Slide 1: 2007 financial results: a foundation for sustainable growth
1 2007 financial results a foundation for sustainable growth 2007 financial results
Slide 2: Forward-looking statements
2 forward-looking statements We may in this document make statements that are not historical facts and relate to analyses and other information based on forecasts of future results and estimates of amounts not yet determinable. These are forward-looking statements as defined in the U.S. Private Secu
Slide 3: 2007 highlights
SASOL reaching new frontiers 2007 highlights
Slide 4: Record financial performance sets foundation
4 record financial performance sets foundation 2007 financial results operating profit up 49% to R25,6bn excluding Sasol O&S, operating profit up 18% headline earnings per share up 10% to R25,37 operating cash flow up 16% to R28,5bn cash returned to shareholders total dividend up 27% to R9,00 pe
Slide 5: Growth strategy remains resilient and competitive
5 growth strategy remains resilient and competitive strategic agenda grow CTL & nurture and grow our existing GTL asset base values driven leadership style and culture deliver on SA transformation growth drivers grow agenda chemicals (based on our technology or feedstock develop and empower our adva
Slide 6: World demand for oil increasing
6 world demand for oil increasing … 3,5 billion people consume 0.10 less than 0,01bbl/d 0.09 Oil consumption per capita 0.08 0.07 USA 0.06 0.05 OECD (bbl/d) 0.04 0.03 0.02 0.01 0.00 0 10000 20000 30000 40000 50000 China India China India 2016 2005 2016 2005 GDP per capita … creating opportunities fo
Slide 7: Gas and coal beat oil for energy security
7 gas and coal beat oil for energy security creating sweet spot for GTL/CTL 14 m b/d 80% of world coal in 6 countries, representing oil 45% of world population and 46% of GDP total reserves – million BOE 80% of world oil in 9 countries, representing 5% 3,4 m b/d of world population and 5% of GDP
Slide 8: Climate change impacts of synfuels production being addressed
8 climate change impacts of synfuels production being addressed greenhouse gas (GHG) emissions a principal strategic challenge committed to a 10% reduction in GHG emissions per tonne of product off the 2005 base GHG reduced by 6mtpa from Sasolburg natural gas conversion clean development mec
Slide 9: Safety performance improving, remains top priority
9 safety performance improving, remains top priority recordable case rate* RCR reduced by 20% 1,3 1,2 results to 2005 exclude 1,0 service providers and 0,9 occupational illnesses; 2006 0,7 and 2007 results include them goal for 2015 is an RCR of 0,3 2003 2004 2005 2006 2007 *recordable injurie
Slide 10: Schedule and cost of industry's major projects under pressure
10 schedule and cost of industry’s major projects under pressure worldwide global shortage of engineering & construction (E&C) capacity performance of Sasol’s 40 current medium and large projects schedule in line with IPA benchmark of 117% - 119% cost index of 15% mitigating actions taken
Slide 11: Sharp focus on growing skills base
11 sharp focus on growing skills base Project TalentGro – multi-pronged approach to improve internal skills new division to recruit and train in support of expansion projects learnership and apprentice training increased by 233% from 2004 to 2007 involved in numerous external initiatives to
Slide 12: Making strides in transformation in SA
12 making strides in transformation in SA sale of 25% of Sasol Oil to Tshwarisano LFB Sasol Mining empowerment deals later this calendar year finalisation of first phase announcement of second phase continuing investment in skills development of both our own employees and through our CSI p
Slide 13: Major BEE ownership deal proposed to transfer 10% of Sasol
13 major BEE ownership deal proposed to transfer 10% of Sasol largest single broad-based BEE ownership transaction to date legacy of women empowerment, skills and capacity building will differentiate this deal millions of ordinary South Africans to benefit four categories of participants f
Slide 14: Strategy delivering record results
14 strategy delivering record results 2007 financial results
Slide 15: Performance continues to beat targets
15 performance continues to beat targets EVA in excess of targets US$ attributable earnings growth over the cycle accelerating … 30 actual eva % 2000 1 836 group WACC 3-year moving average target returns 28 growth target % $m 1 329 22 15 1000 0 0 2002 2003 2004 2005 2006 2007 2002 2003 2004 2005 200
