10-QPeriod: Q1 FY2012

SPDR GOLD TRUST Quarterly Report for Q1 Ended Dec 31, 2011

Filed February 8, 2012For Securities:GLD

Summary

SPDR Gold Trust (GLD) reported its financial results for the quarter ending December 31, 2011. The Trust's primary asset is gold bullion, and its performance is directly tied to the price of gold. During the quarter, the Trust saw an increase in its gold holdings by volume, with creations exceeding redemptions. This activity resulted in a net gain from operations, although the net gain per share decreased compared to the same period in the prior year. Operationally, the Trust continues to manage its expenses by selling the minimal amount of gold necessary to cover costs. Consequently, the Trust does not maintain cash balances, and its cash flow from operations is negligible. Investors should note the Trust's reliance on the London Fix for valuation and the inherent risks associated with gold price volatility, currency fluctuations, and global economic events.

Financial Statements
Beta
Gross Profit$25.71M
Operating Expenses$68.62M
Net Income$785.30M
EPS (Basic)$1.88
Shares Outstanding (Basic)417.04M

Key Highlights

  • 1Total gain on gold for the three months ended December 31, 2011, was $853,920, a decrease from $1,179,263 in the prior year period.
  • 2Net gain from operations for the quarter was $785,297, down from $1,122,025 in the prior year quarter.
  • 3Net gain per share for the quarter was $1.88, lower than $2.64 in the same period of 2010.
  • 4The Trust experienced net creations of gold during the quarter, with 2,383,450 ounces created versus 1,935,505 ounces redeemed.
  • 5The market value of the Trust's gold holdings stood at $63.51 billion as of December 31, 2011, with a cost basis of $44.53 billion, indicating a significant unrealized gain.
  • 6The Trust reported no cash and cash equivalents, adhering to its strategy of using gold sales to cover operational expenses.
  • 7Shareholder deficit decreased from $(21,948,152) thousand to $(18,982,048) thousand during the quarter.

Frequently Asked Questions

The primary asset held by SPDR Gold Trust (GLD) is physical gold bullion.

The Trust manages its expenses by selling the smallest amount of gold necessary to cover operational costs such as custody fees, trustee fees, and sponsor fees. Consequently, the Trust does not hold cash balances and has minimal cash flow from operations.

The investment objective of SPDR Gold Trust is for its shares (GLD) to reflect the performance of the price of gold bullion, less the Trust's expenses.

The value of the Trust's gold holdings is determined based on the London gold fix (London Fix), specifically the London PM Fix, used to calculate the Net Asset Value (NAV) of the Trust. For financial statement purposes, gold is valued at the lower of cost or market.