{"url_path":"/sec/fgdl/10-k/2026/item-7","section_key":"item-7","section_title":"Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-29","source_url":"https://www.sec.gov/Archives/edgar/data/1858258/0001140361-26-026742-index.html","accession_number":"0001140361-26-026742","cik":"0001858258","ticker":"FGDL","issuer_name":"Franklin Templeton Holdings Trust","edgar_url":"https://www.sec.gov/Archives/edgar/data/1858258/0001140361-26-026742-index.html","primary_entity_key":"0001858258","primary_entity_name":"Franklin Templeton Holdings Trust"},"word_count":2489,"has_tables":true,"body_markdown":"Item 7.\n\nManagement’s Discussion and Analysis of Financial Condition and Results of Operations\n\n \n\nThe following discussion should be read in conjunction with the financial statements and the notes thereto of the Trust and the Fund, included elsewhere in this annual report on Form 10-K.\n\n \n\nForward-Looking Information\n\n \n\nThis annual report on Form 10-K, including this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties. All statements (other than statements of historical fact) included in this Form 10-K that address activities, events, or developments that may occur in the future, including such matters as future gold prices, gold sales, costs, objectives, changes in commodity prices and market conditions (for gold and the Shares), the operations of the Trust and the Fund, the Sponsor’s plans, references to the future success of the Trust and the Fund, and other similar matters, are forward-looking statements. Words such as “could,” “would,” “may,” “expect,” “intend,” “estimate,” and “predict,” variations of such words or their negatives, and similar expressions that reflect our current views with respect to future events and the performance of the Trust and the Fund are intended to identify such forward-looking statements. These forward-looking statements are only predictions and are subject to risks and uncertainties, many of which are difficult to predict and outside our control. Actual results could differ materially from those expressed or implied in these forward-looking statements. *Forward-looking statements involve risks and\nuncertainties that could cause actual results or outcomes to differ materially\nfrom those expressed therein. *We express our estimates, expectations, beliefs, and projections in good faith and believe them to have a reasonable basis. However, we make no assurances that these estimates, expectations, beliefs, or projections will be achieved or accomplished. These forward-looking statements are based on assumptions about many important factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements. Such factors are discussed in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”; Part I, Item 1A, “Risk Factors”; and other parts of this Form 10-K. We do not intend to update any forward-looking statements, even if new information becomes available or other events occur in the future, except as required by the federal securities laws.\n\n \n\nOrganization and Trust Overview\n\n \n\nThe Franklin Templeton Holdings Trust (the “Trust”) was organized as a Delaware statutory trust on April 19, 2021. Franklin Holdings, LLC is the Sponsor of the Trust (the “Sponsor”). The Trust currently offers a single series, the Franklin Responsibly Sourced Gold ETF (the “Fund”). The Fund issues common units of beneficial interest (“Shares”), which represent units of fractional undivided beneficial interest in and ownership of the Fund. The Shares are listed on NYSE Arca, Inc. (“NYSE Arca”) under the symbol “FGDL.” Shares are not obligations of, and are not guaranteed by, the Sponsor or any of its subsidiaries or affiliates. The investment objective of the Fund is for the Shares to reflect the performance of the price of gold bullion, less the Fund’s expenses. The assets of the Fund include only gold bullion and cash, if any.\n\n \n\nThe Fund seeks to hold only responsibly sourced gold in the Fund’s allocated account. The Fund defines responsibly sourced gold for this purpose as London Good Delivery gold bullion bars that were refined on or after January 1, 2012 (also referred to herein as “post-2012 gold”). All post-2012 gold has been refined in accordance with London Bullion Market Association’s (“LBMA”) Responsible Gold Guidance (the “Gold Guidance”), described further herein. To facilitate this, in transferring gold into and out of the Fund’s allocated account, the Custodian will, on a best efforts basis and subject to available liquidity, seek to allocate post-2012 gold. If, due to a lack of liquidity, the Custodian is unable to allocate post-2012 gold to the Fund’s allocated account, the Custodian will do so as soon as reasonably practicable.\n\n \n\nThe Fund issues and offers Shares on a continuous basis. Shares are issued by the Fund only in one or more blocks of 50,000 Shares (a block of 50,000 Shares is called a “Creation Unit”) in exchange for gold from Authorized Participants, which is then allocated to the Fund and stored safely by the Custodian. The Fund issues and redeems Creation Units on an ongoing basis at Net Asset Value to Authorized Participants who have entered into an agreement with the Sponsor and the Administrator.