Sasol Limited
(Incorporated in the Republic of South Africa)
(Registration number 1979/003231/06)
Sasol Ordinary Share codes: JSE : SOL NYSE : SSL
Sasol Ordinary ISIN codes: ZAE000006896 US8038663006
Sasol BEE Ordinary Share code: JSE : SOLBE1
Sasol BEE Ordinary ISIN code: ZAE000151817
("Sasol")
SASOL LIMITED FINANCIAL RESULTS FOR THE YEAR ENDED 30 JUNE 2011
Delivering on growth and value
Driven by innovation, Sasol is an integrated energy and chemicals
company that creates value through its proven alternative fuel
technology and talented people to provide sustainable energy
solutions to the world
Headline earnings per share increased by 27% to R33,85
Total dividend increased by 24% to R13,00 per share
Cash generated by operations increased by 41% to R38,6 billion
Project pipeline progressing well
Canadian shale gas acquisitions add significantly to long-term
value growth
Sasol successfully pioneers first BEE listing on JSE
Segment report
for the year ended 30 June
Turnover
R million
Business unit
analysis
Operating profit
R million
2010
2011
2011
2010
95 538
106 860
South African energy cluster
19 947
17 808
7 863
9 146
Mining
1 063
815
5 371
5 445
Gas
2 578
2 479
33 893
37 485
Synfuels
15 188
13 175
48 411
54 784
Oil
1 180
1 364
-
-
Other
(62)
(25)
3 967
5 872
International energy
cluster
1 587
468
2 282
3 715
Synfuels International
1 205
131
1 685
2 157
Petroleum International
382
337
71 577
82 854
Chemical cluster
8 712
5 496
14 321
17 082
Polymers
1 579
958
15 765
17 280
Solvents
1 655
1 154
25 283
31 715
Olefins & Surfactants
4 161
2 492
16 208
16 777
Other chemical businesses
1 317
892
5 420
6 043
Other businesses
(296)
165
176 502
201 629
29 950
23 937
(54 246)
(59 193)
Intercompany turnover
122 256
142 436
Overview
Chief executive, David Constable, says:
"We have continued to deliver on our strategy in the past
financial year. Our focus on further improving the performance of
our assets has delivered strong production, cost and margin
benefits. We also made significant strides in pursuing responsible
growth, both in South Africa, as well as abroad. We are
particularly pleased with our acquisition of two shale gas assets
in Canada and are making progress on this and other gas-to-liquids
opportunities, based on our proprietary technology."
Earnings attributable to shareholders for the year ended 30 June
2011 increased by 24% to R19,8 billion from R15,9 billion in the
prior year, while headline earnings per share and earnings per
share increased by 27% to R33,85 and by 24% to R32,97,
respectively, over the same period.
Operating profit of R30 billion increased by 25% compared with the
prior year, due to decisive actions taken by management around
energy efficiency initiatives as well as our continued focus on
cost containment and the benefits realised from our functional
excellence programme and business improvement plans. In addition,
operating profit was positively impacted by higher average crude
oil prices (average dated Brent was US$96,48/barrel in 2011
compared with US$74,37/barrel in 2010) and higher chemical product
prices. The benefits of the higher average crude oil and chemical
product prices were partially offset by an 8% stronger average
rand/US dollar exchange rate (R7,01/US$ in 2011 compared with
R7,59/US$ in 2010). Overall, group production volumes improved
marginally from the prior year, despite Sasol Synfuels' major
planned maintenance outage. Group cash fixed costs for the year
were contained within inflation, excluding once-off charges and
growth costs.
The operating profit in the current year was negatively impacted
by once-off charges totalling R1 103 million (2010: R46 million
credit). These once-off charges include competition related
administrative penalties of R112 million, the Escravos gas-to-
liquids (EGTL) partial impairment of R123 million and the share-
based payment expense of R565 million resulting from the Ixia Coal
BEE transaction, offset by the reversal of the remaining
impairment related to Sasol Olefins and Surfactants (O&S) Italy of
R491 million. The current year also includes a Sasol Inzalo BEE
share-based payment expense of R830 million compared with R824
million in the prior year.
The increase in the effective tax rate from 29,9% to 31,3%
resulted from the competition related administrative penalties and
share-based payment expenses, both of which are not deductible for
tax purposes.
Cash flow generated by operating activities was R38,6 billion
compared with R27,3 billion in the prior year. This was mainly due
to increased operating profits and reduced working capital, both
as a result of price and volume effects. The group made good
progress on growth projects as reflected in capital expenditure of
R20,7 billion for the year in addition to the cash consideration
of R3,8 billion related to the Canada shale gas asset
acquisitions.
