Annual report pursuant to Section 13 and 15(d)

Derivative Instruments and Hedging Transactions (Tables)

v3.20.2
Derivative Instruments and Hedging Transactions (Tables)
12 Months Ended
Jun. 30, 2020
Derivative Instruments And Hedging Activities Disclosure [Abstract]  
Summary of Aggregate Gross and Net Derivative Receivables and Payables Balances In the table below, the aggregate gross and net derivative receivables and payables balances are presented by contract type and type of hedge, as of June 30, 2020 and June 30, 2019.

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2020

 

 

June 30, 2019

 

 

 

Gross

Derivative

 

 

Amounts

Netted

 

 

Cash

Collateral

Pledge

 

 

Net

Derivative

 

 

Gross

Derivative

 

 

Amounts

Netted

 

 

Cash

Collateral

Pledge

 

 

Net

Derivative

 

Nettable derivative assets:

 

 

 

Open sale and purchase commitments

 

$

48,896

 

 

$

(2,672

)

 

$

 

 

$

46,224

 

 

$

2,874

 

 

$

(552

)

 

$

 

 

$

2,322

 

Option contracts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

61

 

 

 

 

 

 

 

 

 

61

 

Future contracts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

 

2

 

Forward contracts

 

 

101

 

 

 

 

 

 

 

 

 

101

 

 

 

43

 

 

 

 

 

 

 

 

 

43

 

 

 

$

48,997

 

 

$

(2,672

)

 

$

 

 

$

46,325

 

 

$

2,980

 

 

$

(552

)

 

$

 

 

$

2,428

 

Nettable derivative liabilities:

 

 

 

Open sale and purchase commitments

 

$

5,653

 

 

$

(1,304

)

 

$

 

 

$

4,349

 

 

$

4,093

 

 

$

(271

)

 

$

 

 

$

3,822

 

Margin accounts

 

 

14,616

 

 

 

 

 

 

(9,236

)

 

 

5,380

 

 

 

11,652

 

 

 

 

 

 

(8,671

)

 

 

2,981

 

Liability on price protection programs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

22

 

 

 

 

 

 

 

 

 

22

 

Future contracts

 

 

12,477

 

 

 

 

 

 

 

 

 

12,477

 

 

 

1,241

 

 

 

 

 

 

 

 

 

1,241

 

Forward contracts

 

 

3,208

 

 

 

 

 

 

 

 

 

3,208

 

 

 

2,044

 

 

 

(139

)

 

 

 

 

 

1,905

 

 

 

$

35,954

 

 

$

(1,304

)

 

$

(9,236

)

 

$

25,414

 

 

$

19,052

 

 

$

(410

)

 

$

(8,671

)

 

$

9,971

 

 

Summary of Net Gains (Losses) on Derivative Instruments

Below is a summary of the net gains (losses) on derivative instruments for the years ended June 30, 2020 and 2019.

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

Years Ended

 

 

 

June 30,

2020

 

 

 

June 30,

2019

 

Gains (losses) on derivative instruments:

 

 

 

Unrealized gains (losses) on open future commodity and forward contracts and open sale and purchase commitments, net

 

$

37,163

 

 

 

$

(126

)

Realized losses on future commodity contracts, net

 

 

(29,105

)

 

 

 

(942

)

 

 

$

8,058

 

 

 

$

(1,068

)

Summary of Hedging Activities Shows Precious Metal Commodity Inventory Position Net of Open Sale and Purchase Commitments The following table summarizes the results of our hedging activities, which shows the precious metal commodity inventory position, net of open sale and purchase commitments that is subject to price risk as of June 30, 2020 and June 30, 2019.

 

in thousands

 

 

 

 

 

 

 

 

 

 

June 30,

2020

 

 

June 30,

2019

 

Inventories

 

$

321,281

 

 

$

292,861

 

Precious metals held under financing arrangements

 

 

178,577

 

 

 

208,792

 

 

 

 

499,858

 

 

 

501,653

 

Less unhedgeable inventories:

 

 

 

 

 

 

 

 

Commemorative coin inventory, held at lower of cost or net realizable value

 

 

(17

)

 

 

(17

)

Premium on metals position

 

 

(3,684

)

 

 

(4,424

)

Precious metal value not hedged

 

 

(3,701

)

 

 

(4,441

)

 

 

 

496,157

 

 

 

497,212

 

Commitments at market:

 

 

 

 

 

 

 

 

Open inventory purchase commitments

 

 

514,553

 

 

 

166,600

 

Open inventory sales commitments

 

 

(309,134

)

 

 

(158,870

)

Margin sale commitments

 

 

(14,652

)

 

 

(11,652

)

In-transit inventory no longer subject to market risk

 

 

(3,605

)

 

 

(809

)

Unhedgeable premiums on open commitment positions

 

 

2,779

 

 

 

838

 

Borrowed precious metals

 

 

(168,206

)

 

 

(201,144

)

Product financing arrangements

 

 

(74,678

)

 

 

(94,505

)

Advances on industrial metals

 

 

318

 

 

 

8,644

 

 

 

 

(52,625

)

 

 

(290,898

)

Precious metal subject to price risk

 

 

443,532

 

 

 

206,314

 

Precious metal subject to derivative financial instruments:

 

 

 

 

 

 

 

 

Precious metals forward contracts at market values

 

 

73,948

 

 

 

133,612

 

Precious metals futures contracts at market values

 

 

369,842

 

 

 

72,218

 

Total market value of derivative financial instruments

 

 

443,790

 

 

 

205,830

 

 

 

 

 

 

 

 

 

 

Net precious metals subject to commodity price risk

 

$

(258

)

 

$

484

 

 

Schedule of Outstanding Commitments and Open Forward and Future Contracts As of June 30, 2020 and June 30, 2019, the Company had the following outstanding commitments and open forward and future contracts:

 

in thousands

 

 

 

 

 

 

 

 

 

 

June 30,

2020

 

 

June 30,

2019

 

Purchase commitments

 

$

514,553

 

 

$

166,600

 

Sales commitments

 

 

(309,134

)

 

 

(158,870

)

Margin sales commitments

 

 

(14,652

)

 

 

(11,652

)

Open forward contracts

 

 

73,948

 

 

 

133,612

 

Open futures contracts

 

 

369,842

 

 

 

72,218

 

 

Schedule of Market Values of Denominated in Foreign Currencies Outstanding The market values (fair values) of the Company’s foreign exchange forward contracts and the net open sale and purchase commitment transactions, denominated in foreign currencies, outstanding are as follows:

 

in thousands

 

 

 

 

 

 

 

 

 

 

June 30,

2020

 

 

June 30,

2019

 

Foreign exchange forward contracts

 

$

4,599

 

 

$

5,934

 

Open sale and purchase commitment transactions, net

 

 

3,475

 

 

 

4,667