11 unchanged sentences
The Company’s profitability and cash flow may be significantly impacted by changes in the market price of gold, silver, zinc and lead.
−Removed: Gold, Silver, Zinc and Lead Hedging
−Removed: To mitigate the risks associated with gold, silver, zinc and lead price fluctuations, the Company may enter into option contracts to hedge future production.
−Removed: The Company had outstanding Asian put and call option contracts in net-zero-cost collar contracts on 171,675 ounces of gold at September 30, 2021 that settle monthly through December 2022.
−Removed: The Company is targeting to hedge up to 50% of expected gold production through 2021 and 2022 and may in the future layer on additional hedges as circumstances warrant.
−Removed: The weighted average strike prices on the put and call contracts are $1,623 and $2,002 per ounce of gold, respectively.
−Removed: The contracts are generally net cash settled and, if the price of gold at the time of the expiration is between the put and call prices, would expire at no cost to the Company.
−Removed: These Asian put and call option contracts expose us to (i) credit risk in the form of non-performance by counterparties for contracts in which the contract price exceeds the spot price of a commodity, (ii) price risk to the extent that the spot price exceeds the contract price for quantities of our production covered under contract positions;
−Removed: and (iii) liquidity risk to the extent counterparties exercise rights to cash collateral for out-of-money hedges under applicable instruments.
+Added: To mitigate the risks associated with metal price fluctuations, the Company may enter into option contracts to hedge future production.
+Added: The Company had outstanding forward contracts on 232,000 ounces of gold at March 31, 2022 that settle monthly through June 2023.
+Added: The Company is targeting to hedge up to 70% of expected gold production through 2022, 50% of expected gold production for the first half of 2023 and 25% of expected gold production for the second half of 2023 in order to protect cash flow during a period of elevated capital expenditures, and may in the future layer on additional hedges as circumstances warrant.
+Added: The weighted average fixed price on the forward contracts is $1,956 per ounce of gold, respectively.
+Added: The contracts are generally net cash settled and, if the spot price of gold at the time of expiration is lower than the fixed price or higher than the fixed prices, it would result in a realized gain or loss, respectively.
+Added: The forward contracts expose us to (i) credit risk in the form of non-performance by counterparties for contracts in which the contract price is below the spot price of a commodity, and (ii) price risk to the extent that the spot price exceeds the contract price for quantities of our production covered under contract positions.
To reduce counter-party credit exposure, the Company enters into contracts with institutions management deems credit-worthy and limits credit exposure to each institution.
1 unchanged sentence
For additional information, please see the section titled “Risk Factors” in the 2021 10-K and part II, Item 1A of this report.
−Removed: At September 30, 2021, the fair value of the put and call zero cost collars contracts was an asset of $1.6 million.
−Removed: For the nine months ended September 30, 2021 the Company recognized a loss of $0.9 million related to expired options in Revenue and the remaining outstanding options were included in accumulated other comprehensive income (loss) .
−Removed: A 10% increase in the price of gold at September 30, 2021 would result in a realized loss of $2.5 million a nd 10% decrease would result in a realized gain of $9.3 million .
−Removed: As of September 30, 2021, the closing price of gold was $1,743 per ounce.
−Removed: As of October 25, 2021, the closing price of gold was $1,805 per ounce.
−Removed: Provisional Gold, Silver, Zinc and Lead Sales
+Added: At March 31, 2022, the fair value of the gold forward contracts was a liability of $1.8 million.
+Added: For the three months ended March 31, 2022 the Company recognized a loss of $0.5 million related to expired contracts in Revenue and the remaining outstanding forwards contracts were included in accumulated other comprehensive income (loss) .
+Added: A 10% increase in the price of gold at March 31, 2022 would result in a net realized loss of $43.4 million , the closing price of gold was $1,948 per ounce.
+Added: As of May 3, 2022, the closing price of gold was $1,870 per ounce.
+Added: Provisional Metal Sales
The Company enters into sales contracts with third-party smelters and refiners which, in some cases, provide for a provisional payment based upon preliminary assays and quoted metal prices.
1 unchanged sentence
Depending on the difference between the price at the time of sale and the final settlement price, embedded derivatives are recorded as either a derivative asset or liability.
−Removed: The embedded derivatives do not qualify for hedge accounting and, as a result, are marked to the market gold, silver, zinc and lead price at the end of each period from the provisional sale date to the date of final settlement.
+Added: The embedded derivatives do not qualify for hedge accounting and, as a result, are marked to the market gold and silver price at the end of each period from the provisional sale date to the date of final settlement.
The mark-to-market gains and losses are recorded in earnings.
−Removed: At September 30, 2021, the Company had outstanding provisionally priced sales of 15,966 ounces of gold at an average price of $1,786.
−Removed: Changes in gold prices resulted in provisional pricing mark-to-market loss of $0.6 million during the nine months ended September 30, 2021.
+Added: At March 31, 2022, the Company had outstanding provisionally priced sales of 12,530 ounces of gold at an average price of $1,938.
+Added: Changes in gold prices resulted in provisional pricing mark-to-market loss of $0.5 million during the year ended March 31, 2022.
A 10% change in realized gold prices would cause revenue to vary by $2.5 million.
7 unchanged sentences
To manage foreign currency risk, the Company may enter into foreign currency forward exchange contracts.
−Removed: At September 30, 2021, the Company entered into foreign currency forward contracts to manage this risk and designated these instruments as cash flow hedges of forecasted foreign denominated transactions.
−Removed: The Company had outstanding foreign currency forward exchange contracts to receive $0.4 billion Mexican Pesos at September 30, 2021 with an average exchange rate of 25.43 that settle monthly through December 2021.
−Removed: At September 30, 2021, the fair value of the foreign currency forward exchange contracts was a net asset of $3.3 million.
−Removed: For the nine months ended September 30, 2021 the Company has recognized a gain of $10.5 million related to expired options in Cost Applicable to Sales and Pre-development, Reclamation and Othe r, respectively, and an unrealized gain of $3.3 million related to outstanding options in AOCI.
−Removed: A 10% increase or decrease in the exchange rates at September 30, 2021 would result in a realized gain of $1.8 million or $4.2 million, respectively.
+Added: In 2020, the Company entered into foreign currency forward contracts to manage this risk and designated these instruments as cash flow hedges of forecasted foreign denominated transactions.
+Added: The Company had no outstanding foreign currency forward exchange contracts at March 31, 2022.
Interest Rates
6 unchanged sentences
Market risk is the adverse effect on the value of a financial instrument that results from a change in interest rates.
−Removed: The Company had no outstanding interest rate swaps at September 30, 2021.
+Added: The Company had no outstanding interest rate swaps at March 31, 2022.
Investment Risk
1 unchanged sentence
We are exposed to changes in the fair value of our investments in equity securities.
−Removed: For the nine months ended September 30, 2021, the Company recognized unrealized losses of $3.7 million in Fair value adjustments, net due to decreases in the stock price of those equity securities.
−Removed: At September 30, 2021, the fair value of the equity securities was $139.7 million.
+Added: For the three months ended March 31, 2022, the Company recognized unrealized gains of $13.7 million in Fair value adjustments, net due to increases in the stock price of those equity securities.
+Added: At March 31, 2022, the fair value of the equity securities was $161.9 million.
A 10% change in realized equity prices would result in an unrealized gain or loss of $16.2 million.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.