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Shares in petrochemical company Sasol [JSE:SOL] plunged by up to 9% in early trade on Friday, after it announced lower expected margins and operating profit in a trading update.
Sasol shares were trading down 7.8% at R236.50 a share at 9:40am.
It said that headline earnings per share are expected to be between R4.79 and R7.11 for the financial half year ended ended December 31, a fall of between 69% and 79% from the prior half's HEPS of R23.25.
The group attributed this to a 9% decrease in the rand price per barrel price of Brent crude oil, weaker global chemical and refining margins, and ongoing difficulties at its major Lake Charles Chemicals Project in the US.
Sasol said its earnings were further depressed by about R1.7bn in additional depreciation charges and R2bn in finance charges as the Lake Charles units started to become operational. The project has been marred by cost overruns, which have been blamed on poor project management and forced the resignation of joint CEOs Bongani Nqwababa and Stephen Cornell in October.
