Sasol 1st Half Production Hit by Volatile Environment; Sees Pressure Persisting

By Joe Hoppe

Sasol said its first-half performance was hit by a volatile macroeconomic environment, though it backed prior guidance despite expecting that pricing and demand volatility to persist.

The South African chemicals-and-energy group said the six months ended Dec. 31 were affected by weaker oil and petrochemical prices, unstable product demand and continued inflationary pressure, and said pricing pressure continues to hit sales volumes, margins and resultant profitability.

Mining saleable production declined 1% on-year to 15.1 million metric tons, despite an improved production rate, which the company attributed to safety-related incident and operational challenges.

Mozambique gas production rose 10% to 60.5 billion square cubic feet, while in its Fuels unit, production volumes from its Secunda Operations rose 8% 3.50 million tons.

Total chemicals external sales volumes rose 4% to 3.16 million tons, though revenue fell 21% to $3.78 billion, largely reflecting a 24% decline in average sales basket price.

The company said it expects pricing and demand volatility to persist throughout the second half, as global market sentiment and petrochemical markets remain uncertain.

However, Sasol said it expects to meet most of its prior guidance for fiscal 2024 production and sales volumes.

Write to Joe Hoppe at joseph.hoppe@wsj.com

(END) Dow Jones Newswires

January 25, 2024 01:25 ET (06:25 GMT)

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