Noble Group

[Squirrel]

Just a data point to note, the Noble Notes are trading at levels that does suggest there isn't really any value left in the equity. I think its quite important that this gets taken into consideration if anyone wants to buy this counter.

[CY09]

Hi squirrel,

I noticed that too in krisenergy secured bonds which is selling at 0.42. however the share price is above 0.10. I guess for these 2 examples the price may be factoring some speculative element

[specuvestor]

Kris Energy I think are zeros

It's quite amazing that feels like Noble deja vu 2015/16... I thought they would be tempered to manage their risk better

[yeokiwi]

I used to own Noble group till May 2008. A great stock in the earlier years. I think Wallstraits owned Noble too and it was one of its shrew buys in the earlier years.

The rise of Noble was due to the rise in the China's growing appetite in commodities. But, along the way, it started to bet bigger and bigger with easy loans from financial institutions.

https://www.bloomberg.com/gadfly/article...awber-test

I think it probably cannot survive this winter.

[zz...]

Just a data point to note, the Noble Notes are trading at levels that does suggest there isn't really any value left in the equity. I think its quite important that this gets taken into consideration if anyone wants to buy this counter.

the 8.75% march 2022 bond current bid price at $52, can guess how those bought just one month ago are feeling now

[realanalyst]

The business has no audited flow supporting their 48B$ sales of commodities.
I have warned you on this forum p.69

The 2022 bond issued at 8.75% coupon was purposely to win theta, time... Investors were lured with by 9% coupon wow now 52 down from an initial pricing at 100... 25% yield to maturity.

I predict that they will try to issue another bond, the only escape. because they are desperate but this time, absolutely no fish will bite.

One thing is sure. If they are in this position is because they have messed up. Like Wilmar, Noble had not 2 but 3 years to renovate itself, they failed.

Noble Group has generated negative cash-flows from the operations to the tune of
-$1600M in 2014
-$600M in 2015
-$900M in 2016,

-330M operating cfs Q-1 2017
What kind of MDs can have this patience ?

The market is not overacting

How can Noble still claims a $3.9B equity ?
now that Elman has resigned, Noble is no longer is baby. Will he just babysit or sell his his massive stake.

Can you put the share consolidation and share price compression in context ?
The technical rebound of Noble has too much downside. I'm sorry

[CY09]

Most of Noble's ordinary shareholders equity is tied to the fair value gains of its derivative contracts.

The question is how long and the % of the derivative contracts can be liquidated to cash. It will be nice if Noble can be as transparent as it was on its presentation for period ending 31st March 2016, to state how much of its contracts were expiring before 4 years and beyond 4 years (will be better if they can make it 2,4 and beyond 4 years).

The lack of this set of data is hindering my analysis unlike 1 year back

<Still Interested in Noble if the price is right>

[cfa]

Most of Noble's ordinary shareholders equity is tied to the fair value gains of its derivative contracts.

The question is how long and the % of the derivative contracts can be liquidated to cash. It will be nice if Noble can be as transparent as it was on its presentation for period ending 31st March 2016, to state how much of its contracts were expiring before 4 years and beyond 4 years (will be better if they can make it 2,4 and beyond 4 years).

The lack of this set of data is hindering my analysis unlike 1 year back

<Still Interested in Noble if the price is right>

Hi CY09 , 

With all the negative reports and opinion , do you think Noble can pull through ? Hope you can share your opinion , many thanks.

[CY09]

Hi CFA,

Based on this data below and from the past 1 year due to the cash inflow from sales, bonds and rights; and assuming Noble has not purchased a large amount of new derivatives maturing beyond 31 March 2020, Noble has the cashflow to survive

As mentioned previously; as of 31st March 2016,  Noble's current assets consist of fair value derivatives which has maturity of beyond 4 years (1,339mil) and before 4 years (1,839 mil). We can safely concur Noble holds such derivatives until they mature. Interestingly, all of Noble's 6 bil of debts mature by 2020. It is worth noting then Noble had maturing debts of 2.5 bil in 2016 and 0.7 bil in 2017. Based on other components of the balance sheet, Noble is likely to experience a cash flow problem.

Fast forward to this week's announcement, Noble has declared that it has refinanced/paid all its debts due in 2016. In addition, from its recent presentation, debts due in 2017 has risen from 0.7 bil (as of 31 march) to 2.0 bil (as of 3 June). Noble intends to repay these 2 bil debts in 2017 through the sale of Noble America and proceeds of the 500 mil rights.

From these facts, it shows Noble has ensured its survival until 2017 by negotiating with banks to roll over debts for 1 more year. Given that Noble still has 2.8 bil more debts to clear by 2020 and that it has 1.8 bil of derivatives cash flow+1.3 bil in cash, it seems Noble may be able to survive if it is able to raise approx 1 to 1.5 bil for its impending sale.

<Interested in Noble if the price is right>

[cfa]

Hi CFA,

Based on this data below and from the past 1 year due to the cash inflow from sales, bonds and rights;   and assuming Noble has not purchased a large amount of new derivatives maturing beyond 31 March 2020, Noble has the cashflow to survive

.
As mentioned previously; as of 31st March 2016,  Noble's current assets consist of fair value derivatives which has maturity of beyond 4 years (1,339mil) and before 4 years (1,839 mil). We can safely concur Noble holds such derivatives until they mature. Interestingly, all of Noble's 6 bil of debts mature by 2020. It is worth noting then Noble had maturing debts of 2.5 bil in 2016 and 0.7 bil in 2017. Based on other components of the balance sheet, Noble is likely to experience a cash flow problem.

Fast forward to this week's announcement, Noble has declared that it has refinanced/paid all its debts due in 2016. In addition, from its recent presentation, debts due in 2017 has risen from 0.7 bil (as of 31 march) to 2.0 bil (as of 3 June). Noble intends to repay these 2 bil debts in 2017 through the sale of Noble America and proceeds of the 500 mil rights.

From these facts, it shows Noble has ensured its survival until 2017 by negotiating with banks to roll over debts for 1 more year. Given that Noble still has 2.8 bil more debts to clear by 2020 and that it has 1.8 bil of derivatives cash flow+1.3 bil in cash, it seems Noble may be able to survive if it is able to raise approx 1 to 1.5 bil for its impending sale.

<Interested in Noble if the price is right>

Thanks CY 09 .