Jumia, the Africa-ecommerce company, has refuted allegations of fraud levelled against it by Citron Research’s Andrew Left.
Responding to claims that sent its shares falling just weeks after a ‘celebrated’ debut on the New York Stock Exchange, Sacha Poignonnec, co-chief executive and co-founder, said the company “completely stands by” its filings with the US Securities and Exchange Commission, which were questioned by Citron Research in a report last Thursday that claimed Jumia’s equity was “worthless”.
Shares have fallen over 50 per cent since the release of the report by Citron, whose founder Andrew Left told the Financial Times he had taken a short position in the company.
“We will not be distracted . . . by those who seek to create doubt to profit at our expense and that of our long-term stakeholders,” Mr Poignonnec said on an analyst call following the announcement of first-quarter results, which it had brought forward following the allegations.
Over the weekend, Jumia passed around a research note by Citibank that rebutted some of Mr Left’s allegations, but also argued that the company needs to be more transparent about some of the issues raised, particularly whether active user numbers were inflated, and a related-party transaction involving one of its co-chief executives.
Jumia, which operates in 14 African countries, reported a loss of €45.4m in the first quarter, against a €34.2m loss in the same period a year earlier. Revenues rose 12.3 per cent from the previous year to €31.8m. The company also announced a €50m partnership with Mastercard for its payments system JumiaPay.