JOHANNESBURG, Aug. 11, 2020 /PRNewswire/ -- Sasol will announce
group financial results for the year ended 30 June 2020 (2020 financial year) that were
impacted by the COVID-19 pandemic and a severe decline in crude oil
and chemical product prices. The impact of the weak macro-economic
environment was partly mitigated by a strong cash cost, working
capital and capital expenditure performance.
Shareholders are advised that, for the 2020 financial year:
- The loss per share is expected to be between R146,75 and
R148,15 compared to the prior year earnings per share of R6,97
(representing a decline of more than 100%);
- Headline loss per share is expected to be between R8,72 and
R14,86 compared to the prior year headline earnings per share
(HEPS) of R30,72 (representing a decline of more than 100%);
and
- Core HEPS (CHEPS**) is expected to be between R11,02 and R18,56
compared to the prior year CHEPS of R37,65.
Sasol's adjusted earnings before interest, tax, depreciation and
amortisation (adjusted EBITDA*) is expected to decline by between
17% and 37% from R47,6 billion in the prior year, to between R30,0
billion and R39,5 billion. This results from a 18% decrease in the
rand per barrel price of Brent crude oil coupled with much softer
global chemical and refining margins impacting our gross margins
adversely, especially during the second half of the 2020 financial
year. The cash fixed cost performance for the second half of the
year improved markedly, partly offsetting the impact of lower gross
margins.
The loss per share was as a result of the decrease in the
adjusted EBITDA as well as notable non-cash adjustments to
earnings. The largest contributor relates to impairments of a
number of cash generating units following the decline in the
long-term macro-economic outlook, and the fair value impact
following the commencement of partnering discussions for our Base
Chemicals assets in the United
States. Aggregate pre-tax impairment charges of
approximately R112 billion have been recognised in the 2020
financial year. The impairments and fair value adjustments have
impacted the reporting segments as follows:
- Energy R12,5 billion across the portfolio;
- Base Chemicals R71,3 billion, primarily in the United States; and
- Performance Chemicals R27,7 billion, primarily relating to its
share of ethylene producing assets in the
United States.
Other non-cash adjustments include:
- Unrealised losses of R7,4 billion on the translation of
monetary assets and liabilities due to the 23% weakening of the
closing rand/US dollar exchange rate; and
- Unrealised losses of R4,8 billion on the valuation of financial
instruments and derivative contracts.
- Depreciation of R3,9bn attributable to those Lake Charles
Chemicals Project (LCCP) units that reached beneficial
operation.
The financial information on which this trading statement is
based has not been reviewed and reported on by the Company's
external auditors.
Sasol will release its Annual Financial Results on Monday,
17 August 2020, for the year ended
30 June 2020. Given the prevalence of
the COVID-19 pandemic, and the associated restrictions placed on
public gatherings, Sasol has decided to pre-record its results
presentation. Sasol's President and Chief Executive Officer,
Fleetwood Grobler, and Chief
Financial Officer, Paul Victor, will
present the results. The pre-recorded presentation will be
available on 17 August 2020 on the
following link: https://www.corpcam.com/Sasol17082020.
A conference call will also be hosted via webcast at 15h00 (SA)
with Fleetwood Grobler and
Paul Victor to discuss the results
and provide an update of the business. Please confirm your
participation by registering
online: https://www.corpcam.com/Sasol17August2020
* 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.
** Core HEPS is calculated by adjusting headline earnings with
non-recurring items, earnings losses of significant capital
projects (exceeding R4 billion) which have reached beneficial
operation and are still ramping up, all translation gains and
losses (realised and unrealised), all gains and losses on our
derivatives and hedging activities (realised and unrealised), and
share-based payments on implementation of BBBEE transactions.
Adjustments in relation to the valuation of our derivatives at
period end are to remove volatility from earnings as these
instruments are valued using forward curves and other market
factors at the reporting date and could vary from period to period.
We believe core headline earnings are a useful measure of the
group´s sustainable operating performance.
Adjusted EBITDA and Core HEPS are not defined terms under IFRS
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,
Feroza Syed, Chief Investor
Relations Officer
Direct telephone: +27 (0) 82 557 7740
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 impact of the novel coronavirus
(COVID-19) pandemic on Sasol's business, results of operations,
financial condition and liquidity and statements regarding the
effectiveness of any actions taken by Sasol to address or limit any
impact of COVID-19 on its business; statements regarding exchange
rate fluctuations, changing crude oil prices , volume growth,
increases in market share, total shareholder return, executing our
growth projects (including LCCP), oil and gas reserves, cost
reductions, 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.
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SOURCE Sasol Limited