Slide 16: 2007 financial review
SASOL reaching new frontiers 2007 financial review
Slide 17: Main pricing drivers favourable
17 main pricing drivers favourable $/bbl fuel pricing $1=R currency 8 90 $80,9 75 $76,1 7 R7,20 BFP $60,9 $63,7 60 6 R6,41 45 30 Brent 5 2005 2006 2007 2005 2006 2007 $/ton chemical pricing 1250 + 16% + 12% solvents 1000 polymers 750 2007 financial results 2005 2006 2007
Slide 18: 2007 abridged income statement
18 2007 abridged income statement % Rm change 85% of 2007 operating profit turnover 98 127 + 19% generated by SA energy cluster gross profit 38 130 + 13% operating profit 25 621 + 49% CAGR 2004-07: 41% 26,6 earnings 17 030 + 64% 17,2 14,4 9,2 headline earnings 15 797 + 11% 2004 2005 2006 2007 operat
Slide 19: Good growth in headline earnings
19 good growth in headline earnings 2007 2006 change eps Rm Rm Rm % attributable earnings 17 030 10 406 6 624 + 63% adjustments (1 233) 3 841 (5 074) - 53% capital items impairments 208 1 067 (859) net profit on disposals (749) (132) (617) O&S write down reversal (803) 3 196 (3 999) scrapping of ass
Slide 20: Inflation and weaker rand main contributors to cash fixed cost increase
20 inflation and weaker rand main contributors to 19% increase in cash fixed costs 1 121 21 056 includes 400 1 013 incl. R316m additional benefit on staff oil hedge 753 6% 414 17 681 409 203 280 cash fixed costs (R million) 2006 savings once-off study shutdown growth currency inflation 2007 costs pr
Slide 21: Steady contribution from mining despite lower production volumes
21 steady contribution from mining despite lower production volumes operating profit 5% lower total production down 6% cost/ton sold up 17% inflation & other costs 11% lower volumes sold 3% 1 185 1 256 1 227 higher purchases 2% 1 171 Mooikraal mine became fully R million operational in Janua
Slide 22: Growth from gas continues
22 growth from gas continues operating profit up 27% sales volumes increased by 7% 25% stake in natural gas pipeline 1 936 sold to CMG (Mozambique) – 1 526 profit of R346m R million 931 386 2004 2005 2006 2007 operating profit 2007 financial results
Slide 23: Synfuels benefits from higher product prices and weaker rand
23 synfuels benefits from higher product prices and a weaker rand operating profit up 20% production down 2,8% mainly due to two planned shutdowns cash unit production costs up 22% impact of shutdowns 8% 16 251 13 499 inflation 7% R million growth plans 4% 7 546 labour 3% 5 498 2004 2005 2006
Slide 24: Oil profits remain steady
24 oil profits remain steady operating profit down 1% total liquid fuel sales up 1% increased level of imported petrol, diesel & fuel components 2 432 2 417 Natref white product yield up 1 892 2% to 91% R million 1 421 2004 2005 2006 2007 operating profit 2007 financial results
Slide 25: Increased exploration activity at SPI
25 increased exploration activity at spi operating profit before operating profit before exploration costs 300 exploration costs up 14% 600 826 significant increase in exploration 723 280 activity R million 401 (119) natural gas production in 104 Mozambique increased by 4% (121) (123) (223)
Slide 26: Project development activity increases at SSI
26 project development activity increases at ssi operating loss increased by 19% costs incurred to develop GTL/CTL opportunities teething problems at Oryx delay (223) (201) contribution to operating profit R million (642) (763) 2004 2005 2006 2007 operating loss 2007 financial results
Slide 27: Polymers turns around in 2nd half
27 polymers turns around in 2nd half operating profit up 32% total production down 4% due to feedstock shortages resulting from Synfuels maintenance shutdowns 1 475 despite high feedstock costs, 1 089 1 021 higher margins were realised R million 822 2004 2005 2006 2007 operating profit 2007 fi
Slide 28: Solvents: stronger product prices negate lower volumes
28 solvents – stronger product prices negate impact of lower volumes operating profit up 27% total production down 6% due to feedstock shortages resulting from Synfuels maintenance shutdowns 1 106 1 021 873 margins improve despite high R million feedstock costs 113 2004 2005 2006 2007 operatin
Slide 29: Olefins & surfactants: divestiture terminated, turnaround in progress
