Hi Optimistus, I had the same feeling as you regarding the...

Hi Optimistus, I had the same feeling as you regarding the hedging and this was because I didn't understand the position that the company had nor did I fully understand how the hedges would unwind and in what time frame. One of the other posters went to great lengths to try to explain how it worked.Bottom line is the whole hedge book wont unwind all at once in one year, only some of it.

My understanding is that only 40,000 oz of the hedge will crystallize this year. Sure they will only get approximately $1600 per oz from this 40,000 oz, which is will below the current spot price. However the other 340,000 oz will be sold at current market prices or near enough.

Next year the same will happen except the number of oz to be sold at market will be approx 360,000 oz if I am reading the presentations correctly.

My understanding is that they roll the hedges forward that as they mature. The total reserves and resources is approximately 12m oz. Of this a small portion is hedged. As such, the company has large upside to the gold price.Refer previous posters for details.

My great wish is that the accounting standards set out better disclosure for hedging and that the company issue a statement regarding how the position is to be unwound. I have scanned the annual accounts and various presentations and to say the least its non existent re the details required to project the gold price and the time frame that the hedges will mature.

It would be great if the CFO and the board decided to offer full disclosure for the readers of the financial accounts. One can dream I suppose.

I might highlight the issue to the CPA association as to the deficiency, I would prefer self disclosure by the company.

Anyway, this is my take on the situation. Happy to be corrected.

DYOR