10-QPeriod: Q2 FY2009

SPDR GOLD TRUST Quarterly Report for Q2 Ended Mar 31, 2009

Filed May 8, 2009For Securities:GLD

Summary

SPDR Gold Trust (GLD) reported significant growth in its assets under management for the period ending March 31, 2009. The total assets of the Trust surged from approximately $17.8 billion in September 2008 to $28.9 billion by March 2009, primarily driven by a substantial increase in its "Investment in Gold" holdings. This growth reflects a strong investor demand for gold as a safe-haven asset amidst a volatile economic climate. The Trust experienced a net loss from operations for the three months ended March 31, 2009, amounting to $22.0 million, a notable shift from the significant net gain of $588.7 million in the same period of the prior year. This was largely due to a substantial decrease in the "Gain on gold distributed for the redemption of shares." Despite the net loss for the quarter, the Trust's overall financial position remains robust due to the appreciation of its gold holdings.

Financial Highlights

10 data points
Beta

Net Income

-$22.01M

EPS (Diluted)

$-0.07

Cash & Equivalents

$0.00

Free Cash Flow

$0.00

Financial Statements
Beta
Gross Profit$3.77M
Operating Expenses$27.28M
Net Income-$22.01M
EPS (Basic)$-0.07
Shares Outstanding (Basic)309.08M

Key Highlights

  • 1Total Assets increased significantly to $28.9 billion as of March 31, 2009, up from $17.8 billion as of September 30, 2008, indicating strong investor inflows and rising gold prices.
  • 2Investment in Gold (at market value) grew to $33.15 billion by March 31, 2009, from $20.58 billion in September 2008, showcasing the appreciation of the underlying gold holdings.
  • 3The Trust reported a net loss of $22.0 million for the three months ended March 31, 2009, a stark contrast to a net gain of $588.7 million in the same period last year.
  • 4For the six months ended March 31, 2009, the Trust reported a net gain of $34.8 million, compared to a substantial $703.2 million net gain for the same period in the prior year.
  • 5The number of outstanding shares increased substantially, with 368.7 million shares outstanding at March 31, 2009, compared to 246.5 million shares at September 30, 2008, reflecting increased investor participation.
  • 6The Trust reported zero cash flow from operations, consistent with its structure where gold is used to pay expenses, minimizing cash holdings.
  • 7The market value of the Trust's gold holdings exceeded its cost basis significantly, with an unrealized gain of $4.3 billion at March 31, 2009.

Frequently Asked Questions

The primary driver of the Trust's asset growth was the substantial increase in the value of its gold holdings, reflecting both rising gold prices and strong investor inflows. Total assets grew from $17.8 billion to $28.9 billion between September 30, 2008, and March 31, 2009.

The net loss for the quarter was primarily due to a significant reduction in the 'Gain on gold distributed for the redemption of shares.' This gain was exceptionally high in the prior year's comparable quarter, making the year-over-year comparison appear unfavorable, even though the underlying gold asset value increased.

The Trust sells a portion of its gold holdings to cover operational expenses such as custody, trustee, and sponsor fees. This practice means the Trust typically has minimal cash on hand, as it aims to hold only gold as an asset.

The Trust's NAV is designed to reflect the performance of the price of gold bullion, less the Trust's expenses. The value of the Shares is directly linked to the value of the gold held by the Trust, and fluctuations in gold prices will materially impact the Share value.