Risk

Successful businesses are able to quantify and assess the risks and rewards inherent in their core
business units due to their intimate knowledge of industry specific market dynamics. However, these
same companies often make material decisions on key services without the same level of due diligence
or understanding. When commodity price movements contribute to the single largest variation within a
company's cost structure, then regardless of the company's focus, appropriate attention must be
devoted to understand and manage this variability. A wide range of standard and customizeable
contracts and services are available to manage commodity price variability over defined time periods.
Once a company decides how much commodity risk it is willing to "wear," then deciding how to
implement a hedging program becomes the next challenge. Lastly, monitoring performance and
adjusting the plan as required ensures a comprehensive approach.

A great deal of effort can be expended in developing and managing a commodity hedging plan, but the
results can create much more predictable operating costs/profits and enhance competitive advantage.
While cost savings can be sufficient motivation, increasingly companies will also be required to manage
their environmental impact as part of their overall hedging plan.

Agilis has experience in the fields of risk quantification and reporting, scenario simulation, forward curve
advanced modeling for electricity, natural gas and select agricultural products in the United States and
other international markets. Specifically, Agilis has worked on projects such as:

-Created a comprehensive risk quantification and hedging plan for a large healthcare facility that
quantified their natural gas and electricity exposure across nine dispersed geographic regions.

-Developed an agriculture-based risk quantification and simulation methodology to be used for
commodity trading and exposure management.