Chief financial officer, Christine Ramon says:
"Decisive management actions on operational efficiencies, cost
control and business improvement plans have boosted the bottom
line this year. Higher global commodity prices have supported the
healthy margins delivered, particularly in our chemicals
businesses, negating the impact of the strong rand. The global
economy remains volatile and our strong cash flows continue to
underpin the robustness of our businesses. Our strong balance
sheet provides a buffer against volatility and positions the
company well to fund growth opportunities, with the aim of
enhancing long-term shareholder value."
Striving for strategic and sustainable growth
In order to ensure that our strategic growth objectives are
achieved and build on the solid foundation of our existing
businesses, we will continue to focus on specific initiatives
which will contribute to achieving and delivering on stakeholder
value. All our businesses and functions will continue to operate
sustainably underpinned by sound governance. This will be achieved
through improving our operational excellence and delivering
further value on our functional excellence initiatives, which were
implemented two years ago. These initiatives will support our
commitment to energy efficiency and our environmental projects. In
addition, we will establish and roll-out our sales and marketing
excellence initiative across the group to support our customer
focus. We will continue to focus on improving our safety
performance striving for zero harm to all our stakeholders. The
aforementioned actions will enable us to pursue our growth
drivers, including growing our upstream gas resources,
accelerating our GTL developments and ramping up our new energy
business. Our growth will be supported by our capital excellence
programme, which aims to enhance long-term shareholder returns.
We have paid R25,4 billion direct and indirect taxes to the South
African government. This makes Sasol one of the largest corporate
taxpayers in South Africa, contributing significantly to the South
African economy.
We contribute about 5% of South Africa's gross domestic product
(GDP), directly and indirectly. We employ approximately 34 000
people globally, of which 80% are in South Africa, and create
about 200 000 additional indirect jobs.
During the year, the following noteworthy milestones were
achieved:
In July 2010 we concluded an agreement with Gassnova SF, a
Norwegian state-owned enterprise. This agreement allows us to
participate in the European CO2 Technology Centre Mongstad, which
is currently constructing a carbon capture facility in Norway.
Construction is progressing and the facility is scheduled for
start-up in the latter half of 2012.
Sasol New Energy has undertaken studies related to various clean
energy and low-carbon electricity initiatives, including the
generation of electricity from natural gas in both South Africa
and Mozambique and the establishment of concentrated solar power
facilities to produce electricity in South Africa.
In September 2010, we concluded the Ixia Coal transaction in
line with Sasol Mining's empowerment strategy and its commitment
to comply with the objectives of the South African Mineral and
Petroleum Resources Development Act and the Mining Charter. This
transaction results in Ixia Coal Funding (Pty) Ltd, a subsidiary
of Ixia Coal (Pty) Ltd, acquiring a 20% shareholding in Sasol
Mining (Pty) Ltd for a purchase consideration of R1,8 billion.
The recordable case rate (RCR) for employees and service
providers, including injuries and illnesses, improved to a record
low of 0,42 at 30 June 2011 from 0,51 at 30 June 2010. However, we
have experienced an increase in fatalities. Our revised safety
improvement plan is currently being implemented to address this
matter.
In February 2011, we listed the Sasol BEE ordinary shares on the
BEE segment of the Johannesburg Stock Exchange. This pioneering
trading facility provides many new Sasol shareholders access to a
regulated market in line with our commitment to broad-based
shareholder development.
Acquisitions and projects progressing
Projects and gas asset acquisitions in support of our GTL value
proposition are advancing, supported by our strong cash flow
generation and balance sheet, which provides a solid platform for
growth:
Progress has been made in the following areas related to the
advancement and acquisition of natural gas assets in support of
leveraging GTL technology:
In December 2010, Sasol acquired a 50% stake in the Farrell
Creek shale gas assets of Talisman Energy Inc. (Talisman), a
Canadian-based company, located in the Montney Basin, of British
Columbia, Canada, for an amount of R7,1 billion. In March 2011,
Sasol further acquired a 50% stake in Talisman's Cypress A shale
gas assets for an amount of R7,1 billion on similar terms. The
acquired assets also include associated gas gathering systems and
processing facilities.
During 2011, Sasol Petroleum International (SPI) increased its
exploration and appraisal activities in Mozambique, Australia and
Papua New Guinea. Further explorations and evaluation activities
in these areas is ongoing.
During 2011, Sasol New Energy obtained approval from the Sasol
board to construct a 140 megawatt electricity generation plant in
Sasolburg, South Africa. The plant will utilise natural gas as its
feedstock.
During 2011, a pre-feasibility study into an integrated GTL and
chemicals facility in the United States was concluded. After the
successful completion of the pre-feasibility study, the Sasol
board has approved that the project proceed to feasibility study
phase.
During the year, we commenced with a feasibility study to
determine the technical and commercial viability of a GTL plant in
western Canada, following our recent shale gas acquisitions in the
area.
The feasibility study for the Uzbekistan GTL plant has been
completed. The decision to proceed to front end engineering and
design (FEED) will be taken in the near term and is dependent upon
certain commercial conditions.
