Comprehensive additional information is available on our website:
http://www.sasol.com JOHANNESBURG, South Africa, March 6
/PRNewswire-FirstCall/ -- a pleasing performance Attributable
earnings for the first half of the financial year 2006 (the
'interim period') increased by 86% from R3,9 billion to R7,3
billion. Headline earnings per share increased by 67% to R11,58. In
US dollar terms, attributable earnings per share of US$1,81
represented a 76% increase. IFRS 2, which refers to share-based
payments, applied from 1 July 2005 resulted in attributable
earnings diluting by R84 million and headline earnings per share
reducing by 14 cents during the interim period. Previous years'
comparative information has been restated accordingly. higher
international oil prices Operating profit increased by R4,6 billion
(71%) to R11,1 billion. Higher average international oil prices
(dated Brent US$59,21/b versus US$42,77/b) boosted operating profit
by about R2,9 billion, taking into account the negative effect of
the Sasol Synfuels oil production hedge incurred in the previous
reporting period of R0,7 billion. This benefit was enhanced by the
positive impact of the weaker rand (average rate R6,52: US$1,00
versus R6,21: US$1,00), which increased operating profit by
approximately R0,6 billion. The currency effects manifested
themselves across all of Sasol's businesses. The benefit of higher
international oil prices was, however, only realised in the energy
and fuel-related businesses with adverse effects being experienced
in the chemical businesses because of higher oil-derivative
feedstock costs. Furthermore, margins were adversely affected in
most of the chemical businesses by a reduction in international
chemical commodity prices. major capital projects advanced Cash
flow capital expenditure amounted to R6,1 billion. Major projects
advanced included the fuel quality enhancement and polymer
expansion project (Project Turbo) in South Africa, the Oryx gas
to-liquids (GTL) venture in Qatar and the Arya Sasol polymers
project in Iran. gearing reduced Gearing (net debt as a percentage
of shareholders' equity) reduced from 42% at 31 December 2004 to
29%. Gearing is expected to return to within our targeted range of
30% to 50% by the end of the financial year 2006. interim dividend
increased The interim dividend declared of R2,80 per share
represents a 22% increase compared to the previous interim dividend
declared. sasol mining The operating profit of Sasol Mining of R636
million was R103 million (19%) better than the previous comparable
reporting period, mainly because of slightly higher sales volumes
and selling prices. sasol synfuels Primarily because of higher oil
prices and slightly higher production volumes, Sasol Synfuels
achieved an increase in operating profit of 99% to R7 336 million.
The increase in production volumes resulted from the shift of a
planned shutdown from September 2005 to September 2006. Higher
intake of natural gas from Mozambique also contributed to improved
plant stability. Regrettably, a number of short, unscheduled
shutdowns occurred during the period under review. The causes are
being addressed to avoid reoccurrence. sasol liquid fuels business
Higher refinery margins, improved sales volumes and some benefit
from a weaker rand increased operating profit in our liquid fuels
business by 47% to R1 125 million. The expansion of the dual brand
(Sasol and Exel) retail network advanced successfully and market
share objectives were met. The proposed merging of our liquid fuels
business with Engen was considered at the Competition Tribunal
during October 2005. The ruling announced by the Competition
Tribunal on 23 February 2006, prohibiting the merger, is being
studied and a response is being formulated together with Petronas
of Malaysia. The Black Economic Empowerment (BEE) component of this
merger advanced successfully with the announcement during the
period under review of our broad-based Tshwarisano LFB Investments
transaction. Likewise, the implications of the ruling on this
transaction are being considered. sasol gas Primarily driven by
higher selling prices and moderate sales volume increases, both to
external customers and Sasol businesses, operating profit increased
by 66% to R780 million including a capital profit of R199 million.
