Noble Group falls as results disappoint; Singapore index flat

SINGAPORE Mon Feb 24, 2014 12:22am EST

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SINGAPORE Feb 24 (Reuters) - Noble Group fell as much as 2 percent before paring some of the losses on Monday after posting disappointing results, while the Singapore index flat-lined.

Shares of Noble Group Ltd fell to S$0.97 in early trade, before recovering to S$0.985. The commodities trader reported a 48 percent plunge in its 2013 net profit on Friday, falling short of market estimates.

Brokerage Maybank Kim Eng maintained its "hold" rating on Noble Group, but lowered its 2014/15 core profit forecasts by 3 to 4 percent and target price to S$1.04 from S$1.07.

The brokerage assumed a sharp rebound in Noble Group's 2014 net profit due to the low base effect and expected the agricultural sector to drive earnings growth, but cited extreme drought in Brazil as "a cause of grave concern".

"The drought could adversely affect the production of crops like sugar and coffee and indirectly affect Noble's soybean crushing business in Argentina", Maybank Kim Eng said in a research note. "We see a higher risk of earnings miss in the next few quarters and a delay in earnings recovery to FY15E."

The benchmark Straits Times index was nearly flat at 3,102.65 as of 0515 GMT, after rising 2 percent last week. Trading volume was under 30 percent of its full-day 90-day average volume.

Among the top performers of the Singapore index, shares of Global Logistic Properties Ltd rose 1.4 percent to an intra-day high of S$2.83. It announced on Monday that it has signed partnership agreement with Sinotrans Logistics Investment to develop national network of logistics facilities across China.

The other top performer, shares of SIA Engineering Co Ltd rose 1.9 percent to a more than one-week high of S$4.76, their biggest daily gain in nearly four months.

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