Given the delay in the approval from the Chinese government for
our CTL project in China, we are developing other investment
strategies and growth opportunities, both in South Africa and
abroad. We have reallocated planned project funding for the China
CTL project and redeployed staff to other projects. We remain
committed to growing our other businesses in China.
The pre-feasibility study in respect of our Indian coal-to-
liquids (CTL) project has largely been concluded. As the last
phase of the study, a drilling programme is being undertaken to
verify the coal assumptions.
Sasol Mining is nearing completion of the Thubelisha shaft which
will supply both the export market and sustain Sasol Synfuels'
production. The shaft is expected to be completed in 2012.
Construction on the Impumelelo colliery remains on track for
completion in 2014.
Construction on the wax production facility in Sasolburg, South
Africa, continues to progress according to plan.
Climate change being addressed
Sasol agrees that climate change presents a risk to the world at
large, to South Africa and to the local and international business
community. We are committed to transitioning to a low carbon and
climate resilient economy and are actively engaging with the South
African government in its development of national policy. This
policy is aimed at ensuring a coordinated, coherent, efficient and
effective response to this challenge, without prejudicing the
country's growth and development goals and the competitiveness of
key industries within the South African economy.
We are a significant contributor to the South African economy and
play a key role in ensuring energy security for the country;
however, we also recognise that we are a large emitter of
greenhouse gases (GHG). We have made changes to how we operate our
business in order to transition to a lower carbon economy. Through
investments in energy efficiency and in finding and using natural
gas from Mozambique, Sasol reduced annual GHG emissions levels by
10 million tonnes between 2004 and 2011, a reduction of 12%.
Performance from existing operations delivers results
South African energy cluster
Sasol Mining - higher coal prices
Operating profit of R1 628 million, excluding the once-off Ixia
Coal transaction share-based payment expense of R565 million,
doubled compared with the prior year. Higher US dollar export coal
prices contributed to the increase in operating profit despite the
impact of the Sasol Synfuels' maintenance outage. This positive
contribution, however, was partially offset by a stronger rand/US
dollar exchange rate.
Sasol Gas - improved sales volumes
Operating profit increased by 4% to R2 578 million compared with
the prior year mainly as a result of improved sales volumes,
despite lower gas prices due to the stronger rand/US dollar
exchange rate. The increase in operating profit was partially
offset by start-up costs in respect of a new compressor in
Mozambique, which supported the increased sales volumes.
Sasol Synfuels - major planned maintenance outage impacts
production volumes
Sasol Synfuels' operating profit increased by 15% to R15 188
million compared with the prior year. Production volumes were 4%
lower than the prior year primarily due to the largest planned
maintenance outage in Sasol Synfuels' history. Operating profits
were enhanced by higher average oil prices. The open cycle gas
turbines were successfully commissioned during July 2010, making
available an additional 200 megawatts of electricity generation
capacity for the Sasol Synfuels operations, thereby significantly
reducing the impact of above inflation electricity price increases
on Sasol Synfuels' unit cost. Sasol Synfuels' cash fixed cost per
unit increase was contained to 4%.
Sasol Oil - improved production
Operating profit decreased by 13% to R1 180 million compared with
the prior year. Higher retail and commercial sales volumes were
supported by increased production from the Natref refinery. Higher
wholesale margins were, however, countered by the strong rand as
well as weaker refining margins. Eight new retail convenience
centres were opened during the year.
International energy cluster
Sasol Synfuels International (SSI) - Oryx GTL improved production
SSI's operating profit increased significantly to R1 205 million
from R131 million in the prior year. This was mainly due to
increased production at the Oryx gas-to-liquids (GTL) plant in
Qatar and higher product prices derived from crude oil prices,
which were partially offset by a stronger rand/US dollar exchange
rate. The Oryx GTL plant is producing well and achieved an 82%
utilisation rate for the year.
Sasol Petroleum International (SPI) - higher oil and gas prices,
improved volumes
Operating profit increased by 13% to R382 million compared with
the prior year, mainly due to higher sales volumes resulting from
increased production. The increase was further underpinned by
higher oil and gas prices. Exploration expenditure was higher
during the year. Work on the expansion of the onshore gas
production facilities in Pande and Temane, Mozambique, to increase
the current annual production capacity from 120 million gigajoules
to 183 million gigajoules, is nearing completion. Production from
our Canadian operation is ramping up.
Chemical cluster
Sasol Polymers - improved volume and prices
Sasol Polymers operating profit of R1 579 million increased by 65%
compared with the prior year. Operating profit was positively
impacted by increases in production volumes from our local and
offshore operations. The increase in operating profit was softened
by margin pressure in the international polymer industry and was
partially offset by the stronger rand/US dollar exchange rate.
Arya Sasol Polymer Company (ASPC) contributed positively with an
average capacity utilisation of 80% for the year. Our local
operation's results included the negative impact of a once-off
administrative penalty of R112 million paid to the South African
Competition Commission (the Commission).
