How Théa Pharma improved its transactional cash flow hedging

‍Théa Group is an independent pharmaceutical company specialising in the development and commercialisation of eye-care products. The company has been innovating in the pharmaceutical industry since 1995 and has achieved great international presence with operations in 70 countries, 20 subsidiaries in Europe and more than 600 partners around the world.

Despite this internationalisation, their financial landscape was as complex as it was dynamic. Théa Group manages FX risk centrally, as each subsidiary invoices customers in local currencies. For that reason, the company's treasury team faced a daunting challenge: managing transactional cash flow hedging amidst a whirlwind of currencies.

They were looking for a solution that could improve the quality of its exposure data while removing time-consuming manual processes.

FX CHALLENGES

Théa Group needed a solution that could save the precision of its transactional cash flow hedging.

The main challenge for them was to avoid over-hedging and lighten the heavy manual workload, which were draining resources. Manual processes were a time-consuming bottleneck, preventing the company’s small treasury team from focusing on higher-value activities.

In addition,  the lack of a robust data infrastructure made accurate financial reporting and compliance made it difficult to perform hedge accounting in accordance with IFRS standards.

That’s why they went looking for currency management software that could fit their needs, streamline their transactional cash flow hedging process, improve data quality, and enhance overall efficiency.

THE SOLUTION

Théa Pharma found in Kantox the solution that could fix all their FX problems. They implemented an automated cash flow hedging program for firm commitments across all the main currencies.

This allowed them to transform their FX risk management. The platform's intuitive interface empowered the treasury team to make informed decisions, reducing the risk of over-hedging and freeing up valuable time.

With Kantox, the firm’s risk manager has full control over how their FX currencies are managed. And the Treasury team can stick to a carefully planned out strategy, following the manager’s specific set of business rules and parameters.

Additionally, Kantox Dynamic Hedging® solution connects directly to Théa Pharma’s chosen liquidity providers with the Cortex FX platform for effective trade execution.

THE BENEFITS

Now, the company is able to better manage their portfolio of currencies. They drastically reduced their exposure to FX risk after implementing the currency management automation solution.

Moreover, the Group was able to mitigate the negative impact of unfavourable forward points using delayed hedging with conditional FX orders. Thanks to Kantox, the company has improved their reporting. They have now access to a convenient analytics interface that helps them generate accurate reports of their hedging.

Are you facing similar challenges in managing your transactional cash flow hedging? Kantox can help.

Contact our currency management experts today for a free consultation.