(Adds details on additional costs and background)
Jan 31 (Reuters) – South African petrochemicals group Sasol
said on Friday it expects lower first-half headline
earnings per share (HEPS) and also cut earnings outlook from its
Lake Charles Chemicals Project following a fire mishap at one of
its unit this month.
HEPS is the main profit measure in South Africa and strips
out certain one-off items.
The company said it expects core earnings from the Lake
Charles project to come in between $50 million and $100 million
for the financial year 2020 following an explosion and a fire at
the low-density polyethylene unit in Louisiana, United States on
In August, Sasol had lowered its core earnings outlook for
the U.S.-based ethane cracker project to between $150 million
and $300 million from $300 million-$350 million. [nL5N25M3A3]
Problems with the Lake Charles project, which is costing
billions of dollars more than initial estimates, have led to the
resignation of both of the company’s joint chief executives.
Sasol expects its first-half HEPS to be between 4.79 rand
and 7.11 rand, for the six months ended Dec. 31, compared with
HEPS of 23.25 rand ($1.62) last year.
Half-year earnings will also be hit by about 1.7 billion
rand in depreciation charges and nearly 2 billion rand in
finance charges as the Lake Charles units reach beneficial
operation, the South African company said, adding that results
were also dented by a weak macroeconomic environment that
resulted in lower margins and operating profit.
($1 = 14.3325 rand)
(Reporting by Tanishaa Nadkar in Bengaluru, Editing by Sherry
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Keywords: SASOL OUTLOOK/ (UPDATE 1)
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