the global leader in cloud treasury and finance solutions, today
announced that its FX management technology has been proven to help its
publicly traded clients manage earnings per share (EPS) at risk closer
to the best practice standard of less than $.01.
Based on information gathered from customer data and use cases over the
last several years, Kyriba sees that many CFOs, of both public and
private companies, are still allowing unnecessary currency risk to
negatively impact the financial performance of their companies. For
publicly traded companies, Kyriba sees company valuations being
materially impacted by negative FX results on earnings that reduce EPS.
The inability to effectively manage negative currency impacts continues
to bedevil many global organizations. In the May 2019 Kyriba
Currency Impact Report, a survey of 1,200 publicly traded companies,
Kyriba found that North American companies sustained nearly $21 billion
in FX losses during the fourth quarter of 2018, the largest hit in
nearly three years. Meanwhile, the average EPS at risk due to FX
reported by those same companies rose to $.05, the highest level since
2016, according to the report.
“With the technology available today, it is completely unnecessary for
companies to routinely accept these types of foreign exchange losses,”
said Wolfgang Koester, Chief Evangelist at Kyriba. “Reducing currency
impacts with the right technology is one of the easiest things a global
CFO can do to shore up negative impacts to net operating income and EPS.”
According to Koester, what’s required is a more holistic approach to FX
management, something that enables FX risk to be mitigated through pre-
and post-trade processes. In April, Kyriba closed on its acquisition of
FiREapps, the pioneer and leader in enterprise currency management, to
create the industry’s first end-to-end solution for managing FX risk.
FiREapps has had a nearly decades-long track record of helping companies
mitigate currency risk and manage their EPS at risk to less than $.01,
and together Kyriba and FiREapps are helping multinational companies
increase their hedge ratios on the balance sheet, while also improving
cash flow hedging by more than 25 percent, Koester said.
“In my decades of talking with CEOs and CFOs of some of the largest
global companies, they always say they want the same thing: in-depth
insight and intelligence that allows them to protect the value of their
business and make better risk-mitigating decisions,” Koester said. “The
acquisition of FiREapps by Kyriba makes all of that possible in a
a case study from 2018, Tennant, a manufacturing company, was able
to reduce EPS impact to less than $.01, while organically reducing
currency exposure by 42 percent.
On Friday, June 7, in London, Koester and Kyriba clients will be
discussing best practices in FX management at the Kyriba
Live Treasury & Finance Summit UK, part of a global conference
series for treasury and finance professionals.
Background on the May 2019 Kyriba Currency Impact Report
In this report, Kyriba analyzed the earnings calls of more than 1,200
publicly traded North American and European companies to collect data on
the negative impact and volatility of various currencies during Q4 2018.
The Kyriba Currency Impact Report, which is compiled through enterprise
currency management leader FiREapps, a Kyriba company, can be used as a
benchmarking tool for corporate boards and CFOs to gauge their company’s
currency impacts in comparison to other multinational corporations.
To learn about specific industries that were affected and which
currencies were most impactful to corporations, download
the latest Kyriba Currency Impact Report here.
About Kyriba Corp.
Kyriba empowers financial leaders and their teams with award-winning
solutions for cash and risk management, payments and working capital
optimization. Kyriba delivers a highly secure, 100 percent SaaS
enterprise platform, superior bank connectivity and a seamlessly
integrated solution set for tackling today’s most complex financial
challenges. Thousands of companies, including many of the world’s
largest organizations, rely on Kyriba to streamline key processes,
protect against loss from fraud and financial risk, and accelerate
growth opportunities through improved decision support. Kyriba is
headquartered in San Diego, with offices in New York, Paris, London,
Tokyo, Dubai and other major locations. For more information, visit www.kyriba.com.