Sasol Solvents - higher product prices result in higher margins
Operating profit increased by 43% to R1 655 million compared with
the prior year. The increase is mainly due to improved margins,
resulting from higher prevailing product prices coupled with cost
savings. The increased operating profit was, however, partially
offset by reduced sales volumes due to scheduled outages at
production facilities as well as the negative effect of the strong
rand.
Sasol Olefins & Surfactants (Sasol O&S) - improved demand, margin
expansion
Operating profit increased by 67% to R4 161 million compared with
the prior year, mainly as a result of robust demand in most of the
Sasol O&S markets as well as improved margins across the Sasol O&S
product portfolio. The increase in operating profit from our
foreign operations was partially offset by foreign currency
translation effects. The 2011 financial year includes the reversal
of the remainder of the impairment related to Sasol O&S Italy
assets amounting to R491 million.
Other chemical businesses - improved sales volumes
Operating profit increased by 48% to R1 317 million compared with
the prior year. Global sales volumes of the wax markets as well as
the explosives and ammonia markets in Southern Africa improved on
the back of increased demand. Lower fertiliser sales volumes were
experienced due to the impacts associated with the required exit
of retail sales. Improved margins underpinned higher operating
profits which were partially offset by the stronger rand. Cost
control and restructuring have remained a key focus area for our
other chemical businesses.
Competition law compliance
We are continuously evaluating and enhancing our compliance
programmes and controls in general, and our competition law
compliance programme and controls in particular. As a consequence
of these compliance programmes and controls, including monitoring
and review activities, we have also adopted appropriate remedial
and/or mitigating steps, where necessary or advisable, lodged
leniency applications and made disclosures on material findings as
and when appropriate. As reported previously, these compliance
activities have already revealed, and the implementation of
certain close-out actions arising there from, may still reveal
competition law contraventions or potential contraventions in
respect of which we have taken, or will take, appropriate remedial
and/or mitigating steps including lodging leniency applications.
The Commission is conducting investigations into the South African
piped gas, coal mining, petroleum, fertilisers and polymer
industries. We continue to interact and co-operate with the
Commission in respect of the subject matter of current leniency
applications brought by Sasol, conditional leniency agreements
concluded with the Commission, as well as in the areas that are
subject to the Commission's investigations. To the extent
appropriate further announcements will be made in future.
Due to the uncertainty related to these matters, it is currently
not possible to estimate contingent liabilities, if any, and
accordingly no provision has been recognised at 30 June 2011.
Balance sheet remains strong
Balance sheet gearing at 30 June 2011 of 1,3% (30 June 2010: 1,0%)
remained low as a result of improved cash flow generation. This
low level of gearing is expected to be maintained in the short-
term, but is likely to return to within our targeted range of 20%
to 40% in the medium term as our large capital intensive growth
programme and gas acquisition strategy gains momentum. At the
annual general meeting of 26 November 2010, shareholders granted
the Sasol directors authority to buy back up to 10% of Sasol's
issued share capital (excluding the preferred ordinary and Sasol
BEE ordinary shares) for a further 12 months. No shares were
repurchased during the current year.
Profit outlook* - uncertain macro environment, focus on improved
operational performance and cost control
The past financial year has seen a global recovery from the
economic crisis, although some economies are proceeding at a
slower pace. Downside risks remain with high funding requirements
of banks and sovereign states. However, product prices and the
demand for chemical products have shown significant improvement.
Crude oil prices remained volatile but have increased steadily as
a result of the political turmoil in the Middle East and North
Africa and disruptions to supply. These increased prices have
assisted with offsetting the negative impact of the strong rand.
The strengthening of the rand/US dollar exchange rate remains the
single biggest external factor exerting pressure on our
profitability.
We anticipate that Sasol Synfuels' production volumes will improve
to between 7,2 million tons (mt) and 7,3 mt in 2012 following the
major planned maintenance outage which was undertaken in September
2010. Oryx GTL is expected to perform at its planned operating
rate of 80% to 90% of design capacity and Arya is expected to
improve as it ramps up to design capacity utilisation rate. We
expect improved volumes from Mozambique and Canada. Our focus in
the year ahead remains on factors within our control: volume
growth, margin improvement and cost containment. These focus areas
will be underpinned by our group-wide initiatives on operations
excellence, functional excellence and capital excellence. We are
also enhancing the extraction of value across our integrated
operations through planning and optimisation and have introduced
the sales and marketing excellence initiative. We remain on track
to deliver on our expectations for an improved operational
performance and to contain cost increases to within inflation.
Given the continuing uncertain macro economic conditions and our
assumptions in respect of improved crude oil and product prices,
as well as the strong rand/US dollar exchange rate, it is
difficult to be more precise in this outlook statement.
