Xtrackers ETC Public Limited Company
Directors’ Report and Audited Financial Statements
For the year ended 30 September 2024
Registered number: 627079
Xtrackers ETC Public Limited Company
Contents
Page (s)
Directors and other information 1
Directors' report
2
- 9
Statement of Directors'
responsibilities
10
Independent auditor's report 11 - 16
Statement of comprehensive income 17
Statement of financial position 18
Statement of changes in equity 19
Statement of cash flows 20
Notes to the financial statements 21 - 42
Xtrackers ETC Public Limited Company
Page 1
DIRECTORS AND OTHER INFORMATION
Directors
Authorised Participants
Claudio Borza
Jane Street Financial Limited
Eileen Starrs
30
th
Floor, 20 Fenchurch Street
London EC3M 3BY
Company Secretary
United Kingdom
Wilmington Trust SP Services (Dublin) Limited
Fourth Floor
HSBC Bank Plc
3 George’s Dock
1 Grand Canal Harbour
IFSC, Dublin 1, Ireland
Dublin 2, Ireland
Registered Office
Susquehanna International Securities Limited
Fourth Floor
6th Floor Pinnacle 2
3 George’s Dock
Eastpoint Business Park
IFSC, Dublin 1, Ireland
Dublin, Ireland
Fourth Floor
Flow Traders B. V.
Independent Auditors
Jacob Bontiusplaats 9
KPMG
1018 LL Amsterdam, The Netherlands
1 Harbourmaster Place, IFSC
Dublin 1, Ireland
Deutsche Bank AG
Mainzer Landstr 11-17
Corporate Administrator
60329 Frankfurt, Germany
Wilmington Trust SP Services (Dublin) Limited
Fourth Floor
Morgan Stanley & Co. International plc
3 George’s Dock
20 Bank Street,
IFSC
London E14 4AD, United Kingdom
Dublin 1, Ireland
Citigroup Global Markets Limited
Programme Administrator
Citigroup Centre, Canada Square
DWS International GmbH
Canary Wharf
4th Floor Mainzer Landstrasse 11-17,
London E14 5LB, United Kingdom
60329 Frankfurt am Main
Germany
Optiver VOF
Strawinskylaan 3095
Secured Account Custodian, Subscription Account Custodian,
1077 ZX Amsterdam,
Fee Account Custodian and Metal Agent
The Netherlands
JP Morgan Chase Bank, N.A. London
25 Bank Street, Canary Wharf, London E14 5JP
Virtu Financial Ireland Limited
United Kingdom
North Dock One, Fifth Floor
91/92 North Wall Quay, Dublin 1
Trustee
D01 H7V7, Ireland
Wilmington Trust SP Services (Dublin) Limited
Fourth Floor, 3 George’s Dock IFSC
Determination and Issuing Agent
Dublin 1, Ireland
State Street Fund Service (Ireland) Limited
78 Sir John Rogerson’s Quay,
Dublin 2, Ireland
Series Counterparty
JP Morgan AG
Taunus Turm, Taunustor 1,
60310 Frankfurt am Main,
Germany
Xtrackers ETC Public Limited Company
Page 2
Directors' report
The Board of Directors (the “Board”) present the Directors' report and audited financial statements of Xtrackers ETC Plc (the “Company”) for the year ended
30 September 2024.
Principal activities, business review and future activities
Xtrackers ETC Plc (the “Company”) was incorporated in Ireland under registration number 627079 on 21 May 2018 with limited liability and is organised under
the laws of Ireland as a Public Limited Company (“plc”) pursuant to the Companies Act, 2014 (the “Companies Act”). It has been established as a special
purpose vehicle for the purpose of issuing asset backed securities. The Company is taxable as a securitisation company pursuant to section 110 of the Taxes
Consolidation Act 1997. Profits arising to the Company is taxable at a rate of 25 per cent. The Company has commenced trading on 16 April 2020.
The principal activity of the Company, under the Secured Xtrackers ETC Precious Metal Linked Securities Programme (the “Programme”), is issuance of
several series (each a "Series/ETC Security") of ring-fenced notes listed on one or more of the following stock exchanges: the Frankfurt Stock Exchange, the
Borsa Italiana, and the London Stock Exchange.
The metal for any Series of ETC Securities may consist of gold, silver, or platinum (the “Metal”). The main assets of the Company in respect of a Series of ETC
Securities are its holdings of Metal held by or on behalf of the Company (through the Secured Account Custodian, the Subscription Account Custodian) and its
interests under the related metal agent agreement entered into by the Company and the Metal Agent (the “Metal Agent Agreement”) and the Balancing
Agreement.
The ETC Securities are designed to provide purchasers with exposure to a Metal without having to take physical delivery of the Metal. Each ETC Security
relates to a specific amount in weight of Metal, specified in the relevant Final Terms, known as the metal entitlement per ETC Security. On any particular day,
the ETC Security can be viewed as giving an exposure to that amount of Metal as the amount payable in respect of the ETC Securities and the Value per ETC
Security is linked to the value of the Metal. In order to back its obligations under the ETC Securities, the Company will seek to hold enough Metal to meet its
obligations under the ETC Securities. The precise amount it holds at any time may be more or less than the aggregate amount of the metal entitlement per ETC
Security to reflect the periodic payment of product fees and, in respect of FX Hedged ETC Securities, an adjustment for any foreign exchange gains or losses.
Because the Company obtains its exposure to the precious Metal by physically investing directly in the relevant Metal, these types of ETC Securities are known
as physical replication exchange traded commodities. The proceeds from the disposal of the Underlying Metal, plus (where applicable) any interest received on
the proceeds of such disposal less any negative interest, net of any deductions (and, in the case of FX Hedged ETC Securities, converted into the currency of
the ETC Securities at the rate the Metal Agent determines would be obtainable at the time of conversion which shall be on or about the day of such sale (or, if
such day is not an FX Business Day, the immediately following FX Business Day), and which may take into account a bid/offer spread quoted by a dealer), will
equal the amount due under the ETC Securities (subject to certain minimum amounts owed).
The Master Balancing Terms (the “Balancing Agreement”) sets out the arrangements between the Company and JP Morgan AG (the “Series Counterparty”)
with respect to the rebalancing of the Metal held by the Company for the relevant ETC securities. Such rebalancing will be made in respect of FX Hedged ETC
Securities to reflect gains or losses in respect of the foreign exchange hedge element of the metal entitlement per ETC Security. The Balancing Agreement
broadly seeks to account for any currency hedging gains or losses by requiring deliveries of Precious Metal to be made between the Company and the Series
Counterparty so that, as a result of such deliveries, the amount of Underlying Metal held by the Company should equal the aggregate metal entitlement in the
foreign currency of the ETC Security in respect of all outstanding ETC Securities of the relevant Series. Where there are foreign exchange gains and the metal
entitlement per ETC Security consequently increases, the Series Counterparty will be required to deliver additional Metal equivalent to such increase to the
Company under the Balancing Agreement. Where there are losses and the metal entitlement per ETC Security consequently decreases, the Company will be
required to deliver Metal equivalent to such decrease to the Series Counterparty under the Balancing Agreement.
With respect to each Series of ETC Securities, the Company’s primary assets are its holdings of underlying metal and its interests under the related Balancing
Agreement (the ''Balancing Agreement''). The obligations of the Company under the ETC Securities of a Series will be secured in favour of the Trustee by an
assignment by way of security of all the Company’s rights, title, interest and benefit present and future against the secured account custodian (the ''Secured
Account Custodian''), the subscription account custodian (the ''Subscription Account Custodian'') relating to the underlying metal in respect of this Series of
ETC Securities. Subscription and redemption terms of the ETC Securities are disclosed in the notes of the financial statements.
Irish law requires the Directors to prepare financial statements for each financial period. Under that law they have elected to prepare these financial statements
in accordance with International Financial Reporting Standards (“IFRS”) as adopted by the European Union (“EU”).
Xtrackers ETC Public Limited Company
Page 3
Directors' report (continued)
Significant Events during the financial year
On 29 November 2023, the Company informed Securityholders of the below Series of the following fee changes, with effect from 1 December 2023:
On 26 February 2024, the Company informed Securityholders of the below Series of the following fee changes, with effect from 1 March 2024;
On 26 February 2024, the Company informed Securityholders of the below Series of the following changes, with effect from 27 March 2024:
Directors and secretary and their interests in shares of the Company
The Directors and secretary who served the Company during the period together with their beneficial interests in the shares of the Company were as follows:
Ordinary Shares of €1 each
30 September 2024
Ordinary Shares of €1 each
30 September 2023
Claudio Borza
-
-
Eileen Starrs
-
-
Wilmington Trust SP Services (Dublin) Limited
25,000
25,000
Wilmington Trust SP Services (Dublin) Limited is acting as Company Secretary and not in the capacity as a Director or Directors.
General information
The Company is a public company limited by shares incorporated in Ireland with registered office at Fourth Floor, 3 George’s Dock, IFSC, Dublin 1.
ETC Securities Details
The following Series of ETC Securities were in operation at 30 September 2024 and 30 September 2023. The Series are priced daily, based on the metal
reference price source from the London Bullion Market Association (“LBMA”) and London Platinum and Palladium Market (“LPPM”) in the table below. In
respect of FX Hedged ETC Securities, an adjustment is also required for any exchange gains or losses under the relevant Balancing Agreement:
Series
Description
Underlying Metal
Series 1
Xtrackers IE Physical Platinum ETC Securities
Platinum Price
Series 2
Xtrackers IE Physical Gold ETC Securities
Gold Price
Series 3
Xtrackers IE Physical Silver ETC Securities
Silver Price
Series 4
Xtrackers IE Physical Silver EUR Hedged ETC Securities
Silver Price
Series 5
Xtrackers IE Physical Gold EUR Hedged ETC Securities
Gold Price
Series 6
Xtrackers IE Physical Gold GBP Hedged ETC Securities
Gold Price
Series 7
Xtrackers IE Physical Platinum EUR Hedged ETC Securities
Platinum Price
Please refer to note 16 of the financial statements for the Company’s fair value consideration under IFRS 13.
Stock Exchange Listings
The Company maintains a listing on the Frankfurt Stock Exchange, the Borsa Italiana and the London Stock Exchange.
Series
Description
Old Base Fee
Percentage
Old Product
Fee Percentage
New Base Fee
Percentage
New Product Fee
Percentage
Series 2
Xtrackers IE Physical Gold ETC Securities
12 bps
12 bps
11 bps
11 bps
Series
Description
Old FX
Hedging Fee
Percentage
Old Product
Fee Percentage
New FX
Hedging Fee
Percentage
New Product Fee
Percentage
Series 5
Xtrackers IE Physical Gold EUR Hedged
ETC Securities
13 bps
28 bps
9 bps
24 bps
Series 6
Xtrackers IE Physical Gold GBP Hedged
ETC Securities
13 bps
28 bps
9 bps
24 bps
Series
Description
Old Maximum FX Bid-Offer
Spread Adjustment
New Maximum FX Bid-Offer
Spread Adjustment
Series 5
Xtrackers IE Physical Gold EUR Hedged
ETC Securities
18 bps
22 bps
Series 6
Xtrackers IE Physical Gold GBP Hedged
ETC Securities
18 bps
45 bps
Xtrackers ETC Public Limited Company
Page 4
Directors' report (continued)
Product fee
Each Series pays a product fee prepared by the Determination Agent, which accrues on a daily basis. The Product fee is the rate set out below for each Series as
of 30 September 2024 and is applied to the Metal Entitlement on a daily basis to determine a daily deduction of an amount of Metal from the Metal Entitlement:
Series
Description
Annual Product fee as a
% of metal entitlement
30 Sep 2024
Annual Product fee as a
% of metal entitlement
30 Sep 2023
Series 1
Xtrackers IE Physical Platinum ETC Securities
0.38
0.38
Series 2
Xtrackers IE Physical Gold ETC Securities
0.11
0.12
Series 3
Xtrackers IE Physical Silver ETC Securities
0.20
0.20
Series 4
Xtrackers IE Physical Silver EUR Hedged ETC Securities
0.73
0.73
Series 5
Xtrackers IE Physical Gold EUR Hedged ETC Securities
0.24
0.28
Series 6
Xtrackers IE Physical Gold GBP Hedged ETC Securities
0.24
0.28
Series 7
Xtrackers IE Physical Platinum EUR Hedged ETC Securities
0.73
0.73
Key performance indicators
The Company is a Special Purpose Vehicle (the ''SPV'') whose sole business is the issue of asset-backed securities. The Company has established a programme
for the issue of ETC Securities whose return is linked to the performance of a specified precious metal: either gold, silver, platinum. Each series of ETC
Securities will be separate (or ‘ring-fenced’) from each other series of ETC Securities. The ETC uses a hedging mechanism (“Balancing Agreement”) which is
designed to reduce exposure of the underlying precious metal to exchange rate fluctuations between US dollars and the currency in which the ETC is
denominated.
Metal
Price in USD per ounce
30 September 2024
Price in USD per ounce
30 September 2023
Increase in price
Gold
2,629.95
1,870.50
40.60%
Silver
31.075
23.075
34.67%
Platinum
985.00
923.00
6.72%
The prices of all three commodities rose between September 2023 and September 2024. The performance of a precious metal is dependent upon macroeconomic
factors including (without limitation) supply and demand, liquidity, conflicts, natural disasters, direct investment costs, location and changes in tax rates and
changes in laws, regulations and the activities of governmental or regulatory bodies.
The Directors confirm that the key performance indicators as disclosed below are those that are used to assess the performance of the Company.
During the year:
•
the Company made a profit of USD 2,519 (2023: USD 2,384);
•
the net fair value gain on Precious metals at fair value and Precious metals due from Series Counterparty amounted
to USD 1,717,764,655 (2023:
USD 565,233,010), for details please refer to note 4;
•
the net fair value loss on ETC securities designated at fair value through profit or loss amounted to USD 1,717,764,655 (2023: USD 565,233,010
), for
details please refer to note 5;
•
there were new subscriptions in the following Series of ETC Securities:
Series
Description
Issuances in USD*
30-Sep-24
Issuances in USD*
30-Sep-23
1
Xtrackers IE Physical Platinum ETC Securities
6,606,311
6,544,609
2
Xtrackers IE Physical Gold ETC Securities
2,645,412,540
507,721,658
3
Xtrackers IE Physical Silver ETC Securities
16,284,559
14,062,884
4
Xtrackers IE Physical Silver EUR Hedged ETC Securities
10,523,083
10,628,688
5
Xtrackers IE Physical Gold EUR Hedged ETC Securities
74,025,193
205,703,259
6
Xtrackers IE Physical Gold GBP Hedged ETC Securities
54,050,285
87,355,684
7
Xtrackers IE Physical Platinum EUR Hedged ETC Securities
5,091,673
4,052,000
*The timing of issuances will impact the gains/losses of the relevant Series.
