Summary
SPDR Gold Trust (GLD) reported its quarterly results for the period ending December 30, 2006. The Trust's primary asset is gold bullion, and its objective is to reflect the performance of the gold price, less expenses. During the quarter, the Trust saw a significant increase in its investment in gold, growing from $6.2 billion to $7.5 billion, reflecting both an increase in the price of gold and an increase in shares created. The market value of its gold holdings rose to $9.2 billion. Despite the growth in assets, the Trust reported a net loss of $3.176 million for the three months ended December 31, 2006. This loss is primarily driven by expenses such as custody, trustee, sponsor, and marketing agent fees, which amounted to $8.3 million. Notably, the Trust's cash flow from operations was zero, as gold is sold to cover expenses, minimizing cash holdings.
Key Highlights
- 1Investment in Gold increased by $1.3 billion to $7.5 billion (at cost) during the quarter, with market value reaching $9.2 billion.
- 2The Trust experienced a net loss of $3.176 million for the three months ending December 31, 2006, compared to a net loss of $3.230 million in the prior year's comparable period.
- 3Total expenses for the quarter were $8.3 million, significantly higher than the $3.5 million reported in the same period of the previous year, driven largely by increased sponsor and marketing agent fees.
- 4The Trust's operations resulted in zero cash flow, as gold is systematically sold to cover expenses, keeping cash balances at zero.
- 5The number of outstanding shares increased by approximately 21.8 million to 146.9 million shares.
- 6The price of gold, as indicated by the London Fix, saw an increase from $599.25 at the end of the prior fiscal year to $635.70 by the end of the reporting quarter.
- 7A lawsuit filed against the Sponsor, WGC, Trust, and Trustee was dismissed in December 2006.