JOHANNESBURG, March 6, 2020 /PRNewswire/ -- Sasol notes that
the credit rating agencies, S&P Global Ratings (S&P) and
Moody's have completed their periodic review of Sasol following the
release of the company's interim financial results for 2020.
S&P has affirmed Sasol's BBB-/A-3 credit rating whilst
Moody's has downgraded Sasol's credit rating to Ba1/NP. The ratings
action by Moody's reflects Sasol's elevated leverage in the context
of volatile market conditions.
As stated in Sasol's recent financial results, protecting the
balance sheet remains an important priority during the peak gearing
phase. In this regard, several proactive actions have already been
taken which include a measured financial risk management programme
to hedge oil and ethane commodity price and exchange rate
exposures, managing costs, increasing working capital efficiency
and agreeing additional flexibility on covenants with the lending
group.
These initiatives continue to benefit the balance sheet with
further actions underway. These include re-phasing discretionary
capital, ongoing delivery of the value-driven asset disposal
programme and active balance sheet management to maintain a healthy
liquidity position and a balanced debt maturity profile as Sasol
works to restore an optimal capital structure. Sasol maintains a
long-term commitment to an investment grade credit rating.
Subject to the macroeconomic environment and the impact of
COVID-19 on global product demand, Sasol continues to expect the
cash flow inflection point to be reached in the second half of FY20
and de-leveraging to start thereafter. The overall Lake Charles
Chemicals Project ("LCCP") cost estimate is tracking US$12,8 billion, within our previous guidance of
US$12,6 - 12,9 billion. LCCP is
expected to be EBITDA positive in the second half of FY20 with a
contribution of US$50 – US$100m for FY20.
Fleetwood Grobler commented, "We
recognise the challenges presented by the current market
environment and acknowledge the outcomes of the rating agency
reviews. We remain focused on managing the factors within our
control – delivering safe, strong and stable operational
performance and protecting the balance sheet as we bring the Lake
Charles Chemicals Project to completion and start deleveraging. The
revised rating profile is not expected to have a material impact on
our existing funding costs. As ever, we remain committed to our
capital allocation framework and priorities."
In light of the above, Sasol management will be hosting a
conference call to discuss our approach to protecting the balance
sheet on Tuesday, 10 March 2020, at
15h00 (SA).
Conference call
details:
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|
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Tuesday, 10
March 2020
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Time
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Dial-in
numbers
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South
Africa
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15:00
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+27 11 535
3600
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United
Kingdom
|
13:00
|
+44 (0) 333 300
1418
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United
States (ET)
|
08:00
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+1 508 924
4326
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Other
countries
|
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+27 11 535
3600
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The transcript
will be available from March 13, 2020 at 6:00 PM (SA) on Sasol's
investor relations website.
|
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, statements regarding exchange rate
fluctuations, volume growth, increases in market share, total
shareholder return, executing our growth projects (including LCCP),
oil and gas reserves, cost reductions, our Continuous Improvement
(CI) initiative, our climate change strategy and business
performance outlook. Words such as "believe", "anticipate",
"expect", "intend", "seek", "will", "plan", "could", "may",
"endeavour", "target", "forecast" and "project" and similar
expressions are intended to identify such 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 28 October 2019 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 both these factors and other uncertainties and
events. 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.
For further information, please contact:
Sasol
Investor Relations, please contact:
Feroza Syed, Chief Investor
Relations Officer
Direct telephone: +27(0)10-344-7778
investor.relations@sasol.com
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SOURCE Sasol Limited