The period under review was characterized by several headwinds such as local currency devaluations across the region. Sustained conflict and geopolitical tensions continued to disrupt supply chains and fuel inflation. In addition, climate change presented challenges in the region, with drought conditions prevalent in Southern Africa. However, Seed Co noted relative stability in its East African markets, mitigating the effects of the headwinds in other markets. Moreover, food security strategies by governments provided opportunities for the Group. Early signs of recovery from the El-Nino season were evidenced by buoyant demand for seed during the first half. Volumes performance was underpinned by winter sales and strong early maize sales, as well as the Group’s debut commercial trading in Ethiopia. Strong volumes performance was notably observed in Nigeria, Tanzania and Zambia. Although regional production was curtailed by 40% owing to the drought, maize volumes for the period were 17% ahead of the prior comparative period. Total seed volumes increased 27% y/y to 17,642MT from 13,867MT in 1H24. Consequently, turnover for the period at US$40.0mn was 28% ahead of the prior comparative period’s US$31.3mn. However, increased business activity also brought about a 25% increase in operating costs. Moreover, a reduction in commodity sales led to 93% decline in other income. EBITDA margin therefore eased from 7.99% in 1H24 to 5.8% in 1H25, with EBITDA closing at US$2.30mn from US$2.50mn. Seed Co benefitted from strong cash generation in the prior year, which helped reduce debt levels, reducing net finance costs by 29%. The Group closed the period with US$44.0mn in debt against US$12.6mn in cash. Seed Co managed to reduce its net losses by 28% from US$3.9mn in 1H24 to US$2.8mn in the current period. Considering the seasonal nature of the business, the Group resolved not to declare an interim dividend for the period.
