Financial Instruments and Financial Risk Management (Tables)

12 Months Ended

Dec. 31, 2018

Schedules of Risks Arising from Financial Instruments

The table below outlines our outstanding settlement receivables and payables, which were provisionally valued at December 31, 2018, and December 31, 2017.


	Outstanding at December 31, 2018				Outstanding at December 31, 2017
(Pounds in millions)	Pounds		US$/lb.		Pounds		US$/lb.
Receivable positions
Copper		93	$	2.70		138	$	3.26
Zinc		208	$	1.12		197	$	1.50
Lead		24	$	0.91		44	$	1.13
Payable positions
Zinc payable		77	$	1.12		97	$	1.50
Lead payable		16	$	0.91		30	$	1.13

Schedules of Risks Arising from Financial Instruments

A summary of these derivative contracts and related fair values as at December 31, 2018 is as follows:

Derivatives not designated as

hedging instruments

Quantity

Average Price
of Purchase
Commitments

Average Price
of Sale
Commitments

Fair Value
Asset (Liability)
(CAD$ in millions)

Zinc swaps

122 million lbs.

US$

1.14/lb.

US$

1.11/lb.

)

Lead swaps

70 million lbs.

US$

0.90/lb.

US$

0.92/lb.

)

Schedules of Risks Arising from Financial Instruments

Derivatives Not Designated as Hedging Instruments and Embedded Derivatives


(CAD$ in millions)	Amount of Gain (Loss) Recognized in Other Operating Income (Expense) (Note 9)
	2018			2017
Zinc derivatives	$	(40	)	$	11
Lead derivatives		(4	)		10
Settlements receivable and payable		(117	)		190
Contingent zinc escalation payment embedded derivative (c)		13			(24	)
Gold stream embedded derivative (c)		(1	)		13
Silver stream embedded derivative (c)		(4	)		2

	$	(153	)	$	202

Currency risk [member]

Statement [LineItems]

Schedules of Risks Arising from Financial Instruments

U.S. dollar financial instruments subject to foreign exchange risk consist of U.S. dollar denominated items held in Canada and are summarized below. This risk is reduced by our policy to apply a hedge against our U.S. dollar net investments using our U.S. dollar debt.


(US$ in millions)	December 31, 2018			December 31, 2017
Cash and cash equivalents	$	907		$	368
Trade and settlement receivables		640			913
Trade accounts payable and other liabilities		(421	)		(569	)
Debt		(3,809	)		(4,831	)

		(2,683	)		(4,119	)
Net investment in foreign operations hedged		2,628			4,149

Net U.S. dollar exposure	$	(55	)	$	30

Commodity Price Risk [member]

Statement [LineItems]

Schedules of Risks Arising from Financial Instruments

The following represents the effect on profit attributable to shareholders from a 10% change in commodity prices, based on outstanding receivables and payables subject to final pricing adjustments at December 31, 2018. There is no effect on other comprehensive income.

Price on December 31,

Change in Profit
Attributable to Shareholders

(CAD$ in millions, except for US$/lb. data)

2018

2017

2018

2017

Copper

US$

2.70/lb.

US$

3.26/lb.

Zinc

US$

1.12/lb.

US$

1.50/lb.

Liquidity risk [member]

Statement [LineItems]

Schedules of Risks Arising from Financial Instruments

Contractual undiscounted cash flow requirements for financial liabilities as at December 31, 2018 are as follows:


(CAD$ in millions)	Less Than 1 Year		2–3 Years		4–5 Years		More Than 5 Years		Total
Trade accounts payable and other liabilities (Note 18)	$	2,333	$	—	$	—	$	—	$	2,333
Debt (Note 19(f))		—		190		575		4,462		5,227
Estimated interest payments on debt	$	317	$	625	$	582	$	3,528	$	5,052