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Noble Group's net profit tumbles 62% to US$40.5m in Q1
Blame it on weaker margins.
Asia's largest commodity trader reported a 62% decline in its net profit for the first quarter. Noble Group's bottomline shrank to US$40.5 million in Q1, dragged by lower tonnage and squeezed margins.
The group's operating income margin slipped to 2.19% from 2.51% a year ago, while total tonnage dropped to US$57 million from US$65.8 million in the same period last year. As a result, total revenue dropped to US$11.39 billion from US$16.64 billion.
"We have also been focused on strengthening the foundations of Noble, in particular on improving commercial opportunities, returning all of our businesses to profitability and reallocating capital away from underperforming businesses. This has resulted in an overall drop in our first quarter tonnage, down 9 million tonnes from Q1 2015 to 57 million tonnes, mainly in the Carbon Steel Materials and Logistics Businesses, as we actively reduced their counterparty exposure," Noble Group's CEO Yusuf Alireza said.
"Our focus on liquidity, and the short term constraints also placed upon us by both banks and counterparties, in advance of the refinancing, impacted our operating results in the period. With refinancing now resolved, we expect to re-establish more normal operating conditions as we move further into 2016,” he added.
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