US-listed Discovery Communications has said its programme of currency hedging will insulate it from the financial impact of last week’s Brexit vote.
The value of sterling fell sharply in the wake of UK voter’s decision to take the country out of the European Union and huge global media companies including Discovery are hoping they have measures in place to offset potential negative effects.
“In the short-term and medium-term, our currency hedging programme will significantly minimise the foreign exchange impact of the Brexit vote on our financial performance,” Discovery said in a statement issued late Friday, the day after the Brexit vote that saw Britain begin on a journey out of the European Union.
Currency hedging is a mechanism that allows multi-national companies to lock in exchange rates, meaning they are unaffected by market fluctuations.
Discovery has a significant presence in the UK, which has historically been its largest market outside of its domestic US operation and biggest single revenue generator in its Discovery Networks International business, which now accounts for more than half of company sales.
From its west London UK base, Discovery runs a multitude of channels, and also has an international production hub, now run by Marjorie Kaplan after she relocated from the US last year.
“Discovery Communications respects the decision of the UK people in this historic vote to leave the European Union,” the company’s statement read. “Discovery Channel launched in the UK in 1989 and since then it has become one of our biggest markets and a critical creative and business hub.
“As a global company with a significant presence in 220 markets, we are accustomed to operating in an industry and a world where change is constant. We will work closely with UK and EU leaders to successfully navigate this change and find new opportunities to shape our future.”
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12 May 2021 @ 19:00:01 UTC