Management has recommended and the board has approved the final
dividend taking into account the ongoing strength of our financial
position and current capital investment plans, as well as the
increased earnings. This approach is in line with our progressive
dividend policy and our commitment to return value to
shareholders.
* In accordance with standard practice, it is noted that this
information has not been reviewed or reported on by the company's
auditors.
Acquisitions and disposals of businesses
In September 2010, we concluded the Ixia Coal transaction. This
transaction results in Ixia Coal Funding (Pty) Ltd, a subsidiary
of Ixia Coal (Pty) Ltd, acquiring a 20% shareholding in Sasol
Mining (Pty) Ltd for a purchase consideration of R1,8 billion. The
transaction resulted in a non-controlling interest of an effective
10,2% being recognised.
On 1 March 2011 and 10 June 2011, we concluded the acquisitions of
the Farrell Creek and Cypress A shale gas assets, respectively, in
Canada for a total purchase consideration of R14,2 billion. Of
this consideration R3,8 billion was paid in cash, while the
remaining purchase consideration will be settled through a capital
carry mechanism.
Changes of directors and company secretary
On 26 November 2010, Mr A Jain retired as a non-executive director
of Sasol Limited. On 1 January 2011, Messrs BP Connellan and TA
Wixley retired as non-executive directors of Sasol Limited. On 1
April 2011, Mr GA Lewin resigned as a non-executive director of
Sasol Limited.
On 30 June 2011, Mr LPA Davies retired as an executive director
and chief executive of Sasol Limited after 36 years of service to
the company. The board wishes to thank Mr LPA Davies for his
valuable contribution and the foundation laid for sustainable
growth.
Mr DE Constable was appointed as an executive director and chief
executive of Sasol Limited with effect from 1 July 2011.
The company secretary, Dr NL Joubert, resigned as company
secretary and has been appointed as the country president of Sasol
Canada. Mr VD Kahla was appointed as company secretary with effect
from 14 March 2011.
Declaration of cash dividend number 64
A final cash dividend of South African R9,90 per ordinary share
(2010: R7,70 per share) has been declared for the year ended 30
June 2011. The final cash dividend is payable on all ordinary
shares (including the Sasol BEE ordinary shares), excluding the
Sasol preferred ordinary shares.
The salient dates for holders of ordinary shares are:
Last day for trading to qualify for and
participate in the final dividend (cum
dividend)
Friday, 7 October 2011
Trading ex dividend commences
Monday, 10 October 2011
Record date
Friday, 14 October 2011
Dividend payment date
Monday, 17 October 2011
Holders of American Depositary Receipts*
Ex dividend on New York Stock Exchange
Wednesday, 12 October
2011
Record date
Friday, 14 October 2011
Approximate date for currency conversion
Tuesday, 18 October 2011
Approximate dividend payment date
Friday, 28 October 2011
* All dates are approximate as the NYSE sets the record date after receipt of
the dividend declaration.
On Monday, 17 October 2011, 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 hold dematerialised shares
will have their accounts held by their CSDP or broker credited on
Monday, 17 October 2011.
Share certificates may not be dematerialised or re-materialised
between Monday, 10 October 2011 and Friday, 14 October 2011, both
days inclusive.
On behalf of the board
Mrs Hixonia Nyasulu
Mr David
Constable
Mrs Christine Ramon
Chairman
Chief executive
Chief financial officer
Sasol Limited
9 September 2011
The preliminary financial statements are presented on a
summarised consolidated basis.
Statement of financial position
at 30 June
2011
Rm
2010
Rm
Assets
Property, plant and equipment
79 245
72 523
Assets under construction
29 752
21 018
Goodwill
747
738
Other intangible assets
1 265
1 193
Investments in associates
3 071
3 573
Post-retirement benefit assets
792
789
Deferred tax assets
1 101
1 099
Other long-term assets
2 218
1 828
Non-current assets
118 191
102 761
Assets held for sale
54
16
Inventories
18 512
16 472
Trade and other receivables
23 174
20 474
Short-term financial assets
22
50
Cash restricted for use
3 303
1 841
Cash
14 716
14 870
Current assets
59 781
53 723
Total assets
177 972
156 484
Equity and liabilities
Shareholders' equity
107 649
94 730
Non-controlling interest
2 691
2 512
Total equity
110 340
97 242
Long-term debt
14 356
14 111
Long-term financial liabilities
103
75
Long-term provisions
8 233
7 013
Post-retirement benefit obligations
4 896
4 495
Long-term deferred income
498
273
Deferred tax liabilities
12 272
10 406
Non-current liabilities
40 358
36 373
Liabilities in disposal groups held for
sale
-
4
Short-term debt
1 602
1 542
Short-term financial liabilities
136
357
Other current liabilities
25 327
20 847
Bank overdraft
209
119
Current liabilities
27 274
22 869
Total equity and liabilities
177 972
156 484
Income statement
for the year ended 30 June
2011
Rm
2010
Rm
Turnover
142 436
122 256
Cost of sales and services rendered
(90 467)
(79 183)
Gross profit
51 969
43 073
Other operating income
1 088
854
Marketing and distribution expenditure
(6 796)
(6 496)
Administrative expenditure
(9 887)
(9 451)
Other operating expenditure
(6 424)
(4 043)
Competition related administrative
penalties
(112)
-
Effect of crude oil hedges
(118)
(87)
Share-based payment expenses
(2 071)
(943)
Effect of remeasurement items
(426)
46
Translation losses
(1 016)
(1 007)
Other expenditure
(2 681)
(2 052)
Operating profit
29 950
23 937
Finance income
991
1 332
Share of profits of associates (net of
tax)
292
217
Finance expenses
(1 817)
(2 114)
Profit before tax
29 416
23 372
Taxation
(9 196)
(6 985)
Profit for the year
20 220
16 387
Attributable to
Owners of Sasol Limited
19 794
15 941
Non-controlling interest in subsidiaries
426
446
20 220
16 387
Earnings per share
Rand
Rand
Basic earnings per share
32,97
26,68
Diluted earnings per share1
32,85
26,54
1 Diluted earnings per share are calculated taking the Sasol
Share Incentive Scheme and Sasol Inzalo share transaction into
account.
