Big changes begin to pay off for Sasol
COAL and oil company Sasol lifted headline earning per share (HEPS) by 14% to a record R60.16 in the year ended June 2014 from R52.62 in the year-earlier period, the group said on Monday.
Diluted HEPS amounted to R59.64 from R52.53 previously. The total dividend increased 13% to R21.50 per share from R19 per share in the year-earlier period.
President and CEO David Constable said: “Underpinned by a solid operational performance, ongoing business improvements and strengthened stakeholder relations, Sasol has outperformed our previous best efforts.
“The all-encompassing changes we have introduced in the last three years have set the scene for us to deliver on our strategy as a more efficient, effective and competitive organisation.
“Over the last three years, the compounded annual growth rate of headline earnings per share increased by 21% and dividends by 18%. This outstanding performance sets the platform for what is the beginning of a new era for the group. In this new era, our focus will be on becoming a leading monetiser of natural resources and a trusted partner to countries seeking to add value to their hydrocarbon reserves,” Mr Constable said.
Acting chief financial officer Paul Victor said: “These outstanding final results are due to an excellent underlying operational performance, coupled with a continued focus on cost control. Despite the impact of increased noncash charges, we continue to deliver growth in earnings. Our cash flow generation remains robust, which together with our undergeared balance sheet, allows us to increase dividends in line with our progressive dividend policy. At the same time, we are able to invest in new growth projects in southern Africa and North America.”
Synfuels production volumes of 7.6-million tons were the highest in a decade and the Oryx GTL plant achieved an average utilisation rate of 97%, the company said.
Normalised cash fixed costs were 1.8% below South Africa’s producer price index (PPI) and total skills development and socioeconomic spend was R1.4bn. The business performance enhancement programme would deliver increased annual savings of at least R4bn by 2016, it said.
Capital expenditure amounted to R39.5bn, with 57% invested in South Africa, Sasol said.