American Barrick case

Submitted by:
Meenal Gupta
In the absence of any hedging, what would the profit of the company (ABRC) have been
in 1991?
Particulars
Gold Price
Average Ounces Delivered
Revenus (in 1000s)
(price*ounces)

1991 (without
hedge)
362
787735

1991 (with
hedge)
438
787735

285160.07

345027.93

Particulars
Revenues
Operating Expenses
Administrative Expenses
Income from operations
Depreciation, depletion, and amortization
Exploration and deferred mining costs
written of
Interest and other income
Interest Expense on Long term obligations
Other Expenses
Income before Taxes
Income Tax

1991 (without
hedge)
285160.07
-175357
-11951
97852.07
-49277

1991 (with
hedge)
345027.93
-175357
-11951
157719.93
-49277

-3465

-3465

23961
-9427
-4243
55401.07
11080.214

23961
-9427
-4243
115268.93
23053.786

Net Income

44320.856

92215.144