TVX Locking in Hedge Gains, Expects to Realize US$70 Million.TORONTO--(BUSINESS WIRE)--Feb. 12, 1998--TVX Gold Inc.(TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :TVX TVx Target Vertex TVX Transmission Valid Timer (FDDI) TVX Valid Transmission .) (ME:TVX.) (NYSE NYSE See: New York Stock Exchange :TVX) TVX Gold Inc. announced today that it is in the final stages of substantially restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). its gold and silver hedge positions and expects to realize about US$70 million net in cash when completed. The company is monetizing the gains on the majority of its gold position and is reducing its silver exposure. Cash proceeds are being banked and will provide further flexibility for future developments. Eike Eike is a village in the municipality of Karmøy, Norway. Its population (2005) is 1,408, of which 24 people live within the border of the neighboring municipality Tysvær. It also is a male and female name used in Scandinavia and especially northern Germany. F. Batista Not to be confused with Barista. Batista is a Spanish or Portuguese surname. It may refer to:
Words used to describe investor attitude. A bearish investor believes that a particular asset or the market as a whole will decline in value. bearish on both metals. Now it is our view that gold has bottomed out, and it makes sense to cash out the gold position. Conversely con·verse 1 intr.v. con·versed, con·vers·ing, con·vers·es 1. To engage in a spoken exchange of thoughts, ideas, or feelings; talk. See Synonyms at speak. 2. ," he said, "the disclosure that Warren Buffett's Berkshire Hathaway Berkshire Hathaway (NYSE: BRKA, NYSE: BRKB) is a conglomerate holding company headquartered in Omaha, Nebraska, U.S., that oversees and manages a number of subsidiary companies. Inc. has bought 130 million ounces of silver over the last six months has changed the price-risk profile of the silver market." In light of these changing market conditions, TVX continues to take action to reduce the net number of silver call options it sold last year to finance put options. TVX is a gold mining company with significant silver production. Over 20 million ounces of silver (TVX's share) will be produced at the La Coipa gold/silver joint venture in Chile during the next two years. The company's share of La Coipa silver reserves at year end 1996 totaled over 100 million ounces. In addition, TVX has more than 50 million ounces in silver resources. The major portion of these resources will be upgraded to reserves in 1998 on completion of the Olympias feasibility study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. . Olympias is a gold/silver project in Greece. As at 31st December 1997 TVX's seven-year gold floor hedge position totaled nearly 2.2 million ounces of forward sales forward sales npl → ventas fpl a término and put options at an average price of US$405 an ounce ounce, in zoology ounce, in zoology: see leopard. ounce, unit of measurement ounce: see English units of measurement. . The position also included call options on 1.4 million ounces at $433. The gold forward sales, puts and calls have been cashed out, being replaced with 1.0 million ounces of put options at US$280. These puts will provide a floor price for about 60 per cent of gold production over the next five years. At year end 1997, the seven-year silver position totaled 34.2 million ounces of forward sales and puts at an average of US$6.25, plus calls sold on 59.8 million ounces at US$6.67. The company has now reduced its net exposure to calls to 22 million ounces. Operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. for 1998 was previously forecast at US$64 million, based on US$300 gold and US$5.30 silver prices. As a result of this restructuring, it is now forecast at approximately US$115 million. TVX has sufficient tax pools to shelter the gains from tax. TVX is a precious metals Precious Metals Valuable metals such as gold, iridium, palladium, platinum, and silver. Notes: Investing in precious metals can be done either by purchasing the physical asset, or by purchasing futures contracts for the particular metal. growth company. Planned gold equivalent production will increase by 25 per cent in 1998 to 510,000 ounces (372,000 ounces of gold and 7.8 million ounces of silver) at a cash operating cost of US$200 per ounce. Production is expected to double and costs per ounce decrease further when the Olympias and Skouries projects in Greece come into production in 2001. Forward Looking Statements Some statements in this press release contain forward looking information. These statements address future events and conditions and so involve inherent risks and uncertainties. Actual results could be significantly different from those currently projected. -0-
TVX Gold Inc.
Gold Hedge Position
As at December 31, 1997
Forwards Sold Puts Bought Calls Sold
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1998 161 $469
1999 148 $460 48 $384 96 $420
2000 92 $423 164 $446 376 $452
2001 168 $427 130 $406 236 $423
2002 100 $392 844 $368 284 $427
2003 60 $412 130 $413 260 $427
2004 110 $413 160 $429
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729 $437 1,426 $388 1,412 $433
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As at February 10, 1998
Forwards Sold Puts Bought
------------- -----------
1998 38 $466 150 $280
1999 6 $481 200 $280
2000 200 $280
2001 200 $280
2002 200 $280
2003 50 $280
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44 $468 1,000 $280
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(ounces are expressed in thousands)
TVX Gold Inc.
Silver Hedge Position
As at December 31, 1997
Forwards Sold Puts Bought Calls Sold Calls Bought
------------- ----------- ---------- ------------
1998 960 $5.43 2,022 $6.95 8,044 $6.58 2,022 $7.75
1999 3,100 $5.66 8,856 $6.25 24,842 $6.76 2,256 $8.07
2000 2,500 $5.50 7,200 $6.03 12,230 $5.99
2001 4,000 $6.60 7,130 $6.87
2002 3,200 $6.98 5,200 $7.45
2003 1,200 $6.60 1,200 $7.10
2004 1,200 $6.60 1,200 $7.10
-------------- -------------- ------------- ------------
6,560 $5.56 27,678 $6.41 59,846 $6.67 4,278 $7.92
-------------- -------------- ------------- ------------
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As at February 10, 1998
Forwards Sold Puts Bought Calls Sold Calls Bought
------------- ----------- ---------- ------------
1998 880 $5.43 1,854 $6.95 7,707 $6.53 9,354 $9.15
1999 3,100 $6.05 8,856 $6.25 24,842 $6.76 18,756 $8.61
2000 2,500 $6.00 7,200 $6.03 12,230 $5.99 9,000 $7.88
2001 4,000 $6.60 16,130 $7.28 9,000 $7.60
2002 3,200 $6.98 5,200 $7.45
2003 1,200 $6.60 1,200 $7.10
2004 1,200 $6.60 1,200 $7.10
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6,480 $5.95 27,510 $6.41 68,509 $6.78 46,110 $8.38
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(ounces are expressed in thousands)
CONTACT: TVX Gold Inc. Ed Baer, 416/941-0119 |
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