Listed seed producer, Seed Co Limited’s volumes dropped 24% in the nine months to 31 December 2019 due to low onset of the rainy season and unfavourable weather conditions.
The drop in volumes was also attributed to the negative impact of low consumer disposable incomes, reduced government uptake of seed, fuel shortages affecting land preparation by farmers, electricity and water shortages incapacitating farmers from growing crop under irrigation during the period under review.
Profit after tax for the group stood at ZWL$309m during the period under review from US$23.2m in the prior period.
In a statement accompanying Seed Co’s trading update for the third quarter and nine months to December 31, 2019, the group company secretary Terrence Chimanya, said the company welcomed the reduction in input Tax (VAT) from 15% to 14.5% effective January 1, 2020 as well as the reduction in effective Corporate income Tax, including 3% Aids Levy from 25.75% to 24.72%.
He said the new directive allowing electricity to be levied in foreign currency for certain players in the economy could improve the power supply from imports going forward.
Chimanya said the company was continuing with its major project of constructing a flagship Artificial Maize Seed Drying Plant at the company’s Stapleford complex outside Harare
“The construction project is progressing with all equipment having been received from the supplier in Denmark. Construction progress is however at a slower pace than originally anticipated due to funding challenges,” he said.