"Key financial metrics, on a last twelve months basis (LTM), showed a substantial improvement over the previous quarter given the rolling off of third quarter 2011 when Noble reported a quarterly loss; however the metrics remain weak for Noble's Baa3 rating, which have already been factored into the current negative outlook," says Laura Acres, a Moody's Senior Vice President.

Noble achieved record nine month revenues of US$69.8 billion, an increase of 15.1% year-on-year, but the third quarter growth rate had slowed substantially to 8.7% from the 23% we saw in second quarter 2012. The improvement was substantially driven by the energy segment, particularly growth in gas and power volumes post expansion into Europe.

Indeed, the pace of revenue growth in energy, at 27% for the nine months was more than sufficient to offset revenue declines of 19% in the agriculture segment where unseasonal rains in Brazil had delayed sugar cane harvests into the third quarter and weak crushing margins reduced volumes in grains & oilseeds.

Notwithstanding the fact that utilization at the Brazilian sugar mills have improved, the Agriculture segment continues to underperform due to continuing weak crushing margins in China and South America.

Noble also reported $1,172.1 million in operating income from supply chain for nine months 2012, an increase of 3.1% and a record for the group. The decline in the agricultural segment was more than offset by improvements in the energy and MMO segments.

While showing an improving trend on an LTM basis, the Q3 2012 performance was lacklustre -- in fact adjusted EBITDA had fallen approximately 30% compared to Q2 2012; however there is a degree of seasonality to Q3 numbers typically. Notwithstanding this, Noble was able to reduce its reported debt level further which now stands at $5.7 billion -- the lowest level since at least Q2 2010. Noble continued to focus on improving working capital efficiency. Balance sheet cash--excluding cash with futures brokers--remained stable to historical levels at about US$850 million.

Adjusted net debt/EBITDA for the LTM improved to about 3.7x from 4.0x, in part because of the exclusion of a very weak Q3 2011 in the calculations -- in isolation, the annualized Q3 2012 figure stood at about 4.4x. LTM retained cash flow ("RCF")/adjusted net debt picked up to about 13% from the year end 2011 position.

Noble continues to pursue asset monetization initiatives, including the merger between Gloucester Coal Limited and Yanzhou Coal Mining Company, and the sale of Terminal Maritimo do Maranhao S.A. in Brazil, the proceeds of which will help to lower Noble's financial leverage as proceeds are deployed towards a reduction in net debt. The Gloucester Coal merger is complete although the final cashflow of $357 million for the repayment of the promissory note will not be received until 3 January 2013. The impact of this cash inflow will reduce pro forma LTM adjusted net debt/EBITDA to about 3.5x.

While the improvement in the LTM operating results and progress of its asset monetization initiatives are encouraging, it remains uncertain if the company can improve its financial profile to a level more in line with the current rating, given the challenging economic outlook. Moody's will continue to monitor the company's ability to improve earnings and cash flow, and its progress in reducing leverage through a combination of asset monetization, lower capex and cost management initiatives over the next 6-12 months.

Noble's Baa3 rating continues to be supported by its scale and diversified product portfolio, as well as its sound liquidity profile, with free cash--excluding restricted cash with future brokers--of around US$850 million and undrawn committed credit facilities of around US$5.1 billion. This is sufficient to cover all of its total reported debt outstanding of US$5.7 billion. Of note is the increase in short term debt given that Noble's US$500 million 8.5% senior notes mature on 30 May 2013, although refinancing of this is not considered to be a problem.

The rating outlook could revert to stable if Noble can improve its financial profile by enhancing its RCF and containing its debt levels through asset monetization, such that RCF/ adjusted net debt trends towards 20% and adjusted net debt/EBITDA remains below 3.5x-4.0x.

On the other hand, downward rating pressure could emerge if: 1) liquidity weakens, 2) EBITDA margin erodes, 3) the company undertakes aggressive debt-funded expansion, and, 4) its financial profile deteriorates over an extended period. Credit metrics that Moody's would consider include adjusted net debt/EBITDA exceeding 3.5x-4x and RCF/adjusted net debt failing to trend towards 20%.

The principal methodology used in rating Noble Group Limited was the Global Commodity Merchandising & Processing Companies Industry Methodology published in December 2011. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.

Please see ratings tab on the issuer/entity page on www.moodys.com for the last rating action and the rating history.

Noble is the largest global trader and supply-chain manager in Asia. It is engaged in the sourcing, storage, transportation, and distribution of agricultural, energy, and industrial products. It is headquartered in Hong Kong and listed on the Singapore Stock Exchange.

Laura Acres Senior Vice President Corporate Finance Group Moody'sInvestors Service Hong Kong Ltd. 24/F One Pacific Place 88 Queensway Hong Kong China (Hong Kong S.A.R.) JOURNALISTS: (852) 3758 -1350 SUBSCRIBERS: (852) 3551-3077 Gary Lau MD - Corporate Finance Corporate Finance Group JOURNALISTS: (852) 3758 -1350 SUBSCRIBERS: (852) 3551-3077 Releasing Office: Moody's Investors Service Hong Kong Ltd. 24/F One Pacific Place 88 Queensway Hong Kong China (Hong Kong S.A.R.) JOURNALISTS: (852) 3758 -1350 SUBSCRIBERS: (852) 3551-3077 (C) 2012 Moody's Investors Service, Inc. and/or its licensors and affiliates (collectively, "MOODY'S"). All rights reserved.

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