Net Loss Reduces, Blibli Pursues Profitability in 2024

PT Global Digital Niaga Tbk (IDX: BELI) recorded a reduction in net loss to IDR 3,6 trillion in 2023 from a net loss position previous year which had swollen by IDR 5,5 trillion. The company's EBITDA was also recorded as shrinking 30% to minus IDR 3,3 trillion.

Blibli's net income fell 4% (YoY) to IDR 14,7 trillion due to the company's strategy to optimize its Total Processing Value (TPV) mix throughout 2023. This optimization is through a focus on selecting more profitable products in all categories in the 1P Retail segment. Meanwhile, the 3P Retail segment was driven primarily by OTA performance.

However, the average order value (average order value) increased 39% to IDR 1,5 million in 2023. The value of spending per user in the Institutional segment also rose to IDR 11,7 million, and spending per institutional client rose to IDR 64,4 million in 2023.

“Throughout 2023, we will focus on improving profitability performance. This was done by rationalizing our new product categories in the 1P Retail segment and adjusting costs accordingly marketplace. "This encourages healthier gross profits and gross margins," said Blibli CFO Ronald Winardi in his official statement.

• 1P Retail Segment (marketplace B2C) recorded a decline in TPV of 26% (YoY) to IDR 7,3 trillion and revenue of around 28% (YoY) to IDR 6,3 trillion; gross profit rose 42% (YoY) to IDR 517 billion.
• 3P Retail Segment (third party passes marketplace and OTA) recorded an increase in TPV of 35% (YoY) to IDR 49 trillion and net income of 466% (YoY) to IDR 1,1 trillion. Gross profit also rose 51% (YoY) to IDR 1,9 trillion.
• Institutional Segment (B2B and B2G) posted TPV of IDR 10 trillion or down 4% (YoY), net income rose 15% (YoY) to IDR 3 trillion, and gross profit shot up 114% to IDR 279 billion.
• Physical Store pocketed TPV of IDR 4,7 trillion or grew 20%, followed by net income increasing 18% (YoY) to IDR 4,1 trillion, and gross profit increasing 18% to IDR 914 billion.

As of December 31 2023, Blibli had a cash and cash equivalent position of IDR 1,8 trillion, down from the previous year's position of IDR 3 trillion.

Profitability strategy

Efficiency strategy became Blibli's main focus last year with leveraging automation and technology in simplifying operational processes. The company said it continues to encourage this strategy, especially cutting advertising and marketing costs to reduce further losses. Blibli estimates that the positive performance trend will continue in 2024.

"Reflecting on 2023, our strategic agenda is comprehensive, targeting expansion of product range, value-added services, technological advances and ecosystem synergy," said Co-Founder and CEO Kusumo Martanto.

Blibli will also expand physical stores through partnerships with global brand owners and strengthen loyalty programs omnichannel which is integrated in its service ecosystem. The company is also building a new warehouse in Marunda, West Java, in order to expand its network fulfillment and logistics infrastructure this year.

This warehouse is targeted to operate in stages this year, and will complement the total of 15 warehouses currently owned by Bliblib with a total accumulated area of ​​130 thousand square meters.

Throughout 2023, Blibli has added 40 electronic stores to drive its strategy omnichannel company. As of the end of 2023, the company operated 166 consumer electronics stores; consisting of 87 single-brand stores, 79 multi-brand stores and 65 premium supermarket outlets operated by Ranch Market.

For information, a number of technology companies still recorded red performance last year. in the midst of their all-out efficiency efforts in pursuit of profitability. its competitors, Bukalapak experienced a net loss amounting to IDR 1,36 trillion, meanwhile GoTo Group net loss swelling up to IDR 90 trillion in its performance throughout 2023.