Xtrackers ETC Public Limited Company
Page 5
Directors' report (continued)
Key performance indicators (continued)
•
the following Series of ETC Securities were partially redeemed:
Series
Description
Redemption in USD*
30-Sep-24
Redemption in USD*
30-Sep-23
1
Xtrackers IE Physical Platinum ETC Securities
(8,641,337)
(9,233,517)
2
Xtrackers IE Physical Gold ETC Securities
(1,450,288,522)
(1,050,424,334)
3
Xtrackers IE Physical Silver ETC Securities
(28,664,427)
(11,466,591)
4
Xtrackers IE Physical Silver EUR Hedged ETC Securities
(24,319,408)
(14,618,707)
5
Xtrackers IE Physical Gold EUR Hedged ETC Securities
(203,160,075)
(260,414,245)
6
Xtrackers IE Physical Gold GBP Hedged ETC Securities
(156,217,754)
(134,944,576)
7
Xtrackers IE Physical Platinum EUR Hedged ETC Securities
(5,450,692)
(8,661,908)
*The timing of redemptions will impact the gains/losses of the relevant Series.
As at 30 September 2024:
•
the Company’s total ETC Securities issued had a fair value of USD 6,723,955,903
(2023: USD 4,070,939,819)
;
•
the Company has invested in Precious metals with a fair value of USD 6,742,533,617
(2023: USD 4,067,249,325)
;
• Precious metals with a fair value of USD 82,020 (2023: USD 2,689,877) were due to the Company from the Series Counterparty and Precious metals
with a value of USD 1,682,761 (2023: Nil) were due from the Company to the Series Counterparty, Amounts receivable on Precious metals awaiting
settlement amounted to USD 3,951,935 (2023: USD 2,814,106), Amounts payable on Precious metals awaiting settlement amounted to Nil (2023: USD
73,566), Amounts payable on ETC securities awaiting settlement amounted to USD 20,872,032 (2023: USD 6,243,267) and Amounts receivable on
ETC securities awaiting settlement amounted to Nil (2023: USD 4,571,760);
•
total equity USD 38,130 (2023: USD 35,611); and
•
the Company had the following ETC Securities in issue:
Series
Description
Maturity date
Ccy
Nominal
(in units)
Local price
of ETCs***
FV in USD
Precious metals
held
1
Xtrackers IE Physical Platinum ETC Securities
17-Apr-80
USD
671,683
24.2051
16,258,141
Platinum
2
Xtrackers IE Physical Gold ETC Securities
23-Apr-80
USD
134,691,436
40.5194
5,457,618,164
Gold
3
Xtrackers IE Physical Silver ETC Securities
30-Apr-80
USD
2,983,217
44.6071
133,072,759
Silver
4
Xtrackers IE Physical Silver EUR Hedged ETC
Securities*
15-Apr-80
EUR
882,764
35.6276
35,193,451
Silver
5
Xtrackers IE Physical Gold EUR Hedged ETC
Securities*
21-May-80
EUR
20,122,291
33.5671
754,372,447
Gold
6
Xtrackers IE Physical Gold GBP Hedged ETC
Securities**
23-May-80
GBP
7,667,741
30.9713
317,819,437
Gold
7
Xtrackers IE Physical Platinum EUR Hedged
ETC Securities*
29-May-80
EUR
444,409
19.3477
9,621,504
Platinum
* with a EUR/USD hedge in terms of the Balancing Agreement.
** with a GBP/USD hedge in terms of the Balancing Agreement.
***The timing of issuances/redemptions will impact gains/losses in the Statement of Comprehensive Income.
•
The Company had the following ETC Securities in issue in prior year as at 30 September 2023:
Series
Description
Maturity date
Ccy
Nominal
(in units)
Local price
of ETCs***
FV in USD
Precious metals
held
1
Xtrackers IE Physical Platinum ETC Securities
17-Apr-80
USD
756,734
22.7694
17,230,386
Platinum
2
Xtrackers IE Physical Gold ETC Securities
23-Apr-80
USD
102,823,390
28.8515
2,966,605,505
Gold
3
Xtrackers IE Physical Silver ETC Securities
30-Apr-80
USD
3,292,199
33.1910
109,271,386
Silver
4
Xtrackers IE Physical Silver EUR Hedged ETC
Securities*
15-Apr-80
EUR
1,274,583
27.3572
36,999,552
Silver
5
Xtrackers IE Physical Gold EUR Hedged ETC
Securities*
21-May-80
EUR
24,453,307
24.4665
632,986,670
Gold
6
Xtrackers IE Physical Gold GBP Hedged ETC
Securities**
23-May-80
GBP
10,960,773
22.3046
298,650,999
Gold
7
Xtrackers IE Physical Platinum EUR Hedged ETC
Securities*
29-May-80
EUR
463,770
18.7077
9,195,321
Platinum
* with a EUR/USD hedge in terms of the Balancing Agreement.
** with a GBP/USD hedge in terms of the Balancing Agreement.
***The timing of issuances/redemptions will impact gains/losses in the Statement of Comprehensive Income.
The financial statements and notes to the financial statements are presented in US Dollar (“USD” or “$”) which is the Company’s functional currency. Functional
currency is the currency of the primary economic environment in which the entity operates. The Directors of the Company believe that USD most faithfully
represents the economic effects of the underlying transactions, events and conditions.
Xtrackers ETC Public Limited Company
Page 6
Directors' report (continued)
Future developments
The Directors expect that the present level of activity will be sustained for the foreseeable future. The Board will continue to seek new opportunities for
the Company and will continue to ensure proper management of the current portfolio of Series of the Company.
Going concern
The nature of the Company’s business dictates that the outstanding ETC Securities may be redeemed at any time by the holder and in certain
circumstances may be compulsorily redeemed by the Company. As the redemption of ETC Securities will always coincide with the transfer of an equal
amount of Precious metals, no net liquidity risk is considered to arise.
Post the financial year end, as at 21 January 2025, the prices of the Precious metals have remained stable or positive. The Administrator has taken
measures to ensure business continuity. The Company also has a diversified portfolio of several different metals, post the financial year end. The Company
continues to generate substantial cash flows to meet its contractual obligations in relation to the payment of the product fee. Refer to Note 19.
The Directors consider the Company to be a going concern.
Principle risks and uncertainties
The Company is subject to various risks. The principal risks facing the Company are outlined in Note 15 to the financial statements.
Price Risk
Price risk is the risk that the value of Precious metals will fluctuate as a result of changes in market prices, whether caused by factors specific to an
individual investment, its issuer or other factors affecting all instruments traded in the market. Refer to note 15 for further details.
Operational risk
Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the Company’s processes and from external
factors other than credit, market and liquidity risks such as those arising from legal and regulatory requirements and generally accepted standards of
corporate behaviour.
Operational risk arises from all of the Company’s operations. The Company was incorporated with the purpose of engaging in those activities outlined
in note 1. All administration functions are undertaken by Wilmington Trust SP Services (Dublin) Limited. Deutsche Bank AG, Jane Street Financial
Limited, HSBC Bank Plc, Susquehanna International Securities Limited, Flow Traders B.V., Morgan Stanley & Co. International Plc, Citigroup Global
Markets Limited, Optiver VOF and Virtu Financial Ireland Limited act as the Company's authorised participants (the " Authorised Participants"), DWS
International GmbH acts as arranger (the "Arranger") and Programme Administrator, JP Morgan Chase Bank N.A. acts as metal agent (the "Metal
Agent"), Secured Account Custodian, Fee Account Custodian, Subscription Account Custodian and Series Counterparty (“Series Counterparty”) and
State Street Fund Services (Ireland) Limited acts as determination and issuing agent.
Credit Risk
Credit risk is the risk of financial loss to the Company if a counterparty to a financial instrument fails to meet its contractual obligations. The Company’s
principal financial assets are cash and cash equivalents, other receivables, Amounts Receivable on Precious metals awaiting settlement and Precious
metals due from the Series Counterparty which represents the Company's maximum exposure to credit risk. All credit risks are ultimately borne by the
ETC Security holders.
The Directors have also considered the credit risk and counterparty risk with JP Morgan as custodian (the "Custodian") and Series Counterparty
respectively, of the Precious metals held by the Company given the significance of the Precious metals to the overall financial position of the Company.
With an overall credit rating status of JP Morgan 2024: S&P A+ (2023: S&P A+), the Directors are of opinion that counterparty risk is acceptable.
Ultimately, all credit and counterparty risks associated with JP Morgan are borne by the ETC Security holders.
Liquidity Risk
Liquidity risk is the risk that the Company will not be able to meet its obligations as they fall due. The Company limits its exposure to liquidity risk
through the purchase of Precious metals. All liquidity risk associated with the Precious metals are ultimately borne by the ETC Security holders. Due to
the fact that the ETC Security holders have the option to redeem the securities before the final scheduled maturity date, the ETC securities designated at
fair value through profit or loss have been classified as due in less than one year. Maturity dates across the ETC Securities range between April 2080
and May 2080.
Currency Risk
In addition to metal price risk, the Company has exposure to currency risk as some of the ETC Securities are priced in currencies other than US Dollars
and hedged against exchange rate movements between the US Dollar and the Euro or Pound Sterling.
An ETC Security is a debt instrument whose redemption price is linked to the value of the relevant underlying Precious metals and Precious metals due
from Series Counterparty. The ETC Securities are issued under limited recourse arrangements whereby the holders have recourse only to the Precious
metals and Precious metals due from Series Counterparty attributable to the class of Security held and not to the Company. In addition, since any
movements in the value of the Precious metals and Precious metals due from Series Counterparty are wholly attributable to the holders of the ETC
Securities, the Company has no residual exposure to movements in the value of the Precious metals and Precious metals due from Series Counterparty.
From a commercial perspective, the gains or losses on the liability represented by the ETC Securities are matched economically by corresponding losses
or gains attributable to the Precious metals and Precious metals due to/from Series Counterparty under the Balancing Agreement. The Company does not
retain any net gains or losses or net risk exposures. Further details surrounding the value of the Precious metals and Precious metals due to/from Series
Counterparty are disclosed in note 11.
Xtrackers ETC Public Limited Company
Page 7
Directors' report (continued)
Principal risks and uncertainties (continued)
Currency Risk (continued)
Movements in the value of the underlying Precious metals and Precious metals due from Series Counterparty, and thus the value of the ETC Securities,
may vary widely which could have an impact on the demand for the ETC Securities issued by the Company. These movements are shown in note 11 and
12.
Climate Risk
The directors acknowledge that climate change is an emerging risk impacting the global economy and will continue to be of interest to all stakeholders
with a focus on how climate change is expected to impact the operations of the precious metals industry in areas such as mining, processing,
warehousing, transportation, societal response and the regulatory environment in the future. However, having considered such factors relating to
climate change, the directors have determined that there are no direct or immediate impacts of climate change on the business operations of the
Company. Given this, there is no basis on which to provide extended information of analysis relating to climate change risks on the business operations
of the Company. Furthermore, the directors conclude that at present there is no material impact to the fair value of financial instruments, assets and
liabilities of the company. The directors recognise that governmental and societal responses to climate change risks are still developing and the future
impact cannot be predicted. Therefore, the future fair value of assets and liabilities may fluctuate as the market responds to climate change policies,
physical events and changes in societal behaviours. The Directors are currently assessing whether the Corporate Sustainability Reporting Directive
(“CSRD”) will impact the Company.
Geopolitical Risk
The business of the Company may be affected by factors that are beyond the Company’s control, such as geopolitical, economic and business
conditions. Current conflicts and possible outbreaks elsewhere in the world may lead to instability in certain regions together with sanctions being
imposed against certain countries, companies and/or individuals which could have an adverse economic impact.
Results and dividends for the year
The results for the year are set out on page 17. The Directors do not recommend the payment of a dividend for the year ended 30 September 2024 (2023:
Nil).
Corporate Governance Statement
General Principles
The Company is subject to and complies with Irish statute comprising the Companies Act 2014. As the Company’s ETC Securities have been admitted
to trade on the regulated market of the Frankfurt Stock Exchange, the Borsa Italiana, and the London Stock Exchange., the Company adheres to the
Listing Rules of these exchanges in so far as it relates to an overseas company trading in secured metal linked debt securities.
The Board of Directors of the Company is responsible for establishing and maintaining adequate internal control and risk management systems for the
Company in relation to the financial reporting process. Such systems are designed to manage rather than eliminate the risk of failure to achieve the
Company’s financial reporting objectives and can only provide reasonable and not absolute assurance against material misstatement or loss.
Board Composition
In accordance with the Company’s Articles of Association, the number of Directors, from time to time, shall be not less than two and not more than
twelve. The Company may from time to time, by ordinary resolution, increase or reduce the number of Directors provided that any resolution to appoint
a director approved by the members that would result in the maximum number of Directors being exceeded shall be deemed to constitute an ordinary
resolution increasing the number of Directors to the number in office following such a resolution of appointment.
The Directors are responsible for managing the business affairs of the Company in accordance with the Constitution of the Company, which allows it
to enter into contracts and perform all tasks necessary to conduct the business of the Company. The directors may delegate certain functions to the
Administrator and other parties, subject to supervision and direction by the directors.
Internal Control and Risk Management Systems in Relation to Financial Reporting
The Directors are responsible for establishing and maintaining adequate internal control and risk management systems of the Company in relation to
the financial reporting process. Such systems are designed to manage rather than eliminate the risk of failure to achieve the Company's financial
reporting objectives. The Board has put in place a formal procedure to ensure that relevant accounting records for the Company are properly maintained
and are readily available and includes the procedure for the production of half yearly and annual audited financial statements for the Company. The
annual audited financial statements of the Company are produced by the Corporate Administrator, reviewed by the Programme Administrator, then
presented to the Board of Directors for consideration and approval and are filed with the Companies Registration Office in accordance with the
provisions of the Transparency (Directive 2004/109/EC) Regulations 2007.
European Communities (Takeover Bids (Directive 2004/25/EC)) Regulations 2006
The Company is not subject to the European Communities (Takeover Bids (Directive 2004/25/EC)) Regulations 2006 and therefore not required to
include information relating to voting rights and other matters required by those Regulations and specified by the Companies Act 2014 for our
consideration.
Board Appointments
The Directors who served during the financial year are shown on page 1.
Audit Committee
As set out in Section 1551 (11) (c) of the Act, a Company issuing asset backed securities may avail itself of an exemption from the requirements to
establish an audit committee. The sole business of the Company relates to the issuing of asset-backed securities. Given the contractual obligations of
the Administrator and the limited recourse nature of the securities issued by the Company, the Board of Directors have concluded that there is currently
no need for the Company to have a separate audit committee in order for the Board to perform effective monitoring and oversight of the internal control
and risk management systems of the Company. The Board monitors the audit process and the independence of the statutory auditor. Accordingly, the
Company has availed itself of the exemption under Section 1551 (11) (c) of the Act not to establish an audit committee.
Xtrackers ETC Public Limited Company
Page 8
Directors' report (continued)
Programme Administrator
The Company has appointed DWS International GmbH as its Programme Administrator pursuant to a Programme Administrator Agreement.
Remuneration
Details of remuneration paid to the Directors are set out in note 17.
Changes in Directors, Secretary and registered office
There has been no change in Directors, Secretary and registered office during the year.
