THE country’s leading producer and marketer of crop seed, Seed Co has recorded a 3% increase in after tax profit to $15,4 million for the year ended March 31 2016 on the back of improved margins.
BY TARISAI MANDIZHA
In the period under review, revenue grew to $96 million from $94,6 million in 2015.
In a statement accompanying the group abridged audited results for the financial year, Seed Co chairperson John Rooney said gross margins increased by 7% attributed to increased efficiency in cost of sales management through reduced inventory write off, as well as value pricing in selected markets and products in short supply.
“Group turnover was maintained despite a very tough environment with the following factors affecting demand: depressed commodity prices, weaker currencies and tight financial conditions, El Nino induced weather patterns across the region, reduced government input programmes in all the markets the group operate in,” Rooney said.
“Price adjustments in selected markets and the coming on board of the new vegetables seed business helped offset the effects of the reduction in maize seed volumes.”
He said other income decreased due to reduced exchange gains and operating costs were up due to the inclusion of the new vegetable business expenses as well as increased market developments cost in new markets.
In the period under review, finance income decreased by 16% due to reduction in short term money market deposit interest rates while finance costs decreased by 39% due to access to cheaper facilities.
- Chamisa under fire over US$120K donation
- Mavhunga puts DeMbare into Chibuku quarterfinals
- Pension funds bet on Cabora Bassa oilfields
- Councils defy govt fire tender directive
Keep Reading
“The new vegetable business has now been fully integrated into the group and capitalisation of the business has been completed to enable it to grow. Despite a slow start of seed production in West Africa, the group is continuing in its efforts to break through in this lucrative underserved market,” he said.
He, however, said the steep decrease in commodity prices and the tough economic environment prevailing in sub-Saharan Africa was expected to continue in the outlook period.
He also said the effects of El Nino on the food resources of the region, in the year just ended were expected to buoy seed demand in the coming season as families expect to increase planting to restock.
