Atlantic Sapphire
Annual Report 2018

Plain-text annual report

92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page i Gold and Precious Metals Limited Annual Report and Financial Statements November 2018 A Closed-End Fund Specializing in Gold and Other Precious Metals Investments Beginning on January 1, 2021, as permitted by regulations adopted by the U.S. Securities and Exchange Commission, paper copies of the Company’s annual and semi-annual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Company’s website www.asaltd.com, and you will be notified by mail each time a report is posted and provided with a website link to access the report. If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Company electronically anytime by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-800-432-3378 or by sending an e-mail request to info@asaltd.com. Beginning on January 1, 2019, you may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Company, you can call 1-800-432-3378 or send an email request to info@asaltd.com to inform the Company that you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held in your account if you invest through your financial intermediary or all funds held with the fund complex if you invest directly with the Company. 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page ii 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 1 ASA Gold and Precious Metals Limited Annual Report and Financial Statements November 30, 2018 Table of Contents Management’s letter to shareholders, board retirement and message from the independent directors 2 Forward-looking statements 4 10-year performance returns 5 Certain investment policies and restrictions 6 Report of independent registered public accounting firm 6 Schedules of investments 7 Portfolio statistics 9 Principal portfolio changes 9 Statements of assets and liabilities 10 Statements of operations 11 Statements of changes in net assets 12 Notes to financial statements 13 Financial highlights 18 Certain tax information for U.S. shareholders 19 Dividend reinvestment and stock purchase plan 19 Privacy notice 20 Proxy voting 20 Form N-Q 20 Common shares repurchased 20 Board of directors and officers 21 Other information 22 1 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 2 Management's Letter to Shareholders, Board Retirement and Message from the Independent Directors During 2018, global economic growth characterized by modest inflation and slowly rising interest rates continued to dampen the market’s enthusiasm for gold and gold mining shares. Much like the previous year, gold drifted lower in this environment from $1,320 at the beginning of the year to a low of $1,175 during August of 2018. With a lack of positive gold price momentum or significant growth in gold production from the miners, valuation mul- tiples attributed to mining shares continued to soften, leaving most gold companies trading at lower levels at the end of 2018 than at the beginning. For the fiscal year ended November 30, 2018, ASA Gold and Precious Metals Limited (“ASA” or the “Company”) reported a total return of negative 20.0% based on its net asset value (“NAV”), including reinvested dividends, compared with a total return of negative 14.5% for the FTSE Gold Mines Total Return Index (the “Index”). Announcement of the merger of Barrick Gold Corporation and Randgold Resources, two of the largest gold mining companies, caused their share prices to outperform and had a significant effect on the total return of the Index, which is calculated based on market capitalization. The Index outperformed nearly all active gold mining invest- ment managers, ASA included, during the last year. Total return of ASA’s share price for the fiscal year was nega- tive 21.4%. The gold price decreased 6.5% during the one-year period ending November 30, 2018. At fiscal year-end, total net assets of ASA were $194.8 million, a decline of $49.4 million as compared to fiscal year-end 2017. The Company’s average expense ratio rose to 1.35% during the 2018 fiscal year from 1.19% dur- ing fiscal year 2017 due to the decrease in asset values. Total operating costs decreased modestly in 2018 as compared to 2017 reflecting, among other things, a reduc- tion in compensation and retirement benefits to former directors, offset somewhat by an increase in the office lease. Investment income improved to $1.6 million during fiscal year 2018 from $1.4 million during 2017, generated by increased dividends from portfolio investments. The discount at which ASA’s shares traded in the mar- ket fluctuated