Accounting records
The Directors are responsible for ensuring that adequate accounting records, as outlined in Section 281 to 285 of the Companies Act 2014, are kept by
the Company. The measures taken by Directors to secure compliance with the Company’s obligation to keep adequate accounting records are the use
of appropriate systems and procedures and ensuring that competent persons are responsible for the accounting records. The accounting records are kept
at the following address: Wilmington Trust SP Services (Dublin) Limited, Fourth Floor, 3 George’s Dock, IFSC, Dublin 1, Ireland.
Political donations
The Electoral Act 1997 (as amended by the Electoral Amendment Political Funding Act 2012) requires companies to disclose all political donations
over €200 in aggregate made during the financial year. The Directors, on enquiry, have satisfied themselves that no such donation in excess of this
amount has been made by the Company.
Significant events since the financial year end
Information relating to significant events since the financial year end can be found at note 19 below.
Independent Auditor
KPMG, Chartered Accountants, were appointed statutory auditor on 4 June 2020 and pursuant to section 383(2) will continue in office.
Relevant audit information
Each Director at the date of approval of this report confirms that:
• so far as the Directors are aware, there is no relevant audit information of which the Company’s auditors are unaware; and
• the Directors have taken all steps that they ought to have taken as a Director in order to make themselves aware of any relevant audit information
and to establish that the Company’s auditors are aware of this information.
Responsibility statement of the Directors in respect of the Directors’ Report
We confirm that to the best of our knowledge:
•
the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities,
financial position and profit or loss of the Company; and
•
the Directors’ report includes a fair review of the development and performance of the business and the position of the Company, together with a
description of the principal risks and uncertainties that they face. The principal risks facing the Company are outlined in note 15 to the financial
statements.
Xtrackers ETC Public Limited Company
Page 9
Director’s Report (continued)
Directors’ Compliance Statement
The Directors, in accordance with section 225(2) of the Companies Act, acknowledge that they are responsible for securing the Company’s compliance
with certain obligations specified in that section arising from the Companies Act and Tax laws (“relevant obligations”).
The Directors confirm that:
• a compliance policy statement has been drawn up setting out the Company’s policies that in their opinion are appropriate with regard to such
compliance;
• appropriate arrangements and structures have been put in place that, in their opinion, are designed to provide reasonable assurance of compliance
in all material respects with those relevant obligations; and
• a review has been conducted, during the financial period, of those arrangements and structures.
In discharging their responsibilities under section 225 of the Companies Act, the Directors relied upon, among other things, the services provided,
advice and/or representations from third parties whom the Directors believe have the requisite knowledge and experience in order to secure material
compliance with the Company’s relevant obligations.
On behalf of the Board
Eileen Starrs
Director
Date: 21 January 2025
Claudio Borza
Director
_
Xtrackers ETC Public Limited Company Page 10
Statement of Directors' responsibilities
The directors are responsible for preparing the directors’ report and financial statements, in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law they have elected to prepare the
financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU).
Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the
state of affairs of the Company and of its profit or loss for that year. In preparing the financial statements, the directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable and prudent;
• state whether applicable Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial
statements;
• assess the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
• use the going concern basis of accounting unless they either intend to liquidate the Company or to cease operations, or have no realistic
alternative but to do so.
The directors are responsible for keeping adequate accounting records which disclose with reasonable accuracy at any time the assets, liabilities,
financial position and profit or loss of the Company and enable them to ensure that its financial statements comply with the Companies Act
2014. They are responsible for such internal controls as they determine is necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to
them to safeguard the assets of the Company. In this regard they have entrusted the assets of the Company to a trustee for safe-keeping. They
have general responsibility for taking such steps as are reasonably open to them to prevent and detect fraud and other irregularities. The directors
are also responsible for preparing a directors’ report that complies with the requirements of the Companies Act 2014.
The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website.
Legislation in the Republic of Ireland governing the preparation and dissemination of financial statements may differ from legislation in other
jurisdictions.
On behalf of the Board
Eileen Starrs
Director
Date: 21 January 2025
Claudio Borza
Director
_
Xtrackers ETC Public Limited Company Page 11
Independent Auditor’s Report to the Members of Xtrackers ETC Public Limited Company
Report on the audit of the financial statements
Opinion
We have audited the financial statements of Xtrackers ETC Public Limited Company (‘the Company’) for the year ended 30 September 2024 set out
on pages 17 to 42, which comprise the Statement of Comprehensive Income, Statement of financial position, Statement of changes in equity, Statement
of cash flows and related notes, including the material accounting policies set out in note 3.
The financial reporting framework that has been applied in their preparation is Irish Law and International Financial Reporting Standards (IFRS) as
adopted by the European Union.
In our opinion:
- the financial statements give a true and fair view of the assets, liabilities and financial position of the Company as at 30 September 2024
and of its profit for the year then ended;
- the financial statements have been properly prepared in accordance with IFRS as adopted by the European Union; and
- the financial statements have been properly prepared in accordance with the requirements of the Companies Act 2014.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (Ireland) (ISAs (Ireland)) and applicable law. Our responsibilities
under those standards are further described in the Auditor’s Responsibilities section of our report. We believe that the audit evidence we have obtained
is a sufficient and appropriate basis for our opinion. Our audit opinion is consistent with our report to the Board of Directors.
We were appointed as auditor by the directors on 4 June 2020. The period of total uninterrupted engagement is the 5 years ended 30 September 2024.
We have fulfilled our ethical responsibilities under, and we remained independent of the Company in accordance with, ethical requirements applicable
in Ireland, including the Ethical Standard issued by the Irish Auditing and Accounting Supervisory Authority (IAASA) as applied to listed public
interest entities. No non-audit services prohibited by that standard were provided.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the preparation of the
financial statements is appropriate. Our evaluation of the Directors’ assessment of the Company’s ability to continue to adopt the going concern basis
of accounting included using our knowledge of the Company and the asset management industry to identify the inherent risks to the Company’s
business model and analysing how those risks might affect the Company’s financial resources or ability to continue as a going concern over the twelve
months from the date of when the financial statements are authorised for issue. As part of our evaluation we note that the Company issued, and
continues to issue, a large number of certificates, through different series of certificates and have assessed management plan.
Post the financial year end, the Company continues to have a diversified portfolio of several different metals and continues to generate substantial
cash flows to meet its contractual obligations in relation to the payment of the product fee.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or
collectively, may cast significant doubt on the Company’s ability to continue as a going concern for a period of at least twelve months from the date
when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Xtrackers ETC Public Limited Company
Page 12
Independent Auditor’s Report to the Members of Xtrackers ETC Public Limited Company (continued)
Detecting irregularities including fraud
We identified the areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements and risks of
material misstatement due to fraud, using our understanding of the Company's industry, regulatory environment and other external factors and inquiry
with the directors. In addition, our risk assessment procedures included:
- Inquiring with the directors and other management as to the Company’s policies and procedures regarding compliance with laws and
regulations, identifying, evaluating and accounting for litigation and claims, as well as whether they have knowledge of non-compliance
or instances of litigation or claims.
- Inquiring of directors as to the Company’s high-level policies and procedures to prevent and detect fraud, as well as whether they have
knowledge of any actual, suspected or alleged fraud.
- Inquiring of directors regarding their assessment of the risk that the financial statements may be materially misstated due to irregularities,
including fraud.
- Inspecting the Company's correspondence, if any, with the relevant licensing or regulatory authorities to identify pressures that may
indicate that financial reporting may be influenced by regulatory requirements.
- Obtaining and reviewing board minutes to identify any actual or potential fraudulent activities during the year.
- Reviewing evidence obtained as part of the planning analytical procedures.
We discussed identified laws and regulations, fraud risk factors and the need to remain alert among the audit team.
Firstly, the Company is subject to laws and regulations that directly affect the financial statements including companies and financial reporting
legislation. We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items,
including assessing the financial statement disclosures and agreeing them to supporting documentation when necessary.
Secondly, the Company is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on
amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation.
We identified the following areas as those most likely to have such an effect: certain aspects of company legislation recognising the financial and
regulated nature of the Company’s activities and its legal form.
Auditing standards limit the required audit procedures to identify non-compliance with these non-direct laws and regulations to inquiry of the directors
and other management and inspection of regulatory and legal correspondence, if any. These limited procedures did not identify actual or suspected
non-compliance.
We assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. As required
by auditing standards, we performed procedures to address the risk of management override of controls. We did not identify any additional fraud
risks.
In response to the fraud risks, we also performed procedures including:
- Identifying journal entries and other adjustments to test based on risk criteria and comparing the identified entries to supporting
documentation.
- Evaluating the business purpose of significant unusual transactions, if any.
- Assessing significant accounting estimates for bias.
- Assessing the disclosures in the financial statements.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial
statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed
non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the
inherently limited procedures required by auditing standards would identify it.
In addition, as with any audit, there remains a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to
detect non-compliance with all laws and regulations.
Xtrackers ETC Public Limited Company
Page 13
Independent Auditor’s Report to the Members of Xtrackers ETC Public Limited Company (continued)
Key audit matters: our assessment of risks of material misstatement
Key audit matters are those matters that, in our professional judgement, were of most significance in the audit of the financial statements and include
the most significant assessed risks of material misstatement (whether or not due to fraud) identified by us, including those which had the greatest
effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were
addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
In arriving at our audit opinion above, the key audit matters, in decreasing order of audit significance, were as follows (unchanged from 2023):
Accuracy of precious metals at fair value through profit or loss $6,742,533,617 (2023: $4,067,249,325)
Refer to note 3 (accounting policy) and note 11 (financial disclosures)
The key audit matter
How the matter was addressed in our audit
The Company's investment in precious metals make up 99.9% of the total
asset value of the Company and is considered to be the key driver of the
Company's results.
While the nature of the precious metals held do not require a significant
level of judgement as they comprise of precious metals which have
observable quoted prices on actively traded markets, due to their
significance in the context of the financial statements as a whole, the
precious metals were identified as a matter which had the greatest effect
on our overall audit strategy and allocation of resources in planning and
completing our audit.
For the reasons outlined above the engagement team determine this matter
to be a key audit matter.
Our audit procedures included but were not limited to:
- Obtained and documented our understanding of the process in place to
value the precious metals; and
- With the assistance of our valuation specialists, independently revalued
the precious metals held by the Company and determined that the prices
were within a reasonable range.
Based on evidence obtained, we found that the accuracy of precious metals
was not materially misstated.
Existence of precious metals at fair value $6,742,533,617 (2023: $4,067,249,325)
Refer to note 3 (accounting policy) and note 11 (financial disclosures)
The key audit matter
How the matter was addressed in our audit
Due to the size of the portfolio and the fact that precious metals are the
main asset owned by the Company, the existence of precious metals at fair
value was identified as a key audit matter which had a significant effect on
our overall audit strategy and allocation of resources in planning and
completing our audit.
For the reasons outlined above the engagement team determine this matter
to be a key audit matter.
Our audit procedures included but were not limited to:
- Obtained and documented our understanding of the process to verify the
existence of precious metals; and
- We obtained an independent third-party confirmation directly from the
custodian, JPMorgan Chase Bank, N.A. and agreed the confirmation to the
quantity of precious metals held at year end.
Based on evidence obtained, we found that the existence of precious
metals was not materially misstated.
Xtrackers ETC Public Limited Company
Page 14
Independent Auditor’s Report to the Members of Xtrackers ETC Public Limited Company (continued)
Our application of materiality and an overview of the scope of our audit
Materiality for the financial statements as a whole was set at $67.5million (2023: $40.7million), determined with reference to a benchmark of the
Company’s total asset value (of which it represents 100 basis points (2023: 100 basis points)) as at 30 September 2024, which we consider to be one
of the principal considerations for members of the Company in assessing the financial performance of the Company.
In line with our audit methodology, our procedures on individual account balances and disclosures were performed to a lower threshold, performance
materiality, so as to reduce to an acceptable level the risk that individually immaterial misstatements in individual account balances add up to a
material amount across the financial statements as a whole. Performance materiality for the financial statements as a whole was set at 75% (2023:
75%) of materiality for the financial statements as a whole, which equates to $50.6million (2023: $30.6million). We applied this percentage in our
determination of performance materiality because we did not identify any factors indicating an elevated level of risk.
We reported to the Board of Directors any corrected or uncorrected identified misstatements exceeding 5 basis points (2023: 5 basis points), in addition
to other identified misstatements that warranted reporting on qualitative grounds.
In planning the audit, we applied materiality to assist in determining what risks were significant risks, including those set out above, and to determine
the nature, timing and extent of our audit response.
Our audit was undertaken to the materiality and performance materiality level specified above and was all performed by a single engagement team in
Dublin. We applied the above levels for materiality and performance materiality on total assets, which is the presumed benchmark for the Company’s
Industry. Total assets consists of easy to value investments (precious metals with observable quoted prices in active markets), KPMG have chosen
100 basis points of total assets and performance materiality has been set at 75% of materiality. The risk of accumulated errors is low. There were no
transactions, account balances or disclosures where a lower level of materiality for the financial statements as a whole was required.
Other information
The Directors are responsible for the other information presented in the Annual Report together with the financial statements. The other information
comprises the information included in the Directors’ report, Directors Other Information and the Statement of Directors’ Responsibilities. The
financial statements and our auditor’s report thereon do not comprise part of the other information. Our opinion on the financial statements does not
cover the other information and, accordingly, we do not express an audit opinion or, except as explicitly stated below, any form of assurance conclusion
thereon.
Our responsibility is to read the other information and, in doing so, consider whether, based on our financial statements audit work, the information
therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work we have not identified
material misstatements in the other information.
Based solely on our work on the other information undertaken during the course of the audit, we report that:
- we have not identified material misstatements in the Directors’ report;
- in our opinion, the information given in the Directors’ report is consistent with the financial statements; and
- in our opinion, the Directors’ report has been prepared in accordance with the Companies Act 2014.
Xtrackers ETC Public Limited Company
Page 15
Independent Auditor’s Report to the Members of Xtrackers ETC Public Limited Company (continued)
Corporate governance statement
As required by the Companies Act 2014, we report, in relation to information given in the Corporate Governance Statement on page 7, that:
- based on the work undertaken for our audit, in our opinion, the description of the main features of internal control and risk management
systems in relation to the financial reporting process is consistent with the financial statements and has been prepared in accordance with
the Act;
- based on the work undertaken for our audit, the Company is not subject to the European Communities (Takeover Bids (Directive
2004/25/EC)) Regulations 2006 and therefore not required to include information relating to voting rights and other matters required by
those Regulations and specified by the Companies Act 2014 for our consideration in the Corporate Governance Statement; and
- based on our knowledge and understanding of the Company and its environment obtained in the course of our audit, we have not identified
any material misstatements in that information.
We also report that, based on work undertaken for our audit, the information required by the Act is contained in the Corporate Governance Statement.
Our opinions on other matters prescribed by the Companies Act 2014 are unmodified
We have obtained all the information and explanations which we consider necessary for the purposes of our audit.
In our opinion the accounting records of the Company were sufficient to permit the financial statements to be readily and properly audited and the
financial statements are in agreement with the accounting records.
