Seed Co International Limited (VFEX) – HY2024 Financial Results Presentation

By Published On: December 8th, 2023Categories: Corporate announcement, Earnings
Seed Co International Limited 2024 Presentation Results For The Half Year

Seed Co International Limited (SCIL.vx) HY2024 Presentation

General environment

  • Continuation of the Russo-Ukraine war and outbreak of Israel-Palestine war compounding global challenges (logistics, inflation & soaring interest rates)
  • Regional economic headwinds characterized by power shortages, inflation and depreciating currencies with limited global donor support
  • Unfavourable weather outlook (drought) in Southern Africa further compounding regional economic headwinds
  • Favourable weather and grain commodity prices in East Africa spurring the demand for seed
  • Ongoing political instability in key developing markets (Burkina Faso, DRC, Ethiopia, Nigeria, Mali and Sudan), continue to slow business development
  • Government programs continuing in most markets though under budgetary constraints


  • Satisfactory product pipeline renewal to address the ever changing climate and farmer needs
  • Regional maize varietal registrations:
    • Kenya: SC739 & SC805- Highlands adaptable hybrids
    • Zambia: SC669 & SC 671- Cob rot tolerant 600 series hybrids
    • South Africa: SC710, SC657 & SC653 came top in silage trial evaluations
    • Nigeria: 5 hybrids undergoing on farm evaluation including SC417
  • Significant progress has been made towards developing fall armyworm tolerant breeding lines


  • FY22/23 production exceeded targets due to significant yield and quality gains achieved.
  • Total available maize seed stocks for sale this year stood at 58,850MT that is 14% higher than PYr
  • Available maize seed stocks more than adequate to satisfy anticipated demand this year with intra Group exports
  • Whilst overall stocks are adequate some varieties like SC719 have already stocked-out as they are highly in demand


  • Processing plants working very well but power outages are a challenge in Zambia, Malawi, and Tanzania
  • Back-up power investments are being made but these are however costly to run compared to the grid
  • Broke ground to build a new factory in Tanzania to address the needs of this growing market
  • Work in progress to increase maize seed drying capacity and storage capacity in Zambia

Sales & Marketing

  • During this year’s 1st half, sales by volume were 16% higher than the same period prior year driven by:
    • Growth in East Africa buoyed by good rainfall prospects and early seed availability in the trade
    • Early uptake of maize seed in Mozambique by NGOs in involved in post-Cyclone Freddy relief activities
    • Early seed sales in Zambia and Malawi driven by good grain prices
  • Maize and wheat constituted 60% and 31% of volume sold
    • Maize sales were largely in Tanzania, Kenya, Zambia, and Malawi respectively


  • A mixed selling season is being anticipated benefiting from:
    • the Group’s diversified geographical footprint; and
    • a diverse climate-smart product portfolio.
  • Potential downside from unfavourable rains in Southern Africa though sales to date are not showing signs of being adversely impacted by the bad weather – small-scale farmers will still try to plant with any rains
  • Attractive commodity prices in the region motivating farmers to stock seed regardless of weather forecasts in Malawi and Zambia
  • YTD sales are well ahead of same period PYr and expectations despite the El-Nino
  • Tanzania solid performance growth trajectory continuing riding on growing demand driven by good rains and the fertiliser subsidy
  • Kenya is on the rebound buoyed by good rains and fertiliser subsidy
  • Nigeria is however expected to perform below expectation due to low disposable incomes and absence of Gvt agricultural inputs support
  • Business unit balance sheets successfully restructured:
    • to mitigate exchange losses by refinancing USD liabilities with local currency borrowings
    • increased finance costs from local currency borrowings expected to be significantly lower than potential exchange losses without the refinancing
  • Key risks being monitored and managed going forward:
    • Inflation in most regional markets due to imported global inflation
    • Currency devaluation pressures in most regional markets
    • Mixed rainfall outturn El-Nino phenomenon

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