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I think you may need to look at your % .... 6250 x 3 months /...

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wassa

3,437 Posts.

1423

10/04/22

18:46

Post #: 60769462
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Originally posted by EagleOnEagleSt: ↑

The additional hedges were made in November 2021, and total 170,000t at an average price of A$3,834/tonne, and will be complete by 30 June 2024.

The first deal is 3,750t/month over the next 2 years.
The second deal is 2,500t/month to 30 June 2024.

So we have 6,250t a month hedge over the next 2 years, before it drops to 2,500t/month after the initial 2 year period.

In the last Quarter they produced 30,300t, so if we were to maintain that/expand that production, our hedges would eat ~25% of production, and our balance of 75% would be subject to the spot markets (not too bad, could be worse).

The zinc price is now over A$5,000/tonne, and come 2023/2024 i think we will be a lot higher than these levels. Our hedges will look terrible, as we will be missing out on hundreds of millions of extra revenue if no hedges were in place (IMO).

No more hedges! We're in a wild bull market... we're loosing $6.25m/month because of these hedges (hedge price v spot market * 6,250t/month).

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I think you may need to look at your % .... 6250 x 3 months / 30,300 .... but your right the hedges have and will cost shareholders a fortune ... the banks are doing well.

NCZ Price at posting: $2.09 Sentiment: None Disclosure: Not Held
1 Upvote

0 Great analysis

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