We have nothing to report on other matters on which we are required to report by exception
The Companies Act 2014 requires us to report to you if, in our opinion, the disclosures of Directors’ remuneration and transactions required by
Sections 305 to 312 of the Act are not made. We have nothing to report in this regard.
Respective responsibilities and restrictions on use
Responsibilities of directors for the financial statements
As explained more fully in the Statement of Directors’ Responsibilities set out on page 10, the directors are responsible for: the preparation of the
financial statements including being satisfied that they give a true and fair view; such internal control as they determine is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or error; assessing the Company’s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern; and using the going concern basis of accounting unless they either
intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due
to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with ISAs (Ireland) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these financial statements.
A fuller description of our responsibilities is provided on IAASA’s website at:
https://iaasa.ie/publications/description-of-the-auditors-responsibilities-for-the-audit-of-the- financial-statements/.
Xtrackers ETC Public Limited Company
Page 16
Independent Auditor’s Report to the Members of Xtrackers ETC Public Limited Company (continued)
The purpose of our audit work and to whom we owe our responsibilities
Our report is made solely to the Company’s members, as a body, in accordance with Section 391 of the Companies Act 2014. Our audit work has
been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report and for no
other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s
members, as a body, for our audit work, for this report, or for the opinions we have formed.
Date: 21 January 2025
Rio Howley
For and on behalf of
KPMG
Chartered Accountants, Statutory Audit Firm
1 Harbourmaster Place
IFSC
Dublin 1
D01 F6F5
Xtrackers ETC Public Limited Company
Page 17
Statement of comprehensive income
For the year ended 30 September 2024
Year ended
Year ended
30-Sep-24
30-Sep-23
Notes
USD
USD
Income
6
7,084,033
7,431,840
Net fair value gain on Precious metals at fair value and Precious metals due from
Series Counterparty
4
1,717,764,655
565,233,010
Net fair value (loss) on ETC securities designated at fair value through profit or loss
5
(1,717,764,655)
(565,233,010)
Operating expenses
7
(7,080,674)
(7,428,662)
Operating profit before taxation
3,359
3,178
Taxation
9
(840)
(794)
Profit and total comprehensive income for the year
2,519
2,384
Xtrackers ETC Public Limited Company
Page 18
Statement of financial position
As at 30 September 2024
30-Sep-24
30-Sep-23
Notes
USD
USD
Assets
Cash and cash equivalents
10
2,477,926
765,044
Precious metals at fair value
3e,11
6,742,533,617
4,067,249,325
Precious metals due from Series Counterparty
3f,11
82,020
2,689,877
Amounts receivable on Precious metals awaiting settlement
3e
3,951,935
2,814,106
Amounts receivable on ETC Securities awaiting settlement
3g
-
4,571,761
Other receivables
3i
30,990
1,121,952
Total assets
6,749,076,488
4,079,212,065
Liabilities and equity
ETC securities designated at fair value through profit or loss
3h,12
6,723,955,903
4,070,939,819
Precious metals due to Series Counterparty
3f,11
1,682,761
-
Amounts payable on Precious metals awaiting settlement
3e
-
73,566
Amounts payable on ETC Securities awaiting settlement
3g
20,872,032
6,243,267
Other payables
3i
2,527,662
1,919,802
Total liabilities
6,749,038,358
4,079,176,454
Equity
Share capital
13
27,223
27,223
Retained earnings
10,907
8,388
Total equity
38,130
35,611
Total liabilities and equity
6,749,076,488
4,079,212,065
The financial statements on pages 17 to 42 were approved by the Board and authorised for issue on 21 January 2025.
On behalf of the Board
Eileen Starrs Claudio Borza
Director Director
Xtrackers ETC Public Limited Company
Page 19
Statement of changes in equity
For the year ended 30 September 2024
Note
Called up Share
Capital
Retained
Earnings
Total Equity
USD
USD
USD
Balance as at 1
st
October 2022
27,223
6,004
33,227
Comprehensive income for the financial year
-
2,384
2,384
Balance as at 30 September 2023
27,223
8,388
35,611
Note
Called up Share
Capital
Retained
Earnings
Total Equity
USD
USD
USD
Balance as at 1
st
October 2023
27,223
8,388
35,611
Comprehensive income for the financial year
-
2,519
2,519
Balance as at 30 September 2024
27,223
10,907
38,130
Xtrackers ETC Public Limited Company
Page 20
Statement of cash flows
For the year ended 30 September 2024
Year ended
30-Sept-24
Year ended
30-Sept-23
USD
USD
Notes
Cash flows from operating activities
Amount received from metal sold
7,080,674
7,428,662
Amount paid for operating expenses
(5,367,792)
(9,078,836)
Net cash inflows from operating activities
1,712,882
(1,650,174)
Movement in cash and cash equivalents
1,712,882
(1,650,174)
Cash and cash equivalents at start of the year
765,044
2,415,218
Cash and cash equivalents at end of the year 10 2,477,926 765,044
Non-cash transactions during the year include:
USD
USD
Issuance of ETC Securities
2,811,993,644
836,068,782
Redemptions of ETC Securities
(1,876,742,215)
(1,489,763,877)
Additions of Precious metals
2,818,035,433
848,154,524
Disposals of Precious metals
(1,804,531,711)
(1,428,836,399)
Settlements of Precious metals due to/from Series Counterparty
(53,194,030)*
(68,253,239)*
*Settlements of Precious metals due to/from Series Counterparty comprise of gross inflows amounting to USD 389,622,488 (2023: USD
599,208,915) and gross outflows amounting to USD 336,428,458 (2023: USD 530,955,676).
Xtrackers ETC Public Limited Company
Page 21
Notes to the financial statement
For year ending 30 September
2024
1 General information
Xtrackers ETC Plc (the “Company”), the reporting entity, was incorporated on 18 May 2018 as a public limited company with limited liability
under the Companies Act 2014, as amended, with registration number 627079. The Company commenced operations on 16 April 2020. The
registered office of the Company is at 4th Floor, 3 George’s Dock, IFSC, Dublin 1, Ireland.
The purpose of the Company is to provide a vehicle that facilitates the issuance and subsequent listing and trading of ETC Securities. The ETC
Securities are issued under limited recourse arrangements whereby the Company has no residual exposure to the value of the Precious metals and
Precious metals due from Series Counterparty, therefore from a commercial and accounting perspective the aggregate gains and losses in respect
of Precious metals and Precious metals due from Series Counterparty will always be offset by a corresponding loss or gain on the ETC Securities.
Further details regarding the risks of the Company are disclosed in note 15. Further details regarding the application of IFRS 13 are disclosed in
note 16.
Exchange traded products are not typically actively managed, are significantly lower in cost when compared to actively managed mutual funds
and are easily accessible to investors. No active trading or management of Precious metals and Precious metals due from Series Counterparty is
required because the Company only receives or delivers Precious metals on the issue and redemption of ETC Securities, and only holds Precious
metals to support the ETC Securities.
The ETC Securities issued are listed on the following exchanges: the Frankfurt Stock Exchange, the Borsa Italiana and the London Stock Exchange.
In all cases, the ETC securities issued by the Company are limited recourse.
Each ETC Security of a Series has metal entitlement (the “Metal Entitlement”) expressed as an amount in weight (in troy or fine troy ounces) of
the relevant metal linked to such Series. This Metal Entitlement starts at a predetermined initial Metal Entitlement for the relevant Series and is
reduced weekly by a Product fee (in metal) for the Series, and in respect of FX Hedged ETC Securities, an adjustment is also required for any
exchange gains or losses under the relevant Balancing Agreement.
The Balancing Agreement sets out the arrangements between the Company and JP Morgan AG (the “Series Counterparty”) with respect to the
rebalancing of the Metal held by the Company for the relevant ETC securities. Such rebalancing will be made in respect of FX Hedged ETC
Securities to reflect gains or losses in respect of the foreign exchange hedge element of the metal entitlement per ETC Security. The Balancing
Agreement broadly seeks to account for any currency hedging gains or losses by requiring deliveries of Precious Metal to be made between the
Company and the Series Counterparty so that, as a result of such deliveries, the amount of Underlying Metal held by the Company should equal
the aggregate metal entitlement per ETC Security in respect of all outstanding ETC Securities of the relevant Series. Where there are foreign
exchange gains and the metal entitlement per ETC Security consequently increases, the Series Counterparty will be required to deliver additional
Metal equivalent to such increase to the Company under the Balancing Agreement. Where there are losses and the metal entitlement per ETC
Security consequently decreases, the Company will be required to deliver Metal equivalent to such decrease to the Series Counterparty under the
Balancing Agreement. The balancing agreement is recognised as a derivative in the financial statements of the Company. Refer to note 3(b) and
3(f) for more detail.
Subscriptions
Only Authorised Participants may subscribe for ETC Securities from the Company. The Authorised Participant(s) in respect of each Series of
ETC Securities at the relevant Tranche Issue Date of such Series will be specified in the relevant Final Terms and have been disclosed on page 1.
The Company will, as subscription proceeds for the issue of ETC Securities, receive an amount of the relevant Metal from the Authorised
Participants subscribing for the ETC Securities sufficient to cover the relevant metal entitlement per ETC Security.
Securities may be offered by the Authorised Participant to any category of potential investors on the secondary market provided that the offer
complies with the selling restrictions set out in the Company’s prospectus.
Redemptions and Buy-backs
Buy-backs
An Authorised Participant may request that the Company buys back ETC Securities from such Authorised Participant. Prior to settlement of a
Buy-Back, the Authorised Participant will be required to deliver to the Issuing Agent acting on behalf of the Company the relevant ETC Securities
being bought back. The Company will not cancel such ETC Securities and deliver to the Authorised Participant an amount of Metal equal to the
product of the Metal Entitlement on the relevant trade date and the total number of ETC Securities being bought back, until the Determination and
Issuing Agent has confirmed receipt of such ETC Securities.
Xtrackers ETC Public Limited Company
Page 22
Notes to the financial statement
For year ending 30 September
2024
1. General information (continued)
Redemptions
The ETC Securities of a Series may become due and payable prior to their Scheduled Maturity Date, which is known as an “Early Redemption
Event” as defined in the Company’s Prospectus. If any of the Early Redemption Events occur, each ETC Security will become due and payable at
an amount (the “Early Redemption Amount”) equal to the greater of (i) the Early Metal Redemption Amount (defined below) plus the Specified
Interest Amount (as defined in the Company’s prospectus) and (ii) the Minimum Debt Principal Amount (as defined in the Company’s prospectus)
plus the Specified Interest Amount.
The “Early Metal Redemption Amount” is determined by multiplying (i) the metal entitlement per ETC Security as at the Early Redemption
Valuation Date (defined below); and (ii) the Average Metal Sale Price during the Early Redemption Disposal Period (defined below), net of
associated fees, deductions and taxes.
The “Early Redemption Valuation Date” is (i) the date specified as such in relation to the relevant Early Redemption Event or if not specified, the
date of the occurrence of such Early Redemption Event or (ii) the date on which the Trustee gives notice that due to the occurrence of an event of
default, the ETC Securities shall become due and payable at their Early Redemption Amount on the Scheduled Early Redemption Date, or if such
day is not a business day, the next following business day.
The “Early Redemption Disposal Period” is the period which lasts for the number of days specified in the Final Terms, which shall start from (but
exclude) the date falling four non-disrupted business days following the /Early Redemption Valuation Date.
On the Scheduled Maturity Date, each ETC Security will become due and payable at an amount (the “Final Redemption Amount”) equal to the
greater of (i) the Final Metal Redemption Amount (defined below) plus the Specified Interest Amount and (ii) 10 per cent. of the Issue Price per
ETC Security as at the Series Issue Date (the “Minimum Debt Principal Amount”) plus the Specified Interest Amount.
The “Final Metal Redemption Amount” is determined by multiplying (i) the metal entitlement per ETC Security as at the Final Redemption
Valuation Date (defined below); and (ii) the volume-weighted average prices per metal unit at which the Metal Agent is able to sell the Underlying
Metal (“Average Metal Sale Price”) during the Final Redemption Disposal Period (defined below), net of associated fees, deductions and taxes.
“Final Redemption Valuation Date” is the date specified in the Final Terms or, if such day is not business day, the next following business day.
The “Final Redemption Disposal Period” is the period which lasts for the number of days specified in the Final Terms, which shall start from (but
exclude) the date falling four non-disrupted business days following the Final Redemption Valuation Date.
2. Basis of preparation
The accounting policies set out below have been applied in preparing the financial statements for the year ended 30 September 2024; the
comparative information for the year ended 30 September 2023 presented in these financial statements has been prepared using the same accounting
policies.
These financial statements have been prepared on a going concern basis as disclosed in the Directors' report.
a. Statement of compliance
The financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as adopted for use in the
European Union (“EU”) and in accordance with the Companies Act 2014.
b. Basis of measurement
The financial statements have been prepared on the historical cost basis except for the following material items in the Statement of financial
position:
i. Precious metals measured at fair value;
ii. Precious metals due to/from Series Counterparty measured at fair value; and
iii. ETC securities designated at fair value through profit or loss.
The method used to measure fair values are discussed further in note 3(e, f, h) and 16.
c. Functional and presentation currency
The financial statements and notes to the financial statements are presented in US Dollar (“USD” or “$”) which is the Company’s functional
currency. Functional currency is the currency of the primary economic environment in which the entity operates. The Directors of the Company
believe that USD most faithfully represents the economic effects of the underlying transactions, events and conditions.
Xtrackers ETC Public Limited Company
Page 23
Notes to the financial statements (continued)
For the year ended 30 September 2024
2. Basis of preparation (continued)
d. Use of estimates and judgements
The preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect
the application of accounting policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated
assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of
which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in
which the estimates are revised and in any future periods affected. Details of material judgements and estimates have been further described in
accounting policy notes 3(e), 3(f), 3(h) and note 16.
Judgements
The following are the critical judgements and estimates that the Directors have made in the process of applying the Company’s accounting policies
and that have the most significant effect on the amounts recognised in the financial statements.
Accounting for Precious metals at fair value
Under IFRS there is no standard treatment for the classification of physical metals. The Precious metals are held to provide the security holders
with the exposure to changes in the fair value of Precious metals and therefore the Directors consider that carrying the Precious metals at fair
value through profit or loss, consistent with the treatment that would be applicable to a financial instrument, reflects the objectives and the purpose
of holding this asset.
e. Accounting standards
New effective EU endorsed standards for 01 October 2023 to 30 September 2024
Standards/interpretations
Effective date
Amendments to IAS 12 Income Taxes - deferred tax related to assets and liabilities arising from a
single transaction
1 January 2023
IFRS 17 Insurance Contracts
1 January 2023
Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practise Statement 2)
1 January 2023
Definition of Accounting Estimate (Amendments to IAS 8)
1 January 2023
International Tax Reform - Pillar Two Model Rules (Amendments to IAS 12)
23 May 2023
International Tax Reform - Pillar Two Model Rules (Amendments to the IFRS for SMEs Accounting
Standard
29 September 2023
None of the above standards, amendments and interpretations had a material impact on the Company’s financial statements.