during the year from a high of 15.8% to a low of 12.3% and ended the fiscal year at 14.3%. The Board of Directors of ASA monitors the Company’s share price and discount to NAV on an ongoing basis. Shareholders Becoming More Demanding Investors in the global gold mining industry have increasingly demanded that mining companies be good stewards of capital with a focus on returns to investors, profitability and sustainability. During 2018, investors intensified their agenda by restricting the availability of capital for new mining projects and taking activist stances with regards to board representation by pushing corpo- rate boards to take accountability for their poor perform- ance. A large investor initiated a proxy contest against Detour Gold to replace its Board of Directors and man- agement team whom they believed had repeatedly failed to deliver. The result was a significant turnover of the Board, a new CEO and a renewed commitment to listen to shareholders. We believe that this and similar actions 2 may provide impetus to other companies to increase engagement with shareholders and improve their focus on returns to all stakeholders. Chart 1: Precious Metals Mining Companies – Equity Financing Trends ) $ S U , s n o i l l i i b ( g n c n a n F y t i i u q E $16 $14 $12 $10 $8 $6 $4 $2 $0 $13.5 $10.3 $8.6 $6.0 $4.7 $8.9 $6.7 $3.4 $4.8 $3.2 9 0 0 2 0 1 0 2 1 1 0 2 2 1 0 2 3 1 0 2 4 1 0 2 5 1 0 2 6 1 0 2 7 1 0 2 8 1 0 2 Source: ASA, Bloomberg Demand for higher returns from investors combined with the lack of price direction from gold has dramatically decreased the quantity of and increased the cost of financings in the mining sector. Equity financings in the gold mining industry reached a 10 year low in 2018 with only $3.1 billion raised by precious metals companies throughout the year. Generally, only projects with very strong returns and large backers have been able to raise capital as investors have fled the industry looking for higher return opportunities in other sectors. The low-cost capital that fueled many unprofitable projects in the last cycle appears to be no longer available. Companies seem to be reevaluating or sidelining marginal projects and increasingly focusing on metrics like cash flow and return on equity. We believe that companies who focus on profitability and shareholder returns will outperform over time. This renewed focus on returns and scarcity of capital has also forced companies to consider creative strategic options. Traditionally, companies demanded steep pre- miums for acquisitions and refused to engage in negoti- ations in their absence. The strong market support for the “no premium” merger between Randgold Resources and Barrick Gold Corporation has shifted the narrative around merger expectations. Investors have messaged that they are more interested in solid, diversified companies than short-lived, headline deal premiums. We are hopeful that this trend will continue and may result in some well bal- anced, multi-asset companies. Portfolio Changes ASA closely tracks numerous companies within the precious metals mining sector to identify investment opportunities as strategies and assets change over time. In the second half of fiscal 2018, ASA added two new positions to the portfolio, IAMGOLD and Centamin Pty. ASA previously held shares in both operators but exited them several years ago due to concerns about strategic 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 3 direction. We continued to follow their projects, manage- ment changes and strategic focus at both companies, despite no longer holding any shares, and saw an oppor- tunity to reinvest in each in 2018. Chart 2: Investment Holdings by Sector United States Gold Miners 15.7% Australian Gold Miners 7.8% South African Gold Miners 6.5% Liquid Assets 1.3% Cayman Gold Miners 1.6% Channel Island Gold Miners 10.8% Canadian Gold Miners 49.1% Diamond Miners 1.1% Silver Miners 1.1% Latin American Miners 5.1% Source: ASA, As of fiscal year-end 2018 IAMGOLD operates mines in West Africa and South America. Shares of IAMGOLD were purchased in 2018 based on a view that there is strong exploration and expansion potential at several of the company’s assets and a solid balance sheet to support their development. This improved outlook was a significant shift from when we exited the position in 2013, and we saw an opportu- nity to reinvest in the company. Centamin owns a high-quality project in Egypt that mines both open pit and underground. We believe that the mine has now reached a steady state in terms of oper- ations and development