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Mix-Ansicht- Barrick cuts gold hedge position by 3 mln ounces (Text und Link) - yatri, 08.05.2002, 22:38
- Barrick würde ich deswegen trotzdem nicht kaufen. - Diogenes, 09.05.2002, 10:11
Barrick cuts gold hedge position by 3 mln ounces (Text und Link)
Barrick cuts gold hedge position by 3 mln ounces
(Adds background and quotes throughout. In U.S. dollars)
By Scott Anderson
TORONTO, May 8 (Reuters) - Barrick Gold Corp. (Toronto:ABX.TO - news) said on Wednesday it would reduce its gold forward position by about three million ounces by the end of this year to take advantage of the rising price of gold.
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The decision, unveiled at Barrick's annual meeting, comes on top of a February promise to sell 50 percent of Barrick output on the spot market, rather than as forward sales.
"A simple spot deferred program makes more sense in today's environment," said chief financial officer Jamie Sokalsky.
"The overall program will be simpler, smaller and better positioned to take greater advantage of rising gold prices. At the same time, it will continue to generate significant additional revenues and provide secure and predictable cash flows."
Sokalsky said the decision to simplify the company's complex hedging strategy comes as investors continue to scrutinize earnings statements, part of the fallout of the Enron Corp. debacle.
Barrick, the world's second-largest gold producer, was one of the biggest gold hedgers, seeking to lock in promises to sell gold at prices above those on the spot market.
Barrick said on Wednesday it would not renew call contracts and contracts to sell gold at variable prices, leading to the 3-million-ounce cut in its forward position. It would no longer invest a portion of spot-deferred contracts in corporate bond funds.
At the end of the first quarter, Barrick said it had 18 million ounces of spot deferred contracts, representing 22 percent of reserves, and 6 million ounces of call and variable price sales contracts in its Premium Gold Sales Program.
With 3 million fewer ounces hedged, the total number of ounces hedged could fall to 21 million by year end.
Sokalsky said the company has no plans to increase the number of ounces in its spot deferred position in today's gold market.
"In an environment where the gold price is still very positive, reducing the overall number of ounces in the hedge program will also increase our exposure to a rising gold price," Sokalsky told Reuters."That will also be a positive aspect of the simplification."
Major gold producers are increasingly choosing spot sales over hedged deals. South Africa's AngloGold Ltd. (ANGJ.J) said last month it had cut its open hedge book by 1.7 million ounces to 12.9 million ounces.
Barrick last week said its first quarter earnings fell to $46 million, or 9 cents a share, from $87 million, or 16 cents a share, as lower sales failed to offset higher gold prices.
Its gold production eased to 1.4 million ounces at a total cash cost of $175 an ounce, from 1.5 million ounces at a total cash cost of $161 an ounce for the same time a year earlier.
Barrick, whose shares have risen 25 percent so far this year on the Toronto Stock Exchange on the back of a surging gold price, was down 20 Canadian cents at C$32.12 on Wednesday.
<ul> ~ http://biz.yahoo.com/rc/020508/minerals_barrick_gold_2.html</ul>
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