Sasol swings to profit as shares surge 39% in 2025

Sasol, the world’s largest producer of fuels and chemicals from coal, boosted carbon credit purchases as it targets higher ouptut using the dirtiest fossil fuel.

The Johannesburg-based company, the second-largest emitter of greenhouse gases in South Africa, is trying to mitigate that with plans to increase renewable power generation as it aims to boost output of its main products by at least 4.5% at the Secunda hub, according to an earnings statement Monday.

Read: Sasol strength points to continued growth

Since taking over last year, Chief Executive Officer Simon Baloyi has made a number of strategy changes including aiming for higher output using coal, while reducing the role of gas and boosting renewables to help reach a target of cutting emissions 30% by 2030.

Sasol has taken measures to contain costs and strengthen the balance sheet, Baloyi said in the statement. Some of that is starting to show results with the company’s shares rising about 39% so far in 2025, following three consecutive annual declines.

Listen: Sasol is cheap, but is there value?

The company reported net income of R6.8 billion ($389 million) for the 2025 financial year that ended in June, compared with a loss of R44.3 billion in the previous period. Its $3.7 billion of net debt exceeded the $3 billion threshold set by the board that allows a final dividend to be paid.

Sasol’s business primarily uses coal as feedstock while remaining susceptible to oil-price volatility that dictates the value of its products. Moody’s Ratings said in October that the company has a “large exposure to carbon transition risk,” which requires significant investments.

“The global environment remains complex and volatile,” Baloyi said.

The purchase of carbon credits rose by a quarter to R723 million year-on-year. It was nearly triple the amount it bought in 2023. Sasol also said it would increase the amount of renewable energy it will source to offset pollution to 2 gigawatts by the end of the decade.

Read: Sasol shares surge as group flags jump in earnings

Baloyi had previously floated the idea of a possible listing of Sasol’s international chemicals business. That could happen by the end of the decade after improving the business, he said in a May 20 interview. The company will continue asset reviews throughout the business as part of an effort to boost the division’s profitability, it said in Monday’s presentation.

Sasol said it completed the construction of a plant that removes stones from coal, to improve the quality of the fuel that it mines.

Read the Sens here.

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