and see upside from exploration in surrounding areas as well as potential to support a div- idend to shareholders. As in past years, many of our sales in 2018 were to rebalance the portfolio as well as to generate cash to pay our distributions to shareholders and operating expenses. Most of the positions that we exited in 2018 no longer had a compelling investment thesis and we believed capital was better allocated elsewhere. Shareholders are encouraged to contact us directly with any questions that they may have either through the company website at www.asaltd.com or by calling us at 1-800-432-3378. David Christensen President, Chief Executive Officer and Chief Investment Officer January 18, 2019 * * * * * * Board Retirement We regret that on January 8, 2019, our colleague Robert Pilkington resigned from the Board for personal reasons. Robert’s deep institutional knowledge of ASA, the mining sector and investment world were invaluable to us. We shall miss him and wish him well in his retirement. David Christensen, Director Bruce Hansen, Director Gary Glynn, Director Mary Joan Hoene, Director Message from the Independent Directors ASA Board Decision to Propose Merk Investments LLC as its External Investment Adviser ASA has had its own employees and operations since 1978. Rising costs related to this internally managed structure, declining assets at ASA, and many years of overall flat to declining gold prices combined with per- formance lagging the FTSE Gold Mines Total Return Index, have led the Independent Directors to evaluate strategic options and conclude that externalizing portfolio management to an experienced and committed invest- ment adviser will provide valuable resources and greater efficiencies. On December 14, 2018, ASA announced that the Board has reached an agreement, in principle, for Merk Investments LLC to become ASA’s investment adviser, subject to approval of the advisory agreement with Merk Investments by ASA shareholders at the share- holder meeting scheduled for March 26, 2019. Merk Investments is an SEC registered investment adviser that provides advice on liquid global markets, including domestic and international equities, fixed income, com- modities and currencies and their respective derivative markets. In addition to the VanEck Merk Gold Trust, the Merk Funds include the Merk Hard Currency Fund and the Merk Absolute Return Currency Fund. The Independent Directors believe that the opportunity to work with Merk Investments will provide a more sus- tainable and transparent cost structure for the long-term benefit of shareholders. If approved by shareholders, the Board anticipates that the transition will be completed on or about March 31, 2019. ASA’s investment objective and policies will remain the same. The Independent Directors extend their deep appreci- ation to David Christensen, who has led ASA as its CEO and served on the Board since 2007. With the transition to Merk Investments as ASA’s investment adviser, Mr. Christensen will be stepping down from his positions. The Independent Directors are grateful for his long and dedi- cated service to ASA. In addition to the election of directors and approval of auditors, the ASA proxy statement for 2019 will include the proposal to approve the advisory agreement with Merk Investments, along with detailed background and information. The Independent Directors encourage shareholders to review the proxy and vote promptly in favor of each action proposed in the proxy. Mary Joan Hoene, Chair Gary Glynn Bruce Hansen 3 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 4 Copies of financial reports for ASA Gold and Precious Metals Limited, as well as its latest NAV, may be requested from ASA Gold and Precious Metals Limited, 400 S. El Camino Real, Suite 710, San Mateo, CA (650) 376-3135 or (800) 432-3378, and may be found on the Company’s website (www.asaltd.com). We would like to call to your attention the availability of the Dividend Reinvestment and Stock Purchase Plan. See page 19 of this report for information on how shareholders can par- ticipate in this plan. * * * * * * The Annual General Meeting of Shareholders is cur- rently anticipated to be held Thursday, March 26, 2019 at 10:00 a.m. EST at the offices of K&L Gates LLP, 599 Lexington Avenue, 32nd Floor, New York, New York, USA. We look forward to your attendance. Forward-Looking Statements This shareholder letter includes forward-looking state- ments, which involve known and unknown risks, uncer- tainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Company, or industry results, to