On 1 July 2005 the South African Government, through its gas
pipeline development company iGas, acquired a 25% stake in Republic
of Mozambique Pipeline Investments Company (Pty) Limited (ROMPCO),
which owns the natural gas pipeline between Mozambique and South
Africa. sasol synfuels international This business hosts the growth
ambitions of the group relating to GTL and coal-to-liquid (CTL)
ventures. Its costs are associated with advancing the Qatar and
Nigeria GTL projects and evaluating others in accordance with our
strategic objective to build these global businesses. Costs rose to
R256 million in this period as a direct consequence of increased
activity in this respect. We expect our Oryx GTL plant to come into
operation during the second quarter of 2006. sasol olefins and
surfactants (O&S) The operating profit of Sasol O&S of R290
million is R426 million better than the operating loss achieved
during the previous comparable reporting period, mainly because of
non-recurring impairment costs incurred during the previous period
and the reversal of impairment costs relating to the Octene train-3
project that were previously written off. Excluding these capital
effects, the operating profit amounted to R169 million, which was
R57 million (51%) higher than the first half of the previous
financial year. Oil-derivative feedstock costs reached record high
levels although most of these increases were recovered through
increased product pricing and continuing cost optimisation
initiatives. The results of O&S were also negatively impacted
by Hurricane Rita which caused our Lake Charles site to close down
for almost a month. Towards the end of the reporting period,
detergent-range alcohol prices started to come under pressure in
anticipation of significant oleochemical-based capacity additions
coming on stream in South East Asia. sasol polymers Higher
oil-derivative feedstock costs from Sasol Synfuels could not be
fully recovered through higher polymer selling prices resulting in
significantly depressed margins. Sasol Polymers achieved an
operating profit of R394 million, which was 31% lower than the
comparable result of the previous period. sasol solvents After an
extraordinary previous year characterised by unprecedented high
selling prices and margins, market conditions in the solvents
industry normalised. Operating profit of R516 million was R35
million (6%) lower than the comparable result of the previous
reporting period. other businesses Sasol Nitro's performance
improved because of higher ammonia prices and pleasing results from
our explosives business. The fertiliser business experienced
trading difficulties because of lower sales resulting from high
maize inventories and reduced plantings because of late rains. The
operating profit of Sasol Wax was lower than in the previous period
mainly because of currency effects and higher oil-derivative
feedstock cost increases that were not recovered through selling
prices. basis of preparation and accounting policies The condensed
consolidated interim financial report for the six months ended 31
December 2005 has been prepared in compliance with the Listings
Requirements of the JSE Limited, International Financial Reporting
Standards (IFRS) (in particular International Accounting Standard
34 Interim Financial Reporting) and the South African Companies
Act, 1973, as amended. Except as otherwise disclosed, the
accounting policies applied in the presentation of the interim
financial report are consistent with those applied for the year
ended 30 June 2005. The following accounting standards were adopted
by Sasol with effect from 1 July 2005: -- IFRS2 Share-based payment
(with retrospective application); -- IFRS4 Insurance contracts; --
IAS21 The effect of changes in foreign exchange rates; -- IAS24
Related party disclosure; -- IAS32 Financial instruments:
disclosure and presentation; and -- IAS39 Financial instruments:
recognition and measurement. The provisions of IFRS2 Share-based
payment have been applied retrospectively and comparative
information restated accordingly. IFRS2 requires that every
business accounts for the effects of its share-based payment
expenses on profit and its financial position, including the
effects of share options granted to employees. The effect of the
adoption of this standard is set out in the interim financial
report. Basic earnings and diluted earnings per share were reduced
by 11 cents for the six months ended 31 December 2004 and 22 cents
for the year ended 30 June 2005. The adoption of the remaining
standards had no material effect on the financial results and
financial position of the group. Further details will be provided
in the annual report for the year ending 30 June 2006. related
party transactions The group, in the ordinary course of business,
enters into various sale and purchase transactions on an arm's
length basis at market rates with related parties. disposal of
businesses On 1 July 2005, a 25% interest in Republic of Mozambique
Pipeline Investments Company (Pty) Limited was sold to iGas (Pty)
Limited in terms of the shareholders' agreement. A profit of R199
million was realised on this transaction. The group is advancing
the process of preparing its Olefins & Surfactants business for
sale. post balance sheet date events The 2006 budget presented by
the Minister of Finance, South Africa, made reference to a task
