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Sasol hits $1.8bn US credit deal

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Sasol has entered into new $1.8 billion (R26.86bn) dollar-denominated senior unsecured credit facilities that will be used to refinance in full the outstanding Lake Charles Chemical Project asset-finance loan, a statement said on Friday.

The facilities comprise a $1.65bn five-year term loan facility and a $150 million revolving credit facility.

Sasol, the biggest maker of liquid fuels from coal, said late last month that the capital cost of the Lake Charles Chemical Project had increased by between $1bn and $1.3bn to between $12.6bn and $12.9bn. This was as a result of oversights in how an earlier estimate had been calculated and additional events and remaining work.m  n

In the last year to December 31, 2018, Sasol’s gearing increased to 48.9 percent from 38 percent at the end of the previous year. Net debt stood at R115.47bn, up 22 percent from R94.55bn the previous year end.

The group had set itself a target in 2017 of keeping gearing between 20 percent and 40 percent, and that gearing would peak temporarily at 44 percent by the end of 2018, a target that was exceeded.

Sasol’s share price rose 3.57 percent to close at R379.45 on Friday on the JSE, which an analyst said was probably more to do with the rand weakening than the new financing arrangement. The rand fell as much as 1.2 percent on Friday, and traded 0.6 percent weaker at 15.09 per dollar around 12pm in Johannesburg, bringing its decline last week to more than 3 percent.

Sasol’s share price represented an almost 6 percent respite from the low levels that it traded at, after falling a whopping 18 percent to R353.55 per share on May 22, the day it announced the Lake Charles cost overruns.

Recently, Sasol announced the beneficial operation of its new ethylene oxide production facility at the Lake Charles Chemical Project.

The combined ethylene oxide/ethylene glycol unit is the second of the seven LCCP production facilities to come online – the other five manufacturing units were expected to come online throughout this year and in 2020, according to the Sasol website.

The project consists of a 1.5 million ton per year ethane cracker, and the downstream chemical units under construction near Lake Charles, Louisiana in the US, adjacent to Sasol’s existing chemical operations.

Once commissioned – it was 88 percent complete by June 30, 2018 – the petrochemicals complex was expected to almost triple Sasol’s chemical production capacity in the US, enabling it to further strengthen its position in the growing global chemicals market.

 

 

 

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Auditing

Consolidated Hallmark Insurance Profit hit by 56% to N659m in Nine Months

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An efficient general business insurance company Consolidated Hallmark Insurance (CHI) Plc has announced an impressive recorded result for the nine months and is getting ready to raise additional N6.618 billion to further enhance its operations going forward.

According to the unaudited report for the nine months ended September 30, 2019, showed gross written premium of N6.687 billion, up by 23 per cent compared with N5.405 billion in the corresponding of 2018.Net premium income stood at N3.857 billion as against N3.369 billion, while net underwriting income ended at N4.306 billion, up from N3.656 billion.

Meanwhile, the Profit before tax jumped by 56 per cent from N422 million to N659 million, just as profit after tax (PAT) rose from N355 million to N519.6 million.

The shareholders of the CHI Plc will on November 21, authorise the board to raise about N1.117 billion through a rights issue. The shareholders will also approve that the board raise another N4.5 billion.

Particularly, the directors are asking that they be authorized to raise, whether by way of private/public, special offering, rights issue or a combination or any other method(s) they deem fit, additional capital of up to N4.5 billion or its equivalent whether locally or internationally or a combination of both, through the issuance of shares, long term debt, preference shares (redeemable or irredeemable), convertible and non-convertible securities or depository receipts or any other instrument(s), whether as a standalone transaction, or a combination.”

However, in order to accommodate the new shares to be issued, the company will also increase its authorised share capital from N7,500,000,000 divided into 15,000,000,000 Ordinary shares of 50 kobo each to N10,000,000,000 divided into 20,000,000,000 Ordinary shares of 50 kobo each with the creation of additional 5,000,000,000 Ordinary shares of 50 kobo each.

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Cadbury Nigeria Plc Grows Profit by 277% to N646m in Nine Months

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One of the world’s largest snacks companies Cadbury Nigeria Plc has announced a hit of 277 per cent in profit after tax (PAT) to N648 million for the nine months ended September 30, 2019.

In its unaudited results, the company reported a revenue of N28.912billion, representing an increase of 7.2 per cent over the N26.959billion revenue reported within the same period in 2018.

According to a statement, Cadbury Nigeria said, it recorded gross profit of N5.857billion, showing an increase of 10.4 per cent over the N5.306billion that was reported for the same period in 2018.    The company recorded a net finance income of N114 million in 2019 as against a net finance cost of N426 million in 2018, a development that boosted its bottom-line.

Consequently, profit before tax rose by 266 per cent to N926 million from N253 million in 2018, while PAT grew faster by 277 per cent to N648 million in 2019 to N172 million in 2018.  According to the company, the result reflects a sustained positive trend in its performance.

Market analysts said the performance has rekindled shareholders’ hope for higher dividend in line with the promise made by the company last July. The company had paid a dividend of N471 million that translated to 25 kobo per share for the 2018 financial year.

Speaking at the 54th annual general meeting (AGM), the Chairman of Cadbury Nigeria Plc, Mr. Atedo Peterside, said assured shareholders of company’s continued efforts to create more value for them and sustain its progressive dividend policy.

According to him, the company would continue its cost-cutting measures, effective marketing strategy, ensuring superlative performance of its various brands. The shareholders commended the performance and pledged their support for better performance going forward.

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Conoil Plc Reports N1.7 Billion Profit after Tax in Nine Months

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The Petroleum products marketing firm, Conoil Plc has reported a profit after tax (PAT) of N1.7 billion for the nine months ended September 30, 2019, showing an increase of seven per cent compared with N1.59 billion in the corresponding period of 2018.

The unaudited results showed that Conoil Plc recorded a jump of 49 per cent in revenue from N75.8 billion to N112.7 billion. However, cost of sale rose by 56 per cent to N102 billion, from N65.3 billion, bringing gross profit to N11.05 billion, as against N10.4 billion. Financing cost rose from N1.483 billion to N1.832 billion.

Consequently, profit before tax (PBT) stood at N2.45 billion, up from N2.27 billion, while PAT rose from N1.59 billion to N1.7 billion. The company ended the nine months with retained earnings of N14.441 billion, up from N13.9 billion in the corresponding period of 2018.

Market analysts said if the company will be able to sustain the performance in the last quarter of the year, shareholders would be able to smile home with dividend at the end of the year.

Shareholders of Conoil Plc received a dividend of N1.4 billion for 2018 financial year. Chairman of the company, Mike Adenuga, had in August told the shareholders that every segment of their business will continue to receive the desired attention with a view to maintaining world class levels of operating and capital discipline.

“We believe that the future holds a lot of promise for our shareholders, the company will surely reward them for their steadfastness and unwavering faith in its prospects,” Adenuga said.

He attributed Conoil’s improved performance in 2018 to the commitment of the board and management of the company to deliver solid financial results in spite of the enormous challenges that confronted operators in the downstream oil sector, including the prohibitive cost of procuring petroleum products.

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