Sasol Expects to Book $3 Billion Net Loss After Impairments

By Christian Moess Laursen

Sasol will report a $3.05-billion net loss for the fiscal year after writing down the carrying value of its chemicals and fuel assets, largely due to persistently weak prices.

The South African energy and chemicals group said Monday that its results for the year ended June 30 were hit by challenging market conditions, with weaker chemicals prices and squeezed margins as a result.

Sasol expects to book a net loss of 55.8 billion South African rand ($3.05 billion) after impairments of nearly 45.5 billion rand recognized at its American chemicals business and a further 3.9 billion rand at its African chemicals business.

The impairments are primarily driven by prolonged softer market pricing and outlook, it said.

Shares were down 2.1% at 127.68 rand in early afternoon trading.

Sasol also expects to book a basic loss-per-share between 68.82 and 71.48 rand for the fiscal year, compared with basic earnings-per-share of 14.00 rand a year before.

Headline EPS--a commonly-used metric in South Africa that excludes one-off items--are expected to slump as much as 77% to 53.75 rand, while adjusted earnings before interest, taxes, depreciation and amortization are expected to decline between 2% and 17% to between 54.7 billion and 64.7 billion rand.

A stronger rand and oil price, together with improved refining margins and higher sales volumes, help offset some of the losses, Sasol said.

The company plans to publish full results on Aug. 20.

Write to Christian Moess Laursen at christian.moess@wsj.com

(END) Dow Jones Newswires

August 12, 2024 08:41 ET (12:41 GMT)

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