force being appointed to investigate a windfall tax which may
affect Sasol. The company is still studying the proposals and will
be engaging with government to obtain further information on the
proposed investigation. Sasol will cooperate with the proposed task
force and is confident that, once all of the pertinent facts have
been scrutinised, an outcome will result in which the interests of
all stakeholders would be addressed. On 23 February 2006, the South
African Competition Tribunal prohibited the merger between Sasol
Oil (Pty) Limited and Engen Limited. changes in contingent
liabilities since 30 June 2005 The South African Competition
authorities received a complaint against Sasol Oil (Pty) Limited in
April 2003. The competition authorities found against Sasol that it
was a dominant firm whose conduct met the test required in
establishing prohibited price discrimination. The company filed a
notice of appeal which was heard and upheld by the South African
Competition Appeal Court. principal foreign currency conversion
rates The economic indicators used in preparing the interim report
were: One unit of foreign currency equals 31 December 31 December
30 June 2005 2004 2004 Rand/US$ (closing) 6,33 5,66 6,67 Rand/US$
(average) 6,52 6,21 6,21 Rand/euro (closing rate) 7,49 7,70 8,07
Rand/euro (average rate) 7,85 7,82 7,89 independent review by the
auditors The condensed consolidated balance sheet at 31 December
2005 and the related condensed consolidated statements of income,
changes in equity and cash flow for the six months then ended have
been reviewed by our auditors, KPMG Inc. Their unmodified review
report is available for inspection at the registered office of
Sasol Limited. profit outlook Assuming lower oil and commodity
chemical prices and a stronger rand relative to the first half,
earnings in the second half of the financial year are expected to
be considerably lower than the first half year although pleasing
growth in earnings for the full financial year is anticipated.
declaration of interim dividend number 53 The directors of Sasol
Limited have declared an interim dividend of 280 cents per share
(2004: 230 cents per share) for the six months to 31 December 2005.
The dividend has been declared in the currency of the Republic of
South Africa. The salient dates are: To holders of ordinary shares:
Last day for trading to qualify for and participate in the dividend
(cum dividend) Friday, 31 March 2006 Trading ex dividend commences
Monday, 3 April 2006 Record date Friday, 7 April 2006 Dividend
payment date (electronic and certified register) Monday, 10 April
2006 On 10 April 2006, dividends due to certificated shareholders
on the South African registry will either be electronically
transferred to shareholders' bank accounts or, in the absence of
suitable mandates, dividend cheques will be posted to such
shareholders. Shareholders who have dematerialised their share
certificates will have their accounts, at their Central Securities
Depository Participant or broker credited on Monday, 10 April 2006.
Share certificates may not be dematerialised or rematerialised
between Monday, 3 April 2006 and Friday, 7 April 2006, both days
inclusive. To holders of American Depositary Receipts: Ex dividend
on New York Stock Exchange Wednesday, 5 April 2006 Record date
Friday, 7 April 2006 Approximate date for currency conversion
Tuesday, 11 April 2006 Approximate dividend payment date Thursday,
20 April 2006 On behalf of the board PV Cox L P A Davies T S Munday
Chairman Chief executive Deputy chief executive and chief financial
officer Sasol Limited, 6 March 2006 Forward-looking statements:
Forward-looking statements: In this report we make certain
statements that are not historical facts relate to analyses and
other information based on forecasts of future results not yet
determinable, relating, amongst other things, to exchange rate
fluctuations, volume growth, increases in market share, total
shareholder return and cost reductions. These are forward-looking
statements as defined the United States Private Securities
Litigation Reform Act of 1995. Words such as "believe,"
"anticipate," "intend," "seek," "will," "plan," "could," "may,"
"endeavour" and "project" and similar expressions are intended to
identify such forward-looking statements, but are not the exclusive
means of identifying such statements. Forward-looking statements
involve inherent risks and uncertainties and, if one or more of
these risks materialise, or should underlying assumptions prove
incorrect, actual results may be very different from those
anticipated. The factors that could cause our actual results differ
materially from such forward-looking statements are discussed more
fully in our most recent annual report under the Securities
Exchange Act of 1934 on Form 20-F filed on 26 October 2005 and
other filings with the United States Securities and Exchange
Commission. Forward-looking statements apply only as of the date on
which they are made, and Sasol does not undertake any obligation to
update or revise any of them, whether as a result of new
information, future events or otherwise. Registered office: Sasol
Limited, 1 Sturdee Avenue, Rosebank, Johannesburg 2196, P.O. Box
5486, Johannesburg 2000 Share registrars: Computershare Investor
Services 2004 (Pty) Limited, 70 Marshall Street, Johannesburg 2001.
