Sasol shares sink after warning on Secunda challenges

1st December 2022

By: Reuters


Font size: - +

Sasol shares fell nearly 7% after the South African petrochemicals company said it expects challenges at its Secunda operations to impact coal and fuel production, although higher crude oil prices are seen boosting half-year profit by more than 20%.

Sasol shares were 6.74% lower at 1301 GMT.

The world's biggest producer of fuel products from coal and chemicals manufacturer said 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:dollar exchange rate on our gross margins," Sasol said in a trading statement.

Sasol said the challenges related to coal quality, safety stoppages and flooding at Secunda, which have 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-million to 6.9-million tonnes, from previous guidance of 7-million to 7.2-million tonnes. Liquid fuels sales volumes are now expected at 52-million to 55-million barrels, down from initial guidance of 53-million to 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 strike 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.

Edited by Reuters



Sandvik Mining and Rock Solutions
Sandvik Mining and Rock Solutions

Sandvik offers a wide range of loaders and trucks for underground hard rock mining, all engineered for safety, productivity and reliability in the...

SBS Tanks
SBS Tanks

SBS® Tanks is a leading provider of innovative water security solutions with offices in Southern Africa, East and West Africa, the USA and an...


Latest Multimedia

sponsored by

Photo of Martin Creamer
On-The-Air (01/12/2023)
1st December 2023
Magazine round up | 01 December 2023
Magazine round up | 01 December 2023
1st December 2023

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?







sq:0.261 0.316s - 162pq - 2rq
Subscribe Now