VENTURES AFRICA – Sasol said its expectations for a strong year had been boosted by a good quarterly performance at its synthetic fuels unit.
But the shares of the JSE-listed petrochemicals giant sagged 1.4 percent to R369.31 ($41) during Monday’s intraday trading.
Traders said this signalled that investors were not happy with the announcement because the performance was below market expectations.
Christine Ramon, Sasol’s CFO, said the the company remained confident that, based on the production guidance and the company’s macroeconomic assumptions, they will deliver solid operational performance and earnings for the (2012/13) financial year.
Ramon said currency and oil price volatility were likely to persist given the uncertain global economic outlook.
Output of synthetic fuels from July-September – its first quarter – rose 12 percent to 1.8 million tonnes. Sasol, the world’s top maker of motor fuels from coal, kept its full-year production forecast at 7.2-7.4 million tonnes.
She said the quarter was also boosted by a weaker rand, which helps exporters as it lifts profit when overseas earnings are brought home.
The average Brent crude oil price, however, softened and chemical prices remained depressed, hitting Sasol’s chemicals units, where demand remained soft, the company said in a statement.