The surge in currency volatility over the past fewquarters has increased concern among corporate finance executivesabout currency exposures, and it's encouraging companies tore-examine their hedging strategies.
The effects of the currency volatility have been highlighted bythe steady parade of big U.S. corporations reporting damage fromforeign exchange (FX) moves in their first-quarter earnings.Procter & Gamble blamed FX for a 2% drop in its sales.McDonald's said currency moves took $700 million off of its Q1revenue, and Pepsi said FX was likely to trim 11% from its earningsper share in 2015.
“The companies that are taking the earnings hits derive alarge portion of their sales from outside the U.S.,” said SanjayThoppil, a solution consultant at technology provider Reval. “Mostorganizations do a great job of hedging their exposure, butcurrency volatility and a strong dollar mean a hit toearnings.”
Continue Reading for Free
Register and gain access to:
- Thought leadership on regulatory changes, economic trends, corporate success stories, and tactical solutions for treasurers, CFOs, risk managers, controllers, and other finance professionals
- Informative weekly newsletter featuring news, analysis, real-world cas studies, and other critical content
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the employee benefits and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
*May exclude premium content
Already have an account?
Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Susan Kelly
Susan Kelly is a business journalist who has written for Treasury & Risk, FierceCFO, Global Finance, Financial Week, Bridge News and The Bond Buyer.
