10-QPeriod: Q3 FY2016

SPDR GOLD TRUST Quarterly Report for Q3 Ended Jun 30, 2016

Filed August 2, 2016For Securities:GLD

Summary

SPDR Gold Trust (GLD) reported significant growth in its Net Assets for the nine months ended June 30, 2016, reaching $40.33 billion, a substantial increase from $24.61 billion at the end of fiscal year 2015. This growth was primarily driven by a surge in share creations, indicating strong investor demand for gold exposure. The Trust's investment in gold also increased substantially in both cost and fair value, reflecting a notable appreciation in gold prices during the period, especially in the second quarter of 2016. Operationally, the Trust experienced a significant net income of $2.32 billion for the three months ended June 30, 2016, and $4.98 billion for the nine months ended June 30, 2016. This contrasts sharply with the net loss reported in the comparable periods of 2015, highlighting the positive impact of rising gold prices. The Trust's expense structure remains lean, with the sponsor bearing most ordinary expenses, a model designed to minimize the impact on investors.

Financial Highlights

12 data points
Beta

Net Income

$2.32B

EPS (Diluted)

$8.06

Total Assets

$40.34B

Cash & Equivalents

$0.00

Free Cash Flow

$0.00

Financial Statements
Beta
Operating Expenses$34.41M
Operating Income-$34.41M
Net Income$2.32B
EPS (Basic)$8.06
Shares Outstanding (Basic)287.99M

Key Highlights

  • 1Net Assets surged to $40.33 billion as of June 30, 2016, up from $24.61 billion as of September 30, 2015, driven by significant share creations.
  • 2Investment in Gold (cost) increased to $37.44 billion and fair value to $40.23 billion by June 30, 2016, from $27.10 billion (cost) and $24.50 billion (fair value) respectively at September 30, 2015.
  • 3Net income for the nine months ended June 30, 2016, was $4.98 billion, a significant turnaround from a net loss of $1.33 billion for the same period in 2015.
  • 4The Trust saw substantial net increase in shares issued and outstanding in value ($10.74 billion) for the nine months ended June 30, 2016, compared to a net decrease of $2.80 billion for the year ended September 30, 2015.
  • 5The Trust reported no cash and cash equivalents, as it aims to minimize holdings of assets other than gold by selling gold to cover expenses.
  • 6The sponsor assumed responsibility for all ordinary fees and expenses of the Trust effective July 17, 2015, simplifying the expense structure and centralizing it under a 0.40% annual sponsor fee.
  • 7Net asset value per Share increased to $126.11 as of June 30, 2016, from $106.68 as of September 30, 2015.

Frequently Asked Questions

The significant increase in Net Assets to $40.33 billion by June 30, 2016, was primarily driven by a surge in the creation of Shares by investors, indicating strong demand for gold exposure. This was coupled with a substantial appreciation in the value of the Trust's gold holdings due to rising gold prices.

The Trust's financial performance has dramatically improved. For the nine months ended June 30, 2016, GLD reported a net income of $4.98 billion, a substantial turnaround from a net loss of $1.33 billion for the same period in 2015. This positive shift is directly attributable to the significant gains in the price of gold.

Effective July 17, 2015, the Trust's primary recurring expense is a Sponsor's fee, accruing daily at an annual rate of 0.40% of the daily Net Asset Value (NAV). In exchange, the Sponsor assumes responsibility for all ordinary fees and expenses of the Trust, including custody, trustee, marketing, and other operational costs. The Trust aims to minimize non-gold assets by selling gold to cover any necessary expenses, resulting in no reported cash balances.

The NAV per Share is calculated by dividing the Trust's total Net Assets by the number of Shares outstanding. The NAV per Share has shown a positive trend, increasing to $126.11 as of June 30, 2016, from $106.68 as of September 30, 2015, reflecting the appreciation in the price of gold and the overall growth in the Trust's assets.