be materially dif- ferent from any future results, levels of activity, perform- ance or achievements expressed or implied by such forward-looking statements. The Company’s actual per- formance or results may differ from its beliefs, expecta- tions, estimates, goals and projections, and consequently, investors should not rely on these forward- looking statements as predictions of future events. Forward-looking statements are not historical in nature and generally can be identified by words such as “believe,” “anticipate,” “estimate,” “expect,” “intend,” “should,” “may,” “will,” “seek,” or similar expressions or their negative forms, or by references to strategy, plans, goals or intentions. The absence of these words or refer- ences does not mean that the statements are not for- ward-looking. The Company’s performance or results can fluctuate from month to month depending on a variety of factors, a number of which are beyond the Company’s control and/or are difficult to predict, including without lim- itation: the Company’s investment decisions, the perform- ance of the securities in its investment portfolio, economic, political, market and financial factors, and the prices of gold, platinum and other precious minerals that may fluctuate substantially over short periods of time. The Company may or may not revise, correct or update the forward-looking statements as a result of new informa- tion, future events or otherwise. The Company concentrates its investments in the gold and precious minerals sector. This sector may be more volatile than other industries and may be affected by movements in commodity prices triggered by interna- tional monetary and political developments. The Company is a non-diversified fund and, as such, may invest in fewer investments than that of a diversified port- 4 folio. The Company may invest in smaller-sized compa- nies that may be more volatile and less liquid than larger more established companies. Investments in foreign securities, especially those in the emerging markets, may involve increased risk as well as exposure to currency fluctuations. Shares of closed-end funds frequently trade at a discount to net asset value. All performance informa- tion reflects past performance and is presented on a total return basis. Past performance is no guarantee of future results. Current performance may differ from the perform- ance shown. This shareholder letter does not constitute an offer to sell or solicitation of an offer to buy any securities. 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 5 10-Year Performance Returns Fiscal Year Total Returns 120% 100% 80% 60% 40% 20% 0% -20% -40% -60% 102.0% 101.2% NAV Share Price 51.9% 51.5% 29.1% 16.6% -4.6% -13.7% -24.2% -22.4% -11.1% -15.7% -27.2% -33.0% -41.1% -45.6% 0.7% 2.6% -20.0% -21.4% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Best Quarter (NAV): Q2 2009 44.18% Worst Quarter (NAV): Q4 2014 -27.99% Average Annual Total Returns For the periods ended November 30, 2018 1 Year 3 Year 5 Year 10 Year ASA Gold and Precious Metals – NAV -19.97% 6.97% -4.55% -3.03% ASA Gold and Precious Metals – Share Price -21.39% 6.89% -7.15% -3.41% FTSE Gold Mines Total Return Index (1) -14.46% 13.65% -0.90% -3.37% The performance data quoted represent past performance and do not indicate future results. Current performance may be lower or higher than the performance data quoted. For more current performance data, please visit http://www.asaltd.com/investor-information/factsheets. The results shown in the table reflect the reinvestment of income dividends and other distributions, if any. The results do not reflect the effect of taxes a shareholder would pay on Company distributions or on the sale of the Company’s common shares. The investment return and market price will fluctuate and the Company’s common shares may trade at prices above or below NAV. The Company’s common shares, when sold, may be worth more or less than their original cost. (1)The FTSE Gold Mines Total Return Index encompasses gold mining companies that have a sustainable, attributable gold production of at least 300,000 ounces a year and that derive 51% or more of their revenue from mined gold. Please note that the Index is unmanaged, and does not take into account any fees and expenses or any tax consequences of investing in the individual securities that it tracks and one cannot invest directly in the Index. The Company does not attempt to replicate the Index. The Index generally does not reflect investments in other precious metals companies (e.g., silver, platinum, and diamonds) in which the Company invests. Data about the performance of this Index are prepared or obtained by Management and include reinvestment of all income dividends and other distributions, if any. The Fund may invest in securities not included in the Index and generally does not invest in all securities included in the Index. 