Mishma Chakanyuka, Staff Writer 
SEED Co is intensifying its cash-based sales strategy to boost liquidity, eliminate bad debt and reduce operational overheads, the company’s secretary Faithful Sithole has said.
The Zimbabwe Stock Exchange (ZSE)-listed seed manufacturer and distributor expects the move to strengthen its cash generation capacity through prudent credit management in a market grappling with liquidity challenges.
The group suffered significant cash flow challenges in 2024 due to late payments from key customers, mainly the government, prompting management to come up with strategies to free up cash towards operations.
The government is the group’s largest single off-taker of seed, which it distributes to farmers through its subsidy programmes such as Pfumvudza/Intwasa and the Presidential Inputs Scheme.
In a trading update for the third quarter ended December 31, 2025, Seed Co said, volumes suffered a 32 percent decline to 18 192 metric tonnes (MT) from 26 919MT comparable period prior year, partly as a result of tighter credit controls.
“Performance declined, primarily reflecting reduced winter cereal seed trading in the local market due to a shortened planting window following the late cessation of last season’s rains, as well as lower export sales after the prior year’s record performance, as the company’s regional associate markets rebuilt stock positions,” Sithole said in a trading update.
“This was compounded by tighter credit controls and a deliberate shift towards cash-based sales in the local market in response to ongoing challenges within the formal distribution chain.”
Consequently, the group experienced a trade-off among key matrices of volume, revenue, and operating profit during the quarter under review, highlighting its focus on cash sales and cautious credit management.
During the quarter under review, the company recorded a 21 percent decline in revenue to US$49,8 million while operating profit declined by 41 percent to US$14,7 million.
Meanwhile, the company continued executing its operating model and strategic adjustment agenda to enhance operational resilience, cash generation, and long-term value creation in response to prevailing market conditions.
“This included aligning operations with evolving market dynamics, strengthening cost discipline and credit risk management, and advancing targeted investments in innovation and product development,” Sithole added.
The group is shifting focus towards preparations for the winter cereal selling season, with continued emphasis on cash generation and disciplined working capital management, consistent with the business’s cyclical operating model.
“The company continues to leverage the renowned Seed Co brand and proprietary seed genetics, together with synergies within the broader and growing Seed Co International network, to profitably support its cash-sales-led strategy through active participation in the local distribution chain and exploitation of export opportunities,” Sithole said.
