Kantox solutions for European gas company
This European company, a leading Liquified Petroleum Gas (LPG) wholesaler, purchases gas internationally and distributes it through its retailer network in two ways: with semi-annual contracts with pre-established total volumes and by filling orders from extra-contractual demands. The company was looking for an automated solution to protect its operating margins from currency risk while hedging both its forecasted and transactional exposure.
- The high sensitivity of the business to FX underlined the need to protect operating profit margins from market fluctuations.
- The extended time lapse between firm commitments and cash settlement required an efficient solution to hedge transaction exposure.
- The excessive burden that manually-executed FX risk management was putting on the firm’s treasury resources.
- The company protects its profit margins from currency risk while effectively hedging all cash-flow FX transaction exposure.
- Quickly hedging the forecasts and firm orders allows the company to maximise the impact of favourable forward points.
- The automated solution streamlines the entire FX workflow, thereby doing away with ‘key-person risk’ in FX management.