\n\n \n\nThe Fund pays the Sponsor a fee that accrues daily at an annualized rate equal to 0.15% of the daily Net Asset Value of the Fund, paid monthly in arrears (the “Sponsor Fee”). The Sponsor Fee is accrued in and payable in U.S. dollars.\n\n \n\nThe NAV is computed based upon the total value of the assets of the Fund (i.e., gold and cash) less its liabilities. To determine the Fund’s NAV, the Administrator generally will value the gold bullion held by the Fund on the basis of the LBMA Gold Price PM as published by the IBA. IBA operates electronic auctions for spot, unallocated loco London gold, providing a market-based platform for buyers and sellers to trade. The auctions are run at 10:30 a.m. and 3:00 p.m. London time for gold. The final auction prices are published to the market as the LBMA Gold Price AM and the LBMA Gold Price PM, respectively. The Administrator will calculate the NAV on each day NYSE Arca is open for regular trading, at 12:00 PM New York time. If no LBMA Gold Price (AM or PM) is made on a particular evaluation day or if the LBMA Gold Price PM has not been announced by 12:00 PM New York time on a particular evaluation day, the next most recent LBMA Gold Price AM or PM will be used in the determination of the NAV, unless the Sponsor determines that such price is inappropriate to use as the basis for such determination. If the Sponsor determines that such price is inappropriate to use, it shall identify an alternate basis for evaluation of the gold bullion held by the Fund that the Sponsor determines fairly represents the commercial value of the Fund’s gold bullion.\n\n \n\nOnce the value of the gold bullion has been determined, the Administrator subtracts all estimated accrued expenses and other liabilities of the Fund from the total value of the gold bullion and any cash of the Fund. The resulting figure is the NAV. The Administrator determines the NAV per Share by dividing the NAV of the Fund by the number of Shares outstanding as of the close of trading on NYSE Arca.\n\n \n\nCritical Accounting Policies\n\n \n\nThe financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements relies on estimates and assumptions that impact the Fund’s and the Trust’s financial position and results of operations. These estimates and assumptions affect the Fund’s as well as and the Trust’s application of accounting policies. Earlier in this report under the heading “Valuation of Gold and Computation of Net Asset Value” we describe the valuation of gold bullion, a critical accounting policy that we believe is important to understanding the results of operations and financial position. In addition, please refer to Note 2 to the Financial Statements for further discussion of the accounting policies followed by the Fund and the Trust.\n\n \n\nThe gold bullion held on behalf of the Fund at the vaults of the Custodian is audited each year generally coinciding with the Fund’s financial year end at March 31 and/or the preparation of\nthe Fund's annual report on Form 10-K. On June 1, 2026, Bureau Veritas Commodities UK LTD concluded the audit inspection procedures with respect to the Fund’s gold bullion held by the Custodian. The audit findings did not identify non-conformities.\n\n \n\n17\n\n*Table of Contents*\n\nResults of Operations\n\n \n\nAt March 31, 2026, the Custodian held 103,215.624 ounces of gold on behalf of the Fund, with a market value of $475,653,721 (cost: $319,559,905) based on the LBMA Gold Price PM at period end.\n\n \n\nResults of Operations for the year ended March 31, 2026\n\n \n\nFor the year ended March 31, 2026, 4,300,000 Shares were issued in exchange for 57,308.239 ounces of gold and 1,050,000 Shares were redeemed in exchange for 13,988.775 ounces of gold. The Fund’s NAV per Share began the period at $41.54 and ended the period at $61.37. The 47.74% increase in the Fund's NAV per share from $41.54 at March 31, 2025 to $61.37 at March 31, 2026 is directly related to the 47.94% increase in the price of gold. The Fund's NAV per share increased slightly less than the price of gold on a percentage basis due to the Sponsor's fee, which was $540,465 for the year ended March 31, 2026.\n\nNet realized and unrealized gain on investment in gold for the year ended March 31, 2026, was approximately $132,648,139 which included a realized gain of $150,444 on the sale of gold to pay the Sponsor Fee, realized gain of $18,051,497 on the sale of gold for redemptions, and net change in unrealized appreciation on investment in gold of approximately $114,446,198. Net realized and unrealized gain on investment in gold for the period was driven by gold price appreciation from $3,115.10 per ounce as of March 31, 2025 to $4,608.35 per ounce as of March 31, 2026. Net increase in net assets resulting from operations was approximately $132,107,674 for the year ended March 31, 2026, which consisted of the net realized and unrealized gain on investment in gold of $132,648,139, offset by the Sponsor Fee of $540,465. Net assets increased to approximately $475,584,035 on March 31, 2026. The increase in net assets primarily resulted from net capital share transactions of approximately $156,540,600, in addition to the aforementioned gold price appreciation. Other than the Sponsor's fee, the Fund had no expenses during the year ended March 31, 2026.