MOSCOW (MRC) -- Sasol is expected to deliver a strong set of results for the six months ended 31 December 2020 (2021 financial half year), underpinned by a strong cash cost, working capital and capital expenditure performance despite the effects of the COVID-19 pandemic, a severe decline in crude oil prices and softer chemical product prices, said the company.
In addition, our Lake Charles production was impacted by hurricanes experienced in the US Gulf Coast, resulting in lost production of approximately 300kt for the 2021 financial half year.
Shareholders are advised that, for the 2021 financial half year: The earnings per share is expected to be between R22,76 and R24,07 compared to the prior half year earnings per share of R6,56 (representing an increase of more than 100%);
Headline earnings per share (HEPS) is expected to be between R18,59 and R19,78 compared to the prior half year HEPS of R5,94 (representing an increase of more than 100%); and Core HEPS (CHEPS) is expected to be between R6,94 and R8,79 compared to the prior half year CHEPS of R9,25.
Sasol?s adjusted earnings before interest, tax, depreciation and amortisation (adjusted EBITDA) is expected to decline by between 0% and 10% from R19,8 billion in the prior year, to between R17,9 billion and R19,8 billion. This decline results from a 23% decrease in the rand per barrel price of Brent crude oil coupled with lower sales volumes due to softer demand attributable to COVID-19 lockdowns and the aforementioned hurricanes impacting our gross margins adversely. This was offset by a strong cost performance, supported by delivery towards the US$1 billion integrated crisis response plan commitment.
Notable non-cash adjustments for the 2021 financial half year include: Unrealised gains of R5,4 billion on the translation of monetary assets and liabilities due to the 15% strengthening of the closing rand/US dollar exchange rate compared to June 2020; Unrealised gains of R4,7 billion on the valuation of financial instruments and derivative contracts; and R3,3 billion gain on the realisation of the foreign currency translation reserve (FCTR), mainly on the divestment of 50% interest in the LCCP Base Chemicals Business.
The financial information on which this trading statement is based has not been reviewed and reported on by the Company's external auditors. Sasol will release its 2021 financial half year results on Monday, 22 February 2021. Sasol?s President and Chief Executive Officer, Fleetwood Grobler, and Chief Financial Officer, Paul Victor, will present the results. The pre-recorded presentation will be available on 22 February 2021 on the following link: presentation link.
As per MRC, Sasol completed the USD404-million sale to Ineos of its 50% equity stake in the companies’ Gemini high-density polyethylene (HDPE) manufacturing joint venture (JV) at La Porte, Texas. The planned divestment, first announced by Sasol in November 2020, was successfully closed on 31 December.
According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC