At the hedge price of A$230, cost base is 45% so they hedged to that extent. Provided the iron ore price remains above zero, the price received on the remaining 55% of output is pure margin. It'll fluctuate, but any output over that time period is profitable due to the hedge.
I don't know how you arrive at a capital preservation strategy with the knowledge they've hedged out the cost base?
Ann: Dividend/Distribution - FEX, page-47
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