Statement of cash flows
for the year ended 30 June
2011
Rm
2010
Rm
Cash receipts from customers
138 955
118 129
Cash paid to suppliers and employees
(100 316)
(90 791)
Cash generated by operating activities
38 639
27 338
Finance income received
1 380
1 372
Finance expenses paid
(898)
(1 781)
Tax paid
(6 691)
(6 040)
Dividends paid
(6 614)
(5 360)
Cash retained from operating activities
25 816
15 529
Additions to non-current assets
(20 665)
(16 108)
Acquisition of interests in joint
ventures
(3 823)
-
Disposal of businesses
22
-
Additional investments in associate
(91)
(1 248)
Other net cash flows from investing
activities
92
652
Cash utilised in investing activities
(24 465)
(16 704)
Share capital issued
430
204
Contributions from non-controlling
shareholders
27
9
Dividends paid to non-controlling
shareholders
(419)
(318)
Increase/(decrease) in long-term debt
545
(2 567)
Decrease in short-term debt
(295)
(29)
Cash effect of financing activities
288
(2 701)
Translation effects on cash and cash
equivalents of foreign operations
(421)
(124)
Increase/(decrease) in cash and cash
equivalents
1 218
(4 000)
Cash and cash equivalents at beginning of
year
16 592
20 592
Cash and cash equivalents at end of year
17 810
16 592
Statement of comprehensive income
for the year ended 30 June
2011
Rm
2010
Rm
Profit for the year
20 220
16 387
Other comprehensive income
Effect of translation of foreign
operations
(2 031)
(802)
Effect of cash flow hedges
111
13
Investments available-for-sale
-
4
Tax on other comprehensive income
(23)
8
Other comprehensive income for the year
net of tax
(1 943)
(777)
Total comprehensive income for the year
18 277
15 610
Attributable to
Owners of Sasol Limited
17 849
15 171
Non-controlling interests in subsidiaries
428
439
18 277
15 610
Statement of changes in equity
for the year ended 30 June
2011
Rm
2010
Rm
Opening balance
97 242
86 217
Shares issued during year
430
204
Share-based payment expenses
1 428
880
Disposal of businesses
(4)
-
Change in shareholding of subsidiaries
-
9
Total comprehensive income for the year
18 277
15 610
Dividends paid
(6 614)
(5 360)
Dividends paid to non-controlling
shareholders in subsidiaries
(419)
(318)
Closing balance
110 340
97 242
Comprising
Share capital
27 659
27 229
Share repurchase programme
(2 641)
(2 641)
Sasol Inzalo share transaction
(22 054)
(22 054)
Retained earnings
98 590
85 463
Share-based payment reserve
8 024
6 713
Foreign currency translation reserve
(1 895)
137
Investment fair value reserve
5
5
Cash flow hedge accounting reserve
(39)
(122)
Shareholders' equity
107 649
94 730
Non-controlling interest in subsidiaries
2 691
2 512
Total equity
110 340
97 242
Salient features
for the year ended 30 June
2011
2010
Selected ratios
Return on equity
%
19,6
17,9
Return on total assets
%
18,7
16,9
Operating margin
%
21,0
19,6
Finance expense cover
times
34,8
14,3
Dividend cover
times
2,5
2,5
Share statistics
Total shares in issue
million
671,0
667,7
Treasury shares (share
repurchase programme)
million
8,8
8,8
Weighted average number of
shares
million
600,4
597,6
Diluted weighted average number
of shares
million
614,5
615,5
Share price (closing)
Rand
355,98
274,60
Market capitalisation - Sasol
ordinary shares
Rm
238 863
183 350
Market capitalisation - Sasol
BEE ordinary shares
Rm
742
-
Net asset value per share
Rand
179,68
159,00
Dividend per share
Rand
13,00
10,50
- interim
Rand
3,10
2,80
- final
Rand
9,90
7,70
Other financial information
Total debt (including bank
overdraft)
- interest bearing
Rm
15 522
15 047
- non-interest bearing
Rm
645
725
Finance expense capitalised
Rm
43
58
Capital commitments
Rm
48 321
46 497
- authorised and contracted
Rm
41 367
31 553
- authorised, not yet contracted
Rm
33 458
35 769
- less expenditure to date
Rm
(26 504)
(20 825)
Guarantees and contingent
liabilities
- total amount
Rm
31 378
19 120
- liability included in the
