs and merchants together spending $4 trillion, and almost entirely offline. Moving on to Page six, in Africa, Distribution of goods and services is very challenging in the offline world. Therefore technology and e-commerce can create…

We will now begin the question and answer session. [Operator Instructions] The first question today comes from Mark Mahaney with RBC. Please go.

Great. Thanks. Could you do two things? First, any color you can give us on markets Nigeria and Egypt, your two biggest markets or other ones where you seeing acceleration in growth or notable deceleration and could you – just notable deceleration in growth any markets where you could talk about trends being materially different than what you're reporting overall? And then second could you just address the issue of Jforce and fraud [ph] in Nigeria as an operating risk? And how you tried to hedge that? How you tried to manage that? Thank you very much.

Thanks very much Mark, and two very good questions. On the first one, we're seeing very strong momentum and we're seeing quite some uniform momentum across the markets and very much and nothing very different from what we have reported in the past or certainly in the past. In this case we were seeing very very good momentum. And on the second question here I would like to say very upfront that the Jforce agents which are consultants which are part of Jforce get commissions of course on the percentage of their completed transaction after all cancellations and returns. And this is of course key and very normal. We do that. We have even actually introduced penalties as well as extra incentive to drive lower cancellations and returns for the orders which are generated by the Jforce consultant. So for us this is a very innovative marketing channel which helps consumers adopt e-commerce. It's also very useful channel to gather insights on the consumers, in addition to the data we collect online. And it's been a very successful channel which is particularly adapted to the needs of our market.

Okay. Thank you, Sasha.

The next question comes from Aaron Kessler with Raymond James. Please go ahead.

Great. Thanks guys. Congrats in the first quarter. Couple of questions. Firstly on the Jumia deal, can you talk a little bit about -- do you see more deals like this occurring kind of more I guess what we’ve seen from Tmall [ph] where you set up stores for companies. Additionally if you could just talk maybe the opportunities over that kind of maybe near to intermediate term increased commission rates as well as kind of monetization of the marketing? And then third maybe to address some of the recent concerns around maybe its delivery rates, failed deliveries and cancellations kind of where we're at now on that? Thank you.

Thanks very much. On the first question the answer is very much yes. And we're seeing a lot of appetite from sellers which include international brands to start operating and distributing their goods and services in Africa. And they very much see Jumia as a partner of choice. I would say to do that we see a lot of brands also who has now experienced e-commerce in other regions and are very familiar with the development of e-commerce. We have in particular a lot of discussions with sellers who are already present in Africa notably in the FMCG sector, and I think you will see more and more of those partnerships in the future. And I think on the commission and the marketing, I agree with you that for us we like to keep commissions competitors and we as you know have multiple revenue streams on doing expertise on marketing and advertising and working with those brands for us is rather an opportunity to drive more revenues on those streams than necessarily in commission. We would like to partner with them on marketing and advertising and the Jumia Express rather than just increasing commissions. And our goal is to of course grow the commission but together with the business and generate revenues from diversified streams and more value added services and advertising than necessarily the commissions, right. Then on the failed delivery; these are normal features of an e-commerce business and for us we have cancellations, failed deliveries and returns and those are expected to be higher in the nation's e-commerce markets where the majority of the business is still cash on delivery. And for us this actually represents monetization upsides, because today we carry certain costs on those transactions without booking a corresponding revenue, so of course we see the upside there.

Great. Thank you.

The next question comes from Ralph Schackart with William Blair. Please go ahead.

Good morning, Sasha. A couple of questions on JumiaPay; maybe just sort of frame the opportunity for that service that you provide; little bit more color if you could on the MasterCard investment and how that might further accelerate JumiaPay adoption? And then just little bit more broader on it; do you look at JumiaPay is mainly just a Nigeria and West Africa, and Egyptian opportunity? Or do you eventually think it would be broader across all your geographies? Thank you.

