Sasol : delivers on guidance despite ongoing headwinds

• Black-owned businesses spend in South Africa of R41,7 billion B-BBEE spend
• Invested R1,4 billion in skills development
• Renewables on track to achieve 1 200MW by 2030
• Operational improvements through successful mitigation plans
• Sustained dividend of R10,00 per share

Johannesburg, South Africa - Sasol's financial results for the year ended 30 June 2023 were impacted by the volatile global economic landscape and the underperformance of state-owned enterprises in South Africa, which continue to impact both our Energy and Chemical businesses. This impact was, to an extent, offset by a weakening of the Rand/US Dollar exchange rate.

Earnings before interest and tax (EBIT) of R21,5 billion declined 65% compared to the prior year, mainly due to the impairment of assets, inflationary impact on costs, the softening of the Brent crude oil price and refining margins in the latter part of the year. Chemicals basket prices were on a declining trend during 2023, and while we have recently seen some respite with lower feedstock and energy prices, gross margin and global demand remained depressed particularly in our American and Eurasian segments.

Operating profit of R55,4 billion before remeasurement items increased 8% from the prior year, benefitting from gains on the translation of monetary assets and liabilities and valuation of financial instruments and derivative contracts of R6 billion compared to R17,6 billion losses in 2022. Remeasurement items contributed a net loss of R33,9 billion compared to a net gain of R9,9 billion in 2022.The remeasurement items for 2023 mainly relate to:

• The full impairment of the South African wax CGU of R0,9 billion, the full impairment of the Essential Care Chemicals CGU in Sasol China of R0,9 billion, and the full reversal of impairment recognised in 2019 on the Tetramerisation CGU in Lake Charles of R3,6 billion; and
• The Secunda liquid fuels refinery CGU impairment of R8,1 billion at 31 December 2022 after being negatively impacted by an update in macroeconomic price assumptions including higher electricity price forecasts and lower gas selling prices. An additional impairment of R27,2 billion was recognised for this CGU resulting in it now being fully impaired. Sasol continues to advance implementation of its emission reduction roadmap (ERR) in South Africa to achieve a 30% reduction in greenhouse gas emissions by 2030 and comply with the requirements of the National Environmental Management: Air Quality Act 39 of 2004. The ERR involves the turning down of boilers, implementing energy efficiency projects, reducing coal usage and integrating 1 200 MW of renewable energy into our operations by 2030. With no significant additional gas to restore volumes back to historic levels, the ERR assumes lower production volumes post 2030 and also results in increased cost of coal and capital expenditure. Optimisation of the ERR is ongoing with several technology and feedstock solutions underway to partially recover volume post 2030, however the maturity thereof needs to be further progressed before it can be incorporated in the impairment calculation. Although the chemical CGUs in the Secunda complex were also negatively impacted, their respective recoverable amounts remained above carrying values given the products' higher derivative value.

In addition, profit on disposal of businesses of R8,5 billion was recorded in 2022 compared to R0,7 billion for 2023.

• Loss before interest and tax

Sasol's results contain an adjustment in respect of an error in the 2022 financial year related to purchases and sales of inventory with the same counterparty that were entered into in contemplation of one another to mitigate production shortfalls and facilitate sales to customers in the coastal areas of South Africa. These transactions were recorded on a gross basis instead of being accounted for as a single exchange transaction resulting in a reclassification between turnover and materials, energy and consumables used. Earnings were not impacted. The Company evaluated the effect of the prior period adjustments, both quantitatively and qualitatively, and concluded that the correction neither had a material impact on, nor requires amendment of, any of the Company's previously issued or filed financial statements taken as a whole.

Dividend

The Sasol Limited board of directors (the Board) declared a final gross cash dividend of South African 1 000 cents per share (2022 - 1 470 cents per ordinary share) for the year ended 30 June 2023. The cash dividend is payable on the ordinary shares and the Sasol BEE ordinary shares. The Board is satisfied that the Company is liquid and solvent, and that capital remaining after payment of the interim dividend is sufficient to support the current operations for the coming year. The final dividend has been declared out of retained earnings (income reserves). The South African dividend withholding tax rate is 20%. At the declaration date, there are 634 336 265 ordinary and 6 331 347 Sasol BEE ordinary shares in issue. The net final dividend amount payable to shareholders who are not exempt from the dividend withholding tax, is 800 cents per share, while the dividend amount payable to shareholders who are exempt from dividend withholding tax is 1 000 cents per share.

Sasol Limited's Annual Financial Statements for the year ended 30 June 2023 (the Annual Financial Statements) have also been published on the Company's website at : https://www.sasol.com/investor-centre/financial-results.

Copies of the full announcement and the Annual Financial Statements may also be requested from the Investor Relations office, investor.relations@sasol.com.

Sasol's President and Chief Executive Officer, Fleetwood Grobler, and Chief Financial Officer, Hanré Rossouw, will present the results at 09h00 (SA time) on 23 August 2023, followed by a market call to address questions.

Please connect to the call via the webcast link here or via teleconference call link here: