Iceberg Research renewed its attack on Noble Group yesterday in a fresh blog post with a string of tough questions on the commodity firm's financials and accounting.
The 13 questions, published online ahead of Noble's annual general meeting today, focused on areas such as its asset valuation, impairment loss and the company's overall performance last year.
Noble suffered a string of impairments last year amid the prolonged commodity crunch, with major sums written off the balance sheet to account for the slashed value of its stake in Yancoal and Noble Agri, as well as the worse-than-expected coal price position.
"The 13-per-cent stake in Yancoal is still valued 28 times its market value on Noble's balance sheet," Iceberg said yesterday, challenging Noble to justify such valuation.
It added: "Noble has stated that its coal price projections were more conservative than the market consensus… How can Noble say that its projection of US$55 per tonne in 2020 is conservative when it is still US$14 above the market forward curve?"
Noble's asset-light business model involves a good deal of fair-value estimates, to put a projection on, for instance, prices of coal on its contracts.
In February, the company reported a net loss of US$1.67 billion (S$2.2 billion) for 2015, owing in large part to a US$1.2 billion impairment as coal prices crashed.
With other write-offs made last year, such as the US$200 million taken off Yancoal in March, Noble has impaired some US$2 billion, Iceberg said. "How can Noble still describe our arguments as 'unfounded allegations' when the confirmation of these arguments can be found in their financial statements?"
Iceberg has been locked in an intermittent war of words with Noble since February last year, often claiming that Noble has manipulated its fair-value accounting to hide cash flow and debt issues.
Noble's management, led by chairman Richard Elman and chief executive Yusuf Alireza, has repeatedly rubbished the criticisms. Mr Elman said in Noble's annual report last month: "Critics should always be aware that talk is cheap. It's coming up with strategies and implementing them that's hard - and that should be left to the ones who have their boots on the ground."
Meanwhile, several initiatives, including the sale of Noble Agri to enhance Noble's liquidity position and the focus on the more lucrative energy businesses, were taken in a bid to steady the firm's performance and financials.
Attempts to improve transparency and communications with shareholders also saw Noble organise an investor conference in August while hiring PwC to review its accounting practice. The review found no compliance issues.
In the blog post yesterday, Iceberg took a swipe at the review, asking why the findings did not question the price assumptions that were eventually written off. It also asked whether shareholders had been misled by Noble's statistics and statements. "It is now clear that these representations have been based on widely unrealistic assumptions. Is there a substantial risk of lawsuit against the company and its senior agreement?"
Noble shares rose 1.5 cents or 3.53 per cent to close at 44 cents.