16 May 2019

Nigeria: Why Jumia Listed On New York Stock Exchange - CEO

Photo: Jumia

The Chief Executive Officer of Jumia Nigeria, Juliet Anammah, has said the company chose to list on the New York Stock Exchange over any of the 14 African countries' stock exchange where it is operating because it needs long-term investors.

Ms Anammah addressed journalists in Lagos on Wednesday while presenting the company's first quarter 2019 report.

"When you list, especially when you are growing at a stage where we are, of course, you want the money to grow but you also want people that will invest for a long time," she said.

"Not just take fund and buy their shares and invest for x months and sell their shares when something else that attracts them. Another person comes and does the same. It increases volatility in price and as much as possible we try to avoid that.

"So we need a good combination of people who are financial investors to a few people who want to lean out to keep your stock, your security, liquid but at the same, we want people who want to invest in a long time."

Ms Anammah said the calibre of financial investors needed by the company are, at the present, not in Africa.

"To find those people, you need people who are well experienced in your field, your industry, at this point in time we don't have them in Africa," she said.

"The industry is just seven years old, so you are likely to get financial investors that will come in and out and that can be very destructive."

The e-commerce giant, which started in Lagos in 2012, was listed in the New York Stock Exchange in April, making it the first African start-up to be listed on the NYSE.

But shortly after, allegations that it falsified its figures in the fillings at the stock exchanges saw a 50 per cent fall in the company's share price. On May 9, the company also lost 18 per cent of its share value.

The company denied the allegations.

Contrary to the report that the company reported a rise in active consumer numbers from 2.1 million in October last year to 2.7 million by April, the quarterly report stated only 1.3 million active consumers in the last one year.

"It is stated in our prospectus to our investors that our active consumers are those who made orders on our website within one particular year," said Ms Anammah.

She noted that though the company recorded a lot of cancelled orders, failed or returned deliveries because most customers prefer payment on delivery, there was a 58 per cent increase in Gross Merchandise Value year on year between Q1 2018 and Q1 2019.

Also, JumiaPay, which is a 50 million euro investment of Master Card, recorded 54 per cent of the payment made to the company.

Ms Anammah said the Jumia brand is registered under three names and they are in the process of consolidating into one name, E-carts.


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