SASOL LIMITED FINANCIAL RESULTS

SASOL LIMITED FINANCIAL RESULTS for the six months ended 31 December 2017

Copyright ©, 2017, Sasol

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Sasol may, in this document, make certain statements that are not historical facts that relate to analyses and other information which are based on

forecasts of future results and estimates of amounts not yet determinable. These statements may also relate to our future prospects, developments

and business strategies. Examples of such forward-looking statements include, but are not limited to, statements regarding exchange rate

fluctuations, volume growth, increases in market share, total shareholder return, executing our growth projects (including LCCP), oil and gas reserves

and cost reductions, including in connection with our BPEP, RP and our business performance outlook. Words such as “believe”, “anticipate”,

“expect”, “intend", “seek”, “will”, “plan”, “could”, “may”, “endeavour”, “target”, “forecast” and “project” and similar expressions are intended to identify

such forward-looking statements, but are not the exclusive means of identifying such statements. By their very nature, forward-looking statements

involve inherent risks and uncertainties, both general and specific, and there are risks that the predictions, forecasts, projections and other forward-

looking statements will not be achieved. If one or more of these risks materialise, or should underlying assumptions prove incorrect, our actual results

may differ materially from those anticipated. You should understand that a number of important factors could cause actual results to differ materially

from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors are discussed more

fully in our most recent annual report on Form 20-F filed on 28 August 2017 and in other filings with the United States Securities and Exchange

Commission. The list of factors discussed therein is not exhaustive; when relying on forward-looking statements to make investment decisions, you

should carefully consider both these factors and other uncertainties and events. Forward-looking statements apply only as of the date on which they

are made, and we do not undertake any obligation to update or revise any of them, whether as a result of new information, future events or otherwise.

Please note: One billion is defined as one thousand million. bbl – barrel, bscf – billion standard cubic feet, mmscf – million standard cubic feet, oil

references brent crude, mmboe – million barrels oil equivalent. All references to years refer to the financial year 30 June.

Any reference to a calendar year is prefaced by the word “calendar”.

Comprehensive additional information is available on our website: www.sasol.com

Introduction

Forward-looking

statements

INTRODUCTION Bongani Nqwababa and Stephen Cornell


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Key messages

What you will

hear today Largely strong set of results in a volatile but growing global economy

Steady progress on LCCP with a drive towards commissioning, operations and business

readiness

Change in dividend policy to a more consistent Core HEPS base

Strong balance sheet enhanced by proactive hedging programme with short- to medium-term

funding plan in place

Continued sustainability and heightened investment focus in Southern Africa

Focused strategy and disciplined capital allocation supports compelling investment case


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• Group RCR at 0,30, regrettably two fatalities

• Sales volumes ▲3%1 for Performance Chemicals, ▼1%

1 for Base Chemicals,

and liquid fuels ▼3%

• Synfuels Operations production volumes ▼1%

• Eurasian Operations volumes ▲2%, Natref volumes ▼21%

• Safety and operational challenges at Mining in ramping up to pre-strike production run-rates

• Successful start-up of 17th oxygen train and Gemini HDPE; FTWEP progressing well

• Stronger rand per barrel price benefitting results

• HEPS ▲17% to R17,67, EPS ▼21% to R11,29

• Response Plan delivery of R75,6bn exceeding upper-end of target with sustainable annual

cash savings of R3,5bn

• Gearing managed to 39%, below our ceiling of 44%

• Normalised cash fixed costs ▲2% in real terms with FY18 forecast tracking our expected

inflation rate of 6%

• Interim dividend of R5,00 per share based on Core HEPS

Key messages

Core HEPS up

5% to R18,22

Largely

strong earnings

performance

driven by higher

oil prices

1. Restated for transfer of ethylene business from PC to BC

OPERATIONAL

PERFORMANCE

FINANCIAL

RESULTS


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• Cost and schedule on track