Standards available for early adoption
Standards/interpretations
Effective date
IAS 1 Presentation of Financial Statements - Classification of Liabilities as Current or Non-current
1 January 2024
Amendments to IAS 21 - The Effects of Changes in Foreign Exchange Rates: Lack of
Exchangeability (issued on 15 August 2023)
1 January 2024
Amendments to IAS 7 & IFRS 7 - Disclosures: Supplier Finance Arrangements (issued on 25
May 2023)
1 January 2024
Amendments to IAS 1 Non-current Liabilities with Covenants
1 January 2024
Amendments to IFRS 16 Leases: Lease Liability in a Sale & Leaseback
1 January 2024
The amendments are not expected to have a material impact on the Company’s financial statements.
3. Material accounting policies
The Company has consistently applied the following accounting policies to all periods presented in these financial statements, except if mentioned
otherwise. In addition, the Company adopted 'Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2)' from 1
October 2023. The amendments require the disclosure of 'material' rather than 'significant' accounting policies. Although the amendments did not
result in any changes in accounting policies themselves, they impacted the accounting policy information disclosed (in this Note) in certain
instances. Set out below are the material accounting policies:
Xtrackers ETC Public Limited Company Page 24
Notes to the financial statements (continued)
For the year ended 30 September 2024
3. Material accounting policies (continued)
a) Foreign currency transactions
Transactions in foreign currencies are translated into the functional currency at the date of the transactions. Monetary assets and liabilities
denominated in foreign currencies at the reporting date are translated into the functional currency at the exchange rate at that date.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated into the functional currency at
the exchange rate at the date that the fair value was determined. Non-monetary items in a foreign currency that are measured in terms of historical
cost are translated using the exchange rate at the date of the transaction. Foreign currency differences arising on translation are recognised in the
Statement of comprehensive income.
Gains and losses arising on translation of ETC securities designated at fair value through profit or loss and Precious metals at fair value are
included in the Statement of comprehensive income together with fair value gains and losses as noted in note 3b and 3c.
b) Net fair value gain/loss on Precious Metal at fair value and Precious metals due to/from Series Counterparty
Net fair value gain on Precious metals and Precious metals due to/from Series Counterparty relates to the movement in the prices of metals and
hedging in respect of the derivative embedded in the Balancing Agreement and includes all realised and unrealised fair value changes. Any gains
and losses arising from changes in fair value of the Precious metals and changes in fair value of Precious metals due to/from Series Counterparty
are recorded in net fair value gain/loss on Precious metals at fair value and Precious metals due to/from Series Counterparty in the Statement of
comprehensive income.
c) Net fair value gain/loss on ETC securities designated at fair value through profit or loss
Net fair value gain/loss on ETC securities designated at fair value through profit or loss relates to ETC Securities issued and includes all realised
and unrealised fair value changes and foreign exchange differences. Any gains and losses arising from changes in the fair value of the ETC
securities designated at fair value through profit or loss are recorded in net fair value gain/loss on ETC Securities in the Statement of
Comprehensive Income. Details of recognition and measurement of financial liabilities are disclosed in the accounting policy of financial
instruments (note 3(h)). Further details regarding the application of IFRS 13 are disclosed in note 16.
d) Income and Expenses
Income and expenses are recognised on an accrual basis.
Product Fees
Each Series pays a product fee prepared by the Determination Agent, which accrues on a daily basis. This fee is used to pay the agreed fees of
other service providers of the Company at an annual rate ranging between 0.11% and 0.73% (2023: between 0.12% and 0.73%) and is applied to
the Metal Entitlement of the ETC Securities on a daily basis to determine a daily deduction of an amount of Metal from the Metal Entitlement of
the ETC Securities.
e) Precious metals at fair value
The Company hold Precious metals at least equal to the amount due to holders of ETC Securities solely for the purposes of meeting its obligations
under the ETC Securities. The Company has developed its policy in accordance with IAS and the Conceptual Framework in the absence of a
specific standard that applies to precious metals. The precious metals received from the Authorised Participants meets the definition of an asset
for the Company applying paragraphs 4.3 and 4.4 of the Conceptual Framework for Financial Reporting (the Conceptual Framework). This is
because the Company:
1. Obtains control of the precious metal, as the precious metal assets have been legally isolated
2. The Company derives economic benefit from the precious metal as it has the ability to use the precious metal to settle its ETC liabilities.
Chapter 6 of the Conceptual Framework describes two measurement bases - historical cost and current value, the latter including fair value, value
in use and fulfilment value and current cost. In the absence of a specific IFRS that applies to transactions involving precious metal assets, the
Directors have applied judgement in accordance with paragraph 10 of IAS 8 and has adopted the fair-value based approach, as they consider this
to provide the most useful information to the users of the financial statements.
The Precious metals are measured at fair value and changes in fair value are recognised in the Statement of comprehensive income. Any costs to
sell precious metal that arise in the course of settling the Company’s obligations under the ETC Securities are borne by the holders of the ETC
Securities (“ETC Security holders”).
Initial recognition
The precious metal is recognised when the metal is received into the vault of the Custodian.
Derecognition
The Company derecognises Precious metals held at fair value when the contractual rights to the asset have expired, or the Company has transferred
the rights to the asset in a transaction in which substantially all the risks and rewards of ownership are transferred.
Valuation of Precious metals
The gold is recorded at fair value using the last available price, nearest or at year-end, quoted by the London Bullion Market Association. The
AM fix (the “AM fix”) on 30 September 2024 and 30 September 2023 were used to value the gold as this was the last fix price available from the
London Bullion Market Association for the year on that date.
Xtrackers ETC Public Limited Company Page 25
Notes to the financial statements (continued)
For the year ended 30 September 2024
3. Material accounting policies (continued)
e) Precious metals at fair value (continued)
The silver is recorded at fair value using the last available price, nearest or at year-end, quoted by the London Bullion Market Association. The
fix on 30 September 2024 and 30 September 2023 were used to value the silver as this was the last fix price available from the London Bullion
Market Association for the year.
The platinum is recorded at fair value using the last available price, nearest or at year-end, quoted by the London Platinum and Palladium Market.
The AM fix on 30 September 2024 and 30 September 2023 were used to value the platinum as this was the last available fix price available from
the London Platinum and Palladium Market for the year.
Amounts receivable/(payable) on Precious metals awaiting settlement
Amounts receivable/(payable) on Precious metals awaiting settlement is the metal amount pending to be settled due to the Balancing Agreement
that settle post year end.
f) Precious metals due to/from Series Counterparty
Precious metals due to/from Series Counterparty (the Balancing Agreement) comprise a financial instrument whose value is linked to the Precious
Metal and foreign exchange. These instruments are mandatorily classified as financial assets/liabilities at fair value through profit or loss upon
initial recognition under IFRS 9 in consideration of contractual terms.
g) Amounts receivable/(payable) on ETC Securities awaiting settlement
Amounts receivable/(payable) on ETC Securities awaiting settlement is the ETC Securities that settle post year end in metal and are held at
amortised cost.
h) Financial instruments
Initial recognition
Financial liabilities at fair value through profit or loss are recognised initially at the trade date at which the Company becomes a party to the
contractual provisions of the instrument. Other financial liabilities are recognised on the date they are originated.
Classification
The Company has classified financial assets and financial liabilities into the following categories:
Financial assets and liabilities at fair value through profit or loss:
• Precious metals due to/from the Series Counterparty
• ETC securities designated at fair value through profit or loss
Financial assets at amortised cost:
• Cash and cash equivalents, receivables awaiting settlement and other receivables
Financial liabilities at amortised cost:
• Other payables and payables awaiting settlement
ETC Securities comprise a financial instrument whose redemption price is linked to exchange quoted prices. The ETC security may be settled by
returning the precious metal to the relevant Authorised Participant (non - financial obligation). Alternatively the obligation may be settled in cash
(financial obligation). Therefore, in substance the holder of the ETC security has been guaranteed a receipt of an amount that is at least equal to
the cash settlement amount. The ETC Securities are classified as financial liabilities at fair value through profit or loss upon initial recognition
under IFRS 9 as they are irrevocably designated by the entity as such. The Company designates the ETC Securities issued as financial liabilities
at fair value through profit or loss both on initial recognition and on an ongoing basis as a result of the derivative embedded in the ETC securities.
The amortised cost of a financial asset or liability is the amount at which the financial asset or liability is measured at initial recognition, minus
principal repayments, plus or minus the cumulative amortisation using the effective interest rate method or any difference between the initial
amount recognised and the maturity amount, minus any reduction for impairment.
Subsequent measurement
After initial measurement, the Company measures financial instruments which are designated as at fair value through profit or loss at their fair
value. Subsequent changes in the fair value of financial instruments designated at fair value through profit or loss are recognised directly in the
Statement of comprehensive income. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.
Derecognition
The Company derecognises a financial asset when the contractual rights to the asset expire, or it transfers the rights to the financial asset in a
transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in transferred financial
assets that is created or retained by the Company is recognised as a separate asset or liability. The Company derecognises a financial liability
when its contractual obligations are discharged, cancelled or expire.
Fair value measurement principles
Precious metals at fair value and precious metals due from Series Counterparty at fair value through profit or loss are valued using the appropriate
metal prices and/or forward foreign exchange prices consistent with the description in the accounting policy for Precious metals and Precious
metals due to/from Series Counterparty above. The exchange quoted value of the ETC Securities is determined by reference to exchange quoted
prices. Changes in the fair value of the ETC Securities are recognised in the Statement of Comprehensive Income.
Xtrackers ETC Public Limited Company
Notes to the financial statements (continued)
For the year ended 30 September 2024
Page 26
3. Material accounting policies (continued)
h) Financial instruments (continued)
Identification and measurement of impairment
IFRS 9 requires an impairment assessment to be carried out on its financial assets held at amortised cost. Impairment does not apply to
precious metals at fair value and precious metals due from Series Counterparty at fair value through profit or loss. The Directors assess the
probability of default of financial assets held at amortised cost to be close to zero, as these instruments have a low risk of default and the
counterparties have a strong capacity to meet their contractual obligations in the near term. As a result, no loss allowance has been recognised
in the financial statements based on 12-month expected credit losses as any such impairment would be wholly insignificant to the Company.
i) Other receivables and payables
Other receivables and payables are accounted for at amortised cost.
j) Cash and cash equivalents
Cash and cash equivalents include deposits held at call with the cash custodian which are subject to insignificant risk of changes in their fair
value and are used by the Company in the management of its short-term commitments.
k) Share capital
Share capital is issued in Euro ("EUR"). Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction from the
proceeds.
l) Segment reporting
A business segment is a group of assets and operations engaged in providing products or services that are subject to risks and returns that are
different from those of other business segments. The Directors are responsible for ensuring that the Company carries out business activities in
line with the transaction documents. They may delegate some or all of the day-to-day management of the business including the decisions to
purchase and sell securities to other parties both internal and external to the Company. The decisions of such parties are reviewed on a regular
basis to ensure compliance with the policies and legal responsibilities of Directors. Therefore, the Directors, as chief operating decision maker,
retain full responsibility as to major allocation decisions of the Company.
The Board believe that each Series can be treated as a segment. Furthermore, financial information reviewed by the Board of Directors is split
out by Series and decisions are made on the basis of this information. The split of financial liabilities designated at fair value through profit or
loss by Series is shown in note 12 to the financial statements. Details of the fair value movement by Series and the year-end unit price by Series
are included in note 12 which are the key measures of performance for each Series. There were no transactions between reportable segments
during the year. All the entity-wide disclosures are covered in the Statement of financial position and the Statement of comprehensive income and
the related notes. In addition, the Company has no single major customer from which greater than 10% of revenue is generated.
The below table provides segmental reporting breakdown for the year ended 30 September 2024:
Series
Income
Net fair value gain on
Precious metals at
fair value through
profit or loss
Net fair value loss on
ETC securities
designated at FVTPL
Operating
expenses
Operating
profit before
taxation
Series 1
60,869
1,062,781
(1,062,781)
(60,389)
480
Series 2
4,023,683
1,295,888,640
(1,295,888,640)
(4,023,203)
480
Series 3
234,905
36,181,242
(36,181,242)
(234,425)
480
Series 4
259,251
11,990,224
(11,990,224)
(258,771)
480
Series 5
1,706,975
250,520,659
(250,520,659)
(1,706,495)
480
Series 6
729,699
121,335,907
(121,335,907)
(729,219)
480
Series 7
68,651
785,202
(785,202)
(68,172)
479
Total
7,084,033
1,717,764,655
(1,717,764,655)
(7,080,674)
3,359
The below table provides segmental reporting breakdown for the year ended 30 September 2023:
Series
Income
Net fair value loss on
Precious metals at
fair value through
profit or loss
Net fair value gain on
ETC securities
designated at FVTPL
Operating
expenses
Operating
profit before
taxation
Series 1
75,560
1,378,831
(1,378,831)
(75,106)
454
Series 2
3,905,506
369,341,345
(369,341,345)
(3,905,052)
454
Series 3
216,130
18,385,922
(18,385,922)
(215,676)
454
Series 4
298,193
9,077,060
(9,077,060)
(297,739)
454
Series 5
1,928,754
105,856,498
(105,856,498)
(1,928,300)
454
Series 6
912,741
59,502,087
(59,502,087)
(912,287)
454
Series 7
94,956
1,691,267
(1,691,267)
(94,502)
454
Total
7,431,840
565,233,010
(565,233,010)
(7,428,662)
3,178
Xtrackers ETC Public Limited Company
Notes to the financial statements (continued)
For the year ended 30 September 2024
Page 27
4. Net fair value gain/(loss) on Precious Metals and Precious metals due to/from the Series
Counterparty
Year-ended
30-Sept-24
USD
Year-ended
30-Sept-23
USD
Net fair value gain on Precious metals
1,668,861,243
500,123,145
Net fair value gain on Precious metals due from Series Counterparty
48,903,412
65,109,865
1,717,764,655
565,233,010
5. Net fair value (loss)/gain on ETC Securities
Year-ended
30-Sept-24
USD
Year-ended
30-Sept-23
USD
Net fair value (loss) on ETC Securities
(1,717,764,655)
(565,233,010)
(1,717,764,655)
(565,233,010)
6. Income
Year-ended
30-Sept-24
USD
Year-ended
30-Sept-23
USD
Product fee
7,084,033
7,431,840
7,084,033
7,431,840
7. Operating expenses
Year-ended
30-Sept-24
USD
Year-ended
30-Sept-23
USD
Product fees to the Programme Administrator
7,080,674
7,428,662
7,080,674
7,428,662
Each Series pays a product fee prepared by the Determination Agent, which accrues on a daily basis. This fee is used to pay the agreed fees of service
providers of the Company. The Product fee is the rate set out for each Series as of 30 September 2024 and is applied to the Metal Entitlement on a daily
basis to determine a daily deduction of an amount of Metal from the Metal Entitlement. Refer to note 3 and 17 for more information.
Pursuant to the Programme Administrator Agreement, DWS International GmbH, the Programme Administrator receives 100% of the Product fee for each
series issued. In return DWS International GmbH pays a designated list of Programme expenses as set out in the Programme Administrator Agreement,
which may be amended from time to time, including where the aggregate of such expenses exceeds the Product Fee due to DWS International GmbH.
