RE:RE:Brexit voteselect1011 wrote: Don't be silly. MT implies that we don't need to hedge against this fX risk. So it must be true.
Lesalpes29 wrote: Puma wrote that it's the only reason to short at this level... now where the share price is going before the vote... whithout bo news it's going down unfortunatly. Glta
The English treasury estimated that a Brexit could hurt the pound by -12% in the first year. Future years would see it stabilize as well as GDP and overall economy.
CXR holds a lot of debt in pounds but if the GBP goes down, and the USD remains strong, this Fx problem would ''kind of '' be lessened. Good US revenues would compensate for the loss in Fx with UK sales.
Of course, CXR also holds a lot of debt in USD. If the revenues in the US are weak and UK's are stable, the Fx change loss would cut into their capacity to pay down US debt.
It's pretty balanced IMO, but this ''Fx problem'' is always part of operating on a global scale. Whatever business you're operating. Let's no forget that all other Pharmaceutical companies operating in the UK would face the same problem. This levels the playing field for everyone so on a competitive side of things, we're OK.
I just don't think the impact of a Brexit would be significantly harmful for CXR, or any other international company for that matter, in the mid-long term.