• Overall project 81% complete with construction execution at ~54%

• $8,8bn spent of $11,13bn project cost

• On track for start-up of first units in H2CY18

• US tax reforms contributing ~0,5% to returns

• Project returns ~7,5 - 8,5% (previous guidance ~7 - 8%)

• Returns based on Q4CY17 spot pricing ~9 - 9,5% (previous guidance ~8 - 8,5%)

• Strong focus on commissioning, operations and business readiness

• Progressive start-up of utilities ongoing and gaining momentum

• Engaging prospective new markets and customers; Gemini HDPE first product to market

• Contracts for major distribution channels in place

Key messages

LCCP adds up to

20% to EBITDA

by FY22 or

$1,3bn real1

Steady progress

on LCCP

1. In FY22 based on our assumptions


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Key messages

FCF positive

in FY19

Strong

balance sheet

enhances

shareholder value

1. Net asset value

• Protect and strengthen the balance sheet and maintain investment grade credit ratings

• Target a superior dividend payout ratio of 40% on Core HEPS

• Incremental investment in existing assets

• Balance growth and value returned to shareholders

• Safe, stable and reliable operations

• Increased cash flows supported by Continuous Improvement

• Continued hedging programme beyond peak gearing

• Optimal capital structure and funding plan with disciplined capital allocation

• Asset divestment opportunities with NAV1 >US$1bn which will yield additional liquidity benefits

• Deleveraged balance sheet, targeting 30% gearing and net debt:EBITDA of 1,5 - 2,0x

• Limited shareholder dilution through Inzalo refinancing and LTI hedge options

• Superior value to our shareholders through dividends and growth

Strategy

Delivered

through…

Resulting in…

2018 2022


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• Sasol Limited B-BBEE scorecard improved from Level 8 to Level 6 and on track for at least Level 4 by 2020

• R4,9bn preferential procurement from black-owned enterprises for HY18

• Shareholders approved our Sasol Khanyisa B-BBEE transaction

• Invested >R630m in skills and socio-economic development programmes for HY18

• R530m in education and skills development

• R100m in community development, including Sasol Ikusasa in the Metsimaholo and Govan Mbeki municipalities

• Invested >R20bn in SA on flagship projects over the past three years

• Investment of R8,7bn for HY18 in key South African industrial hubs

• Includes FTWEP and 17th oxygen train project

Key messages

Positive SA

sentiment driving

increased

investor

confidence

Continued

sustainability and

heightened

investment focus

in South Africa


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Key messages

Ongoing

commitment to

entrench Sasol’s

position as a

trusted partner

Continued

sustainability and

heightened

investment focus

in Mozambique

• Sasol and its partners invested

>US$3bn with >US$1,1bn

contribution to the state

• Local procurement of US$1,2bn

• Invested US$33m mainly towards

education and skills development

• US$285m spent on PSA drilling

and surface facilities

• >300 permanent jobs sustained

across our businesses

• >90% are Mozambican

• ~600 additional contractor job

opportunities for communities

around CPF

• Access to electricity for >2m

Mozambicans through CTRG

• ~2 000 consumers benefitting from

domestic gas reticulation systems

• Support in-country industrialisation and

gas monetisation ambitions

• Further exploration to unlock

beneficiation of resources

• Focused on increasing capacity and

participation of locally owned businesses

and building local SMMEs

• Committed to train >460 artisans for the

oil and gas sector

CONTINUED

BENEFITS TO

STAKEHOLDERS

GOING

FORWARD

STRONG

HISTORICAL

PROGRESS


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To be a leading

integrated global

chemical and energy

company, proudly rooted

in our South African

heritage, delivering

superior value to our

stakeholders

To create superior value

for our customers,

shareholders and other

stakeholders. Through our

talented people, we use

selected technologies to

safely, profitably and

sustainably source,

produce and market

chemical and energy

products LEVERAGE COMPETITIVE ADVANTAGE FROM OUR STRONG ASSET BASE TO ENSURE LONG-TERM SUSTAINABILITY AND

VALUE

VALUE-BASED GROWTH STRATEGY SUPPORTS OUR COMPELLING INVESTMENT CASE

FINANCIAL AND OPERATIONAL PERFORMANCE Paul Victor


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Financial and operational

performance

What you will

hear today

Largely strong set of results with continued focus on cash, cost and capital management

