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Hedge book biting harder - Andrew Joannou, Renaissance Asset Mngt
In an interview on ClassicFM @ 18:00 on Tuesday, 13 February 2007
[miningmx.com] -- ANGLOGOLD Ashanti's hedge book, gold sold forward at predetermined rates, was biting harder than usual.
This was a development that had to be considered when valuing the share, said Andrew Joannou from Renaissance Asset Management.
Joannou also said he was disappointed by the group's next quarter gold production forecast which at 1.3 million ounces is "a little bit below what people were expecting." AngloGold Ashanti has forecast full year production of 5.8 million oz for the 2007 financial year.
Speaking on Classic Business, a week nightly radio programme, Joannou said AngloGold Ashanti was getting 8% to 10% below the spot price of gold owing to gold it had sold forward.
"The hedge book does seem to be biting a little bit harder than it has been," he said. Last year, AngloGold Ashanti said the gold price received for its product would be between 6% to
10% below the spot price of gold.
"I think they do manage that book well - I guess it’s up to them as to how - but as an investor it must come into consideration," he said.
"I think the gold companies are going to have to start proving to the market why a gold company is a better investment than the rand gold," Joannou said.
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