29 olefins & surfactants – divestiture terminated, turnaround in progress operating profit operating profit before capital items before capital items capital items R433m (2006: R576m) 1 140 R million after capital items 32 R1 140m (2006: - R3 567m) (14) production facilities in Baltimore (US
Slide 30: Excellent results from wax and nitro
30 excellent results from wax and nitro 629 wax wax operating profit up 128% lower sales volumes but 266 276 R million margins improved 208 focus on higher value-add 2004 2005 2006 2007 blends 610 nitro nitro 466 449 operating profit up 31% R million higher sales of explosives initiators (
Slide 31: Strong cash flows fund capex and return cash to shareholders
31 strong cash flows used to fund capex and return cash to shareholders cash generated from operating activities up 16% to R28,5bn gearing reduced from 29% to 22% cash spent on capital projects of R12bn, with 54% invested in SA repurchased 14,9m shares amounting to R3,7bn final dividend up
Slide 32: Key financial ratios improving
32 key financial ratios improving 2007 2006 operating margin (%) 26,1 20,9 dividend cover (times) 3,0 2,3 cash available from operating activities to 1,7 1,3 capex (times) gearing (net debt to equity) (%) 22,0 29,0 net working capital as % of turnover 18,5 20,3 ebitda to net borrowing costs (times)
Slide 33: Financial effect of proposed Sasol BEE transaction
33 financial effect of proposed Sasol BEE transaction transaction value about R18bn (@ R285/share) funded by combination of equity, third party funding and facilitation by Sasol third party financing arrangements still to be put in place specific investment entities for each participant cate
Slide 34: Lower margins and prices expected in 2008
34 lower margins and prices expected in 2008 currency: rand/$ expected to average R7,25/$ pricing: Brent crude oil expected to be in mid $60s dollar refining margins and most chemical prices/margins expected to soften costs focus on controlling cash costs per unit of production in 2008
Slide 35: Project delivery supports growth strategy
35 project delivery supports growth strategy 2007 financial results
Slide 36: New capacity providing growth
36 new capacity providing growth Project Turbo almost complete but SCC modifications required Arya Sasol Polymers – virtually complete beneficial operation on track for 1Q2008 start-up of 3rd octene plant expected by 1Q2008 beneficial operation of EGTL expected during 2010 plans underway
Slide 37: Fines reducing at Oryx GTL
37 fines reducing at Oryx GTL 120 fines generation (normalised) 90 60 30 design range 0 Jan 2007 time online Aug 2007 2007 financial results
Slide 38: Oryx performance improving
38 Oryx performance improving fines generation reducing superior quality diesel shipped in July targeting to operate both trains simultaneously in October 2007 confident that remaining technical challenges will be resolved plant to be shutdown for 28 days in February 2008 due to shutdown a
Slide 39: Up to R65bn capex planned for next 3 years
39 up to R65bn capex planned for next 3 years 26 23 only 15% (R10 bn) of planned 16 capital spend has been approved 56% of planned capex is earmarked for growth projects ~50% of capex to be spent by SA 2008 2009 2010 energy sector approved probable possible 26 26 23 23 16 16 2008 2009 2010 200
Slide 40: Building the new Sasol
40 building the new Sasol 2007 financial results
Slide 41: Corporate levers to build a rejuvenated Sasol
41 corporate levers to build a rejuvenated Sasol talent management developing and growing our people values driven leadership enhance Sasol’s culture to lift performance and organisation culture and health of organisation operations excellence improve stability and reliability of operations cost foc
Slide 42: Growth strategy remains resilient and competitive
42 growth strategy remains resilient and competitive strategic agenda grow CTL & nurture and grow our existing GTL asset base values driven leadership style and culture deliver on SA transformation growth drivers grow agenda chemicals (based on our technology or feedstock develop and empower our adv
Slide 43: Foundation for sustainable growth in place
43 foundation for sustainable growth in place existing business again delivers record results financial capacity to support growth safety record improving increased focus on environmental sustainability great strides being made on transformation in SA new capacity about to come on stream
Slide 44: 2007 financial results
SASOL reaching new frontiers =