Sasol Climbs to 5-Year High as Profit Rises as Much as 30%

Sasol Ltd. rose to the highest in five years after the world’s biggest coal-to-liquid-fuel producer said profit rose as much as 30 percent, boosted by higher-than-anticipated output from its synthetic-fuels unit.

Earnings per share excluding one-time items climbed 20 percent to 30 percent in the 12 months through June, the Johannesburg-based company said in a statement today, for so-called headline profit of as much as 54.96 rand compared with 42.28 rand a year earlier. The median estimate of 15 analysts is for headline profit of 47.10 rand, according to a Bloomberg survey. The stock rallied 3.8 percent to 472 rand by the close in the city, the highest since June 2008.

A 4 percent increase in output volumes from Sasol’s synfuels business, which last year comprised 60 percent of operating profit, and the rand’s 14 percent decline against the dollar this year helped bolster earnings, it said. Profit growth was countered by a 3 percent drop in the average price of Brent crude and higher costs in South Africa, which last year made up 75 percent of operating income.

The company further wrote down the value of Arya Sasol Polymer Co. in Iran, which it co-owns with Pars Petrochemical Co., by 1.6 billion rand ($161 million) after tax, “reducing the carrying value of the investment over the financial year by 3.6 billion rand to 2.3 billion rand,” the company said.

Before it's here, it's on the Bloomberg Terminal.