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How a leading industrial machinery company leveraged automation across its complete FX workflow

How a leading industrial machinery company leveraged automation across its complete FX workflow

An industrial machinery company was looking for an automated solution to reduce their exposure to FX risk. Learn how they did it with Kantox Dynamic Hedging.

The company is a leading industrial machinery manufacturer. Headquartered in Germany, the company achieved revenues of EUR 100m in 2024. With operations in Europe, Americas and Asia, the company manages FX risk centrally.

FX CHALLENGES

The treasurer has been manually identifying and calculating currency exposures, making the process time-consuming and error-prone. While exposures are generated daily, hedges are only executed twice per month, thereby exposing the company to remaining currency risk. The listed company needed to implement Hedge Accounting.

THE SOLUTION

The company implemented an automated hedging program based on sales orders for 3 currencies (USD, CNY, JPY). Kantox Dynamic Hedging® directs trade execution to the company’s chosen liquidity providers through 360T. FX management is carried out in accordance with business rules and parameters set by the firm’s risk managers.

  • Exposure to FX risk is reduced by EUR 0.4m annually.
  • Delayed hedging with conditional orders allows the Group to mitigate the negative impact of unfavourable forward points by EUR 20k annually.
  • The solution centralises reporting for the company’s accounting department.

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