\n\n \n\nResults of Operations for the year ended March 31, 2025\n\n \n\nFor the year ended March 31, 2025, 3,150,000 Shares were issued in exchange for 42,022.504 ounces of gold and 750,000 Shares were redeemed in exchange for 10,005.285 ounces of gold. The Fund’s NAV per Share began the period at $29.57 and ended the period at $41.54. The increase in NAV per Share was due to a higher price of gold of $3,115.10 at year end, which represented an increase of 40.68% from $2,214.35 at March 31, 2024.\n\n \n\nNet realized and unrealized gain on investment in gold for the year ended March 31, 2025, was approximately $34,730,830 which includes a realized gain of $28,996 on the sale of gold to pay the Sponsor Fee, realized gain of $4,241,210 on the sale of gold for redemptions, and net change in unrealized appreciation on investment in gold of approximately $30,460,624. Net realized and unrealized gain on investment in gold for the period was driven by gold price appreciation from $2,214.35 per ounce as of March 31, 2024 to $3,115.10 per ounce as of March 31, 2025. Net increase in net assets resulting from operations was approximately $34,588,017 for the year ended March 31, 2025, which consisted of the net realized and unrealized gain on investment in gold of $34,730,830, offset by the Sponsor Fee of $142,813. Net assets increased to approximately $186,935,761 on March 31, 2025. The increase in net assets primarily resulted from net capital share transactions of approximately $90,245,113, in addition to the aforementioned gold price appreciation. Other than the Sponsor's fee the Fund had no expenses during the year ended March 31, 2025.\n\n \n\nLiquidity and Capital Resources\n\n \n\nThe Fund is not aware of any trends, demands, commitments, events or uncertainties that are reasonably likely to result in material changes to its liquidity needs. The Fund’s only ordinary recurring expense is the fee paid to the Sponsor at an annual rate of 0.15% of the daily net asset value of the Fund. The Sponsor’s annual fee accrues daily and is payable by the Fund monthly in arrears. In exchange for the Sponsor’s fee, the Sponsor has agreed to assume the ordinary fees and expenses incurred by the Fund, including but not limited to the following: fees charged by the Administrator, the Custodian and the Trustee, NYSE Arca listing fees, typical maintenance and transaction fees of the DTC, SEC registration fees, printing and mailing costs, audit fees and expenses, up to $500,000 per annum in legal fees and expenses and applicable license fees. The Sponsor may determine in its sole discretion to assume legal fees and expenses of the Fund in excess of the $500,000 per annum stipulated in the Sponsor Agreement.\n\n \n\nThe Sponsor is not required to pay any extraordinary or non-routine expenses. Extraordinary expenses are fees and expenses which are unexpected or unusual in nature, such as legal claims and liabilities and litigation costs or indemnification or other unanticipated expenses. Extraordinary fees and expenses also include material expenses which are not currently anticipated obligations of the Fund. The Fund is responsible for the payment of such expenses to the extent any such expenses are incurred. Routine operational, administrative and other ordinary expenses are not deemed extraordinary expenses. The Fund will sell gold on an as-needed basis to pay the Sponsor’s fee.\n\n \n\nThe Administrator will, at the direction of the Sponsor, sell the Fund’s gold as necessary to pay the Fund’s expenses not otherwise assumed by the Sponsor. When selling gold to pay the Sponsor’s fee and other expenses, if any, the Administrator endeavors to sell the exact amount of gold needed to pay expenses to minimize the Fund’s holdings of cash. At March 31, 2026, the Trust and the Fund did not have any cash balances.\n\n \n\nOff-Balance Sheet Arrangements\n\n \n\nAt March 31, 2026 and 2025, the Trust and the Fund do not have any off-balance sheet arrangements.\n\n \n\nAnalysis of Movements in the Price of Gold\n\n \n\nAs movements in the price of gold are expected to directly affect the price of the Fund’s shares, it is important for investors to understand and follow movements in the price of gold. Past movements in the gold price are not indicators of future movements.\n\n \n\nThe following chart shows movements in the price of gold based on the LBMA Gold Price PM in U.S. dollars per ounce over the period from April 1, 2025 to March 31, 2026.\n\n \n\n18\n\n*Table of Contents*\n\n \n\nThe average, high, low and end-of-period gold prices based on the LBMA Gold Price PM for the period are as below:\n\n \n\n                \n\n \n\nPeriod\n\n \n\nAverage\n\n \n\nHigh\n\n \n\nDate\n\n \n\nLow\n\n \n\nDate\n\n \n\nEnd of period(1)\n\n \n\nLast business day\n\n \n\nApril 1, 2025 to March 31, 2026\n\n \n\n3,933.64\n\n \n\n5,405.00\n\n \n\nJanuary 29, 2026\n\n \n\n3,014.75\n\n \n\nApril 8, 2025\n\n \n\n4,608.35\n\n \n\nMarch 31, 2026\n\n \n\n \n\n(1)\n\nThe end of period gold price is the LBMA Gold Price PM on the last business day of the period."}