News Column

Noble First-Quarter Triples as Volatility Boosts Trade Margins

May 20, 2014

ENP Newswire - 20 May 2014

Release date- 16052014 - Noble Group Ltd., Asia's biggest commodity trader by revenue, said first-quarter profit more than tripled as higher price volatility helped boost margins and losses from its agriculture unit narrowed.

Net income was $152.3 million in the three months ended March 31, compared with $41.3 million a year earlier, the Hong Kong-based company said today in a statement. Sales declined 7 percent to $18 billion.

'These strong results start to illustrate that we are making real progress in driving our three segments towards our stated objective of becoming best in class,' Chief Executive Officer Yusuf Alireza said in a statement.

Noble is allocating more resources to its more profitable energy and metals units and selling control in the agriculture division to China'sCofco Corp. for $1.5 billion. The food unit booked losses last year due to weak oilseed crushing margins, helping push profit down 48 percent in 2013.

The company has added traders to cover metals, liquefied natural gas, and power from rivals including Bank of America Corp. and Goldman Sachs Group Inc. as it takes advantage of banks exiting commodity trading due to regulatory pressures.

Noble, whose second-largest investor is sovereign wealth fund China Investment Corp., fell 1.2 percent to S$1.225 at the close in Singapore before the earnings were released.

A rise in commodity price volatility increased 'margin opportunities,' which was reflected in Noble's Value at Risk ratio rising to its highest level since the summer of 2012, the trading company said.

Operating income margin rose to 2.77 percent from 1.98 percent a year earlier. The energy unit's margin jumped to 2.91 percent helping Noble post record operating profit for the business, the company said. Margins at its metals unit rose to 2.42 percent, from 0.31 percent a year earlier on record aluminum premiums.

Losses after tax from agriculture assets narrowed to $78.8 million in the quarter from $180.4 million a year earlier, the company said.


Ms. Rebecca Fung

Noble Group Limited

Tel: +852 2861 4625


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Source: ENP Newswire