Bloomberg reports that according to its half yearly report showed on Thursday, Trafigura was owed $10.5 billion by trade debtors at the end of March.
That's not unusual for the commodity trading giant, which sells hundreds of billions of dollars worth of oil, gas and metals every year.
But this time a much larger proportion of them were late paying. Trafigura said that 15.8% of its receivables were more than 60 days overdue, nearly three times the level at the end of September. That implies that Trafigura had $1.66 billion of receivables more than 60 days overdue, up from $594 million six months earlier.
Even more unusual: Trafigura took a significant loss in relation to those receivables. It recognised expected credit losses of $330.2 million, up one hundred-fold from just $3.3 million at the end of September.
In more than a decade of Trafigura accounts that are public, the company's expected credit loss on its receivables has never been higher than $6 million.
Trafigura's new CFO attributed the higher losses to the high prices of many commodities and the higher rates faced by their counterparties.
In its 2015 annual report the company even boasted that a historical analysis from 2000 to 2015 showed that Trafigura "has demonstrated that there is no significant expected credit risk arising from its trade receivable portfolio and therefore no expected credit loss."
But then again, as they say, "Past Performance is No Guarantee of Future Results"…
See the whole article on Bloomberg here:
Trafigura Has $1.7 Billion Headache After Surge in Overdue Debts
