Seed Co revenue up 32pc

HARARE - One of Africa’s largest seed producers, Seed Co, yesterday said its half year revenues went up 32 percent to $24,8 million compared to $18,7 million in the same period last year.

The group’s chief executive, Morgan Nzwere, attributed the increase to early maize sales and improved vegetable sales.

Although Seed Co witnessed solid demand for maize, the group witnessed a decline in cereals sales.

Nzwere noted that although the company had adequate seed stocks for the current farming season, Seed Co’s profitability was hinged on good weather and the availability of cash in rural communities.

“There are mixed signals for the current year. While the weather forecasts are indicating above normal rainfall, the situation on the ground is yet to reflect that. If good rains materialise as anticipated, seed demand and sales should increase especially in light of the food deficits across the region,” he said.

This was after Seed Co’s half year losses had widened to $9,3 million from $5,6 million in the previous corresponding period.

Nzwere said the losses mainly emanated from inventory write offs, exchange losses of $2 million in Malawi and Zambia and finance charges which rose 100 percent from $1 million to $2 million.

“Finance charges increased due to discounting of treasury bills in Zimbabwe and delays in payments by governments of Zambia and Malawi, which led to extended borrowings,” he said.

However, the seed producer is confident of coming up with newer varieties that can withstand unpredictable weather conditions brought about by climate change.

Early this year, the company introduced a new range of maize varieties to counter effects of the consistent droughts being experienced in the country.

In the four series, Seed Co introduced SC417 is a flint grain type, with good drought tolerance and thick cobs and SC419 is the highest 400 series yielder with very white grain, excellent drought tolerance and widely adaptable and fast dry down rate.

In the early maturity range, SC529 remains the highest yielder in the 500 series. Furthermore, the new additions to the 6-series include the SC649 and the SC643 which both have excellent drought tolerance and widely adaptable, moreover, the SC643 exhibits good nitrogen use efficiency.

Nzwere said the company’s vegetable business was now gathering traction with some growth in revenue expected this year.

“With the impending commissioning of the new seed drying and processing facilities in Kenya, our foothold in the highlands market is expected to strengthen,” he said.

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