Slide 1: NYSE listing roadshow presentation April 2003
NYSE listing roadshow presentation April 2003 JSE : SOL 1 NYSE : SSL (from April 9)
Slide 2: Forward-looking statements
forward-looking statements Sasol has made certain forward-looking statements in this presentation relating to future results of operations, plans, objectives or goals, future competition in local and international markets, existing or anticipated investments, future development in legal or regulator
Slide 3: Section A: what is Sasol?
section A what is Sasol ? ie
Slide 4: Sasol is an integrated oil and gas company with substantial chemical interests
• Sasol is an integrated oil and gas company with substantial chemical interests • our proprietary Fischer-Tropsch technology enables; • fuel and chemicals to be made in almost equal quantities (high- temperature), and • the manufacture of environmentally efficient (gas-to-liquids (GTL)) diesel (low
Slide 5: Employing 31,000 people worldwide, based in South Africa
• employing 31,000 people world-wide, Sasol is based in South Africa with facilities in 15 countries including the USA, Germany, Italy, the Netherlands, the Middle East, West Africa, Malaysia and China • GTL or chemical projects are being advanced in Nigeria, Qatar and Iran. A natural gas project is
Slide 6: More than 50% of sales from foreign operations and exports
• more than 50% of sales revenue arises from foreign operations and exports • oil and gas activities, together with coal mining operations, contribute over 60% of Sasol’s operating profit, with chemicals contributing the balance. It is expected that GTL projects will in future further increase opera
Slide 7: Main operating companies
main operating companies Mining coal mining activities production of liquid fuels, gases Synfuels and chemical products crude oil refining activities and Oil marketing of fuels, lubricants and pipeline gas production and marketing of chemical Chemicals products including solvents, olefins and Sasol
Slide 8: Significant partnerships
we have significant partnerships with; • ChevronTexaco (GTL and upstream exploration and production) • Petronas (monomers and polymers) • Mitsubishi Chemical Corporation (acrylic acid and acrylates) • Qatar Petroleum (GTL) • TotalFinaElf (crude oil refining) 8
Slide 9: Financial statistics
financial statistics market capitalization US$-m 7,300 sales (annualized) US$-m 6,700 operating profit (annualized) US$-m 1,400 attributable earnings (annualized) US$-m 900 last five years’ US$ earnings growth per annum (moving average) 10% return on shareholders’ equity 30% net borrowings to shareh
Slide 10: Our vision
our vision is to be a respected global enterprise, harnessing our talents in applying unique, innovative and competitive technologies to excel in selected markets in the energy, fuels, chemicals and related sectors in Southern Africa and worldwide 10
Slide 11: Our values
our values are • customer focus • winning with people • excellence in all we do • continuous improvement • integrity 11
Slide 12: Corporate governance
corporate governance • we place a very high priority on sound corporate governance, for which Sasol is highly rated • the Sasol Limited Board has 13 directors (5 executive and 8 non- executive, of which 7 are independent), and Audit; Risk and SHE; Nomination and Governance; and Compensation committe
Slide 13: Our strategy is based on four primary growth drivers
our strategy is based on four primary growth drivers • growing the chemicals portfolio • optimizing performance of existing businesses • exploiting upstream hydrocarbon opportunities • commercializing and expanding gas-to-liquids (GTL) technology 13
Slide 14: Our performance objectives
our performance objectives growth : US dollar earnings growth of 10% per annum on a 5 year moving average basis (base years = 1997 – 2001) return / eva : to exceed required rates of return as determined by our Weighted Average Cost of Capital (WACC). For new investments we target returns of 1.3 time
Slide 15: Strong financial performance and expanded operational and geographic reach
strong financial performance and expanded operational & geographic reach growth: US dollar earnings growth of 10% per annum on a 5 year moving average basis globalization: foreign & export sales >50% foreign 60 $m 1000 earnings target export 750 % of sales 40 500 20 250 0 0 fy98 fy99 fy00 fy01 fy02
Slide 16: Sasol: reaching new frontiers
SASOL reaching new frontiers 16
Slide 17: Section B: financial results
section B financial results 17
Slide 18: Solid performance following a remarkable three-year growth period
