What Happened
South African energy and chemicals giant Sasol has reported a staggering 95% decline in basic earnings per share for the six months ended 31 December 2025. Despite a steady turnover of R122.4 billion, the company has been significantly impacted by a challenging macro environment and substantial asset writedowns, leading to a severe erosion of profitability.
Why It Matters
The primary factor behind this earnings collapse was a series of non-cash remeasurement items totaling R7.9 billion, including a R7.8 billion impairment related to the Secunda liquid fuels refinery and gas development projects in Mozambique. Consequently, earnings before interest and tax (Ebit) plummeted 52% to R4.6 billion, down from R9.5 billion in the previous period. Headline earnings per share (Heps) also dived 34% to R9.27. For the first time in four years, Sasol generated positive free cash flow of R0.8 billion, but this was insufficient to support shareholder returns, leading to the decision not to declare an interim dividend due to high debt levels, which stood at R63.3 billion at the end of December 2025.
What’s Next
In addition to financial challenges, Sasol is facing renewed scrutiny over its operations in Louisiana, USA, where allegations of discrimination against homeowners during its buyout program have resurfaced. This follows a recent investigation aired by Carte Blanche, reigniting public concern over the company’s practices. As Sasol continues to implement its strategic initiatives aimed at mitigating global market volatility, the company remains committed to improving operational performance and building resilience for the future.