P.O. Box 61051, Marshalltown 2107, South Africa, Tel: +27 11
370-7700, Fax: +27 11 370 5271/2 Directors (non-executive): P V Cox
(Chairman), E le R Bradley, W A M Clewlow, B P Connellan, M S V
Gantsho, A Jain (Indian), I N Mkhize, S Montsi, J E Schrempp
(German), (Executive): L P A Davies (Chief executive), T S Munday
(Deputy chief executive and chief financial officer), V N Fakude
Company secretary: N L Joubert Company registration number:
1979/003231/06, Incorporated in the Republic of South Africa JSE
NYSE Share codes: SOL SSL ISIN code: ZAE000006896 American
depositary receipt (ADR) program: Cusip number 803866300 ADR to
ordinary share 1:1 Depositary: The Bank of New York, 22nd floor,
101 Barclay Street, New York, N.Y. 10286, U.S.A. e-mail: SASOL
LIMITED GROUP BALANCE SHEET at 31-Dec-05 31-Dec-04 30-Jun-05
Reviewed Reviewed Audited Restated Restated R m R m R m ASSETS
Property, plant and equipment 60 796 50 672 56 550 Goodwill 483 580
509 Intangible assets 1 763 1 987 1 900 Post-retirement benefit
assets 275 231 300 Deferred tax assets 416 507 409 Other long term
assets 2 570 1 908 2 212 Non-current assets 66 303 55 885 61 880
Investment held-for-sale 41 - 41 Inventories 11 001 9 208 9 995
Trade and other receivables 12 832 11 346 12 384 Short-term
financial assets 17 8 178 Cash restricted for use 598 447 1 002
Cash 2 940 2 974 2 509 Current assets 27 429 23 983 26 109 Total
assets 93 732 79 868 87 989 EQUITY AND LIABILITIES Shareholders'
equity 48 665 37 494 43 533 Minority interest 313 379 253 Total
equity 48 978 37 873 43 786 Long-term debt 13 754 10 746 12 951
Long-term provisions 3 458 2 430 2 954 Post-retirement benefit
obligations 2 998 2 843 2 970 Long-term deferred income 1 020 221
763 Deferred tax liability 6 446 6 164 6 286 Non-current
liabilities 27 676 22 404 25 924 Short-term debt 1 987 4 609 3 300
Short-term financial liabilities 838 2 127 792 Other current
liabilities 13 096 9 455 11 572 Bank overdraft 1 157 3 400 2 615
Current liabilities 17 078 19 591 18 279 Total equity and
liabilities 93 732 79 868 87 989 SASOL LIMITED GROUP INCOME
STATEMENT for the period ended half-year half-year full year
31-Dec-05 31-Dec-04 30-Jun-05 Reviewed Reviewed Audited Restated
Restated R m R m R m Turnover 40 256 33 806 69 239 Cost of sales
and services rendered (22 981) (21 496) (42 267) Gross profit 17
275 12 310 26 972 Non-trading income 165 227 417 Marketing and
distribution expenditure (2 590) (2 652) (5 097) Administrative
expenditure (1 877) (1 955) (4 075) Other operating expenditure (1
376) ( 926) (3 802) Share based payment expense ( 84) ( 68) ( 137)
Currency translation losses ( 418) ( 457) 91 Operating profit 11
095 6 479 14 369 Dividends and interest received 142 68 149 Income
from associates 81 81 184 Borrowing costs (net of costs
capitalised) ( 269) ( 362) ( 587) Net income before tax 11 049 6
266 14 115 Taxation (3 662) (2 293) (4 568) Earnings 7 387 3 973 9
547 Attributable to Shareholders 7 295 3 915 9 437 Minority
interest 92 58 110 7 387 3 973 9 547 Basic earnings per share -
attributable earnings basis cents 1 179 639 1 537 - headline
earnings basis cents 1 158 692 1 727 Diluted earnings per share* -
attributable earnings basis cents 1 152 629 1 511 - headline
