Sasol Says $3 Billion of Impairments Will Hit Its Earnings

South African fuel and chemical maker Sasol Ltd. said 55.1 billion rand ($3 billion) of impairments at its American and South African businesses will hurt its full-year earnings.

The basic loss per share for the year to June 30 will be in a range of 68.82 rand to 71.48 rand compared with profit of 14 rand a year earlier, the Johannesburg-based company said in a statement Monday.

Sasol wrote down the value of its Chemicals America ethane value-chain unit by 45.5 billion rand net of tax, primarily due to external conditions “including prolonged softer market pricing and outlook.”

The impairment on its polyethylene, chlor-alkali and polyvinyl chloride and wax value chain in the Africa chemicals business was 3.9 billion rand net of tax, while the Secunda liquid-fuels refinery in South Africa took a 5.7 billion-rand writedown.

Sasol, which manufactures liquid fuels from coal, reported issues throughout its South African operations earlier this year.

So-called headline earnings per share likely fell to a range of 12.28 rand and 21.95 rand, representing a drop of as much as 77% from a year earlier, Sasol said. The average estimate by analysts on Bloomberg is for 40.86 rand.

Source:norvanreports.com