Sasol expects 20% profit jump as oil prices offset lower coal output
Sasol, the world’s biggest producer of fuel products from coal and a chemicals manufacturer, said that headline earnings per share (HEPS) – the main profit measure in South Africa – could be up more than 20% in its half-year to Dec. 31 despite operational challenges at Secunda.
“We continue to see the favourable impact of the higher Brent crude oil price, refining margins and weaker rand-U.S. dollar exchange rate on our gross margins,” Sasol said in a trading statement.
Sasol said the operational challenges related to coal quality, safety stoppages and flooding at Secunda had
hit production and sales volume performance in the current quarter.
As a result, the company has lowered its Secunda coal production guidance for the full-year to June 2023 to 6.6-6.9 million tonnes, from previous guidance of 7-7.2 million tonnes. Liquid fuels sales volumes are now expected at 52-55 million barrels, down from initial guidance of 53-56 million barrels.
Chemicals sales in Africa are also expected to be affected by lower production at Secunda.
Sasol said the force majeure declared in October on the local supply and export of certain chemicals products because of a wage trike at logistics company Transnet had been largely lifted in early November. However, Sasol declared another force majeure in November, this time on local ammonia supply, because of a shortage of rail cars.
Sasol is due to report half-year results on Feb. 21.
“We continue to see the favourable impact of the higher Brent crude oil price, refining margins and weaker rand-U.S. dollar exchange rate on our gross margins,” Sasol said in a trading statement.
Sasol said the operational challenges related to coal quality, safety stoppages and flooding at Secunda had
hit production and sales volume performance in the current quarter.
As a result, the company has lowered its Secunda coal production guidance for the full-year to June 2023 to 6.6-6.9 million tonnes, from previous guidance of 7-7.2 million tonnes. Liquid fuels sales volumes are now expected at 52-55 million barrels, down from initial guidance of 53-56 million barrels.
Chemicals sales in Africa are also expected to be affected by lower production at Secunda.
Sasol said the force majeure declared in October on the local supply and export of certain chemicals products because of a wage trike at logistics company Transnet had been largely lifted in early November. However, Sasol declared another force majeure in November, this time on local ammonia supply, because of a shortage of rail cars.
Sasol is due to report half-year results on Feb. 21.
(Reporting by Nelson Banya; Editing by David Goodman)
Read More: Sasol expects 20% profit jump as oil prices offset lower coal output
2022-12-01 02:08:17