earnings basis cents 1 131 681 1 697 Dividends per share -
interim** cents 280 230 230 - final cents 310 * Taking the Sasol
Share Incentive Scheme into account. ** The interim dividend was
declared subsequent to 31 December 2005 and is presented for
information purposes only. No provision regarding this interim
dividend has been recognised. SASOL LIMITED GROUP STATEMENT OF
CHANGES IN EQUITY for the period ended half-year half-year full
year 31-Dec-05 31-Dec-04 30-Jun-05 Reviewed Reviewed Audited
Restated Restated R m R m R m Balance at beginning of period as
previously reported 35 400 35 400 Share based payment - prior year
adjustment 2 2 Balance at beginning of period restated 43 786 35
402 35 402 Negative goodwill written off - 610 610 Shares issued
during period 258 129 311 Earnings for period 7 295 3 915 9 437 As
previously reported 3 983 9 573 Share based payment expense ( 68) (
136) Dividends paid (1 920) (1 440) (2 856) Movement in foreign
currency translation reserve ( 629) ( 745) 313 Increase in share
based payment expense reserve 84 68 137 Movement in cash flow hedge
accounting reserve 44 ( 72) 552 Movement in minority interest 60 6
( 120) Balance at end of period 48 978 37 873 43 786 Comprising
Share capital 3 461 3 021 3 203 Accumulated profit 50 410 40 933 45
035 Foreign currency translation reserve (1 965) (2 398) (1 336)
Share repurchase programme (3 647) (3 647) (3 647) Share based
payment expense reserve 695 542 611 Investment fair value reserve 2
2 2 Cash flow hedge accounting reserve ( 291) ( 959) ( 335)
Shareholders' equity 48 665 37 494 43 533 Minority interest 313 379
253 Total equity 48 978 37 873 43 786 SASOL LIMITED GROUP CASH FLOW
STATEMENT for the period ended half-year half-year full year
31-Dec-05 31-Dec-04 30-Jun-05 Reviewed Reviewed Audited R m R m R m
Cash receipts from customers 39 461 33 506 68 263 Cash paid to
suppliers and employees (27 310) (25 703) (49 451) Cash generated
by operating activities 12 151 7 803 18 812 Investment income 144
92 169 Borrowing costs paid ( 688) ( 729) (1 523) Tax paid (1 732)
(1 785) (3 753) Dividends paid (1 920) (1 440) (2 856) Cash
retained from operating activities 7 955 3 941 10 849 Additions to
property, plant and equipment (6 044) (5 781) (12 414) Acquisition
of businesses ( 147) - - Disposal of businesses 596 24 36 Cash
disposed of on disposal of businesses ( 1) ( 47) ( 94) Other net
(expenditure in) / proceeds from investing activities ( 328) 192
245 Cash utilised in investing activities (5 924) (5 612) (12 227)
Share capital issued 258 129 311 Dividends paid to minority
shareholders ( 39) ( 53) ( 64) Increase in long-term debt 335 2 172
4 165 (Decrease) / increase in short-term debt (1 010) 1 081 ( 440)
Cash effect of financing activities ( 456) 3 329 3 972 Translation
effects on cash and cash equivalents of foreign entities ( 90) (
114) ( 175) Increase in cash and cash equivalents 1 485 1 544 2 419
Cash and cash equivalents - balance at end of period 2 381 21 896 -
less balance at beginning of period 896 (1 523) (1 523) Increase in
cash and cash equivalents 1 485 1 544 2 419 SASOL LIMITED GROUP
SEGMENT REPORT for the period ended half-year half-year full year
