Sasol mining unit output rises

Cape Town - Sasol [JSE:SOL] announced its production and sales metrics for the year to end-June 2016 on Friday. The group advised that it publishes a quarterly set of business performance metrics (BPM) for each of its operating and strategic business units.

These metrics, which include production and sales information, assist investors and analysts to track Sasol’s performance on an ongoing basis. They ultimately drive earnings and return on invested capital, Sasol said in a statement.

For its full year to end-June 2016, unaudited figures for mining put Sasol's saleable production at 40.3 million tons (previous comparable period 39.2 million tons). External purchases amounted to 5.0 million tons (previous comparable period 5.1 million tons).

Internal sales were as follows: energy 24.9 million tons (25.0); base chemicals 12.6 million tons (12.1); performance chemicals 4.6 million tons (4.6). External sales (international and other domestic) were 3.2 million tons (3.4).

Sasol said that in line with its low oil price response plan, it has reduced appraisal, development and drilling activities in Canada during FY16 until such time as it sees a sustainable recovery in North American gas prices.

Liquid fuels production for the energy business increased by 1% compared to the prior year as a result of a 1% rise in total synfuels production, a higher portion of synfuels volumes utilised by the energy business in the first half of the financial year during the commissioning of the C3 expansion project and a stable throughput from Natref.

Liquid fuels sales volumes of 61.3 million barrels for the energy business exceeded previous market guidance by 2%.

Polymer sales volumes fell by 27% mainly as a result of a reduction in the volume of traded fertilizers (15%) coupled with the impact of the current drought conditions in southern Africa.

Sales volumes in explosives decreased by 7% mainly due to lower demand driven by lower activity in the mining sector.

The increase in organics sales was positively impacted by resilient surfactant and alcohol volumes, further supported by weaker exchange rates, partly offset by lower ethylene pricing in the North American market.

The increase in sales in the 'other' category is largely driven by the positive impact of a weaker exchange rate, partly offset by lower ammonia prices and reduced volumes resulting from an extended planned shutdown of the ammonia plant in Sasolburg.

Sasol said sales volumes in waxes dropped by 5% mainly due to production instabilities at the Sasolburg wax plant during the second half of the year and the sale of the Richmond plant during May 2016 (1%).

The significant planned shutdowns normalised for in FY16 consist of the ammonia plant shutdown in Sasolburg, the extended polypropylene plant shutdown in Secunda and the ethylene plant shutdown in North America.

Sasol shares were at R375.50 in mid-morning trade from the previous close of R371.97.