Staff Writer
Sasol has reduced its net debt by 11% to US$3.3 billion and says it is now working towards sustainably bringing debt below US$3 billion before resuming dividend payments.
The reduction in debt was achieved as the energy and chemicals group delivered on its 2026 net debt target of below US$3.7 billion, supported by stronger cash generation, improved operational performance and disciplined capital allocation.
“This progress has increased our financial resilience, as we progress towards achieving our net debt target of below US$3 billion on a sustainable basis before the resumption of dividends,” Sasol president and chief executive officer Simon Baloyi said.
Baloyi described 2026 as a “decisive year of delivery” against commitments made at Sasol’s Capital Markets Day, saying the group met or exceeded its production and sales targets while strengthening its foundation business.
Sasol ended the financial year with adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of R61 billion, an increase of 17% from the previous year.
The improvement was supported by a 4% increase in sales volumes linked to higher production, a 7% increase in the average US dollar Brent crude oil price and more than a 100% increase in refining margins following improved fuel differentials.
These gains were partly offset by a 7% stronger average rand against the US dollar and the absence of a once-off R5.5 billion Transnet settlement received in the previous year.
Sasol said cash fixed costs were maintained at R70 billion for the third consecutive year, with inflationary pressures offset through cost optimisation measures.
Capital expenditure fell 18% year-on-year, mainly reflecting the completion of major gas and environmental compliance projects, the absence of a Secunda shutdown during the financial year and ongoing capital optimisation.
In Southern Africa, Secunda Operations recorded its highest annual production in five years and exceeded market guidance.
Sasol attributed the performance to improved coal quality following the implementation of its destoning plant and higher overall equipment availability.
In its International Chemicals business, Sasol said its reset strategy continued to improve portfolio competitiveness despite challenging market conditions, including lower US ethylene margins and subdued demand.
Stronger markets in the fourth quarter helped lift US dollar adjusted EBITDA by 47% compared with the prior year.
Sasol also continued to expand its renewable energy portfolio. A further 330 MW of renewable capacity came online during the year, taking renewable energy in operation to more than 500 MW, while total secured renewable capacity rose above 1 350 MW through power purchase agreements.
Baloyi said the group’s progress had positioned Sasol to deliver sustainable shareholder returns, although further work was required before dividends could resume.