5 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 6 Certain Investment Policies and Restrictions The following is a summary of certain of the Company’s investment policies and restrictions and is subject to the more complete statements contained in documents filed with the Securities and Exchange Commission. The concentration of investments in a particular industry or group of industries. It is a fundamental pol- icy (i.e., a policy that may be changed only by share- holder vote) of the Company that at least 80% of its total assets be (i) invested in common shares or securities convertible into common shares of companies engaged, directly or indirectly, in the exploration, mining or process- ing of gold, silver, platinum, diamonds or other precious minerals, (ii) held as bullion or other direct forms of gold, silver, platinum or other precious minerals, (iii) invested in instruments representing interests in gold, silver, plat- inum or other precious minerals such as certificates of deposit therefor, and/or (iv) invested in securities of investment companies, including exchange traded funds, or other securities that seek to replicate the price move- ment of gold, silver or platinum bullion. Com pli ance with the percentage limitation relating to the concentration of the Company’s investments will be measured at the time of investment. If investment opportunities deemed by the Company to be attractive are not available in the types of securities referred to in the preceding paragraph, the Company may deviate from the investment policy out- lined in that paragraph and make temporary investments of unlimited amounts in securities issued by the U.S. Govern ment, its agencies or instrumentalities or other high quality money market instruments. The percentage of voting securities of any one issuer that the company may acquire. It is a non-fun- damental policy (i.e., a policy that may be changed by the Board of Directors) of the Company that the Company shall not purchase a security if, at the time of purchase, more than 20% of the value of its total assets would be invested in securities of the issuer of such security. Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of ASA Gold and Precious Metals Limited Opinion on the Financial Statements We have audited the accompanying statements of assets and liabilities of ASA Gold and Precious Metals Limited (the “Company”), including the schedules of investments, as of November 30, 2018 and November 30, 2017, the related statements of operations and the statements of changes in net assets for each of the two years in the period then ended, and financial highlights for each of the five years in the period then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of November 30, 2018 and November 30, 2017, the results of its operations and the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities rules and regulations of the Securities and Exchange Commission and the PCAOB. We have served as the Company’s auditor since 2012. the applicable laws and We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of November 30, 2018 by correspondence with the custodian. We believe that our audits provide a reasonable basis for our opinion. TAIT, WELLER & BAKER LLP Philadelphia, Pennsylvania January 18, 2019 6 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 7 Schedules of Investments November 30, 2018 and November 30, 2017 2018 2017 ___________________________________ __________________________________ Percent Percent of Net of Net Name of Company Shares Value Assets Shares Value Assets Common Shares Gold mining, exploration, development and royalty companies Australia Newcrest Mining Limited 1,015,000 $ 15,285,900 7.8% 1,015,000 $ 17,610,250 7.2% 15,285,900 7.8 17,610,250 7.2 Canada Agnico Eagle Mines Limited 450,000 15,804,000 8.1 450,000 19,669,500 8.1 Alacer Gold Corp., (1) 2,500,000 3,893,612 2.0 2,500,000 4,051,801 1.7 Alamos Gold Inc. 875,000 2,811,113 1.4 875,000 5,563,956 2.3 Atlantic Gold Corporation – 144A, (1)(2) 2,750,000 3,144,985 1.6 2,750,000 3,284,091 1.3 B2Gold Corp., (1) 1,594,338 3,922,568 2.0 1,594,338 4,067,599 1.7 Barrick Gold Corporation 1,125,000 14,343,750 7.4 1,125,000 15,502,500 6.3 Belo Sun Mining Corp., (1) 2,600,000 