31-Dec-05 31-Dec-04 30-Jun-05 Reviewed Reviewed Audited Restated
Restated R m R m R m Contribution to group turnover Mining 705 626
1 471 Synfuels 462 408 820 Liquid Fuels Business 15 539 11 091 23
525 Gas 814 715 1 408 Synfuels International 119 - - Olefins and
Surfactants 9 835 8 791 18 040 Polymers 3 907 3 617 7 199 Solvents
4 364 3 875 8 063 Other 4 511 4 683 8 713 40 256 33 806 69 239
Operating profit Mining 636 533 1 239 Synfuels 7 336 3 686 7 546
Liquid Fuels Business 1 125 763 1 892 Gas 780 470 931 Synfuels
International ( 256) ( 52) ( 201) Olefins and Surfactants 290 (
136) ( 231) Polymers 394 569 1 475 Solvents 516 551 1 238 Other 274
95 480 11 095 6 479 14 369 Capital effect by operating segment
Mining ( 2) 6 23 Synfuels ( 29) ( 14) ( 110) Liquid Fuels Business
( 7) ( 6) ( 63) Gas 133 - - Synfuels International - 33 33 Olefins
and Surfactants 121 ( 248) ( 783) Polymers 5 ( 11) ( 12) Solvents -
- ( 382) Other ( 21) 19 19 200 ( 221) (1 275) SASOL LIMITED GROUP
SALIENT FEATURES for the period ended half-year half-year full year
31-Dec-05 31-Dec-04 30-Jun-05 Restated Restated Selected ratios
Operating margin % 27.6 19.2 20.8 Borrowing cost cover times 16.5
9.1 9.6 Dividend cover times 4.2 2.8 2.8 Share statistics Total
shares in issue million 680.5 673.9 676.9 Treasury shares (share
repurchase programme) million 60.1 60.1 60.1 Weighted average
number of shares million 618.5 612.4 613.8 Diluted weighted average
number of shares million 633.0 622.5 624.4 Share price (closing)
Rand 226.50 121.0 180.80 Market capitalisation R m 154 133 81 542
122 379 Net asset value per share Rand 78.45 61.08 70.58 Other
financial information Total debt (including bank overdraft) -
interest bearing R m 16 598 18 731 18 865 - non-interest bearing R
m 300 24 1 Borrowing costs capitalised R m 536 434 1 116 Capital
commitments - authorised and contracted R m 10 249 9 877 11 429 -
authorised, not yet contracted R m 5 008 10 787 7 740 Guarantees
and contingent liabilities - total amount R m 31 979 27 974 33 122
- outstanding balance sheet exposure R m 10 986 6 689 11 230
Significant items in operating profit - employee costs R m 4 597 4
748 8 782 - depreciation of property, plant and equipment R m 1 783
1 803 3 591 Effective tax rate % 33.1 36.6 32.4 Number of employees
number 30 185 30 150 30 004 Reconciliation of headline earnings R m
R m R m Attributable earnings 7 295 3 915 9 437 Capital items (
200) 221 1 275 Impairment of assets 99 242 1 078 Reversal of
impairment ( 140) - - Profit on disposal of business ( 199) - ( 40)
Profit on sale of participation rights in GTL - ( 33) ( 33) Profit
on disposal of assets ( 12) ( 9) ( 20) Scrapping of property, plant
and equipment 52 21 290 Deferred tax asset written off - 111 122
Tax effect on reconciling items 67 ( 7) ( 235) Headline earnings 7
162 4 240 10 599 The reader is referred to the definitions
contained in the 2005 Sasol Limited annual financial statements.
The Sasol Investor Relations team Tel.: +27 11 441 3113/3563/3321
DATASOURCE: Sasol Limited CONTACT: The Sasol Investor Relations
team, +27-11-441-3113, +27-11-441-3563, +27-11-441-3321, Web site:
http://www.sasol.com/
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