Thanks very much, Ralph. Just make notes to make sure I don't forget your questions. And the first question we see two huge benefits of JumiaPay. One is to increase the efficiency of our business because of course JumiaPay is more efficient from a fulfilment perspective than cash on delivery, and we are also seeing that it has some great impact on the consumer behaviour. So the number one is for us to make our business better. Number two is to address two very exciting growth opportunities. The first one of this growth opportunity is to distribute financial services on our marketplace and here this is a very very natural extension of our existing platform. We are connecting sellers and consumers with financial institutions to help the financial institutions distribute their products more effectively. I will give you two examples here. Number one, we have already in four of our markets a vendor lending marketplace where we are providing our data to financial institutions of course on the anonymous basis to help them increase their scoring of [Indiscernible] and then they are distributing loans directly on the Jumia service center. The second example is more recent in Nigeria we introduced a microloan company which now can distribute their microloans directly on Jumia. And those of course they are integrated with JumiaPay, so it creates an opportunity for us to drive a lot of engagement, more GMV and more exciting products and services for both the sellers and the consumers. The second growth opportunity is obviously to become a payment platform and to process payments and today JumiaPay only processors payments for Jumia and in the future we intend to enable JumiaPay to be present in third party platforms, which is of course a very exciting business. And with MasterCard; we have been working with MasterCard for now many years and we've been partnering very well and the payment within already doing a lot. And with MasterCard and I would say, also with the investment we get even closer and with bigger plants we are going to launch new products, new solutions both for the sellers and consumers with the goal to increase the penetration of online payment and the penetration of JumiaPay. So here you can expect to see more commercial offers jointly prepared and rolled out between Jumia and MasterCard across Africa. And on the markets which was your third question. We started JumiaPay in Nigeria and Egypt because of course those two are our largest markets. We recently rolled out JumiaPay in three more markets and we are now driving the adoption in those markets. It's still too early to comment on that and we have given in the past some numbers in Nigeria and Egypt. But certainly we intend to leverage or roll out; I would say JumiaPay to almost all of our markets.

Great. Thank you, Sasha.

The next question comes from Sarah Simon with Berenberg. Please go ahead.

Yes. Hi. I've got a couple of questions as well. First one was on the third party, first party split in terms of GMV. Can you give us any help in understanding how that shifted year-on-year? Second one was Jumia Express. Have you started monetizing that yet or is it still just a cost to you? And then the third one was just a question and this is a bit more boring on the numbers, but on the seasonality of working capital obviously we haven't had quarterly results before. So can you help us with the kind of phasing of inflows and outflows through the year please? Thanks.

Thank you very much. Third party and first parties in Q1 we’ve seen faster growth of the GMV from marketplace than on first party which is good and this is something that we very much want to see. Again here, we really use third party opportunistically, so it may change from quarter-to-quarter and this is again why we very much encourage you to look at the GMV and the gross profits as the matrix [ph] of the momentum because by doing that no matter what -- how much we do in retail on marketplace the GMV remains the same and the gross profit remains the same. So those are the real ways to look at our business and we are -- in Q1 we've done less third party than where we've grown first party slower than the marketplace which has grown faster, which is very good. On Jumia Express we're starting to see some good signs and it's coming together. You can see that we grew the value added services by 86% a quarter year-over-year and we are seeing good times. Again here on Jumia Express, this as a process, right? So for us this is really really about first creating the value for the sellers and then starting to monetize that with time. So, we're seeing good times and it's starting to come together. Now, on the working capital in here on one, please feel free to chip in, but basically you have to look at our working capital very much over a couple days of GMV in terms of receivables, should be a couple days because those receivables come from our logistics partner. Then for the payables, you can see we have about maybe between 20 and 25 days of payables because those are the remittance that we give to the fellows who have done the business on Jumia. And then there can be some changes sometimes in the inventory. If you look at the inventory at the end of Q1, I think we're talking about like three days of GMV or something like that, so, it’s rather small. But sometimes it may be that we do some retail in preparation for a commercial event or something like that. So, we will explain whenever we see some change in inventory. But as you can see we're talking about you know three, four days of GVM, so very very limited. And of course as you know we are we are asset light and so there's very little CapEx here. I hope that that answers your questions.