8. Auditors’ remuneration
Fees for the statutory auditor, KPMG Ireland:
Year-ended
30-Sept-24
USD
Year-ended
30-Sept-23
USD
Audit fees:
Statutory audit of financial statements
127,075*
117,593*
Other Non-Audit Service fees:
Tax advisory services
6,583*
6,230*
133,658
123,823
*Audit Fee (excluding VAT): EUR 113,500 (2023: EUR 111,000)
*Tax fee (excluding VAT): EUR 5,880 (2023: EUR 5,880)
Xtrackers ETC Public Limited Company
Notes to the financial statements (continued)
For the year ended 30 September 2024
Page 28
9. Taxation
The Company has been advised that it falls within the Irish regime for the taxation of qualifying companies as set out in Section 110 of the Taxes consolidation
Act 1997 (“Section 110”), and as such should be taxed only on the amount of its retained profit after deducting all amounts of interest and other revenue
expenses due to be paid by the Company. If ceases to be entitled to the benefits of Section 110, then profits or losses could arise in the Company which could
have tax effects not contemplated in the cashflows for the transaction and as such adversely affect the tax treatment of the Company and consequently the
payments on the ETC Securities.
The Company will be taxable as a securitisation Company pursuant to Section 110 of the Taxes Consolidation Act (“TCA”) 1997. Profits arising to the
Company are charged at a corporate tax rate of 25%. All expenses that are not capital in nature and are for the purposes of the Company’s activities will be
deductible from income in order to determine taxable profits.
The Company is a qualifying Company within the meaning of Section 110 of the TCA. As such, the profits are chargeable to corporation tax under Case III
of Schedule D of the TCA at the rate of 25% but are computed in accordance with the provisions applicable to Case I Schedule D of the TCA.
Year-ended
30-Sept-24
USD
Year-ended
30-Sept-23
USD
Net result for the financial year before tax
3,359
3,178
Corporation tax rate 25%
(840)
(794)
Taxation charge
(840)
(794)
10. Cash and cash equivalents
Year-ended
30-Sept-24
USD
Year-ended
30-Sept-23
USD
Cash at bank
2,477,926
765,044
2,477,926
765,044
11. Precious metals at fair value and Precious metals due to/from Series
Counterparty
Precious Metal
30-Sept-24
USD
Net Precious
metals due
to/from Series
Counterparty
30-Sept-24
USD
Precious metals at fair value
6,742,533,617
-
Precious metals due from Series Counterparty
-
82,020
Precious metals due to Series Counterparty
-
(1,682,761)
6,742,533,617
(1,600,741)
Movement in Precious metals and Precious metals due to/from Series
Counterparty
Precious Metal
30-Sept-24
USD
Net Precious
metals due
to/from Series
Counterparty
30-Sept-24
USD
At beginning of the year
4,067,249,325
2,689,877
Additions during the year
2,818,035,433
-
Disposals/settlements during the year*
(1,811,612,384)
(53,194,030)
Net changes in fair value during the year
1,668,861,243
48,903,412
At end of the year
6,742,533,617
(1,600,741)
Disposals of Net Precious metals due to/from Series Counterparty were in respect of Precious metals per the Balancing agreement into metals at fair value of
USD 53,194,030.
*Disposals/settlements during the year incorporates the value of the metals sold during the year to cover the expenses of the Company of USD 7,080,674.
However, this fee is excluded from the disposals of precious metals amount in the non-cash transactions during the year listing in the Statement of cash
f lows as it is a cash transaction.
Xtrackers ETC Public Limited Company
Notes to the financial statements (continued)
For the year ended 30 September 2024
Page 29
11. Precious metals at fair value and Precious metals due to/from Series
Counterparty (continued)
Precious Metal
30-Sept-23
USD
Net Precious
metals due
to/from Series
Counterparty
30-Sept-23
USD
Precious metals at fair value
4,067,249,325
-
Precious metals due from Series Counterparty
-
2,689,877
4,067,249,325
2,689,877
Movement in Precious metals and Precious metals due to/from Series
Counterparty
Precious Metal
30-Sept-23
USD
Net Precious
metals due
to/from Series
Counterparty
30-Sept-23
USD
At beginning of the year
4,155,236,718
5,833,251
Additions during the year
848,154,524
-
Disposals/settlements during the year*
(1,436,265,061)
(68,253,239)
Net changes in fair value during the year
500,123,144
65,109,865
At end of the year
4,067,249,325
2,689,877
Disposals of Net Precious metals due to/from Series Counterparty were in respect of Precious metals per the Balancing Agreement into metals at fair value of
USD 68,253,239.
*Disposals/settlements during the year incorporates the value of the metals sold during the year to cover the expenses of the Company of USD 7,428,662.
However, this fee is excluded from the disposals of precious metals amount in the non-cash transactions during the year listing in the Statement of Cash
Flows as it is a cash transaction.
Movement in Metal in troy ounces for the year ended 30 September 2024
Opening
balance
Metal
Metal
Metal
Price of metal
Fair value
USD
Series
Description
1-Oct-23
Troy
Ounces
contributed
Troy
Ounces
distributed
Troy Ounces
30- Sep -24
Troy Ounces
per ounce
30-Sep-24
30-Sept-24
USD
Series 1
Xtrackers IE Physical
Platinum ETC
18,669
6,985
(9,147)
16,507
$985.00
16,259,822
Series 2
Xtrackers IE Physical Gold
ETC
1,586,348
1,163,760
(667,623)
2,082,485
$2,629.95
5,476,830,257
Series 3
Xtrackers IE Physical Silver
ETC
4,779,561
623,419
(1,120,434)
4,282,546
$31.075
133,080,113
Series 4
Xtrackers IE Physical Silver
EUR Hedged ETC
1,595,525
939,180
(1,405,492)
1,129,213
$31.075
35,090,288
Series 5
Xtrackers IE Physical Gold
EUR Hedged ETC
336,621
148,761
(199,208)
286,174
$2,629.95
752,623,556
Series 6
Xtrackers IE Physical Gold
GBP Hedged ETC
158,697
80,047
(117,427)
121,317
$2,629.95
319,057,500
Series 7
Xtrackers IE Physical
Platinum EUR Hedged ETC
9,920
9,073
(9,255)
9,738
$985.00
9,592,081
8,485,341
2,971,225
(3,528,586)
7,927,980
6,742,533,617
Metal has been rounded to the nearest troy ounce in table above.
Xtrackers ETC Public Limited Company
Notes to the financial statements (continued)
For the year ended 30 September 2024
Page 30
11.
Precious metals at fair value and Precious metals due to/from Series
Counterparty (continued)
Movement in Metal in troy ounces for the year ended 30 September 2023
Series
Description
Opening
balance
1-Oct-22
Troy Ounces
Metal
contributed
Troy Ounces
Metal
distributed
Troy Ounces
Metal
30-Sep-23
Troy Ounces
Price of
metal per
ounce
30-Sep-23
Fair value
USD
30-Sept-23
USD
Series 1
Xtrackers IE Physical
Platinum ETC
21,460
6,613
(9,404)
18,669
$923.00
17,231,689
Series 2
Xtrackers IE Physical Gold
ETC
1,886,172
268,449
(568,273)
1,586,348
$1,870.50
2,967,263,841
Series 3
Xtrackers IE Physical Silver
ETC
4,642,093
598,260
(460,792)
4,779,561
$23.075
110,288,367
Series 4
Xtrackers IE Physical Silver
EUR Hedged EC
1,646,301
1,444,116
(1,494,892)
1,595,525
$23.075
36,816,735
Series 5
Xtrackers IE Physical Gold
EUR Hedged ETC
343,330
307,533
(314,242)
336,621
$1,870.50
629,649,302
Series 6
Xtrackers IE Physical Gold
GBP Hedged ETC
166,301
164,007
(171,611)
158,697
$1,870.50
296,843,189
Series 7
Xtrackers IE Physical
Platinum EUR Hedged ETC
13,784
11,496
(15,360)
9,920
$923.00
9,156,202
8,719,439
2,800,475
(3,034,573)
8,485,341
4,067,249,325
Metal has been rounded to the nearest troy ounce in table above.
12.
ETC securities designated at fair value through profit or loss
30-Sep-24
30-Sep-23
Nominal units
issued
Fair value
Nominal units
issued
Fair value
USD
USD
ETC Securities issued
167,463,541
6,723,955,903
144,024,756
4,070,939,819
Movement in ETC Securities issued
30-Sep-24
30-Sep-23
USD
USD
At beginning of the year
4,070,939,819
4,159,401,905
Issue of ETC Securities issued during the year
2,811,993,644
836,068,782
Redemption of ETC Securities issued during the year
(1,876,742,215)
(1,489,763,878)
Net changes in fair value during the year
1,717,764,655
565,233,010
At end of the year
6,723,955,903
4,070,939,819
The ETC Securities issued are listed on following exchanges: the Frankfurt Stock Exchange, the Borsa Italiana and the London Stock Exchange. Refer
to note 15 for a description of the key risks regarding the issue of these instruments.
Xtrackers ETC Public Limited Company
Notes to the financial statements (continued)
For the year ended 30 September 2024
Page 31
12.
ETC securities designated at fair value through profit and loss
(continued)
The ETC securities in issue at 30 September 2024 are as follows:
Series
Description
CCY
Maturity
Date
Units
outstanding
30 -Sep-24
Metal entitlement
per ETC Security*
(ounces)
Value per ETC
Security
(Local CCY)
30-Sept-24
Value per ETC
Security USD
30-Sept-24
Fair value
USD
30-Sept-24
Series 1
Xtrackers IE Physical
Platinum ETC
USD
17-Apr-80
671,683
0.0246
$24.2051
$24.2051
16,258,141
Series 2
Xtrackers IE Physical
Gold ETC
USD
23-Apr-80
134,691,436
0.0154
$40.5194
$40.5194
5,457,618,164
Series 3
Xtrackers IE Physical
Silver ETC
USD
30-Apr-80
2,983,217
1.4355
$44.6071
$44.6071
133,072,759
Series 4
Xtrackers IE Physical
Silver EUR
EUR
23-Apr-80
882,764
1.2829
€35.6276
$39.8673
35,193,451
Series 5
Hedged ETC
Xtrackers IE Physical
Gold EUR
EUR
21-May-80
20,122,291
0.0143
€33.5671
$37.4894
754,372,447
Hedged ETC
Series 6
Xtrackers IE Physical
Gold GBP
GBP
23-May-80
7,667,741
0.0158
£30.9713
$41.4489
317,819,437
Series 7
Hedged ETC
Xtrackers IE Physical
Platinum EUR
EUR
29-May-80
444,409
0.0220
€19.3477
$21.6501
9,621,504
Hedged ETC
Total
167,463,541
6,723,955,903
*Metal entitlement per ETC security is calculated exclusive of ETC securities awaiting settlement.
Movement in fair values by Series for the year ended 30 September 2024
Opening balance
Net changes in
Closing balance
Series
Description
1-Oct-23
USD
Issuances
USD
Redemptions
USD
fair values
USD
30-Sept-24
USD
Series 1
Xtrackers IE Physical
Platinum ETC
17,230,386
6,606,311
(8,641,337)
1,062,781
16,258,141
Series 2
Xtrackers IE Physical Gold
ETC
2,966,605,505
2,645,412,540
(1,450,288,522)
1,295,888,640
5,457,618,164
Series 3
Xtrackers IE Physical Silver
ETC
109,271,386
16,284,559
(28,664,427)
36,181,242
133,072,759
Series 4
Xtrackers IE Physical Silver
EUR Hedged ETC
36,999,552
10,523,083
(24,319,408)
11,990,224
35,193,451
Series 5
Xtrackers IE Physical Gold
EUR Hedged ETC
632,986,670
74,025,193
(203,160,075)
250,520,659
754,372,447
Series 6
Xtrackers IE Physical Gold
GBP Hedged ETC
298,650,999
54,050,285
(156,217,754)
121,335,907
317,819,437
Series 7
Xtrackers IE Physical
Platinum EUR Hedged ETC
9,195,321
5,091,673
(5,450,692)
785,202
9,621,504
4,070,939,819
2,811,993,644
(1,876,742,215)
1,717,764,655
6,723,955,903
Xtrackers ETC Public Limited Company Page 32
Notes to the financial statements (continued)
For the year ended 30 September 2024
12.
ETC securities designated at fair value through profit and loss
(continued)
The ETC securities in issue at 30 September 2023 are as follows:
Series
Description
CCY
Maturity
Date
Units
outstanding
30 -Sep-23
Metal entitlement
per ETC Security*
(ounces)
Value per ETC
Security
(Local CCY)
30-Sept-23
Value per ETC
Security USD
30-Sept-23
Fair value
USD
30-Sept-23
Series 1
Xtrackers IE Physical
Platinum ETC
USD
17-Apr-80
756,734
0.0247
$22.7694
$22.7694
17,230,386
Series 2
Xtrackers IE Physical
Gold ETC
USD
23-Apr-80
102,823,390
0.0154
$28.8515
$28.8515
2,966,605,505
Series 3
Xtrackers IE Physical
Silver ETC
USD
30-Apr-80
3,292,199
1.4384
$33.1910
$33.1910
109,271,386
Series 4
Xtrackers IE Physical
Silver EUR
EUR
23-Apr-80
1,274,583
1.2580
€27.3572
$29.0288
36,999,552
Series 5
Hedged ETC
Xtrackers IE Physical
Gold EUR
EUR
21-May-80
24,453,307
0.0138
€24.4665
$25.8855
632,986,670
Hedged ETC
Series 6
Xtrackers IE Physical
Gold GBP
GBP
23-May-80
10,960,773
0.0146
£22.3046
$27.2473
298,650,999
Series 7
Hedged ETC
Xtrackers IE Physical
Platinum EUR
EUR
29-May-80
463,770
0.0215
€18.7077
$19.8273
9,195,321
Hedged ETC
Total
144,024,756
4,070,939,819
*Metal entitlement per ETC security is calculated exclusive of ETC securities awaiting settlement.
Movement in fair values by Series for the year ended 30 September 2023
Opening balance
Net changes in
Closing balance
Series
Description
1-Oct-22
USD
Issuances
USD
Redemptions
USD
fair values
USD
30-Sept-23
USD
Series 1
Xtrackers IE Physical
Platinum ETC
18,540,464
6,544,609
(9,233,517)
1,378,831
17,230,386
Series 2
Xtrackers IE Physical Gold
ETC
3,139,966,835
507,721,658
(1,050,424,334)
369,341,345
2,966,605,505
Series 3
Xtrackers IE Physical Silver
ETC
88,289,172
14,062,884
(11,466,591)
18,385,922
109,271,386
Series 4
Xtrackers IE Physical Silver
EUR Hedged ETC
31,912,511
10,628,688
(14,618,707)
9,077,060
36,999,552
Series 5
Xtrackers IE Physical Gold
EUR Hedged ETC
581,841,157
205,703,259
(260,414,245)
105,856,498
632,986,670
Series 6
Xtrackers IE Physical Gold
GBP Hedged ETC
286,737,804
87,355,684
(134,944,576)
59,502,087
298,650,999
Series 7
Xtrackers IE Physical
Platinum EUR Hedged ETC
12,113,962
4,052,000
(8,661,908)
1,691,267
9,195,321
4,159,401,905
836,068,782
(1,489,763,877)
565,233,010
4,070,939,819
Xtrackers ETC Public Limited Company
Notes to the financial statements (continued)
Page 33
For the year ended 30 September 2024
13.