Ability to generate strong cash flows enables increased dividend payout ratio on Core HEPS

and quality growth investments

Protect and strengthen the balance sheet through continued hedging beyond peak gearing,

a robust funding plan and deleveraging to improve flexibility

Outlook for FY18 and positioning for the medium-term


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Macroeconomic environment

Chemical product

prices trending

up. Exchange

rate remains

volatile

Volatility in a

growing global

economy

% c

hange y

-o-y

Solvents basket Polymers basket Brent

$/m

mb

tu (

ga

s p

rice)

US

$/b

bl

Brent Product price Henry Hub

Stronger crude oil prices drives higher chemical prices

US

$1 =

ZA

R

Currency volatility remains as rand strengthens

Base chemical prices vs Brent

HY17 HY18

$2,95 $2,93

$48

$71 $60

$57

HY17

(4%)

28%

19%

HY17 HY18

R13,99 R13,40

HY18

US$/unit

Average

HY18

% ∆ vs

HY17

Brent/bbl 56,74 19▲

Fuel products/bbl 71,23 18▲

Base Chemicals/ton1 826 10▲

Performance Chemicals/ton1 1 436 7▲

Export coal/ton 85 19▲

Product prices

R13,74 R12,37

1. Comparative restated for the transfer of US ethylene to BC and kerosene sales in Alkylates business

Prices reflect international commodities or baskets of commodities and are not necessarily Sasol specific

Sources: RSA Department of Energy, ICIS-LOR, Reuters, Platts, International Energy Agency

Average rate during period Closing rate at period end


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Group profitability

Core HEPS up

5% to R18,22

Strong core

operating profit

performance

HY17 HY18 % ∆

Mining¹ 1 534 2 864 87▲

Exploration and Production International (EPI)² 204 (2 649) >100▼

Performance Chemicals (PC)³ 4 020 3 878 4▼

Base Chemicals (BC)³ 2 360 2 552 8▲

Energy⁴ 5 529 5 748 4▲

Group Functions 25 (607) >100▼

Operating profit (Rm) 13 672 11 786 14▼

Earnings per share (R) 14,21 11,29 21▼

Headline earnings per share (R) 15,12 17,67 17▲

Core headline earnings per share (R) 17,41 18,22 5▲

Dividend per share (R) 4,80 5,00 4▲

Capital expenditure (Rbn) 30,2 27,7 8▼

42

44

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Chemicals

Energy

Mining and other

72

14

11

SA

North America

Europe

Rest of World

Core operating profit (%)

by product

Core operating profit (%)

by geography

1. HY17 includes impact of strike action amounting to R1,0bn

2. HY18 includes R2,8bn (CAD281m) relating to the partial impairment of our Canadian shale gas assets

3. HY17 results have been restated for the transfer of the US ethylene business from PC to BC

4. HY18 includes R1,1bn (US$83m) relating to the scrapping of the US GTL assets

3


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TAILWINDS

• Higher crude oil and product prices

• Higher refining margins and resilient

US$ margins in chemical businesses

• Hedging strategy protects and

strengthens balance sheet

• Response Plan sustainable annual cash

cost savings of R3,5bn achieved

HEADWINDS

• Real cash fixed costs up 2% due largely

to operational challenges

• Stronger exchange rate

• Higher remeasurement items

Operating profit

Operating profit

impacted by

changing macro

environment and

once-off items

1. Excludes mark-to-market valuation on hedges

2. Includes remeasurement items (-25%) and prior year mining strike (+7%)

3. Includes cost inflation (-8%), growth costs (-7%) and production interruptions (-7%)

11 786

13 672

2%

(25%) 3

(16%) 2

36%

(11%)

