Seed producer, Seed Co International, with operations across the African continent, has recorded a 62 percent surge in profit from US$3.77 million last year to US$6.07 million, the company’s financial results for the year ended 31 March 2020 have shown.
The seed company was de-merged from Seed Co Zimbabwe and is listed on both the Botswana Stock Exchange and the Zimbabwe Stock Exchange.
“The 62% increase in group profit for the year was driven by strong product demand in all markets,” said group chief executive, Morgan Nzwere, in a statement accompanying the financial results.
“A combination of normal to above normal rainfall in Tanzania, Malawi and some parts of Zambia together with improved maize commodity prices drove product demand resulting in maize seed sales volumes growing by 37%. Revenue however only increased by 19% due to sharp depreciation of the Zambian Kwacha against the reporting currency.”
Nzwere said the past season was mixed, marked by good rainfall in Eastern and Central Africa which drove seed demand, while in Southern Africa the region experienced below average rainfall resulting in subdued performance.
“Overall, the group experienced a rebound in product demand following a devastating drought experienced in all markets last year,” he said.
“Depreciating currencies dampened the revenue growth despite impressive volumes performance in both East Africa and Central Africa.”
Nzwere said despite challenges posed by COVID-19 restrictions, the group was adequately stocked to meet anticipated demand in the ensuing season.
“Fortunately in all markets, agriculture has been designated as an essential and critical area and operations have been allowed to continue with limited interruptions,” he said.
“The group will continue to implement measures to ensure business continuity amid the challenges being brought by COVID-19 whose full effects on the business will be felt in the new financial year. Market development initiatives will continue in East Africa and the adjacent markets of Angola, DRC and Mozambique.”
He added the group was expected to remain on a growth trajectory with adequate stocks and competitive product performance in all markets.