Noble Group reports US$1.2b loss in Q3

TROUBLED commodity trader Noble Group posted a huge loss of US$1.2 billion for the three months to September from a US$28.1 million loss a year ago on the back of impairments from asset sales and provisions.

This brings losses for the nine-month period to a massive US$3.05 billion from a US$42.5 million loss a year ago.

Revenue for the third quarter fell 18 per cent to US$1.46 billion from US$1.79 billion a year ago. Loss per share came in at 89.9 US cents versus a loss of 2.93 US cents per share in the previous period.

No dividend was declared, the same as the previous year.

Noble said that the operating environment continues to be challenging, which had impacted its showing for the period under review.

Conservative liquidity management and constraints placed on the group's access to trade finance lines led to disruption costs and prevented it from taking advantage of profitable trading opportunities, with volumes dropping 26 per cent year on year, it added.

The weak results may not come as a huge surprise to the market as last month, the Hong Kong-based trader had warned that it expects to suffer potential net losses of some US$1.1 billion to US$1.25 billion, largely non-cash in nature, for the three-month period.

Then, the struggling Singapore-listed firm had also disclosed that it was selling its oil-liquids business to Vitol Group that could net as much as US$582 million based on first-half year accounts which analysts had largely viewed as a positive step to lessening its debt burden. Still, it needs to do a great deal more to alleviate the debt stress.

This latest asset sale followed a month after it completed another sale of its North American gas and power business to Mercuria that was carried out as a result of a strategic review.

The chief concern however is how the Hong Kong-based trader plans to deal with its over US$3 billion debt - one of several key questions that the company will likely be prodded on at its results briefing to be held late on Thursday.

The group has said that it is intense talks with lenders to meet its working capital and trade finance needs.

Noble shares closed at 27 Singapore cents, after losing 0.5 Singapore cent or 1.8 per cent on Thursday ahead of its results announcement.