atans1

Posts Tagged ‘Noble Group’

Noble House, AirAsia, CEOs, spin meisters take note

In Accounting, Airlines, Commodities, Financial competency, Logistics on 03/07/2015 at 1:25 pm

My eyes rolled when I read the CEOs of above two cos recently said that their cos follow the accounting rules. (Remember, credible doubts have arisen over whether their accouting reflects their financial position.)

The best riposte to “We follow the accouting rules” came recently when an ex-convict recently addressed a FT conference.

“There may be a fundamental difference between a company following the rules and a company presenting a true picture of its financial position,” said Andrew Fastow, the infamous treasurer of the even more infamous Enron, to a FT conference.

Or as he puts in another way, that it’s possible for a company to comply with accounting standards while at the same time painting a misleading picture of its real financials.

I tot it tragically funny when he said he went to prison partly for doing things that got him a best CFO award: innovative off-book entities.

 

 

Run on the Noble House?

In Accounting, Commodities on 10/06/2015 at 10:46 am

Sometime back I wrote

Noble said it had secured US$2.25bn of commitments for a new credit facility.

It retains the confidence of its lenders, giving them enough info to keep them lending. The problem for investors is that we small investors will be the last to know when banks cut credit lines.

https://atans1.wordpress.com/2015/05/06/noble-what-matters/

From FT

The $2.3bn revolving credit facility has also come under scrutiny from analysts and traders after at least three tranches of the three-year loan were offered to other banks in the secondary market.

“”It could indicate the banks may be losing some confidence in the company,” said Wei Bin, analyst at Maybank Kim Eng in Singapore.

A hedge fund manager said the latest sell-off was notable because it was accompanied by large daily trading volumes.

“It is now trading in such volume it appears some of the major shareholders are changing their view on the stock,” said Robert Medd at GMT Research, an independent research firm. GMT has published several reports critical of Noble.

Phew glad I wasn’t tempted: https://atans1.wordpress.com/2015/05/14/noble-why-im-not-tempted/

 

Noble: Why I’m not tempted

In Accounting, China, Commodities, Corporate governance on 14/05/2015 at 1:31 pm

Many of Noble’s operations and investments are exposed to the slowdown in China.

And the Chinese economy is still slowing. And the engine of growth is no longer exports or infrastructure spending  or construction. It’s the service sector.

Maybe when I hear that Noble is starting to shipping Pinoy gals to China as wives for barren branches, will I buy the stock.

Noble: What matters

In Commodities on 06/05/2015 at 1:23 pm

Noble said it had secured US$2.25bn of commitments for a new credit facility.

It retains the confidence of its lenders, giving them enough info to keep them lending. The problem for investors is that we small investors will be the last to know when banks cut credit lines.

Noble CEO gets it, ministers don’t?/ Noble a Buy?

In Accounting, Political governance on 20/03/2015 at 12:12 pm

“We unfortunately live in world where knowing that you run your business professionally is not enough,” the CEO of Noble wrote in a letter to stakeholders in February. “You must be able to prove it.”

But will he walk the talk? Two big funds* think so and have been buying. Maybe they have been assured on the following?

[A] chunk of the profits Noble reports comes from non-cash gains created by “marking to market” long-term contracts (eg, to supply coal) and derivatives it holds. Iceberg is not accusing Noble of fraud, but it is questioning how realistic these valuations are and asking how much of the company’s reported profits are the result of this practice. Noble reported that at the end of 2014 the net fair value of these positions was $4.6 billion, equivalent to 91% of its book value.

It is hard to tell from what Noble discloses in its accounts whether its valuations are indeed fair; and since it is also unclear how much of its profits come from such changes in valuation, it is difficult to assess how robust its profits are. Noble did not respond to requests from The Economist for comment. The firm’s cashflow has been weak. Over the past three years it has booked net profits of almost $1 billion but negative cashflow of almost $2 billion, after working-capital, capital-investment and interest costs.

On March 5th it issued an 11-page rebuttal, suggesting that a disgruntled ex-employee was behind Iceberg. It also gave more detail about the “fair value” positions. They reflect over 12,000 individual contracts, almost half of which mature within two years. Over the past three years the firm has realised $800m of cash from such positions. Yet the rebuttal omitted a vital piece of information: how much profit has been booked from these positions. Without this nugget it is hard to form a sensible judgment about Noble’s books or health.

Emphasis mine

http://www.economist.com/news/business/21646233-big-asian-commodity-trader-attacked-anonymous-online-critic-nobbled

*A unit of insurer Prudential, and Invesco increased their stakes in the company. [Added at 1.40pm]

Noble Gp: “Cheong all the way” Maybank

In China, Commodities on 11/01/2013 at 5:39 am

But if China doesn’t perform, you’re in trouble.

S’pore Biz Review

It was annced yesterday that China’s commodities imports accelerated in 2012 in volume terms in spite of slowing growth in the overall economy, with crude oil, iron ore and copper reporting record high imports for 2012.

Now this is accountability

In Commodities, Corporate governance, Logistics on 11/11/2011 at 5:56 am

Commodities supply chain manager Noble Group (based in HK but listed here) announced on Wednesday the resignation of its chief executive only hours after reporting a surprise US$17.5-million (S$22.5-million) net loss in the third quarter from a net profit a year earlier. It blamed volatile market conditions and mark-to-market losses.

CEO Ricardo Leiman will remain as an adviser to the group after resigning “for personal reasons”, Noble said.

Chairman Richard Elman was appointed acting CEO, “We are taking this opportunity … to realign our goals and strategies to adapt to the many challenges that exist in the prevailing market conditions … It goes without saying that we are very unhappy with this performance even if it does just cover a very short period … things happen’ which are out of our control … remains very healthy and strong”.

 

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