statement of financial position
Rm
11 328
10 288
Significant items in operating
profit
- employee costs
Rm
18 756
17 546
- depreciation and amortisation
of non-current assets
Rm
7 400
6 712
- share-based payment expenses
Rm
2 071
943
Sasol share incentive schemes
Rm
676
119
Sasol Inzalo share transaction
Rm
830
824
Ixia Coal transaction
Rm
565
-
Directors' remuneration
Rm
58
59
Share options granted to
directors - cumulative
000
780
914
Share appreciation rights with
no performance targets granted
to directors - cumulative
000
215
215
Share appreciation rights with
performance targets granted to
directors - cumulative
000
370
43
Medium-term incentive rights
granted to directors -
cumulative
000
82
10
Sasol Inzalo share rights
granted to directors -
cumulative
000
50
50
Effective tax rate1
%
31,3
29,9
Number of employees
number
33 708
33 054
Average crude oil price - dated
Brent
US$/
barrel
96,48
74,37
Average rand/US$ exchange rate
1US$ =
Rand
7,01
7,59
Closing rand/US$ exchange rate
1US$ =
Rand
6,77
7,67
1 Increase in effective tax rate as a
result of competition related
administrative penalties and share-based
payment expenses which are not deductible
for tax.
Reconciliation of headline
earnings
Rm
Rm
Profit for the year attributable to
owners of Sasol Limited
19 794
15 941
Effect of remeasurement items
426
(46)
Impairment of assets
171
110
Reversal of impairment
(516)
(365)
(Profit)/loss on disposal of
business
(9)
5
Profit on disposal of associate
(6)
(7)
Profit on disposal of assets
(14)
(3)
Scrapping of non-current assets
359
156
Write off of unsuccessful
exploration wells
441
58
Tax effects and non-controlling
interests
106
(19)
Headline earnings
20 326
15 876
Remeasurement items per above
Mining
3
1
Gas
6
-
Synfuels
197
58
Oil
17
10
Synfuels International
126
4
Petroleum International
442
108
Polymers
46
14
Solvents
63
58
Olefins & Surfactants
(500)
(344)
Other chemical businesses
(11)
21
Nitro
(1)
26
Wax
(3)
(5)
Infrachem
(8)
(1)
Merisol
1
1
Other businesses
37
24
Remeasurement items
426
(46)
Headline earnings per share
Rand
33,85
26,57
Diluted headline earnings per
share
Rand
33,72
26,44
The reader is referred to the definitions contained in the 2010
Sasol Limited annual financial statements.
Basis of preparation and accounting policies
The preliminary summarised consolidated financial results for the
year ended 30 June 2011 have been prepared in compliance with the
Listings Requirements of the JSE Limited, International Financial
Reporting Standards (IFRS) as issued by the International
Accounting Standards Board (in particular International Accounting
Standard 34 Interim Financial Reporting), the AC500 Standards as
issued by the Accounting Practices Board or its successor and the
requirements of the South African Companies Act, 2008, as amended.
The accounting policies applied in the presentation of the
preliminary summarised consolidated financial results are
consistent with those applied for the year ended 30 June 2010,
except as follows:
Sasol Limited has early adopted the following standards, which did
not have a significant impact on the financial results:
IAS 1 (Amendment), Presentation of Financial Statements: Severe
Hyperinflation.
IAS 1 (Amendment), Presentation of Financial Statements:
Presentation of Items of Other Comprehensive Income.
IAS 12 (Amendment), Taxation: Deferred Tax - Recovery of
Underlying Assets.
IFRS 7, Financial Instruments: Disclosures - Transfer of
Financial Assets.
IFRS 13, Fair Value Measurement.
Various Improvements to IFRSs.
Sasol has adopted IFRS 2 (Amendment), Share-based Payment: Group
Cash-settled Share-based Payment Transactions and Various
Improvements to IFRSs: IAS 27, Consolidated and Separate Financial
Statements, effective 1 January 2010 and 1 July 2010,
respectively, which did not have a significant impact on the
financial results.