solid performance following a remarkable three-year growth period 1h03 1h99 1h02 1h00 1h01 operating profit on a comparable half-yearly basis 18
Slide 19: Oil price
oil price $/bbl Brent Dubai Derived Product IBLC 45 35 25 -2% $22.84/bbl 15 $22.35/bbl 5 fy98 fy99 fy00 fy01 fy02 1h03 19
Slide 20: Rand / US$ exchange rate
Rand / US$ exchange rate $1 = R 13 11 rate applicable to fuel sales average monthly rate +20% 9 +8% 7 R10.33/$ (+ 20%) R10.03/$ (+ 8%) 5 R9.29/$ R8.64/$ 3 fy98 fy99 fy00 fy01 fy02 1h03 20
Slide 21: Volatile currency impacts earnings
volatile currency impacts earnings US$1 = R 12 R11.95/$ monthly closing rate average monthly rate 11 R10.27/$ 10 R10.03/$ R9.29/$ 9 R8,57/$ 8 june 01 dec 01 june 02 dec 02 21
Slide 22: Dollar refining margins
dollar refining margins … [expressed as a percentage of July 1997] 200% 150% 100% - 10% 50% 0% fy98 fy99 fy00 fy01 fy02 1h03 blue lines represent theoretical margins when refinery was off-line 22
Slide 23: Chemical prices
chemical prices … [expressed as a percentage of July 1997] Ammonia Polymers Phenols Solvents 160% 140% 120% 100% 80% +19% 60% 40% 20% fy98 fy99 fy00 fy01 fy02 1h03 23
Slide 24: Chemicals margins under pressure
chemicals margins under pressure 40 800 US$/bbl US$/ton 30 600 ethylene 20 400 Brent 10 200 0 0 Jun 97 1h02 1h03 24
Slide 25: Solid performance
solid performance prepared in accordance with IAS 1h03 1h03 US$-m change R-m change sales 3,392 + 13% 34,015 + 22% operating profit before translation effects 825 + 25% 8,279 + 35% operating profit after translation effects 728 - 4% 7,305 + 4% attributable earnings 456 - 8% 4,576 - earnings per shar
Slide 26: 1H03 sales – business unit basis
1h03 sales – business unit basis prepared in accordance with IAS 1h03 1h03 US$-m change R-m change mining 251 - 3% 2,516 + 5% synfuels 987 + 15% 9,896 + 25% oil and gas 379 + 47% 3,803 + 59% chemicals 2,251 + 8% 22,582 + 17% other 48 + 78% 478 + 93% 3,916 + 25% 39,275 + 21% intersegment sales (524)
Slide 27: Operating profit (before translation effects)
operating profit (before translation effects) prepared in accordance with IAS 1h03 1h03 US$-m change R-m change mining 72 + 9% 724 + 19% synfuels 501 + 27% 5,029 + 38% oil and gas 66 - 30% 659 - 25% chemicals 189 + 32% 1,898 + 43% other (3) - (31) - 825 + 25% 8,279 + 35% translation effects (97) - (
Slide 28: Operating profit (after translation effects)
operating profit (after translation effects) prepared in accordance with IAS 1h03 1h02 change $-m $-m mining 70 69 + 1% synfuels 501 397 + 26% oil and gas 56 99 - 43% chemicals 138 204 - 32% other (37) (11) - operating profit 728 758 - 4% 28
Slide 29: Operating profit (after translation effects) detail
operating profit (after translation effects) prepared in accordance with IAS 1h03 1h02 change US$-m US$-m US$-m % mining 70 69 1 +1% synfuels 501 397 104 + 66% oil and gas 56 99 (43) - 43% operating 96 99 (3) - 3% shutdown costs (40) - (40) - chemicals 138 204 (66) - 32% olefins & surfactants * 16 7
Slide 30: LAB margins under pressure
LAB margins under pressure 200% 150% 100% 50% LAB Benzene Kerosene 0% 3qf97 1h02 1h03 30
Slide 31: Limited impact of conversion from IAS to US GAAP
limited impact of conversion of financial statements from IAS to US GAAP IAS US GAAP R-m R-m sales 1h03 3,392 3,312 fy02 6,078 5,495 operating profit 1h03 728 732 fy02 1,470 1,404 31
Slide 32: Divisional highlights
divisional highlights at 32
Slide 33: Mining
mining • operating profit up 1% to $70 million 786 • saleable production up 2% 80 566 US$-m • group selling prices up 4%, export prices 342 60 235 down 58% 40 • productivity improvement processes continue 20 – cash mining costs/ton decreased by 10% 0 1h01 2h01 1h02 2h02 1h03 • Dollar operating profi
Slide 34: Synfuels
synfuels • operating profit up 26% to $501 million • sales volumes of 3.9 mt - up 4% 600 US$-m • IBLC prices down 2% 400 • yields and plant integrity improved • cash fixed costs/ton up 2% 200 0 • Dollar operating profit for 2h03 expected to be 1h01 2h01 1h02 2h02 1h03 lower due to impact of strong R
Slide 35: Chemicals
chemicals • operating profit down 32% to $138 million (up 32% before translation effects) 200 US$-m • difficult trading conditions with severe margin pressures 150 • olefins & surfactants adversely affected by 100 prevailing cyclical market conditions – especially alkylates 50 • strong trading perfo
Slide 36: Oil and gas
oil and gas • operating profit down 43% to $56 million due to lower Natref production resulting from the 120 US$-m planned shutdown ($20 m) and unforeseen 90 down- problems relating to expansion project ($20 m) time 60 • integrity of business remains sound oil 30 • gas business continues to grow – o