HY18

Sales volumes

Cost and other

Once-off items andyear-end adjustments

Crude oil andproduct prices¹

Exchange rate¹

HY17

Rm

Macro

environ-

ment

Costs

and

volumes


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Cash fixed costs

FY18 cash fixed

cost to track 6%

inflation

assumption

Impacted by

growth-related

costs and

production

interruptions

25 053

22 628

HY18

Exchange rate

Inflation

Production interruptions²

Once-off business establishment¹

New capital projects

US growth(LCCP & Gemini)

HY17

Rm

Study,

growth

and

once-offs

Costs

and

volumes

Macro

environ-

ment

151

190

572

513

1 074

75

(0,7%)

(0,8%)

(2,5%)

(2,3%)

(4,7%)

0,3%

Growth

costs

Once-off

1. Unwind in RP savings due to the end of the Eskom PPA (R0,4bn), costs associated with our digital transformation (R0,2bn)

and Khanyisa transaction (R0,1bn), partly offset by costs relating to the mining strike in the prior year (R0,4bn).

2. Includes increased maintenance costs (R0,3bn), higher labour costs (R0,1bn) and increased process materials (R0,1bn)

TAILWINDS

• Realised R3,5bn sustainable annual cash

cost savings under Response Plan

• Sustainable annual BPEP savings of

R5,4bn

• Prudent headcount management

HEADWINDS

• End of the Eskom PPA on 31 March 2017

• Production interruptions during the period

• Pre-investment costs associated with our

digital transformation and Khanyisa B-BBEE

transaction


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Mining and EPI OBUs

Ramping up

production to

pre-strike levels

Taking action to

address safety

and operational

challenges

1. Producing assets

EPI

• Operating profit of R115m excluding

impairment

• Canada impairment of ~R2,8bn

(CAD281m) based on lower gas prices;

disposal process progressing

• Mozambican operations positively

impacted by higher sales prices and

foreign currency gains

• Impact of impairment

HY17 HY18

Rm

HY17 HY18m

m to

ns

Production

HY17 HY18

mm

to

ns

External purchases

HY17 HY18

R/to

n

Unit cost/production ton

HY17 HY18

Op

era

tin

g p

rofit/(lo

ss)

Rm

HY17 HY18

Rm

(3 202)

47

(41)

4,4

2,6

16,6

18,9 264 284

(312)

