Sasol Surges 10.5% to $6.95 Amid Market Volatility

Sasol, a South African energy and chemical company, has risen 10.5% to $6.95. The company, known for its involvement in the development of the Dakota Access Pipeline, has faced protests and lawsuits in the past. Despite this, the stock has seen a significant increase in value.

Sasol (JO:SOLJ) (NYSE:SSL), a South African energy and chemical company, reported a significant rebound in profitability for the year ended June 30, 2025. The company’s shares surged by approximately 6% in Johannesburg, closing at $6.95, a 10.5% increase from the previous closing price [1].

Sasol’s basic earnings per share (EPS) for the year ended June 30, 2025, were 10.60 rand ($0.61), compared to a loss of 69.94 rand per share in the previous year. This improvement was driven by stronger chemical prices, cost discipline, and a significant reduction in asset writedowns. The headline EPS (HEPS) of 35.13 rand was slightly above guidance, while EBITDA of 51.76 billion rand came in just below the midpoint of forecasts [1].

The results were bolstered by a 4.3 billion rand payout from Transnet, a 2.6 billion rand reversal of rehabilitation provisions, and 1 billion rand in insurance proceeds. Despite these positive factors, revenue declined by 9%, primarily due to lower sales volumes, weaker rand oil prices, and softer refining margins. However, Sasol managed to keep fixed-cost growth below inflation, cut capital expenditure by 16% to 25.4 billion rand, and reduce impairments to 20.7 billion rand from 74.9 billion rand a year earlier [1].

The company's net debt stood at $3.7 billion, translating to 1.6x net debt-to-EBITDA, which is broadly in line with expectations according to Morgan Stanley. The bank highlighted strong free cash flow (FCF) generation in the second half of FY25, estimating 12.5 billion rand in free cash flow post discretionary capex. This was aided by the Transnet settlement, lower working capital, and capex underspend [1].

Sasol has faced legal challenges in the past, including protests and lawsuits related to its involvement in the development of the Dakota Access Pipeline. Despite these issues, the company’s stock has seen a significant increase in value. Morgan Stanley analysts noted that the FY26 guidance is consistent with the company’s May 2025 capital markets day, pointing to operational improvements at Secunda, better coal quality, and efficiency gains across chemicals. They forecast international chemical EBITDA to rise to $450–550 million, supported by margin recovery and self-help measures [1].

Greenpeace International has also been involved in legal battles with Sasol. In February 2025, Greenpeace International filed a lawsuit against Energy Transfer in Amsterdam under the European Union’s law to protect freedom of expression. Energy Transfer has sought an anti-suit injunction to prevent Greenpeace International from pursuing justice in Dutch courts. Despite these legal challenges, Sasol continues to focus on its operational improvements and financial performance [2].

References:
[1] https://www.investing.com/news/earnings/sasol-returns-to-profit-as-cost-controls-transnet-payout-lift-results-stock-up-4208180
[2] https://www.greenpeace.org/international/press-release/78071/greenpeace-international-north-dakota-court-reject-energy-transfers-attempt-avoid-accountability-eu-law/