*** lhg hedge concerns as gold rises*** Thanks for your reply Dan. Please see my original post and also refer back to LHG report 22/6/04 to the ASX.
I stand by my figures being accurate with correct interpretation. It clearly shows its its production costs which is approx $US336 per ounce. It clearly shows its current production at 600K ounces p.a. It clearly shows a hedging exposure using derivatives that equates to 2M ounces approx for the next 4-6 years at a price of US$332 which means their hedge is yielding an enormous loss and will lose more as gold RISES. If you read the directors comments, it clearly indicates that on a US$50 per ounce move, it loses another $50M approx on its heding. Do NOT confuse Mine LIfe and total reserves compared to actual production output and Hedge commitment relative to production. The mine could go for another 25 years and its total heding may be only 10% of its total mine reserves, but if it has hedge commitements falls much shorter than that and they are not producing to that level, that spells trouble. If you know the broker, throw that back to him AFTER you do have looked at the report from LHG.
Thanks. But further views are happily taken on board.
LHG
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