Sasol Limited: Trading Statement for the Six Months Ended 31 December 2016

JOHANNESBURG, Jan. 26, 2017 /PRNewswire/ -- Sasol´s earnings per share (EPS) for the six months ended 31 December 2016 are expected to increase by between 12% and 22% (approximating R1,44 to R2,63 per share) compared to the 2016 financial half year (prior period) EPS of R11,97. Headline earnings per share (HEPS) for the same period are expected to decrease by between 34% and 44% (approximating R8,26 to R10,68 per share) from the prior period HEPS of R24,28.

Overall, Sasol delivered a strong business performance across most of the value chain. Secunda Synfuels' production volumes increased by 1% and our Eurasian operations increased production volumes by 8% on the back of stronger product demand. Natref's production volumes were down 7% mainly due to planned shutdowns during the period under review.  Normalised sales volumes increased by 11% for our Base Chemicals business and 2% for our Performance Chemicals business compared to the prior period mainly on the back of stronger demand, higher chemical margins and improved plant stability. Liquid fuels sales volumes decreased by 2% due to the Natref planned shutdowns and more volumes allocated to the higher margin yielding chemical businesses. ORYX GTL achieved a utilization rate of 95% with the run-rate of production in line with previous market guidance provided.  A detailed production summary and key business performance metrics for the first half of the 2017 financial year for all our businesses are available on our website, www.sasol.com.

We have seen a steady and continued recovery in global oil and product prices during the period under review.  Normalised cash fixed costs continued to trend well within inflation for the period under review. HEPS was however negatively impacted by the following items: 

• Although the average rand/US dollar exchange rate weakened by 3% to R13,99 during the period under review, the closing rand/US dollar exchange rate, however, strengthened to R13,74 at 31 December 2016 (30 June 2016 – R14,71) resulting in translation losses of approximately R1,3 billion on the valuation of the balance sheet compared to translation gains of R2,6 billion, which includes foreign exchange contracts, recognised in the prior period. The valuation impact of the stronger closing exchange rate for the period under review negatively impacted earnings by approximately R1,46 per share;
•  The impact of labour actions at our Secunda mining operations, during the six month period, resulted in a 16% decrease in mining production volumes and significantly higher once-off costs to ensure a continuous supply of coal to our Secunda Synfuels Operations. The additional net cost associated with the labour action is estimated at approximately R1 billion or R1,06 per share; and
•  Once-off items in the prior year of R2,3 billion or R3,77 per share relating mainly to the reversal of the Escravos GTL provision.

Our results for the first half of the 2017 financial year may be further affected by any adjustments resulting from our half year-end closure process. This may result in a change in the estimated earnings noted above. This trading statement only deals with the comparison to the first half of the 2016 financial year.

The financial information on which this trading statement is based has not been reviewed and reported on by the Company's external auditors. Sasol's financial results for the six months ended 31 December 2016 will be announced on Monday, 27 February 2017.

Sponsor: Deutsche Securities (SA) Proprietary Limited

Investor relations:
Cavan Hill, Senior Vice President: Investor Relations
Telephone: +27-(0)-10-344-9280

SOURCE Sasol Limited

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