A biotechnology business, heavily focused on R&D for years, was now experiencing rapid sales growth without a robust policy framework to protect itself against the rapidly growing risk profile.
Their main challenges were:
Increasing cash flow forecasts of a publicly listed entity meant that the size of potential losses from otherwise typical market moves was rapidly increasing.
The finance team and Board did not have direct experience developing an appropriate treasury policy.
Rochford advised and implemented the following strategies:
Consulted with the CFO and presented a proposed hedging policy to the Board for approval.
Collaborated with the finance team to execute an initial hedging strategy that ensured base compliance.
Provided on-going advice and reporting on proactive hedging decisions, with an appropriate product mix to ensure compliance.
With our support:
Heightened revenue certainty from a smoothed earnings profile has reduced the business’ cost of capital and risk premium applied by investors, generating increased gains to enterprise value.
The Engineering, Sales and Finance team can focus on growing commercial opportunities with confidence their risk management program will scale alongside them.
By clicking “Accept” you are confirming you are a wholesale client within the meaning of section 761G of the Corporations Act 2001 or acting for a wholesale client and acknowledge the information contained on this website is intended for wholesale clients only, and must not be distributed directly or indirectly to retail clients as defined under the act.