Jumia completes $99.6 million share sale to boost growth, profitability

African e-commerce Jumia has successfully concluded its sale of over 20 million American depositary shares (ADSs), raising nearly $100 million.

The company sold 20,227,736 ADSs at an average price of $4.92 each, slightly below initial estimates, generating gross proceeds of $99.6 million before expenses.

Jumia’s CEO, Francis Dufay, stated that the funds will strengthen the company’s balance sheet and accelerate its growth as it continues on its path to profitability. The capital infusion comes at a crucial time for Jumia, as it looks to reinvigorate user growth, which has seen little change recently.

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As of Q2 2024, Jumia’s cash reserves stand at $92.8 million, down from $120.6 million in Q4 2023. The company ended the quarter with 2 million active customers, a figure that remains stagnant compared to the previous year.

Dufay acknowledged the need for significant growth, especially considering the platform’s potential market of over 600 million people.

This latest share sale follows a period of aggressive capital raising by Jumia, which secured nearly $600 million between 2020 and 2021 during more favourable market conditions. The new funds are expected to help Jumia push forward in its quest to expand its customer base and achieve sustained profitability.