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Mr Nzwere

Business Reporter
ZIMBABWE Stock Exchange-listed Seed Co says Government has paid 15 percent deposit for the seed they need for the upcoming maize season under its input support  scheme. Chief executive Mr Morgan Nzwere told analysts on Wednesday that 10 percent of the payment will come upon completion of delivery while the balance will come in various tranches.

Mr Nzwere also says Government has cleared all its debt with the balance owing from quasi-Government parties such as the President’s Well-Wishers Input Scheme. The group had received US$6 million from the US$18 million owed.

Government had earlier said it would disburse US$10 million as initial payment to seed houses.
In total 16 285 tonnes of seed would be required for this season while over 243 000 tonnes fertiliser was required.

Seed houses have indicated they are holding 56 174 tonnes. Of the US$161 million disbursed by Treasury, US$157,96 million would go towards seed and fertiliser while the remainder – US$2,60 million – will go towards GMB handling costs.

For the half-year ended September 30, which traditionally is a slow period, Seed Co posted an after-tax loss of US$12,8 million, which was 44 percent higher than the same period’s loss last year.

Revenue for the period under review went up by 30 percent from the previous period to US$17 million as the group witnessed an increase in winter cereals seed maize seed.

This was influenced by early sales to niche markets in the cotton and tobacco sectors.
Seed Co’s gross margins also rose by a marginal 3 percent from the prior period’s 36 percent and the group says it expects them to further improve in the second half of the financial year.

This is the period when the selling season picks up.
The group also registered a slight increase in their current assets from US$116 million in March this year to US$119 million in the period under review despite a 31 percent reduction in accounts receivable.

Mr Nzwere highlighted that Seed Co’s borrowings went up by 50 percent largely owing to payments made for current year seed production as well as delayed receipts from major customers.