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Sasol Limited Year-End Trading Statement for 2025

In a significant development for investors and stakeholders, Sasol Limited has released its trading statement for the fiscal year ending June 30, 2025, revealing a remarkable increase in earnings. According to the announcement made on August 12, 2025, the company expects its earnings per share (EPS) to soar by over 100% compared to the previous year, reaching a range of R7.00 to R12.00. This projection comes after a loss per share of R69.94 in the previous fiscal year.

Aside from the EPS growth, the headline earnings per share (HEPS) is also projected to rise between 85% and 100%, anticipated to fall between R33.60 and R36.30, compared to last year’s HEPS of R18.19. However, it’s noteworthy that the adjusted earnings before interest, tax, depreciation, and amortisation (adjusted EBITDA) is forecasted to decrease by 10% to 17%, with estimates between R50 billion and R54 billion, down from R60 billion the previous year.

Key Drivers Behind the Increase

The increase in earnings for this year is underpinned by several strategic factors:
1. Rising Chemical Prices: An increase in average chemical basket prices has positively influenced revenue for Sasol. Management's strict cost control measures further supported these financial results.
2. Decreased Impairments: Sasol recorded significantly lower impairments of R20.7 billion before tax, contrasting sharply with the previous year's R74.9 billion. This has contributed positively to the year’s earnings.
3. Tax Asset Derecognition: The de-recognition of a deferred tax asset worth R15.3 billion from the prior year, particularly related to carried losses from operations in Chemicals America, is now not anticipated to be utilized.
4. Net Cash Settlement: Transnet SOC Limited provided a net cash settlement of R4.3 billion, which contributed to the financial uplift.
5. Reduction in Rehabilitation Provisions: Sasol has also recorded a reduction in asset rehabilitation provisions amounting to R2.9 billion compared to the previous year’s reduction of R800 million.

Factors that Offset Earnings Growth

While Sasol has reported substantial growth in earnings, there are several factors that have acted as a counterweight:

• - Declining Oil Prices: A 15% drop in the average Rand per barrel of Brent crude oil price impacted earnings adversely, coupled with significant declines in refining margins and fuel price differentials.
• - Decreased Sales Volumes: There was a 3% decrease in sales volumes, attributed to lower production rates and decreased market demand, as highlighted in the production and sales metrics shared in a prior announcement on July 22, 2025.
• - Lower Unrealised Gains: Unrealised gains on monetary assets, liabilities, and financial instruments were also lower, reported at R2 billion this year as opposed to R4.7 billion the year prior.

Impairments and Reversals

Sasol’s trading statement also details several significant impairments this year:

• - The liquid fuels refinery cash generating units in Secunda and Sasolburg remain fully impaired. While management actions improved the recoverable amount, it has been negatively influenced by lower macroeconomic forecasts.
• - Impairments amounting to R4.4 billion for Production Sharing Agreement (PSA) and PT5-C exploration assets in Mozambique have been driven by an increase in the weighted average cost of capital due to higher country risk premiums.
• - A R3.2 billion impairment in Italy Care Chemicals has come about due to prolonged expectations of lower sales margins.
• - Conversely, there was a reversal of impairment worth R1 billion in China Care Chemicals, credited to sustained improvements in business results.

Upcoming Financial Presentation

Looking ahead, Sasol is set to present its 2025 financial results on Monday, August 25, 2025, at 09:00 South African time. Following this, a market call hosted by the company’s President and CEO, Simon Baloyi, along with Chief Financial Officer, Walt Bruns, is scheduled to address any queries from stakeholders. Investors and analysts can tune in via the provided webcast link.

In summary, Sasol Limited’s year-end trading statement captures a year of resilience and strategic recovery, marking a turning point that has significantly reassured stakeholders amidst a challenging market landscape.