10-QPeriod: Q2 FY2011

ISHARES GOLD TRUST Quarterly Report for Q2 Ended Jun 30, 2011

Filed August 8, 2011For Securities:IAU

Summary

This filing for iShares Gold Trust (IAU) covers the quarterly period ending June 30, 2011. The Trust's primary asset is gold bullion, which saw a significant increase in fair value from $5,317,017,000 at the end of 2010 to $6,983,435,000 by June 30, 2011. This appreciation, coupled with the creation of new Shares, led to a substantial growth in the Trust's net asset value and net income compared to the prior year's period. Investors should note that the Trust is designed to reflect the price of gold, less expenses. The primary expense is the Sponsor's fee, which was reduced to 0.25% from 0.40% in July 2010, positively impacting net income. The Trust's structure involves the continuous issuance and redemption of Shares in exchange for physical gold bullion, managed through Authorized Participants. The filing confirms no significant changes in risk factors and robust disclosure controls.

Financial Highlights

7 data points
Beta

Net Income

$28.47M

EPS (Diluted)

$0.12

Total Assets

$4.98B

Financial Statements
Beta
Operating Expenses$4.12M
Net Income$28.47M
EPS (Basic)$0.12
Shares Outstanding (Basic)225.17M

Key Highlights

  • 1The Trust's gold bullion inventory increased significantly in fair value, from $5.32 billion at December 31, 2010, to $6.98 billion at June 30, 2011.
  • 2Net income for the six months ended June 30, 2011, was $124.5 million, a substantial increase from $35.8 million in the same period of 2010.
  • 3The number of outstanding Shares increased from 386.95 million at the end of 2010 to 475.05 million by June 30, 2011.
  • 4The Sponsor's fee was reduced from 0.40% to 0.25% of adjusted net asset value on July 1, 2010, leading to lower expenses.
  • 5The Trust's Net Asset Value per Share increased from $13.74 at the start of the year to $14.70 by June 30, 2011.
  • 6The Trust operates as a passive investment vehicle, with its value directly tied to the market price of gold.
  • 7The Trust has no employees and is administered by a Trustee (The Bank of New York Mellon) and sponsored by BlackRock Asset Management International Inc.

Frequently Asked Questions

The primary asset held by the iShares Gold Trust is physical gold bullion.

The Trust does not actively generate income through trading. Its financial results are primarily driven by changes in the market value of its gold holdings, gains from gold distributed for share redemptions, and small gains from gold sales to cover expenses. The main expense is the Sponsor's fee.

Redeemable capital shares represent the beneficial interests in the Trust. They are classified as 'redeemable' because shareholders can redeem their Shares in exchange for physical gold bullion. The balance reflects the redemption value, which is adjusted to reflect the net asset value per Share.

The Sponsor, BlackRock Asset Management International Inc., administers the Trust and is entitled to a Sponsor's fee. This fee accrues daily at an annualized rate of 0.25% of the adjusted net asset value. The Sponsor also assumes certain administrative and marketing expenses for the Trust.