Sasol last year appeared at one point to be sinking into the abyss.

In a letter to unions in July 2020, against the backdrop of collapsing oil prices and extreme uncertainty about the mounting Covid pandemic, Sasol said that it remained “under significant pressure and our current measures are not sufficient for the company to survive this crisis over a longer period unless stringent measures are taken”.

What a difference a year makes. Sasol has apparently weathered the storm, helped by cash raised from disposals, cost containment and a rebound in chemical and oil prices.

The company said in a Sens statement that headline earnings per share are expected to be between R39 and R41, compared with the prior year headline loss per share of R11.50. Adjusted earnings before interest, tax, depreciation and amortisation — a key profit measure — are seen rising by between 32% and 49% from R35-billion in the prior year to between R46-billion and R52-billion.

“This results from a strong recovery in chemical prices and a 4% increase in the rand per barrel price of Brent crude oil, partly offset by weather-related events in both the US and South Africa impacting our gross margins adversely,” Sasol said.

The company, which has been beset in recent years by setbacks such as massive cost overruns at a chemicals project in the US state of Louisiana, has survived the latest crisis and is making money. It still faces many challenges, including pressure to cut its greenhouse gas emissions — it is South Africa’s second-biggest emitter, topped only by Eskom and its belching fleet of ageing coal-fired power plants. And while the oil price has put in a spectacular rebound this year — as South African drivers know when they get their vehicle tanks filled at the pumps — fossil fuels increasingly don’t look like the future. DM/BM