Key Factors
- Sasol’s H1 2024 income fell 10.41% to $6.65 billion because of decrease crude costs and weak refining margins.
- EBIT dropped 40% to $518.58 million, impacted by $338.41 million in impairment expenses at Secunda and Sasolburg refineries.
- Internet debt rose to $4.46 billion, exceeding sustainability limits, prompting Sasol’s board to withhold an interim dividend.
Sasol, the Gauteng-based vitality and chemical compounds group led by South African government Simon Baloyi, reported a ten.41 p.c drop in income for the primary half of its 2025 fiscal 12 months. The corporate’s income fell to R122.1 billion ($6.65 billion) for the six months ending Dec. 31, 2024, as decrease crude costs and weak refining margins weighed on efficiency.
Market headwinds hit earnings
The decline in income from the earlier 12 months’s R136.29 billion ($7.44 billion) was pushed by a mixture of weaker oil costs, a 5 p.c drop in gross sales volumes, and softer market demand. Sasol’s working revenue took a much bigger hit, falling 40 p.c to R9.5 billion ($518.58 million), largely because of R6.2 billion ($338.41 million) in impairment expenses at its Secunda and Sasolburg refineries.
The corporate’s Southern Africa vitality division was significantly hard-hit, with its gas operations recording a lack of R998 million ($54.38 million), a stark distinction to the R9.55 billion ($520.37 million) revenue reported a 12 months earlier. In the meantime, its worldwide chemical compounds enterprise confirmed resilience, with the Americas unit swinging to a R657 million ($35.8 million) revenue from a R1.87 billion ($101.89 million) loss within the earlier interval.
Debt pressures persist
Regardless of weak earnings, Sasol managed to enhance money move from operations by 20 p.c to R17.6 billion ($960.41 million), due to cost-cutting measures and higher working capital administration. Free money move additionally improved, narrowing to a deficit of R1.1 billion ($60.03 million) from R6.45 billion ($351.96 million) within the prior interval.
Nevertheless, the corporate’s debt burden stays a priority. Internet debt (excluding leases) climbed to R81.8 billion ($4.46 billion) from R73.7 billion ($4.02 billion) in June 2024, surpassing Sasol’s debt sustainability threshold of R73.6 billion ($4 billion). In consequence, the board determined to not declare an interim dividend.
Trying forward
Sasol, which operates in 33 nations and employs greater than 30,000 folks, is a key participant in South Africa’s vitality and chemical compounds sector. Recognized for its artificial fuels know-how, the corporate has lengthy performed an important position within the area’s gas provide and industrial manufacturing.
Since taking on as CEO in April 2024, Baloyi has been steering Sasol by way of financial headwinds, together with regional instability and international monetary pressures. The corporate stays targeted on strengthening its steadiness sheet, enhancing operational effectivity, and managing market volatility. Whereas the close to time period stays unsure, Sasol is pushing forward with strategic initiatives aimed toward stabilizing its monetary place and positioning the enterprise for development.