988

1 187

Mozambique¹ Canada¹ Gabon¹

MINING

• Operating profit up 87% to R2,9bn due

to strike in prior period

• Management interventions in place to

address safety performance

• Commitment to deliver full supply to

Synfuels Operations

• Business Improvement Plan to improve

productivity and reduce costs

• Impact of strike


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PERFORMANCE CHEMICALS

• Sales volumes up 3%1, Eurasian

operations production volumes up 2%

• Robust US$ margin and volume

performance

• Excluding the impact of Hurricane Harvey

and stronger exchange rate, operating

profit is in line with the prior year

• FTWEP produced 21kt (50%) more hard

wax compared to HY17

Performance and Base

Chemicals SBUs

Resilient volumes

with margins

impacted by

strong Rand

1. HY17 results have been restated for the transfer of the US ethylene business from PC to BC

2. HY18 operating profit margin have been normalised for the impact of a fire at our US Operations and Hurricane Harvey

BASE CHEMICALS

• Sales volumes decreased by 1%1 due to

SA port constraints and Hurricane Harvey

• Core operating profit up 6% to R2,9bn

• US$ commodity chemical basket prices

up 10%

• FY18 normalised operating profit forecast

of R3-5bn

HY17 HY18kt

HY17 HY18

%

HY17 HY18

Rm

HY17 HY18

%

HY17 HY18

kt

HY17 HY18

Rm

Sales volumes1 Operating profit margin1,2 Core operating profit1

13

2 891

2 740

12 12 1 576 1 625

4 730

4 048

12 1 775 1 754

Sales volumes1 Operating profit margin1,2 Core operating profit1


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Energy SBU

Higher margins

with focus on

improving

volumes

HY17 HY18m

mb

bl

HY17 HY18

mm

bb

l

HY17 HY18

nu

mb

er

HY17 HY18

bscf

HY17 HY18

%

HY17 HY18

%

ORYX utilisation Gas sales Operating profit margin¹

27,6

21

18

29,6 28,6 15,8 15,9 392 394

29,6 95 99

Synfuels refined products Liquid fuels sales Retail centres

1. The HY18 operating profit margin have been normalised for the scrapping of the US GTL asset

ENERGY

• Liquid fuels sales volumes 3% lower

• Natref volumes down 21%, taking

measurable actions to improve

operational performance

• Softer SA market demand

• Synfuels Operations – updated guidance

of 7,7mt for FY18

• Normalised operating profit up 23% to

R7,3bn

• Petrol differential 16% higher, diesel

differential 28% higher

• ORYX GTL achieved 99% utilisation

exceeding market guidance


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60 59

37

54

38

0

20

40

60

80

FY17 act FY18 est FY19 est

Ran

d b

illio

n

37 37

8

32

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Capital expenditure

Capital portfolio

spend profile

supports gearing

targets

Optimised spend

on LCCP with

project on track

Previous forecast

Growth Sustenance

Revised forecast

Sustenance Growth

LCCP LCCP

• Key focus on execution of strategic

projects in North America and Southern

Africa

• Gemini HDPE and 17th oxygen train

successfully reached beneficial operation

during period

• Capital forecast impacted by optimised

LCCP spend

• Forecast based on ~R13/US$ for FY18

and FY19

• Capital estimates may change due to

exchange rate volatility

• US$ capex - $2,8bn (FY18) and

$1,7bn (FY19)

• 10c change in exchange rate equals

R280m


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Near-term focus

Strong balance

sheet underpins

superior returns

BUSINESS

IMPROVEMENT

INITIATIVES

STRENGTHENS

FINANCIAL

POSITION

ENHANCES

SHAREHOLDER

VALUE

• Effective current hedging programme

• Continued hedging beyond peak

gearing

• Continuous improvement to

drive business efficiency and

effectiveness

• Asset review process to optimise

portfolio

• Proactive liquidity management

and optimal capital structure with focus

on longer-term debt instruments

• Disciplined capital allocation

focusing on quality growth projects

• Improved cash flow stability

• Provides additional headroom

on credit rating metrics

• Enhances profitability of

foundation businesses

• Improves cash flow generation

• Improved liquidity profile with

new and amended debt instruments

• Investment grade credit rating

metrics maintained

• Enables Inzalo debt refinancing with

limited shareholder dilution,

resulting in higher gearing into FY19

• ROIC uplift of >2% by FY22

• EBIT US$ growth >5% (real) through

the cycle

• Superior returns through

increased dividends

• ROIC (US$) >12% p.a.

• FCF positive in FY19 and moving

to >$6 per share in FY22

Financial risk

management

Operational

efficiency

Capital

structure


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Outlook

Business

improvement

initiatives

support a

positive FY18

outlook

MINING • Focus on safety and stability of operations

• Coal purchases at higher cost to supplement own production

EPI

• PPA gas production 114 – 118 bscf

• PSA drilling activities to continue

• No drilling activity in Canada

ENERGY • Liquid fuels sales volumes approximately 59 million barrels

• ORYX GTL average utilisation >92%

BASE

CHEMICALS

• Sales volumes 1 - 3% higher than prior year

• US$ basket prices to lag oil prices

PERFORMANCE

CHEMICALS

• Sales volumes 2 - 3% higher than prior year

• US$ margins to remain resilient

GROUP

• Normalised cash fixed costs to remain within inflation assumption of 6%

• Balance sheet gearing below 44%

• Dividend cover of 2,2 – 2,8x Core HEPS

Q&A

Documents

SASOL LIMITED FINANCIAL RESULTS