Sasol’s forecasts for the two factors that play the biggest part in its profits — the rand/dollar exchange rate and Brent crude oil — are extremely conservative and could be arguable. Prudence is wise for a company that may hit peak gearing of about 44% in the 2019 financial year as its Inzalo black empowerment structure unwinds. To protect its balance sheet, Sasol hedges some of its key risks anyway. For the current six-month period, it is predicting the rand-dollar exchange rate will range from R12.50 to R14. It is currently at R11.63/$. It expects Brent oil to be between $55 and $65/barrel, while the price is currently at $67/barrel. Its forecast on the rand seems to imply the euphoria of Cyril Ramaphosa’s appointment as president and his cabinet reshuffle will ebb fairly rapidly. However, South Africans tend to forget the world does not revolve around their domestic problems. The bigger issue is that US President Donald Trump is pursuing policies designed to spur US economic gro...

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