Yes. That's great. Thanks.

The next question comes from Brian Nowak with Morgan Stanley. Please go ahead.

Thanks for taking my questions. I have two. Just the first one, Sasha, I think you mentioned to sort of GMV growth in line with historical rates. Can you talk to us about how you think about buyer growth over the course of the rest of 2019 into 2020 and sort of bigger picture and buyers; 4.3 million buyers after years of work and such a big Tam, what do you think has to really improve to drive faster buyer growth in a bigger buyer base? And then the second one on fulfilment, it looks like fulfilment came in a little bit higher than we expected on a per package or absolute basis. Just talk about some of the puts and takes that went on in the quarter between fulfilment expense and shipping expense that we should think about for the rest of the year? Thanks.

Sure. So look we had 4.3 million consumers over the last 12 months. And this number as drawn by I think 42% or 43% year-on-year and we grew the GMV by 58%. Of course we have to always put that in relationship with the efficiency that we are capturing on the marketing as well as the monetization, right. So we increased our marketing spend by 12% and we drove the marketing or the increase of the consumers by much more than this. We've also seen increase in the spent per consumer. So we're seeing very strong dynamic and we are operating of course with always three components in the equation which is the GMV and the consumer's growth, so the other with the marketing efficiency improvements as well as the monetization that we are driving and those three they come together. So for us when we look ahead and we'll also address your second question we see that we have a lot of consumers who are yet to discover e-commerce and we certainly see that based on the survey and based on what the consumers say, the consumer really considered Jumia and they have a very high level of awareness and we are in the phase where they are still learning and they're still getting educated about the benefits of e-commerce. And in the prospectus we have published a survey where we were asking the non online shoppers why have you never shopped online and some of the reasons were very much around mental barriers or barriers which are not infrastructure driven. They were about I don't know how to shop or I'm not sure about the quality of the products or I'm not sure the products are genuine and those kind of barriers. So we are really working on…

Okay. Thanks.

The next question comes from Andrew Howe with Citi. Please go ahead.

Hello Sasha. Thanks a lot for the call. Three ones from me. Firstly on the G&A expense that was I guess €23.5 million excluding SBC. As you mentioned obviously some IPO related expenses in there in Q1 and just wanting to get a sense of how much of that was one-off. And if you saw that normalize for the rest of this year and can you give a little sense of how that might settle with respect to the GMV? Second question, you talk about rolling out JumiaPay into some new countries. And are you seeing any impact on this moving from postpay to prepay. Can you give any color on how fast that evolution is happening and over what scale you expect that to kind of run over the next few quarters? And finally just on the opinion piece from last week. Just curious what your strategy is for responding to something like that. What do you plan on publishing a rebuttal or response which is what some companies have done in similar situations? Thanks a lot.

Thanks Andrew. Appreciate the questions. I think on the first one, G&A, some of the expenses are indeed concomitant with the IPO. There's about €5 million in the G&A that we believe is nonrecurring and we've not taken it out because we just thought that we would tell you that on the call and certainly for us we want to keep the G&A as stable as possible. Obviously, there will be some growth of the G&A relating to the growth of the GMV and the growth of the business. But we still maintain that this is our objective to continue to drive them in a very discipline way.

Well thank you very much everyone for this first the earnings release and those good questions. And once again we believe we have delivered very strong results this quarter, very strong growth of our GMV, very strong growth our marketplace for the new progress on the path to profitability and progress on JumiaPay. We see a lot of great momentum in the business. We're very excited about the future and about our prospects and also the positive impact that we can create in Africa. We look forward to reconnecting next quarter with all of you. And as I just said we are available anytime. If there any follow up questions on any topics we are very available. So do not hesitate to reach out and we'll take your questions any time. Now thank you very much for your attention and take care. Bye.

This conference is now concluded. Thank you for attending today’s…