10-KPeriod: FY2014

ISHARES GOLD TRUST Annual Report, Year Ended Dec 31, 2014

Filed February 27, 2015For Securities:IAU

Summary

The iShares Gold Trust (IAU) 10-K filing for the year ended December 31, 2014, indicates a slight decrease in its net asset value (NAV) and outstanding shares compared to the previous year. The Trust's primary objective is to reflect the performance of the price of gold, which it achieves by holding physical gold bullion. The Sponsor, iShares Delaware Trust Sponsor LLC, assumes most of the Trust's operational expenses, including trustee and custodian fees, in exchange for a sponsor fee of 0.25% of the Trust's NAV. Key financial performance metrics show a net loss of $42.4 million for 2014, largely influenced by a decrease in the price of gold and the impact of the sponsor's fee. While the Trust aims to track gold prices, fluctuations in gold markets, potential disruptions to benchmark pricing mechanisms like the London Gold Fix, and the ongoing sale of gold to cover expenses can impact the value of Shares. Investors should note that the Trust is a passive investment vehicle and does not actively manage its gold holdings to mitigate losses.

Financial Highlights

14 data points
Beta

Net Income

-$42.42M

EPS (Diluted)

$-0.16

Total Assets

$6.21B

Cash & Equivalents

$0.00

Free Cash Flow

$0.00

Financial Statements
Beta
Operating Expenses$16.63M
Operating Income-$16.63M
Net Income-$42.42M
EPS (Basic)$-0.16
Shares Outstanding (Basic)271.16M

Key Highlights

  • 1The Trust's net asset value decreased by 0.92% to approximately $6.21 billion as of December 31, 2014, from $6.27 billion at the end of 2013.
  • 2Outstanding Shares decreased from 538 million to 535.4 million during the same period.
  • 3The Sponsor's fee, set at an annualized rate of 0.25% of the Trust's NAV, amounted to $16.6 million for the year ended December 31, 2014.
  • 4The Trust experienced a net loss of $42.4 million for the year ended December 31, 2014.
  • 5The net asset value per Share experienced a slight decrease from $11.66 to $11.61 over the year, reflecting both gold price movements and Trust expenses.
  • 6The Trust's operations are primarily driven by the price of gold, with no active management to generate profits or hedge against losses.
  • 7Potential risks include disruptions to the London Gold Fix benchmark and the inherent volatility of gold prices impacting Share value.

Frequently Asked Questions

The primary purpose of the iShares Gold Trust (IAU) is to own gold bullion transferred to the Trust in exchange for Shares. Each Share represents a fractional undivided beneficial interest in the net assets of the Trust, aiming to reflect the performance of the price of gold before expenses.

The Sponsor, iShares Delaware Trust Sponsor LLC, assumes most of the Trust's administrative and marketing expenses, including trustee, custodian, and listing fees. In return, the Sponsor charges a fee, which is accrued daily at an annualized rate of 0.25% of the Trust's net asset value. The Trust may sell gold to cover expenses not assumed by the Sponsor and the Sponsor's fee itself.

Key risks include the inherent volatility of gold prices, potential disruptions to the London Gold Fix (the benchmark used for valuation), the decrease in the amount of gold represented by each Share over time due to expenses, and the possibility that Shares may trade at a premium or discount to their net asset value. The Trust is also a passive investment vehicle, meaning it does not actively manage its gold holdings to mitigate losses.

The Trustee calculates the NAV daily by valuing the gold held by the Trust using the London PM Fix (or London AM Fix if the PM Fix is unavailable). From the total value of the gold and other assets, all accrued fees, expenses, and liabilities of the Trust are subtracted. The resulting figure is the net asset value of the Trust, which is then divided by the number of outstanding Shares to determine the NAV per Share.