Gold producer St Barbara Ltd (ASX:SBM) has entered into forward gold contracts to reduce the U.S. dollar gold price risk.
This risk is associated with accumulating U.S. funds for the future repayment of the remaining of U.S. Senior Secured Notes.
A total of 50,000 ounces of forward gold contracts are to be delivered in monthly instalments from July to December 2016 at a forward price of US$1260 per ounce.
This volume represents less than 15% of current annual company production.
Share in the company last traded at $2.48, or over ten times the valuation of circa $0.21 just one year ago.
1H FY16 Headlines: Record 1H profit and cash flow
St Barbara recently delivered some impressive metrics for 1H FY16, including:
- Statutory profit after tax $77 million: Up 28% on 2H FY15 of $60 million;
- Underlying net profit after tax1 $60 million; Up 40% on 2H FY15 of $43 million; and
- Cash flow from operations $123 million; Up 35% on 2H FY15 of $91 million.
S&P March re-balance
In the most recent quarterly rebalance, the company was added to the S&P/ASX 200 Index and the S&P/ASX All Australian 200 Index.
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