Noble says has sufficient cash to fund bond redemption, US$15b in bank lines

NOBLE Group said on Monday that it has sufficient cash and liquidity to fund its bond redemption and operations, and that its net fair value gains have fallen again in the second quarter.

The troubled commodities group based in Hong Kong also said it has been approached by a number of parties in terms of potential financings, and strategic and/or investment options, but there is no guarantee that any transaction will occur in the near future.

Addressing market rumours over its ability to fund the US$735 million bond redemption due on August 4, Noble said it has ample funds to do so and will still have readily available cash of well over US$1 billion after.

"Noble has sufficient cash and liquidity to meet its obligations and operate its businesses,'' it said.

"In addition to this significant readily available cash, we would also like to provide the following update in terms of our liquidity and available credit as of the end of July: namely, we currently have around US$15 billion in bank lines.''

Noble, whose shares have lost more than 60 per cent of their value since February after Iceberg queried its accounting policies, said "its Q2 performance is satisfactory and we can also confirm that our business in the first month of Q3 is ahead of our Q2".

In an attempt to address swirling market rumours and allegations, the company has decided to release its results earlier on Aug 10 instead of Aug 13. Aug 10 is a public holiday in Singapore.

"The board has a duty to respond to these allegations. The board believes that all the misleading and untruthful information which has been disseminated will be fully and positively resolved by the publication of the company's Q2 results presentation; by the results of the previously announced PWC independent assurance report in connection with the carrying value of long term physical commodity contracts, and by our previously announced forthcoming "Investor Day"," it said.

On allegations of its growing need to depend on fair value gains for profitability, Noble said its net fair value gains have fallen again in the Q2 and details will given with Q2 results, whilst operating income and profits remain positive.

"Our Independent MTM Committee and PWC will provide further analysis and comfort on these contracts and values,'' it said. Noble has hired PricewaterhouseCoopers to review how it values some of its commodity assets. The company also refuted the allegation that the PWC report is cursory in nature, or that the MTM Committee is not truly independent.