These preliminary summarised consolidated financial results have
been prepared in accordance with the historic cost convention
except that certain items, including derivative instruments,
liabilities for cash-settled share-based payment schemes and
available-for-sale financial assets, are stated at fair value.
The preliminary summarised consolidated financial results are
presented in rand, which is Sasol Limited's functional and
presentation currency.
Ms Christine Ramon, chief financial officer is responsible for
this set of financial results and has supervised the preparation
thereof in conjunction with the executive: group finance, Mr
Freddie Meyer and the general manager: group statutory reporting,
Ms Samantha Barnfather.
Related party transactions
The group, in the ordinary course of business, entered into
various sale and purchase transactions on an arm's length basis at
market rates with related parties.
Significant changes in contingent liabilities since 30 June 2010
On 12 August 2010, the Commission announced that it had referred
its complaints of excessive pricing of polypropylene and propylene
in the domestic South African market against Sasol Chemical
Industries Limited (SCI) and of price fixing in respect of
polypropylene against SCI and Safripol to the Competition Tribunal
for adjudication. On 14 December 2010, Sasol Polymers, a division
of SCI, concluded a settlement agreement with the Commission in
relation to its existing propylene supply agreement with Safripol
and agreed to pay a penalty of R112 million. This penalty has been
paid and no further provisions have been recognised at 30 June
2011 with regards to this matter.
Independent audit by the auditors
The preliminary summarised consolidated statement of financial
position at 30 June 2011 and the related preliminary summarised
consolidated income statement, statements of comprehensive income,
changes in equity and cash flows for the year then ended were
audited by KPMG Inc. The individual auditor assigned to perform
the audit is Mr CH Basson. Their unmodified audit report is
available for inspection at the registered office of the company.
Forward-looking statements: Sasol may, in this document, make
certain statements that are not historical facts and relate to
analyses and other information which are based on forecasts of
future results and estimates of amounts not yet determinable.
These statements may also relate to our future prospects,
developments and business strategies. Examples of such forward-
looking statements include, but are not limited to, statements
regarding exchange rate fluctuations, volume growth, increases in
market share, total shareholder return and cost reductions. Words
such as "believe", "anticipate", "expect", "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. By their very nature, forward-looking statements
involve inherent risks and uncertainties, both general and
specific, and there are risks that the predictions, forecasts,
projections and other forward-looking statements will not be
achieved. If one or more of these risks materialise, or should
underlying assumptions prove incorrect, our actual results may
differ materially from those anticipated. You should understand
that a number of important factors could cause actual results to
differ materially from the plans, objectives, expectations,
estimates and intentions expressed in such forward-looking
statements. These factors are discussed more fully in our most
recent annual report under the Securities Exchange Act of 1934 on
Form 20-F filed on 28 September 2010 and in other filings with the
United States Securities and Exchange Commission. The list of
factors discussed therein is not exhaustive; when relying on
forward-looking statements to make investment decisions, you
should carefully consider both these factors and other
uncertainties and events. Forward-looking statements apply only as
of the date on which they are made, and we do not undertake any
obligation to update or revise any of them, whether as a result of
new information, future events or otherwise.
Please note: A billion is defined as one thousand million. All
references to years refer to the financial year ended 30 June. Any
reference to a calendar year is prefaced by the word "calendar".
e-mail: investor.relations@sasol.com
Comprehensive additional information is available on our website:
www.sasol.com
Registered office: Sasol Limited, 1 Sturdee Avenue, Rosebank,
Johannesburg 2196. PO Box 5486, Johannesburg 2000, South Africa
Share registrars: Computershare Investor Services (Pty) Ltd, 70
Marshall Street, Johannesburg 2001, PO Box 61051, Marshalltown
2107, South Africa Tel: +27 11 370-7700 Fax: +27 11 370-5271/2
Sponsor: Deutsche Securities (SA) (Pty) Ltd
Directors (non-executive): Ms TH Nyasulu (Chairman), Mr C Beggs*,
Mr HG Dijkgraaf (Dutch)*, Dr MSV Gantsho*, Ms IN Mkhize*, Mr MJN
Njeke*, Prof JE Schrempp (German)^
(executive): Mr DE Constable (Chief executive), Ms KC Ramon (Chief
financial officer), Ms VN Fakude
*Independent ^Lead independent director
Company secretary: Mr VD Kahla
Company registration number: 1979/003231/06, incorporated in the
Republic of South Africa
JSE
NYSE
Sasol Ordinary shares
Share code:
SOL
SSL
ISIN code:
ZAE000006896
US8038663006
Sasol BEE Ordinary shares
Share code:
SOLBE1
ISIN code:
ZAE000151817
American depositary receipts (ADR) program: Cusip number 803866300
ADR to ordinary share 1:1
Depositary: The Bank of New York Mellon, 22nd floor, 101 Barclay
Street, New York, NY 10286, USA