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Investing.com -- Sasol (JO:SOLJ) (NYSE:SSL) reported a swing back to profit for the year ended June 30, helped by firmer chemicals prices, cost discipline, and sharply lower asset writedowns.
The company’s shares jumped around 6% in Johannesburg.
The South African petrochemical company posted basic earnings per share of 10.60 rand ($0.61), compared with a loss of 69.94 rand per share last year. Headline EPS (HEPS) of 35.13 rand was slightly above guidance, while EBITDA of 51.76 billion rand came in just below the mid-point of forecasts.
Results were boosted by a 4.3 billion rand payout from Transnet, a 2.6 billion rand reversal of rehabilitation provisions, and 1 billion rand in insurance proceeds.
Revenue declined 9%, weighed down by lower sales volumes, weaker rand oil prices and softer refining margins. Still, Sasol kept fixed-cost growth below inflation, cut capital expenditure 16% to 25.4 billion rand, and reduced impairments to 20.7 billion rand from 74.9 billion rand a year earlier.
Writedowns were mainly tied to its Secunda and Sasolburg fuel operations, a Mozambique gas project, and its Italian chemicals business.
Net debt stood at $3.7 billion, translating to 1.6x net debt-to-EBITDA, broadly in line with expectations, according to Morgan Stanley (NYSE:MS).
The bank highlighted “strong free cash flow (FCF) generation in the second half of FY25,” estimating 12.5 billion rand in free cash flow post discretionary capex, aided by the Transnet settlement, lower working capital, and capex underspend.
Morgan Stanley analysts said the FY26 guidance is consistent with the company’s May 2025 capital markets day, pointing to operational improvements at Secunda, better coal quality, and efficiency gains across chemicals.
They forecast international chemical EBITDA to rise to $450–550 million, supported by margin recovery and self-help measures.
Sasol again skipped a dividend, with payouts constrained by debt above its $3 billion policy threshold.