Sasol Limited (SSL) Q4 2025 Earnings Call Transcript
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Aug 25 2025
0mins
Should l Buy SSL?
Source: SeekingAlpha
Adjusted EBITDA Adjusted EBITDA for the period was down 14% to ZAR 52 billion. The decline was due to lower production volumes and operational setbacks, as well as a challenging macroeconomic environment.
Free Cash Flow Free cash flow increased to almost ZAR 12.6 billion, a 75% improvement compared to the prior year. This was driven by disciplined capital spend, lower tax payments, and the receipt of the Transnet legal settlement. Even after normalizing for the Transnet legal settlement, free cash flow increased by more than 30%.
Net Debt Net debt, excluding leases, ended the year at USD 3.7 billion, which is 8% lower than the target of USD 4 billion. This reduction was achieved through disciplined financial management and improved free cash flow.
Capital Expenditure Capital expenditure was ZAR 25 billion, 13% lower than the target of ZAR 28 billion to ZAR 29 billion. This reduction was due to lower feedstock replacement, compliance spend, and discretionary sustenance spend, while maintaining safety and asset integrity.
Gross Margin Gross margin declined by 12%, mainly due to a 9% reduction in turnover as a result of a lower rand oil price and a 3% decrease in sales volumes associated with lower production and weaker market demand.
Net Working Capital Net working capital as a percentage of turnover on a 12-month rolling basis was 16.8%, slightly above the target of 15.5% to 16.5%. This was due to lower rolling turnover and an increase in inventory to manage supply variability during the year.
International Chemicals Adjusted EBITDA Adjusted EBITDA for International Chemicals increased to $411 million, with an improvement in adjusted EBITDA margin from 6% to 9%. This was driven by improved U.S. ethylene margins, stronger palm kernel oil pricing, and strategic reset initiatives.
Social Investment Sasol invested ZAR 600 million in social programs, including ZAR 150 million in community infrastructure projects globally. This investment supported more than 250 students with bursaries and created 3,000 jobs, contributing to local economic development.
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Analyst Views on SSL
About SSL
Sasol Limited is a South Africa-based company, which is a global chemical and energy company. The Company operates in two divisions: Chemical and Energy. Its Energy business operates in three segments Mining, Fuel and Gas. The Mining segment is responsible for securing coal feedstock for the Southern African value chain, mainly for gasification, but also to generate electricity and steam. The Gas segment reflects the upstream feedstock, transport of gas through the Republic of Mozambique Pipeline Investments Company (ROMPCO) pipeline, and external natural and methane rich gas sales. The Fuels segment comprises the sales and marketing of liquid fuels produced in South Africa. The Chemical products are grouped into Advanced Materials, Base Chemicals, Essential Care Chemicals and Performance Solutions.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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