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Sasol to enter empowerment deal by year end
Sasol said that it would enter into a R2.5bn empowerment deal by the end of 2003, catering for empowerment of at least 25%. Executive Pat Davies said that the group was busy with a "big exercise" restructuring the organisation to accommodate empowerment interests. Sasol also said that an empowerment deal had been concluded with a plastic pipe company that had been a joint venture with Group Five. The new company would have annual revenue of R400m and be 74% held by the empowerment entity.
Sasol also commented on its proposed main board New York listing, scheduled for 9 Apr 03, saying that there had been a doubling of trading volumes of Sasol shares in the past 18 months (on the Nasdaq). FD, Trevor Munday said that the US bourse was the most active petrochemical company exchange in the world. He also announced that the group had received a Standard & Poors rating of BBB in the long term and A2 in the short term. The company' s latest Sasolburg plant was now operational, allowing the R1.6bn facility to produce a solvent for the chemicals business, one of the group's fastest expanding divisions growing at around 20% per year. The plants output would mainly be for export and would shortly run on environmentally friendly natural gas from Mozambique. The only downfall of the plant would be the loss of 1000 jobs.
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Sasol supports governments new fuel price formula
The Minister of Minerals and Energy, Ms Phumzile Mlambo-Ngcuka, announced that a new fuel pricing mechanism is to replace the In-Bond Land Cost (IBLC) with effect from 2 Apr 03. The IBLC served as a reasonable proxy for international fuel prices for decades. Sasol has been supportive of the South African government's need to replace it with a new formula, which more accurately represents international product prices. The new formula will be known as the Basic Fuel Price (BFP). It will represent the true cost of alternative fuel imports into South Africa and includes allowances for, freight costs from refining centres to South African ports, demurrage, wharfage, storage, financing and insurance costs.
Sasol believes that the change introduces a more business like and market related price. It will relate South African fuel prices to some of the most efficient refineries in the world (ie in Singapore and the Mediterranean), thereby ensuring that the local industry maintains its international competitiveness. The impact of this change on Sasol's earnings in the current financial year ending 30 Jun 03, is expected to be minimal. In the next financial year, this change could impact earnings by between 2% and 3%, which is significantly less than some industry analysts and other pundits have anticipated.
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Sasol invests R4m in AIDS initiative
Sasol has invested an initial R4m in an HIV/AIDS program. Manager for group human resources, Jannie van der Westhuizen said that this was in addition to the group’s investment in existing interventions. The latest initiative focused on the company's Secunda businesses which represented two thirds of its workforce. The initiative was in response to studies which showed an increase in infection rates and Aids-related deaths among Sasol's workforce. The group's infection rate during 2002 was 15.3% which, without further intervention would rise to 17.5% in 2007. Sasol said that the impact of HIV/Aids on its wage bill was projected to be less than 5% of total payroll in 2007, which figure did not take loss of productivity into account. The majority of Sasol's employees and their dependants had access to anti retroviral treatment via the company's medical aid scheme and the 5000 or so workers at Sasol Mining which were not covered by a medical aid, had access to primary healthcare services through the company's R14m mine hospital, funded by Sasol.
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Sasol to build plant in Iran
Sasol announced on 3 Feb 03 that it had formed an equally owned joint venture with Iran's National Petrochemical Company to build a 1.6 million metric ton plastic raw materials plant in Iran.
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