South African petrochemical and energy company Sasol Ltd. (SOL.JO) on Monday reported a big jump in profit for the 12 months ended June 30, citing a reduction of costs and conservation of cash as oil prices recovered.
Sasol posted a net profit of 20.37 billion South African rand ($1.54 billion) for its 2017 financial year, up 54% from a year earlier and in line with expectations. The company said that in the previous financial year, earnings had been negatively impacted by a ZAR9.9 billion partial impairment of Sasol's Canadian shale gas assets.
Headline earnings per share, the company's preferred profit measure that strips out certain exceptional and one-off items, fell 15% to ZAR35.15 a share. In the 12 months through June, Sasol was aided by a 15% rise in the average Brent crude oil price to $49.77 a barrel, but that increase was offset by an average rand exchange rate of 13.61 to the dollar during 2017, compared with 14.52 during the 2016 financial year.
The company declared a dividend of ZAR7.80 a share, down 14% from the 12 months ended June 30, 2016. Sasol's shares on the Johannesburg Stock Exchange are down 2.1% year-to-date, but are up 2.2% over the past 12 months.
Sasol had previously said it would conserve between ZAR65 billion and ZAR75 billion between Jan. 1, 2015 and June 30, 2018 by cutting back on capital projects, as well as through buyouts and early retirements in order to continue to operate profitably. In addition, the company said it achieved its sustainable savings plan, conserving ZAR5.4 billion in 2017, a year earlier than previous market guidance.
Sasol's revenue was down 0.3% at ZAR172.4 billion in the latest period compared with a year ago.
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(END) Dow Jones Newswires
August 21, 2017 02:52 ET (06:52 GMT)