SASOL LIMITED: TRADING STATEMENT FOR THE YEAR ENDED 30 JUNE 2025

Rhea-AI Summary

Sasol Limited (NYSE:SSL) has released its trading statement for the year ended June 30, 2025, announcing significant earnings improvements. The company expects Earnings Per Share (EPS) to increase by over 100% to between R7.00 and R12.00, compared to the prior year's loss of R69.94. Headline Earnings Per Share (HEPS) is projected to rise 85-100% to R33.60-R36.30.

However, Adjusted EBITDA is expected to decrease by 10-17% to R50-54 billion. The improved earnings were driven by higher chemical prices, lower impairments of R20.7 billion (vs R74.9 billion prior year), and a R4.3 billion settlement from Transnet. These gains were partially offset by a 15% decline in average Rand per barrel oil prices and a 3% decrease in sales volumes.

Positive

• None.

Negative

• Adjusted EBITDA expected to decrease by 10-17% to R50-54B
• 15% decline in average Rand per barrel Brent crude oil price
• 3% decrease in sales volumes due to lower production/market demand
• R13.1B impairment of costs capitalized for Secunda and Sasolburg refineries
• R4.4B impairment of Mozambique assets due to higher country risk premium
• R3.2B impairment of Italy Care Chemicals CGU due to lower sales margins

Insights

Financial Analyst

Sasol reports dramatic EPS recovery from prior year losses, but underlying EBITDA declined 10-17% amid challenging market conditions.

Sasol's trading statement reveals a remarkable turnaround in its headline performance metrics while showing concerning trends in operational profitability. The company expects EPS to swing from a R69.94 loss to between R7.00 and R12.00 per share - an improvement exceeding 100%. Similarly, HEPS is projected to increase by 85%-100% to between R33.60 and R36.30 from R18.19.

However, beneath these headline improvements lies a more concerning operational reality. Adjusted EBITDA - a crucial measure of operational profitability - is expected to decrease by 10%-17% to between R50 billion and R54 billion from R60 billion. This divergence between EPS growth and EBITDA decline indicates the earnings improvement stems primarily from non-operational factors rather than business fundamentals.

The key positive drivers include higher chemical prices, cost control measures, significantly lower impairments (R20.7 billion versus R74.9 billion previously), a R4.3 billion Transnet settlement, and reduced rehabilitation provisions. These gains were partially offset by a 15% decline in Rand per barrel Brent crude prices, deteriorating refining margins, a 3% decrease in sales volumes, and smaller unrealized gains on monetary assets.

The impairment situation remains challenging with Secunda and Sasolburg liquid fuels refinery CGUs still fully impaired despite management actions, and additional impairments in Mozambique exploration assets (R4.4 billion) and Italy Care Chemicals (R3.2 billion). The only bright spot was a R1 billion impairment reversal for China Care Chemicals following sustained business improvement.

The overall picture suggests Sasol faces significant operational headwinds despite the improved headline numbers, with commodity price pressures and volume challenges weighing on core performance metrics.

JOHANNESBURG, Aug. 12, 2025 /PRNewswire/ -- We refer to the SENS announcement of 22 July 2025, on the release of the quarterly production and sales metrics, where Sasol indicated that earnings per share (EPS) are expected to increase by more than 20%.

In terms of paragraph 3.4(b)(i) of the Listing Requirement of the JSE Limited, stakeholders are advised that, for the year ended 30 June 2025:

• Earnings per share (EPS) is expected to increase by more than 100% compared to the prior year, to between R7,00 and R12,00 (prior year loss per share of R69,94); and
• Headline earnings per share (HEPS) is expected to increase by between 85% and 100% compared to the prior year, to be between R33,60 and R36,30 (prior year HEPS of R18,19); and

Adjusted earnings before interest, tax, depreciation and amortisation (adjusted EBITDA*) is expected to decrease by between 10% and 17% compared to the prior year, to between R50 billion and R54 billion (prior year adjusted EBITDA of R60 billion)

The increase in earnings for the year was supported by management actions and driven by:

• ­An increase in the average chemicals basket prices and strict cost control;
• Significantly lower impairments of R20,7 billion (before tax) (summary below), compared to R74,9 billion in the prior year;
• The derecognition of deferred tax asset in the prior year of R15,3 billion, mainly relating to an assessed loss carry forward on our Chemicals America operations which is not anticipated to be utilised;
• Transnet SOC Limited net cash settlement of R4,3 billion (before tax); and
• Reduction in asset rehabilitation provision of R2,9 billion in the current year compared to a reduction of R0,8 billion in the prior year;

The increase in earnings was partially offset by:

• ­A 15% decline in the average Rand per barrel of Brent crude oil price as well as a significant decline in refining margins and fuel price differentials;
• A 3% decrease in sales volumes associated with lower production and/or lower market demand as detailed in the Production and Sales Metrics published on 22 July 2025, which can be found on our website: https://www.sasol.com/index.php/investor-centre/financial-results; and
• Lower unrealised gains of R2 billion on the translation of monetary assets and liabilities, and valuation of financial instruments and derivative contracts compared to unrealised gains of R4,7 billion in the prior year.

The following is a summary of significant impairments and reversal of impairment in the current year:

• The Secunda and Sasolburg liquid fuels refinery cash generating units (CGU) remain fully impaired. The recoverable amount improved through management actions but was negatively impacted by lower forecast macro-economic assumptions. Additional management initiatives need to be further progressed before the benefits can be incorporated in the impairment calculations. Costs capitalised during the current year of R13,1 billion have been impaired;
• Impairment of the Production Sharing Agreement (PSA) and PT5-C exploration assets in Mozambique of R4,4 billion, driven by an increase in the weighted average cost of capital (WACC) attributable to independently calculated higher country risk premium. The PSA was also impacted by a marginal reduction in estimated gas volumes, as well as lower sales prices of oil related products;
• Impairment of Italy Care Chemicals CGU of R3,2 billion, driven by lower for longer forecast sales margins. The CGU is fully impaired; and
• Reversal of impairment of the China Care Chemicals CGU of R1 billion following a sustained improvement in the business results.

