Sasol CFO and long-serving employee Paul Victor has resigned from the company after a tumultuous year in which the group’s balance sheet was brought to the brink and then pulled back, ultimately averting a rights issue.
The synthetic fuels and chemicals producer on Thursday announced that Victor will step down as CFO and executive director on June 30 2022, after six years in the job. Victor has worked at Sasol for 21 years, previously serving as acting CFO, senior vice-president of financial control services and for 10 years was CFO of Sasol Synfuels.
Victor now plans to emigrate to Australia where his family has been living for two years already and the move is by no means sudden, he told the Business Day. “I have engaged with the CEO and Sasol board over the past two years to effectively manage my transition out of the company,” he said. “Given the current repositioning of Sasol to a sustainable future I agreed to continue my contract until the end of the 2022 financial year. This allows for a very smooth transition for me and the new CFO.”
His exit follows on the toughest period in Sasol’s history, which has seen the share price lose 56% over the past three years.
Last year, Sasol’s unsustainable debt — racked up by delays and costs overruns at its disastrous Lake Charles Chemicals Project (LCCP) — coincided with ultra-low oil and chemical prices amid the Covid-19 pandemic.
The group then embarked on an intensive cost savings initiative and assets sales drive, ultimately disposing half of its base chemicals business at Lake Charles. As a result, Sasol was able to avoid a rights issue.
Abdul Davids, head of research at Kagiso Asset Management, said Lake Charles was already well under way when Victor took up the group CFO post, but the move to sell a stake in the base chemicals business to LyondellBasell last year has drawn criticism from some investors, who had expected it to be key to Sasol’s future profitability and cash-flow performance.
“Hindsight is a perfect science,” Davids said, “but the decision to sell the LCCP stake was unfortunate ... some of the more recent corporate actions and decisions, which admittedly is more a group executive decision, might not have been in the best interest of the company or shareholders.”
Davids said Sasol’s determination to maintain its investment grade credit rating steered a lot of the decision-making. Had there been less emphasis on this, the Lake Charles stake may not have been sold and “they would have been a much stronger position to benefit from much higher chemical prices today”, he said.
Taking over the reins in April next year is Hanré Rossouw, the CFO of Royal Bafokeng Platinum, where he was responsible for the restructuring of the balance sheet through the refinancing of debt and a rights issue, the introduction of a new capital allocation framework and a new dividend policy.
His career started as graduate engineer at Anglo American and he later worked for Accenture, De Beers Group, Investec Asset Management and held the CFO position at Xstrata Alloys, as well as a number of other senior roles at Xstrata in London.
Sophie-Marie van Garderen, fund manager at Truffle Asset Management, said Rossouw is an outstanding candidate. “He has excellent mining and financial experience and a very good reputation among SA investors,” she said. “I think he would be very good in building trust back between investors and the company, especially now as the biggest thing for Sasol is to come up with a credible ESG [environmental, social and governance] plan that the market actually believes in.”
Sipho Nkosi, chair of the Sasol board of directors, thanked Victor for his substantial contribution and exemplary leadership over the past 21 years at Sasol. Rossouw’s background and experience will benefit Sasol in meeting its business opportunities and challenges, Nkosi said.
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