Seed Co Group CE, Mr Morgan Nzwere presenting four-month trading update at the recently held AGM
Source: Biglaw IR

Presentation by the Seed Co Group Chief Executive at the 20th Annual General Meeting held at the Seed Co Administration Block at Stapleford on Wednesday 12th August 2015, on the operations of the company for the four months to 31st July 2015.

The main activities for the first four months of the 2015/2016 financial year have been winter cereal sales, intake of new production, following up of outstanding debts and preparing for summer sales.

Overall performance in winter cereals sales was 11% up driven mainly by the rebound experienced in Zambia. Farmers in Zambia exhausted carryover stocks and have had to buy new stocks for this year. A flexible credit plan by the Zambian Commercial Farmers Union under their Lima program has also contributed to the sterling performance in Zambia.

In Zimbabwe, however, winter sales were about 20% lower due to import parity issues, lack of concessionary finance and electricity challenges which affected irrigation. Barley sales were non-existent due to the local breweries having adequate carryover stocks and not placing new orders.

With respect to the intake of production, we expect to have adequate stocks to meet demand, and our focus is on delivering quality. The growouts at all SBUs are progressing well and looking positive, and we expect carryover of 20% of annual requirements at the end of the current financial year.

Regional preparations for the selling season are in progress and the current estimated maize deficit of 25% is expected to spur maize seed demand in the coming season. Seed Co is in the process of placing stocks in distribution outlets, and we have adequate stocks in all maturity categories.

The consolidation of Prime Seeds into the Seed Co Group is continuing and all conditions precedent have now been met, including the required Competition Commission approval and vegetable business structures are being set up in all our SBUs.

Promising progress is now being made in the volatile maize growing belt of Nigeria with the advent of the new political dispensation and we are looking forward to our first meaningful production, though quantities are expected to be small.

The team on the ground in the Democratic Republic of Congo (DRC) is showing growth in terms of market development and the market is still to being served from Zambian exports.

The Ethiopia licence issue is still work in progress and Seed Co has approached COMESA for assistance.

Our recently commissioned research lab is now functional, and  joint projects with Limagrain progressing smoothly in the following areas of Research & Development - Germplasm exchange, double haploids generation, genetic diversity studies, skills exchange and MNLD collaboration.

Overall, our balance sheet remains strong, and US$16.2 million has been collected since last year end and we are currently paying for seed deliveries in the various markets.

Source: Big Law IR