Noble Group’s losses narrowed to US$99 million for Q3

Noble posted a US$99.0 million loss for the third quarter, improving from the US$1.2 billion net loss a year ago, and investors responded positively to the less bad quarterly numbers.

bg_iron_ore_1229611

Noble Group’s third quarter losses slimmed from a year ago, as the commodity giant climbs out of the woods and looks to better days with its ongoing business restructuring and the less bad quarterly numbers.

Noble posted a US$99.0 million loss for the third quarter, improving from the US$1.2 billion net loss a year ago. Revenue was at US$1.2 billion, 16.4% lower than US$1.4 billion in the preceding year, due to a fall in sales from the metals minerals and ores segment, and the energy segment.

The group posted a profit of US$27.4 million before interest, tax, and restructuring expenses, a contrast compared to the US$60.7 million loss a year ago.

Operating income was at US$55.7 million, higher than the US$1.3 million a year ago. Year-to-date, operating income was at US$163.3 million, reversing from the operating loss of US$208.5 million in the preceding year.

Restructuring expenses for the quarter meanwhile, amounted to US$32.8 million.

Noble had earlier in October flagged that it will report a quarterly net loss of between US$90.0 million and US$115.0 million for the third quarter.

Noble Group’s restructuring plans

The group has been implementing a proposed restructuring for their troubled business. Noble said in the press statement that the business restructuring is expected to result in a sustainable capital structure.

Noble had previously assured investors saying that the constraints the company is facing are expected to be alleviated by the new trade finance facility once the restructuring completes.

The restructuring looks to provide for a committed trade finance and hedging facility which is critically important for the group, so that it can continue to trade and expand its presence as an industrial and energy products supply chain manager in Asia Pacific and the Middle East.

Commenting on the restructuring, Noble said: “The group continues to focus on completing the final phase of the proposed restructuring with a view to providing…a sustainable capital structure and a strong foundation from which to deliver long-term value for all its stakeholders.”

The group has seen its stock falling 133% year-to-date. On January 2, 2018, the stock was trading at 21.0 Singapore cents.

Investors responded positively to the less bad quarterly numbers, as Noble’s shares gained 2.25% to 9.1 Singapore cents on Wednesday mid-morning at 10.45am, Singapore time.

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IG Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.

Find articles by writer