Homepage
PR Newswire
16-04-2016, 08:41 PM
The main concern now, is the going concern, with its very-thin margin, vs the higher financing cost...
Noble chief faces tough questions
16 Apr 2016 09:00
By Wong Wei Han
Commodities giant Noble Group has made progress on bolstering its balance sheet but some shareholders are still not buying the turnaround story if yesterday's annual general meeting (AGM) is anything to go by.
About 390 investors turned up for the AGM at Suntec Convention Centre and all 15 resolutions, including the re-election of chairman Richard Elman as director, received a majority backing but there was also plenty of dissent expressed.
Chief executive Yusuf Alireza told the meeting that Noble had delivered on all its key priorities for the second half of 2015. It generated a positive cash flow of around US$651 million (S$887 million) in the period, reducing debt by around US$362 million and raising US$750 million in capital from the sale of Noble Agri.
But several shareholders still stepped forward to voice tough questions, including long-time investor Mano Sabnani, who felt the firm's business margin was too thin to be sustainable.
He asked: "How are you going to maintain margins going forward? Your operating income margin was around 1.76 per cent but your average cost of debt was 3.8 per cent. Can you assure us that your business model is still sustainable?"
Mr Alireza replied that more of Noble's future funding will rely on the cheaper secured financing. Margins will also gradually improve as smaller players are forced out of the market due to a lack of capital.
Meanwhile, Noble will have around US$4.6 billion in potential liquidity to service the US$3.2 billion debt due by the end of next year, he added.
...
Source: Straits Times
Noble chief faces tough questions
16 Apr 2016 09:00
By Wong Wei Han
Commodities giant Noble Group has made progress on bolstering its balance sheet but some shareholders are still not buying the turnaround story if yesterday's annual general meeting (AGM) is anything to go by.
About 390 investors turned up for the AGM at Suntec Convention Centre and all 15 resolutions, including the re-election of chairman Richard Elman as director, received a majority backing but there was also plenty of dissent expressed.
Chief executive Yusuf Alireza told the meeting that Noble had delivered on all its key priorities for the second half of 2015. It generated a positive cash flow of around US$651 million (S$887 million) in the period, reducing debt by around US$362 million and raising US$750 million in capital from the sale of Noble Agri.
But several shareholders still stepped forward to voice tough questions, including long-time investor Mano Sabnani, who felt the firm's business margin was too thin to be sustainable.
He asked: "How are you going to maintain margins going forward? Your operating income margin was around 1.76 per cent but your average cost of debt was 3.8 per cent. Can you assure us that your business model is still sustainable?"
Mr Alireza replied that more of Noble's future funding will rely on the cheaper secured financing. Margins will also gradually improve as smaller players are forced out of the market due to a lack of capital.
Meanwhile, Noble will have around US$4.6 billion in potential liquidity to service the US$3.2 billion debt due by the end of next year, he added.
...
Source: Straits Times
“夏则资皮，冬则资纱，旱则资船，水则资车” - 范蠡