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CREDIT RATING

CREDIT RATING

SASOL

  • On 18 October 2021, S&P affirmed Sasol’s BB rating and revised the outlook from negative to positive on the back of significant debt reduction, stronger cashflow generation and liquidity, and restored headroom in its financial profile. The positive outlook reflects the materially increased headroom in Sasol’s credit metrics, and the expectation that rating upside could materialise over the next 12 months if Sasol maintains its ratio of FFO/Net debt substantially above 30%.
  • In April 2022, Moody’s affirmed Sasol’s rating of Ba2 but changed its outlook to positive from negative, as a direct consequence of the sovereign rating action. Moody’s cited that the change in outlook to positive reflects the company’s recent strong performance and adherence to the disposal and deleveraging strategy put in place during 2020. The positive outlook reflects Moody’s expectation that Sasol’s credit metrics will continue to improve supported by high commodity prices and could be upgraded if Sasol’s Debt/EBITDA is sustained at 2.5x or below through economic volatility and commodity price cycles, whilst strong liquidity is maintained over the next 12 to 18 months. 

SOUTH AFRICA

  • In May 2022, S&P affirmed South Africa's credit rating at BB- and revised the outlook from stable to positive. S&P cited that recent favourable terms of trade in South Africa have improved the external and fiscal trajectory. They also noted improvement in the implementation of key reform targets and higher than expected tax revenue with a focus on debt stabilisation.
  • In April 2022, Moody’s affirmed South Africa’s Ba2 rating but changed its outlook to stable from negative. Moody’s cited that the key driver behind the decision to change the outlook to stable is the improved fiscal outlook that raises the likelihood of the government’s debt burden stabilising over the medium term.