Slide 37: 2003 business prospects
2003 business prospects off a high base …………. ……. currency effects and chemical margin pressure expected to result in reduced earnings for fy03 37
Slide 38: Committed to growing shareholder value
committed to growing shareholder value • we remain committed both to achieving a US dollar earnings growth of 10% per annum on a 5 year moving average basis, and to quality, value-added returns • we are preparing for significant growth with the commissioning of major projects that link our proprieta
Slide 39: Section C: long-term strategy and update
section C long-term strategy and update 39
Slide 40: Our strategy is based on four primary growth drivers
our strategy is based on four primary growth drivers • growing the chemicals portfolio • optimizing performance of existing businesses • exploiting upstream hydrocarbon opportunities • commercializing and expanding gas-to-liquids (GTL) technology 40
Slide 41: Grow chemicals portfolio
grow chemicals portfolio sales ebit 5 700 4 3 US$-m US$-m 350 2 1 0 0 '98 '99 '00 '01 '02 sales ebitda 41
Slide 42: Growing chemicals portfolio
growing chemicals portfolio • 38% ($1.5 bn) of current capital investment devoted to growing chemicals portfolio both locally and abroad – new capex approvals include; • polymers project in Iran, 2nd octene train and vinyls expansion • MCC acrylic acid/acrylates joint venture underway • ~ $2.2 bn po
Slide 43: Optimize performance of existing businesses
optimize performance of existing businesses 500 US$-m 400 300 200 100 0 '97 '98 '99 '00 '01 '02 Vulamehlo, Renewal and Net Gain 43
Slide 44: Optimizing performance of existing businesses
optimizing performance of existing businesses growth and other initiatives include; • building a 15th air-separation unit at Synfuels • the recently commissioned Natref oil refinery expansion project • continuing the Mining renewal project • further expanding the gas pipeline network • advancing the
Slide 45: Exploit upstream hydrocarbon opportunities
exploit upstream hydrocarbon opportunities 400 MMBoe 300 200 100 0 '98 '99 '00 '01 '02 proven & probable reserves 45
Slide 46: Exploiting upstream hydrocarbon opportunities
exploiting upstream hydrocarbon opportunities developing group’s upstream interests in oil and gas exploration and production Mozambique • additional gas production wells being drilled in Mozambique • construction of pipeline and central processing facility on track African west coast • first oil fr
Slide 47: Commercialise and expand gas-to-liquids technology
commercialise and expand gas-to-liquids technology 500 k bbl/day 250 0 '05 '12 targeted gross GTL capacity 47
Slide 48: Commercializing and expanding GTL technology
commercializing and expanding gas-to-liquids (GTL) technology developing and implementing international ventures based on Sasol’s unique Fischer-Tropsch synthesis technology • Oryx GTL project (Qatar) - 49% interest in $950 m 33,000 bbl/day plant • US$675 m EPC contract signed; first production expe
Slide 49: Our performance objectives
our performance objectives growth : US dollar earnings growth of 10% per annum on a 5 year moving average basis (base years = 1997 – 2001) return / eva : to exceed required rates of return as determined by our Weighted Average Cost of Capital (WACC). For new investments we target returns of 1.3 time
Slide 50: Strong financial performance and expanded operational and geographic reach
strong financial performance and expanded operational & geographic reach growth: US dollar earnings growth of 10% per annum on a 5 year moving average basis globalization: foreign & export sales >50% foreign 60 $m 1000 earnings target export 750 % of sales 40 500 20 250 0 0 fy98 fy99 fy00 fy01 fy02
Slide 51: Investment opportunity
investment opportunity upside potential • track record of strong financial and operating performance through commodity cycles • advanced GTL technology and expertise • financial strength underpins growth downside protection • integrated businesses counter cyclicality • currency protection – natural
Slide 52: Sasol: reaching new frontiers
SASOL reaching new frontiers 52
Slide 53: Copyright notice and contact persons
The copyright in the material contained in this presentation vests in Sasol Limited, and any reproduction, publication, adaptation, broadcast or performance in public of any portion of this material requires the express prior authorisation of Sasol Limited Contact persons: - Cavan Hill (+27 11 441 3