Sasol Ltd. (SOL), the world’s biggest coal-to-gasoline maker, said full-year profit climbed 25 percent after production at its synfuels division increased.
Earnings excluding one-time items rose to 52.62 rand ($5.25) a share in the 12 months ended June, from 42.28 rand the previous year, the Johannesburg-based company said in a statement today. That met Sasol’s Aug. 1 forecast for an increase of 20 percent to 30 percent.
Sasol, which sold its Iranian unit last month after twice writing down its value, has benefited from a 15 percent decline in the South African rand against the dollar this year, the largest drop among 16 major currencies tracked by Bloomberg. The company plans to cut 3 billion rand of annual expenditure over the next two to three years after the falling currency failed to arrest rising costs in its home market.
The savings “will be a combination of efficiency benefits stemming from our new operating model, continued improvements in operations, establishing fit-for-purpose functions and driving procurement cost reductions,” Chief Executive David Constable said at a presentation. He declined to comment on potential job cuts, saying that if the company did plan to reduce headcount it would first talk to labor representatives.
The highest output at its synfuels business since 2006 also helped boost operating profit at the division by 30 percent to 28.6 billion rand.
Earnings by the same measure at its South African mining, gas, synfuels and oil operations climbed 28 percent to 37 billion rand. The company raised its total dividend 9 percent to 19 rand a share.
The stock gained 0.3 percent to 491 rand at 2:40 p.m. in Johannesburg trading. The shares have advanced 35 percent this year, outpacing the 9 percent gain in the 165-member FTSE/JSE Africa All-Share Index.
Chairman Hixonia Nyasulu will step down from the board in November after five years in the position, Sasol said today in a separate statement. She will be replaced by Mandla Gantsho, CEO of Africa Rising Capital, and a Sasol director for 10 years.
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