ebitda
450–600 $million
FY 2027
official guidance
SASOL LTD
Last · —$26062.00+208.00 (+0.80%)live · yahoo · 52m ago
Market cap$10.39B—
P/E · TTM14.3fwd — · eps —
Beta—vs S&P 500
Div yield—annual · TTM
52w range
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Volume—session
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OpenFilings analyst
Our analyst
Agentic read of the latest earnings call — recommendation updates when we process a new transcript. Research synthesis, not investment advice.
Strong BuyBuyHoldSellStrong Sell
Balance-sheet repair is credible, but normalized earnings and near-term shareholder returns remain unproven.
Sasol delivered a strong FY26:
adjusted EBITDA rose 17% to ZAR61 billion, net debt fell 11% to USD3.3 billion, and Secunda production reached a five-year high of 7.26 million tonnes. However, much of the earnings uplift came from refining/macro tailwinds and the absence of a shutdown, while International Chemicals guidance of USD450–600 million is below FY26’s USD604 million amid persistent oversupply; dividends also remain gated by sustainably sub-USD3 billion net debt.
Themes
- Deleverage
- Dividend Threshold
- Secunda Reliability
- International Chemicals
- Coal Supply
- Natref Refining
Near term
FY27 Secunda and Natref shutdowns will test whether improved reliability can offset roughly 100 kilotonnes of shutdown-related FY26 production benefit.
Working capital at 18.3% of turnover is above the 15.5%–16.5% target; management expects inventory-related pressure to unwind in Q1 FY27, creating a near-term cash-flow swing factor.
International Chemicals guidance of USD450–600 million reflects the non-repeat of Middle East-related benefits and assumes continued structural weakness in ethylene and European chemicals markets.
Oil prices, refining differentials and the stronger rand remain major earnings variables; FY27 oil hedging provides an approximately USD59-per-barrel floor, while only about 60% of the rand-dollar program was complete.
Net debt could fall below USD3 billion, but management emphasized the threshold must be sustainable before dividends resume.
Longer term
The balance sheet is materially stronger: net debt is at a 10-year low, liquidity is approximately USD5 billion, and debt maturities have been extended. This lowers refinancing risk but does not yet restore dividends.
Secunda’s structural competitiveness depends on lifting internal coal production to 34 million tonnes by FY28, reducing external purchases from 8.8 million tonnes in FY26 toward 5–7 million tonnes in FY27, and improving gasifier availability.
International Chemicals’ reset has produced 7% fixed-cost savings, but analysts correctly highlighted that structural oversupply, weak demand, Chinese exports and elevated European energy costs remain unresolved competitive risks.
Organic retail execution has increased fuel market share from 9% to 13% in five years, but growing imports and more trading-oriented competitors could pressure Sasol’s domestic market position.
Renewables provide strategic optionality, with more than 500 MW operational and over 1.3 GW secured toward a 2 GW FY30 target; returns and capital discipline matter more than the headline capacity.
The transition to MRG, LNG and sustainable fuels remains dependent on regulatory approval, gas pricing visibility and value-accretive economics rather than simply strategic ambition.
Red flags
Two employee fatalities remain a material safety concern despite improved incident statistics.
FY26 EBITDA benefited from stronger refining margins, fuel differentials, oil prices and no Secunda shutdown; management declined to provide the quarterly EBITDA run rate requested by an analyst, limiting confidence in normalized cash earnings.
International Chemicals guidance is below FY26 performance, and management acknowledged that the Q4 market improvement may not persist. The business remains exposed to excess capacity and weaker demand.
CapEx has been reduced for three consecutive years. Management says the cuts are risk-based and partly reflect timing, but analysts’ concern that underinvestment could create later reliability or asset-integrity costs remains unresolved.
The upcoming Secunda turnaround, gasifier constraints and long-term coal-supply replacement require execution while FY27 capital guidance rises to ZAR23–26 billion.
MRG bridge-project spending will not proceed until NERSA provides sufficient pricing clarity, leaving gas-transition economics and future feedstock security uncertain.
The stronger rand remains a structural earnings headwind because much of revenue is dollar-linked, while South Africa’s sovereign rating constrains Sasol’s credit rating and financing-cost improvement.
The Secunda liquid-fuels refinery remains fully impaired; management attributes this to valuation assumptions and a stronger rand outlook, but it underscores the sensitivity of asset value to macro assumptions.
Forward outlook
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OpenFilings analyst view from primary-source filings and earnings calls — not investment advice.