Share Capital
30-Sep-24
30-Sep-23
Authorised:
EUR
EUR
1,000,000 ordinary shares of EUR 1 each
1,000,000
1,000,000
Issued and fully paid:
USD
USD
25,000 ordinary shares of EUR 1 each
27,223
27,223
27,223
27,223
As at 30 September 2024 and as at 30 September 2023, the ordinary share capital was held by the following non-beneficial nominees:
30-Sep-24
30-Sep-23
USD
USD
Wilmington Trust SP Services (Dublin) Limited
27,223
27,223
27,223
27,223
The issued share capital of the Company is EUR 25,000 divided into 25,000 ordinary shares of EUR 1 each, all of which have been issued and fully paid
up (2023: issued and fully paid). The nominee has no beneficial interest in and derives no benefit from its holding of the shares. There are no other rights
that pertain to the shares and the shareholders.
14. Capital risk management
The Company views the share capital as its capital. The Company is a special purpose vehicle set up to issue ETC Securities for the purpose of making
investments as defined under the programme memorandum and in each of the Series memorandum agreements. Share capital of EUR 25,000 was issued in
line with Irish Company Law and is not used for financing the investment activities of the Company. The Company is not subject to any other externally
imposed capital requirements. The Company can issue further series of ETC Securities to meet the demand of its investors.
15. Financial risk management
Risk management framework
The Company, and ultimately the holders of the ETC Securities, have exposure to the following risks from its use of financial instruments:
a) Market risk;
b) Credit risk;
c) Liquidity risk; and
d) Operational risk.
This note presents information about the Company's exposure to each of the above risks, the Company's objectives, policies and processes for measuring
and managing these risks.
a) Market risk
Market risk comprises three types of risk: interest rate risk, currency risk and other price risk. The ETC Security holders are exposed to the market
risk of the financial instruments.
(i) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of financials instruments will fluctuate as a result of a change in interest
rates. The ETC Securities, the Precious metals due from the Series Counterparty and the Precious metals do not bear interest. As such, the
Company and ETC Security holders have limited exposure to interest rate risk.
(ii) Currency risk
The Company has exposure to currency risk as some of the Currency-Hedged Metal Securities are priced in currencies other than US
Dollars and hedged against exchange rate movements between the US Dollar and the Euro or Pound Sterling. However, the Directors do
not consider the Company to have a significant exposure to currency risk arising from the current economic uncertainties facing a number
of countries around the world as the gains or losses on the liability represented by the Currency-Hedged Metal Securities are matched
economically by corresponding losses or gains attributable to the Precious metals and Precious metals due to/from Series Counterparty as
result of the Balancing Agreement. Refer to note 1 and note for more detail.
Xtrackers ETC Public Limited Company
Page 34
Notes to the financial statements (continued)
For the year ended 30 September 2024
15. Financial risk management (continued)
a) Market risk (continued)
(ii) Currency risk (continued)
As at the reporting date, the carrying value of the Company’s assets and liabilities held in individual foreign currencies were as follows:
Series 4
Xtrackers IE Physical Silver EUR Hedged ETC
USD
USD
USD
ETC Security at fair value
Notional amount of the
Balancing Agreement
Net exposure
EUR
(35,193,451)
35,193,451
-
Total
(35,193,451)
35,193,451
-
In the event that the Euro moved by either +5% or -5% against the USD, the value of the ETC Security would move by
USD 1,759,675 and USD (1,759,675) respectively. However, the Balancing Agreement would offset these movements
by USD (1,759,675) and USD 1,759,675 respectively, resulting in a zero net exposure.
Series 5
Xtrackers IE Physical Gold EUR Hedged ETC
USD
USD
USD
ETC Security at fair value
Notional amount of the
Balancing Agreement
Net exposure
EUR
(754,372,447)
754,372,447
-
Total
(754,372,447)
754,372,447
-
In the event that the Euro moved by either +5% or -5% against the USD, the value of the ETC Security would move by
USD 37,718,625 and USD (37,718,625) respectively. However, the Balancing Agreement would offset these movements
by USD (37,718,625) and USD 37,718,625 respectively, resulting in a zero net exposure.
Series 6
Xtrackers IE Physical Gold GBP Hedged ETC
USD
USD
USD
ETC Security at fair value
Notional amount of the
Balancing Agreement
Net exposure
GBP
(317,819,437)
317,819,437
-
Total
(317,819,437)
317,819,437
-
In the event that the Pound Sterling moved by either +5% or -5% against the USD, the value of the ETC Security would
move by USD 15,890,970 and USD (15,890,970) respectively. However, the Balancing Agreement would offset these
movements by USD (15,890,970) and USD 15,890,970 respectively, resulting in a zero net exposure.
Xtrackers ETC Public Limited Company
Page 35
Notes to the financial statements (continued)
For the year ended 30 September 2024
15. Financial risk management (continued)
a) Market risk (continued)
(ii) Currency risk (continued)
Series 7
Xtrackers IE Physical Platinum EUR Hedged ETC
USD
USD
USD
ETC Security at fair value
Notional amount of the
Balancing Agreement
Net exposure
EUR
(9,621,504)
9,621,504
-
Total
(9,621,504)
9,621,504
-
In the event that the Euro moved by either +5% or -5% against the USD, the value of the ETC Security would move by
USD 481,075 and USD (481,075) respectively. However, the Balancing Agreement would offset these movements by
USD (481,075) and USD 481,075 respectively, resulting in a zero net exposure.
Currency risk exposure as at 30 September 2023:
Series 4
Xtrackers IE Physical Silver EUR Hedged ETC
USD
USD
USD
ETC Security at fair value
Notional amount of the
Balancing Agreement
Net exposure
EUR
(36,999,552)
36,999,552
-
Total
(36,999,552)
36,999,552
-
In the event that the Euro moved by either +5% or -5% against the USD, the value of the ETC Security would move by
USD 1,849,980 and USD (1,849,980) respectively. However, the Balancing Agreement would offset these movements
by USD (1,849,980) and USD 1,849,980 respectively, resulting in a zero net exposure.
Series 5
Xtrackers IE Physical Gold EUR Hedged ETC
USD
USD
USD
ETC Security at fair value
Notional amount of the
Balancing Agreement
Net exposure
EUR
(632,986,670)
632,986,670
-
Total
(632,986,670)
632,986,670
-
I In the event that the Euro moved by either +5% or -5% against the USD, the value of the ETC Security would move by
USD 31,649,335 and USD (31,649,335) respectively. However, the Balancing Agreement would offset these movements
by USD (31,649,335) and USD 31,649,335 respectively, resulting in a zero net exposure.
Series 6
Xtrackers IE Physical Gold GBP Hedged ETC
USD
USD
USD
ETC Security at fair value
Notional amount of the
Balancing Agreement
Net exposure
GBP
(298,650,999)
298,650,999
-
Total
(298,650,999)
298,650,999
-
In the event that the Pound Sterling moved by either +5% or -5% against the USD, the value of the ETC Security would
move by USD 14,932,550 and USD (14,932,550) respectively. However, the Balancing Agreement would offset these
movements by USD (14,932,550) and USD 14,932,550 respectively, resulting in a zero net exposure.
Xtrackers ETC Public Limited Company
Page 36
Notes to the financial statements (continued)
For the year ended 30 September 2024
15. Financial risk management (continued)
a) Market risk (continued)
(ii) Currency risk (continued)
Series 7
Xtrackers IE Physical Platinum EUR Hedged ETC
USD
USD
USD
ETC Security at fair value
Notional amount of the
Balancing Agreement
Net exposure
EUR
(9,195,321)
9,195,321
-
Total
(9,195,321)
9,195,321
-
In the event that the Euro moved by either +5% or -5% against the USD, the value of the ETC Security would move by
USD 459,765 and USD (459,765) respectively. However, the Balancing Agreement would offset these movements by
USD (459,765) and USD 459,765 respectively, resulting in a zero net exposure.
b. Price risk
Price risk is the risk that changes in market prices of metals will affect the Company’s income, expense, Precious metals and ETC
securities at fair value through profit or loss. The Company’s liabilities are exposed to the market prices of the metals. However, the
risk is mitigated by the Company holding quantities of Precious metals equivalent to the weight of metal entitlement for each Series
of ETC Securities issued.
The following table assess the sensitivity of the fair value of ETC securities for each series to an impact of a 10% movement in the price of
Precious metals as at 30 September 2024:
Series
Fair value of ETC securities
for each series
10% increase in
price of Precious
metals in USD
10% decrease in price of
Precious metals in USD
Xtrackers IE Physical Platinum ETC Securities
16,258,141
1,625,810
(1,625,810)
Xtrackers IE Physical Gold ETC Securities
5,457,618,164
545,761,820
(545,761,820)
Xtrackers IE Physical Silver ETC Securities
133,072,759
13,307,280
(13,307,280)
Xtrackers IE Physical Silver EUR Hedged ETC
Securities
35,193,451
3,519,350
(3,519,350)
Xtrackers IE Physical Gold EUR Hedged ETC
Securities
754,372,447
75,437,250
(75,437,250)
Xtrackers IE Physical Gold GBP Hedged ETC
Securities
317,819,437
31,781,940
(31,781,940)
Xtrackers IE Physical Platinum EUR Hedged ETC
Securities
9,621,504
962,150
(962,150)
The following table assess the sensitivity of the fair value of ETC securities for each series to an impact of a 10% movement in the price of
Precious metals as at 30 September 2023:
Series
Total for each series
10% increase in price
of Precious metals in
USD
10% decrease in price of
Precious metals in USD
Xtrackers IE Physical Platinum ETC Securities
17,230,386
1,723,040
(1,723,040)
Xtrackers IE Physical Gold ETC Securities
2,966,605,505
296,660,550
(296,660,550)
Xtrackers IE Physical Silver ETC Securities
109,271,386
10,927,140
(10,927,140)
Xtrackers IE Physical Silver EUR Hedged ETC
Securities
36,999,552
3,699,960
(3,699,960)
Xtrackers IE Physical Gold EUR Hedged ETC
Securities
632,986,670
63,298,670
(63,298,670)
Xtrackers IE Physical Gold GBP Hedged ETC
Securities
298,650,999
29,865,100
(29,865,100)
Xtrackers IE Physical Platinum EUR Hedged ETC
Securities
9,195,321
919,530
(919,530)
Xtrackers ETC Public Limited Company
Page 37
Notes to the financial statements (continued)
For the year ended 30 September 2024
15. Financial risk management (continued)
b) Credit risk
Credit risk is the risk of financial loss to the Company if a counterparty to a financial instrument fails to meet its contractual obligations. The
Company’s principal financial assets are cash and cash equivalents, other receivables, Amounts Receivable on Precious metals awaiting
settlement and Precious metals due from the Series Counterparty which represents the Company's maximum exposure to credit risk. All
credit risks are ultimately borne by the ETC Security holders.
30-Sep-24
30-Sept-23
USD
USD
Precious metals due from Series Counterparty
82,020
2,689,877
Amounts Receivable on Precious metals awaiting settlement
3,951,935
2,814,106
Amounts Receivable on ETC Securities awaiting settlement
-
4,571,761
Other receivables
30,990
1,121,952
Cash and cash equivalents
2,477,926
765,044
6,542,871
11,962,740
As at 30 September 2024, no financial assets carried at amortised cost were past due or impaired (2023: Nil). The Directors have also
considered the credit risk and counterparty risk with JP Morgan Chase Bank N.A., London Branch as custodian (the "Custodian") and Series
Counterparty respectively, of the Precious metals held by the Company given the significance of the Precious metals to the overall financial
position of the Company. As at 30 September 2024, the Company held Precious metals at fair value of USD 6,742,533,617 (2023:
4,067,249,325) with the Custodian. Amounts payable on ETC securities awaiting settlement amounted to USD 20,872,032 (2023: USD 6,243,267)
and Amounts receivable on ETC securities awaiting settlement amounted to Nil (2023: USD 4,571,761). Precious metals due from the Series
Counterparty with a fair value of USD 82,020 (2023: USD 2,689,877) and Precious metals due to the Series Counterparty with a fair value
of USD 1,682,761 (2023: USD Nil) was held with the Custodian as at 30 September 2024. Amount payable on Precious metals awaiting
settlement with a fair value of Nil (2023: USD 73,566), amount receivable on the Precious metals awaiting settlement USD 3,951,935 (2023:
USD 2,814,106) and cash and cash equivalents to the amount of USD 2,477,926 (2023: USD 765,044) were held with the Custodian.
Considering the credit rating status of the Custodian (2024: S&P A+ (2023: S&P A+)), the Directors are of the opinion that counterparty
risk is acceptable. Ultimately, all credit and counterparty risks associated with the Custodian are borne by the ETC Security holders.
Custodian Risk
The Company’s ability to meet its obligations with respect to the ETC Securities is dependent upon the performance of the Custodian of its
obligations under the relevant Custody Agreement. Consequently, the Security Holders are relying on the creditworthiness of the Custodian
and the precious metals are segregated from the assets of the Custodian into allocated accounts, with ownership rights remaining with the
Company. To mitigate the Company’s exposure to the Custodian, the Programme Administrator employs specific procedures to ensure that
the Custodian is a reputable institution and that the counterparty credit risk is acceptable to the Company. The Company only transacts with
Custodians with high credit-ratings assigned by international credit-rating agencies. As outlined above, the credit rating status of the
Custodian is A+ (2023: A+) (Standard and Poor’s rating).
The Precious metals are held by the Custodian in their vault premises in the United Kingdom. The Custodian has no obligation to maintain
insurance specific to the Company or specific only to the precious metal held for the Company against theft, damage or loss. However, the
Custodian maintains insurance in connection with its own business operation. The level of insurance and particulars remains at the discretion
of the Custodian. There is a risk that the precious metal could be lost, stolen or damaged and the Company would not be able to satisfy its
obligations in respect of the ETC Securities. In such an event the Company would adjust the Metal Entitlement of each Security of the
relevant Series to the extent necessary to reflect such damage or loss.
Concentration risk
At the reporting date, the Company's Precious metals due from Series Counterparty were concentrated in the following asset types and
geographical location:
By industry
30-Sep-24
30-Sep-23
Types of collaterals
%
%
Gold
97.13
95.73
Silver
2.49
3.62
Platinum
0.38
0.65
100
100
Xtrackers ETC Public Limited Company
Page 38
Notes to the financial statements (continued)
For the year ended 30 September 2024
15. Financial risk management (continued)
b) Credit risk (continued)
Concentration risk (continued)
By Geographical location
30-Sep-24
30-Sep-23
Country of origin
%
%
United Kingdom*
100
100
*the Precious metals are held in a vault in the United Kingdom.
