why?, page-17

re: why - ncm down ? Hi Stockanalyst,

I'm not particularly concerned with this issue. My exposure to NCM is small but I am a little confused with their hedging state. From their 2nd qtr report:

NEWCREST MINING LIMITED 2003-01-30 ASX-SIGNAL-G

HOMEX - Melbourne

+++++++++++++++++++++++++
HEDGING

All gold production from the quarter was delivered into the hedge
book reducing the total ounces hedged to 5.5M ounces and total ounces
committed to 4.9Moz (excluding the gold loan). The achieved gold
price was A$596/oz (A$600/oz). Excluding the 30 June 2002 provision
the achieved gold price was $484/oz

for the quarter. The achieved gold price for the first half was
$598/oz and excluding the provision $503/oz. The amount hedged now
represents 20% of reserves and 11% of resources.

The mark to market position at quarter end totalled approximately
negative $939M ($933M) which comprised negative $633M ($550M) for
gold, $247M ($336M) for currency and $59M ($47M) for copper.

A summary of the hedge position (excluding the gold loan of 691Koz)
at 31 December 2002 is as follows.


'000 A$ US$
OZ /OZ /OZ

Standard put options (AUD) 3,843 615 -
Standard put options (USD) 180 - 500
Standard forward sales 384 592 -
Convertible put options 1,025 693 -
Variable priced forwards 250 1,074 -
Purchased forwards (152) 572 -
Total 5,530 651 500

Granted call options 3,392 558 -

* Estimated average deliverable price, which is subject to gold lease
rate exposure. These values include a lease rate allowance of
approximately 1.5%.

To me it looks like they don't have a tremendous amount on their hedge books and I'm attributing their price weakness more on their (fine with me) development efforts than the current POG. Please correct me if I'm wrong. Thanks!