Seed Co profit jumps 82%
LIVINGSTONE MARUFU
Seed Co International Limited’s profit rose 82% in the 12 months to March 31,2021 to US$11.1m from US$6.1m reported in the prior comparative period due to a growth in revenue owing to the high demand of seed during the just ended summer cropping season.
Zimbabwe and several other countries in Africa, experienced an above average rainfall across the country, something that drove seed demand. Firming maize commodity prices also drove demand.
“Strong sales volume and revenue growth was achieved due to heightened seed demand on the back of favourable weather conditions; attractive maize grain prices and government, quasi-government and non-government food security initiatives,” Seed Co company secretary Eric Kalaote said in a statement accompanying financial results for the period under review.
Revenue for Seed Co International Limited, which is listed on the Victoria Fall Stock Exchange, went up 26% to US$88.5m during the 2021 period from US$70.1m during the same period in 2020 due to high sales volumes.
Total assets for the group stood at US$137.2m during the period under review from US$127.7m during the prior year.
Kalaote said gross margin remained unchanged while other income declined significantly as the massive exchange gains recorded in prior year did not recur.
Overheads rose because of distribution costs linked to the growing sales, Kalaote said.
The group’s much improved cash generation resulted in a reduction in borrowings and associated finance costs.
Associate and joint venture’ contribution remained negative mainly attributable to product shortages.
The group’s gearing ratio declined due to the aforementioned borrowing reduction.
In the outlook, food security is expected to remain high on the agenda as long as the pandemic endures, the company said.