100
100
c) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its obligations as they fall due. The Company limits its exposure to liquidity
risk through the purchase of Precious metals. All liquidity risk associated with the Precious metals are ultimately borne by the ETC Security
holders. As the redemption of ETC Securities will always coincide with the transfer of an equal amount of Precious metals, no net liquidity risk is
considered to arise.
The contractual maturity profile of financial liabilities as at 30 September 2024 is as follows:
Carrying amount
Gross contractual
obligations
Less than one year
USD
USD
USD
ETC securities designated at fair value through profit or loss
6,723,955,903
6,723,955,903
6,723,955,903
Amounts payable on ETC Securities awaiting settlement
20,872,032
20,872,032
20,872,032
Amounts payable on Precious metals awaiting settlement
-
-
-
Other payables
2,527,662
2,527,662
2,527,662
6,747,355,597
6,747,355,597
6,747,355,597
The contractual maturity profile of financial liabilities as at 30 September 2023 is as follows:
Carrying amount
Gross contractual
obligations
Less than one year
USD
USD
USD
ETC securities designated at fair value through profit or loss
4,070,939,819
4,070,939,819
4,070,939,819
Amounts payable on ETC Securities awaiting settlement
6,243,267
6,243,267
6,243,267
Amounts payable on Precious metals awaiting settlement
73,566
73,566
73,566
Other payables
1,919,801
1,919,801
1,919,801
4,079,176,453
4,079,176,453
4,079,176,453
Due to the fact that the ETC Security holders have the option to redeem the securities before the final scheduled maturity date, the ETC securities
designated at fair value have been classified as due in less than one year. Maturity dates across the ETC Securities range between April 2080 and
May 2080.
The carrying amount and the gross contractual cashflows are equal to the fair value of each liability as stated in the Statement of financial position.
ETC Security Holders can request redemption on demand in accordance with the terms stated below.
Subscriptions
Only Authorised Participants may subscribe for ETC Securities from the Company. The Authorised Participant(s) in respect of each Series of
ETC Securities at the relevant Tranche Issue Date of such Series will be specified in the relevant Final Terms. The Company will, as subscription
proceeds for the issue of ETC Securities, receive an amount of the relevant Metal from the Authorised Participants subscribing for the ETC
Securities sufficient to cover the relevant metal entitlement per ETC Security.
Securities may be offered to any category of potential investors provided that the offer complies with the selling restrictions set out in the
Company’s prospectus.
Redemptions and Buy-backs
Buy-backs
An Authorised Participant may request that the Company buys back ETC Securities from such Authorised Participant. Prior to settlement of a
Buy-Back, the Authorised Participant will be required to deliver to the Issuing Agent acting on behalf of the Company the relevant ETC Securities
being bought back. The Company will not cancel such ETC Securities and deliver to the Authorised Participant an amount of Metal equal to the
product of the Metal Entitlement on the relevant trade date and the total number of ETC Securities being bought back, until the Issuing Agent
has confirmed receipt of such ETC Securities.
Xtrackers ETC Public Limited Company
Page 39
Notes to the financial statements (continued)
For the year ended 30 September 2024
15. Financial risk management (continued)
c) Liquidity risk (continued)
Redemptions and Buy-backs (continued)
Redemptions
The ETC Securities of a Series may become due and payable prior to their Scheduled Maturity Date, which is known as an “Early Redemption Event”
as defined in the Company’s Prospectus. If any of the Early Redemption Events occur, each ETC Security will become due and payable at an amount
(the “Early Redemption Amount”) equal to the greater of (i) the Early Metal Redemption Amount (defined below) plus the Specified Interest Amount
and (ii) the Minimum Debt Principal Amount plus the Specified Interest Amount.
The “Early Metal Redemption Amount” is determined by multiplying (i) the metal entitlement per ETC Security as at the Early Redemption Valuation
Date (defined below); and (ii) the Average Metal Sale Price during the Early Redemption Disposal Period (defined below), net of associated fees,
deductions and taxes.
The “Early Redemption Valuation Date” is (i) the date specified as such in relation to the relevant Early Redemption Event or if not specified, the date
of the occurrence of such Early Redemption Event or (ii) the date on which the Trustee gives notice that due to the occurrence of an event of default,
the ETC Securities shall become due and payable at their Early Redemption Amount on the Scheduled Early Redemption Date, or if such day is not a
business day, the next following business day.
The “Early Redemption Disposal Period” is the period which lasts for the number of days specified in the Final Terms, which shall start from (but
exclude) the date falling four non-disrupted business days following the Early Redemption Valuation Date.
On the Scheduled Maturity Date, each ETC Security will become due and payable at an amount (the “Final Redemption Amount”) equal to the greater
of (i) the Final Metal Redemption Amount (defined below) plus the Specified Interest Amount and (ii) 10 per cent. of the Issue Price per ETC Security
as at the Series Issue Date (the “Minimum Debt Principal Amount”) plus the Specified Interest Amount.
The “Final Metal Redemption Amount” is determined by multiplying (i) the metal entitlement per ETC Security as at the Final Redemption Valuation
Date (defined below); and (ii) the volume-weighted average prices per metal unit at which the Metal Agent is able to sell the Underlying Metal (“Average
Metal Sale Price”) during the Final Redemption Disposal Period (defined below), net of associated fees, deductions and taxes.
“Final Redemption Valuation Date” is the date specified in the Final Terms or, if such day is not business day, the next following business day.
The “Final Redemption Disposal Period” is the period which lasts for the number of days specified in the Final Terms, which shall start from (but
exclude) the date falling four non-disrupted business days following the Final Redemption Valuation Date.
d) Operational risk
Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the Company’s processes and infrastructure,
and from external factors other than credit, markets and liquidity issues such as those arising from legal and regulatory requirements and generally
accepted standards of corporate behaviour.
Operational risks arise from all of the Company’s operations. The Company was incorporated with the purpose of engaging in those activities outlined
in note 1. All administration functions are undertaken by Wilmington Trust SP Services (Dublin) Limited. Deutsche Bank AG, Jane Street Financial
Limited, HSBC Bank Plc, Susquehanna International Securities Limited and Flow Traders B.V., Morgan Stanley & Co. International Plc, Citigroup
Global Markets Limited, Optiver VOF and Virtu Financial Ireland Limited act as the Company’s authorised participants (the " Authorised Participants"),
DWS International GmbH acts as arranger (the "Arranger") and Programme Administrator, JP Morgan Chase Bank N.A. acts as metal agent (the "Metal
Agent"), Secured Account Custodian, Fee Account Custodian and Subscription Account Custodian and State Street Fund Services (Ireland) Limited
(“Determination and Issuing Agent”) acts as issuing and determination agent.
16. Fair values
The Company's financial assets and financial liabilities at fair value through profit or loss are carried at fair value in the Statement of financial position.
The Company’s accounting policy on fair value measurement for Precious metals is disclosed in note 3(e) to the financial statements. The Company's
accounting policy on fair value measurement of ETC securities designated at fair value is disclosed in note 3(h). The Company measures fair values
using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements.
a.
Level 1: Quoted market price in an active market for an identical instrument.
b. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
c.
Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).
The objective of valuation techniques is to arrive at a fair value determination that reflects the price of the financial instrument at the reporting date that
would have been determined by market participants acting at arm’s length.
Xtrackers ETC Public Limited Company
Page 40
Notes to the financial statements (continued)
For the year ended 30 September 2024
16. Fair values (continued)
Level 2 prices use widely recognized valuation models for determining the fair value of common and more simple financial instruments that use only
observable market data and require little management judgement and estimation. Availability of observable market prices and model inputs reduces the
need for management judgement and estimation and also reduces the uncertainty associated with determination of fair values. Availability of observable
market prices and inputs varies depending on the products and markets and is prone to changes based on specific events and general conditions in the
financial markets. Precious metals due to/from Series Counterparty (the Balancing Agreement) comprise a financial instrument whose value is linked to
the Precious Metal and foreign exchange and are valued using the appropriate metal price and forward foreign exchange price input.
Transfers between levels are determined based on changes to the significant inputs used in their fair value measurement. The Company recognises transfers
between levels of the fair value hierarchy as at the end of the reporting year during which the change occurred. The Directors evaluate whether significant inputs
to the valuation models are observable at the year-end in making a decision to transfer a valuation from one level to another.
The Company determines the effective date of transfer at the beginning of the reporting year. There were some ETC series that were reclassified from
Level 1 to Level 2, USD 44,814,955 (2023: USD 109,271,386), and from Level 2 to Level 1, USD 133,072,759 (2023: USD 307,846,320), on the basis
of volume and market liquidity.
The Company does not have any financial instruments at Level 3 and there has not been any transfer between levels during the year ended 30 September
2024.
The following table presents financial assets, financial liabilities and precious metals measured at fair value on the Statement of Financial Position by
investment type and by level within the valuation hierarchy as at 30 September 2024:
Level 1
Level 2
Level 3
Total
USD
USD
USD
USD
Precious metals at fair value
6,742,533,617
-
-
6,742,533,617
Precious metals due from Series Counterparty
-
82,020
-
82,020
6,742,533,617
82,020
-
6,742,615,637
Level 1
Level 2 *
Level 3
Total
USD
USD
USD
USD
ETC securities designated at fair value through profit or loss
(6,662,882,807)
(61,073,096)
-
(6,723,955,903)
Precious metals due to Series Counterparty
-
(1,682,761)
-
(1,682,761)
(6,662,882,807)
(62,755,857)
-
(6,725,638,664)
*Level 2 – Series Xtrackers IE Physical Platinum ETC Securities, Series Xtrackers IE Physical Silver EUR Hedged ETC and Series Xtrackers IE
Physical Platinum EUR Hedged ETC
The following table presents financial assets, financial liabilities and precious metals measured at fair value on the Statement of Financial Position by
investment type and by level within the valuation hierarchy as at 30 September 2023:
Level 1
Level 2
Level 3
Total
USD
USD
USD
USD
Precious metals at fair value
4,067,249,325
-
-
4,067,249,325
Precious metals due from Series Counterparty
-
2,689,877
-
2,689,877
4,067,249,325
2,689,877
-
4,069,939,202
Level 1
Level 2 *
Level 3
Total
USD
USD
USD
USD
ETC securities at fair value
(3,944,438,047)
(126,501,772)
-
(4,070,939,819)
(3,944,438,047)
(126,501,772)
-
(4,070,939,819)
*Level 2 – Series Xtrackers IE Physical Platinum ETC Securities and Series Xtrackers IE Physical Silver ETC Securities.
Other financial assets and liabilities are classified as Level 2.
Xtrackers ETC Public Limited Company
Page 41
Notes to the financial statements (continued)
For the year ended 30 September 2024
17. Related Party Transactions and Connected Parties
Related Parties
Parties are considered to be related if one party has the ability to control the other party or is able to exercise significant influence over the party, in
making financial or operational decisions.
The Company’s related parties are the Directors and Wilmington Trust SP Services (Dublin) Limited (“WTD”). During the financial year, the Company
received services to the value of USD 68,858 (2023: USD 43,415) from WTD in line with the Corporate Services Agreement dated 16 March 2020 of
which USD Nil (2023: USD Nil) was outstanding at year end. Claudio Borza is a Director of the Company and is also a director of WTD. Eileen Starrs
is a director of the Company and an employee of WTD. The Director’s fees are included as part of the above purchased services, and consideration paid
to WTD that can be said to relate to the provision of director services amounted to USD 2,000 (2023: USD 2,000).
All of the ordinary shares of the Company are held by WTD as share trustee on trust for charitable purposes to the value of EUR 25,000.
Legal Ownership of the Company
The principle shareholders Wilmington Trust SP Services (Dublin) Limited hold 25,000 shares in trust of the Company as at 30 September 2024 (2023:
25,000). The shares are held under the terms of the declarations of trust dated 20 July 2018 under which the relevant share trustee holds the issued
shares of the Company on trust for charitable purposes. The profit of the Company is retained until the Company winds up its operation whereby any
excess profit will be distributed to its shareholders.
The Board of Directors are responsible for the day-to-day management of the Company. As of the year ended 30 September 2024, the Board is composed
of two Directors, whom are employees of the corporate services provider.
Connected Parties
Connected parties are those parties with significant agreements with the service providers. The Company’s connected party is the Programme
Administrator. Amounts incurred during the year to these connected parties are disclosed in Note 7.
Product fee
Each Series pays a product fee calculated by the Determination Agent, which accrues on a daily basis. This fee is used to pay expenses of the Company
including Product fee paid to DWS International GmbH for providing its service as Programme Administrator. The Product fee rate for each Series as
of 30 September 2024 and 30 September 2023 is set out below. This rate is applied to the Metal Entitlement on a daily basis.
Series
Description
Annual Product fee as a
% of metal entitlement
2024
Annual Product fee as a
% of metal entitlement
2023
Series 1
Xtrackers IE Physical Platinum ETC Securities
0.38
0.38
Series 2
Xtrackers IE Physical Gold ETC Securities
0.11
0.12
Series 3
Xtrackers IE Physical Silver ETC Securities
0.20
0.20
Series 4
Xtrackers IE Physical Silver EUR Hedged ETC Securities
0.73
0.73
Series 5
Xtrackers IE Physical Gold EUR Hedged ETC Securities
0.24
0.28
Series 6
Xtrackers IE Physical Gold GBP Hedged ETC Securities
0.24
0.28
Series 7
Xtrackers IE Physical Platinum EUR Hedged ETC Securities
0.73
0.73
Pursuant to the Programme Administrator Agreement, DWS International GmbH as Programme Administrator receives 100% of the Product fee for
each series issued. In return DWS International GmbH pays a designated list of Programme expenses as set out in the Programme Administrator
Agreement, which may be amended from time to time, even where the aggregate of such expenses exceeds the Product Fee due to DWS International
GmbH. At year end the total product fee under the Programme Administrator Agreement was USD 7,133,338 (2023: USD 7,401,373) of which USD
2,222,220 (2023: USD 1,803,915) is payable to the Programme Administrator at year end.
Xtrackers ETC Public Limited Company
Page 42
Notes to the financial statements (continued)
For the year ended 30 September 2024
18. Charges
The ETC Securities issued by the Company are secured in favor of the Trustee for the benefit of the ETC Security holders by security over the
portfolio of Precious metals held by the Company and other assets not attributable to the equity holders.
19. Subsequent events
Gold price which is the main collateral (97.13%) of the Company's ETC Securities touched USD 2,629.95 per ounce as at 30 September 2024
and continued steady growth reaching USD 2,716.50 as at 16 January 2025 whilst Silver reached USD 31.075 per ounce as at 30 September 2024
and changed to USD 30.705 as at 16 January 2025. Platinum reached USD 985 per ounce as at 30 September 2024 and high of USD 943 per
ounce as at 16 January 2025.
There have been no other significant events that require disclosure to the financial year end and up to the date of approval of the financial
statements.
20. Approval of financial statements
The financial statements were approved and authorised for issue by the Board of Directors on 21 January 2025.