Seed Co hails new dispensation

Published: 26 November 2017

SEED CO group CEO Morgan Nzwere says the leadership change that has taken place in the country and the political and economic stability sweeping across African markets is good for business.

Nzwere told Standardbusiness on Thursday on the sidelines of the company's analysts briefing that there had been uncertainty in the country, which was stifling business viability.

"Well, I think you know there was a lot of uncertainty and business does not thrive in an environment where there is uncertainty. At least now we have a new dispensation and we know who is coming in and in our view, that person (President Emmerson Mnangagwa) is pro-business. He has been talking about the command agriculture programme and he is the one who started it. When it was started they said it would be a five-year programme but we hope it is going to continue because it is good for our business," he said.

Mnangagwa was sworn in on Friday as the new president of Zimbabwe, putting an end to succession squabbles, which were affecting business in the country.

Nzwere said agriculture was key in transforming the country's economy if funded properly.
He said the existence of political stability and predictability in most of its markets like Botswana, Zambia and Kenya as good for smooth business operations.

"You know President Ian Khama is stepping down. Botswana is a key market for us. We are happy to see the smooth change over from him to his deputy. When the environment is volatile business tends to suffer because it will be difficult to make long-term decisions. When you are borrowing funds there is a premium. In Kenya, there was a disputed election and now the president is set to be inaugurated, which is good for business. In Zambia, the opposition leader who was arrested has now been released, which is good for our business," Nzwere said.

During the half year period ended September this year, the company's loss after tax went down from $9,3 million to $2 million due to growth in maize sales, reduced finance costs and exchange losses and early cotton seed sales that saw the cotton business posting a profit as compared to a loss in the previous year.

Revenue increased by 45% to 36,1 million due to maize seed sales and improved winter cereal seed sales.

The company said current bank borrowings requirement was reduced as cash resources available were largely used to fund the group activities during the first half the financial year.

"Property, plant and equipment increased by $1,6 million from the previous year and arising from acquisition of land in Botswana, construction of buildings at Potchefstroom research station, capital improvements at research stations in Zimbabwe, purchase of vegetable seed processing and packing plants by Prime SeedCo," the company said.
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