The financial information underpinning this trading statement has not been reviewed and reported on by the Company's external auditors.

Sasol will present its 2025 financial results on Monday, 25 August 2025 at 09h00 (SA time). This will be followed by a market call, hosted by President and Chief Executive Officer, Simon Baloyi, and Chief Financial Officer, Walt Bruns, to address questions.

Please connect to the call via the webcast link: https://www.corpcam.com/Sasol25082025 or via teleconference call link: https://services.choruscall.eu/DiamondPassRegistration/register?confirmationNumber=3605690&linkSecurityString=89ae33f44

* Adjusted EBITDA is calculated by adjusting operating profit for depreciation, amortisation, share-based payments, remeasurement items, change in discount rates of our rehabilitation provisions, all unrealised translation gains and losses, and all unrealised gains and losses on our derivatives and hedging activities.

Adjusted EBITDA is not a defined term under International Financial Reporting Standards and may not be comparable with similarly titled measures reported by other companies. The aforementioned adjustments are the responsibility of the directors of Sasol. The adjustments have been prepared for illustrative purposes only and due to their nature, may not fairly present Sasol´s financial position, changes in equity, results of operations or cash flows.

For further information, please contact:
Sasol Investor Relations,
Tiffany Sydow, VP Investor Relations
Telephone: +27 (0) 71 673 1929
investor.relations@sasol.com

Disclaimer - Forward-looking statements

Sasol may, in this document, make certain statements that are not historical facts and relate to analyses and other information which are based on forecasts of future results and estimates of amounts not yet determinable. These statements may also relate to our future prospects, expectations, developments, and business strategies. Examples of such forward-looking statements include, but are not limited to, the capital cost of our projects and the timing of project milestones; our ability to obtain financing to meet the funding requirements of our capital investment programme, as well as to fund our ongoing business activities and to pay dividends; statements regarding our future results of operations and financial condition, and regarding future economic performance including cost containment, cash conservation programmes and business optimisation initiatives; recent and proposed accounting pronouncements and their impact on our future results of operations and financial condition; our business strategy, performance outlook, plans, objectives or goals; statements regarding future competition, volume growth and changes in market share in the industries and markets for our products; our existing or anticipated investments, acquisitions of new businesses or the disposal of existing businesses, including estimates or projection of internal rates of return and future profitability; our estimated oil, gas and coal reserves; the probable future outcome of litigation, legislative, regulatory and fiscal developments, including statements regarding our ability to comply with future laws and regulations; future fluctuations in refining margins and crude oil, natural gas and petroleum and chemical product prices; the demand, pricing and cyclicality of oil, gas and petrochemical product prices; changes in the fuel and gas pricing mechanisms in South Africa and their effects on prices, our operating results and profitability; statements regarding future fluctuations in exchange and interest rates and changes in credit ratings; total shareholder return; our current or future products and anticipated customer demand for these products; assumptions relating to macroeconomics; climate change impacts and our climate change strategies, our development of sustainability within our businesses, our energy efficiency improvement, carbon and greenhouse gas emission reduction targets, our net zero carbon emissions ambition and future low-carbon initiatives, including relating to green hydrogen and sustainable aviation fuel; our estimated carbon tax liability; cyber security; and statements of assumptions underlying such statements. Words such as "believe", "anticipate", "expect", "intend", "seek", "will", "plan", "could", "may", "endeavour", "target", "forecast" and "project" and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and there are risks that the predictions, forecasts, projections, and other forward-looking statements will not be achieved. If one or more of these risks materialise, or should underlying assumptions prove incorrect, our actual results may differ materially from those anticipated. You should understand that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors and others are discussed more fully in our most recent annual report on Form 20-F filed on 6 September 2024 and in other filings with the United States Securities and Exchange Commission. The list of factors discussed therein is not exhaustive; when relying on forward-looking statements to make investment decisions, you should carefully consider foregoing factors and other uncertainties and events, and you should not place undue reliance on forward-looking statements. Forward-looking statements apply only as of the date on which they are made, and we do not undertake any obligation to update or revise any of them, whether as a result of new information, future events or otherwise.

 

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SOURCE Sasol Limited

FAQ

What is Sasol's (SSL) expected EPS for the year ended June 30, 2025?

Sasol expects EPS to increase by over 100% to between R7.00 and R12.00, compared to the prior year's loss per share of R69.94.

How much will Sasol's (SSL) Adjusted EBITDA decrease in 2025?

Sasol's Adjusted EBITDA is expected to decrease by 10-17% to between R50 billion and R54 billion, compared to R60 billion in the prior year.

What are the main factors driving Sasol's earnings improvement in 2025?

Key factors include higher chemical basket prices, lower impairments (R20.7B vs R74.9B), R4.3B Transnet settlement, and R2.9B reduction in asset rehabilitation provision.

What major impairments did Sasol (SSL) report in 2025?

Major impairments include R13.1B for Secunda and Sasolburg refineries, R4.4B for Mozambique assets, and R3.2B for Italy Care Chemicals.

When will Sasol (SSL) present its 2025 financial results?

Sasol will present its 2025 financial results on Monday, August 25, 2025, at 09:00 SA time.