645,550 0.3 2,600,000 897,212 0.4 Detour Gold Corporation, (1) 450,000 3,341,735 1.7 450,000 4,885,425 2.0 Eldorado Gold Corporation, (3) — — — 1,296,570 1,465,124 0.6 Franco-Nevada Corporation 160,000 11,075,164 5.7 160,000 13,041,449 5.3 Goldcorp Inc. 932,400 8,652,672 4.4 932,400 11,785,536 4.8 Golden Star Resource Ltd., (1) 580,000 1,711,000 0.9 — — — Guyana Goldfields Inc., (1) 619,500 629,242 0.3 669,500 2,273,979 0.9 IAMGOLD Corp., (1) 675,000 2,058,750 1.1 — — — Kinross Gold Corporation, (1) 800,000 2,168,000 1.1 800,000 3,328,000 1.4 New Gold Inc., (1) — — — 500,000 1,550,000 0.6 OceanaGold Corporation 2,154,013 6,271,936 3.2 2,654,013 6,832,867 2.8 Pretium Resources Inc., (1) 725,000 5,154,750 2.6 725,000 7,757,500 3.2 Roxgold Inc., (1) 2,827,200 1,701,723 0.9 2,827,200 2,587,023 1.1 Semafo Inc., (1) 900,000 1,625,160 0.8 900,000 2,226,358 0.9 Tahoe Resources Inc., (3) 593,200 2,097,690 1.1 708,200 3,141,331 1.3 TMAC Resources Inc., (1) 26,500 125,412 0.1 26,500 153,096 0.1 TMAC Resources Inc. – 144A, (1)(2) 185,000 875,517 0.4 185,000 1,068,784 0.4 Torex Gold Resources Inc., (1) 330,000 2,589,647 1.3 330,000 3,267,884 1.3 Torex Gold Resources Inc. – 144A, (1)(2) 130,000 1,020,164 0.5 125,000 1,237,835 0.5 95,664,140 49.1 119,638,851 49.0 Cayman Islands Endeavour Mining Corporation, (1) 250,000 3,114,890 1.6 250,000 4,526,773 1.9 Channel Islands Centamin plc 1,500,000 1,986,307 1.0 — — — Lydian International Limited, (1) 1,780,000 87,051 0.0 1,780,000 503,819 0.2 Lydian International Limited – 144A, (1)(2) 10,593,775 518,091 0.3 12,593,775 3,564,598 1.5 Randgold Resources Limited – ADRs 229,100 18,366,947 9.4 254,100 23,316,216 9.5 20,958,396 10.8 27,384,632 11.2 Peru Compañia de Minas Buenaventura S.A.A. – ADRs 699,000 9,883,860 5.1 699,000 9,779,010 4.0 South Africa AngloGold Ashanti Limited 898,420 8,912,326 4.6 898,420 9,388,489 3.8 Gold Fields Limited 1,029,577 3,016,661 1.5 1,029,577 4,355,111 1.8 Sibanye-Stillwater 1,092,174 666,226 0.3 1,050,168 1,462,359 0.6 12,595,213 6.5 15,205,959 6.2 United States Newmont Mining Corporation 570,368 18,445,701 9.5 570,368 21,097,912 8.6 Royal Gold, Inc. 165,000 12,069,750 6.2 190,000 15,716,800 6.4 30,515,451 15.7 36,814,712 15.1 Total gold mining, exploration, development and royalty companies (Cost $190,061,071 – 2018, $199,722,344 – 2017) 188,017,850 96.5 230,960,189 94.6 The notes to financial statements form an integral part of these statements. 7 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 8 Schedules of Investments (continued) November 30, 2018 and November 30, 2017 2018 2017 _______________________________ __________________________________ Percent Percent of Net of Net Name of Company Shares Value Assets Shares Value Assets Silver mining, exploration and development companies Canada MAG Silver Corp., (1) 325,000 $ 2,195,847 1.1% 325,000 $ 3,445,194 1.4% Total silver mining, exploration and development companies (Cost $2,541,688 – 2018, $2,541,688 – 2017) 2,195,847 1.1 3,445,194 1.4 Total gold and silver investments (Cost $192,602,759 – 2018, $202,264,032 – 2017) 190,213,697 97.6 234,405,383 96.0 Diamond Mining, Exploration and Development Companies Bermuda Petra Diamonds Limited, (1) 1,000,000 537,348 0.3 1,000,000 909,758 0.4 Canada Stornoway Diamond Corporation, (1) 1,389,500 198,634 0.1 1,389,500 711,155 0.3 Stornoway Diamond Corporation - 144A, (1)(2) 9,698,550 1,386,445 0.7 9,698,550 4,963,780 2.0 1,585,080 0.8 5,674,935 2.3 Total diamond mining, exploration and development companies (Cost $9,760,780 – 2018, $10,222,660 – 2017) 2,122,428 1.1 6,584,693 2.7 Total common shares (Cost $202,363,539 – 2018, $212,486,693 – 2017) 192,336,125 98.7 240,990,076 98.7 Total investments (Cost $202,363,539 – 2018, $212,486,693 – 2017), (4) 192,336,125 98.7 240,990,076 98.7 Cash, receivables, and other assets less liabilities 2,497,874 1.3 3,211,495 1.3 Net assets $194,833,999 100.0% $244,201,571 100.0% (1) Non-income producing security. (2) Restricted security. (3) Non-income producing security in 2018 only. (4) Cost of investments shown approximates adjusted basis for U.S. federal income tax purposes, determined in accordance with U.S. federal income tax principles. Gross unrealized appreciation of investments and gross unrealized depreciation of investments at November 30, 2018 were $57,993,009 and $68,020,423, respectively, resulting in net unrealized depreciation on investments of $10,027,414. Gross unrealized appreciation of investments and gross unrealized depreciation of investments at November 30, 2017 were $80,547,008 and $52,043,624, respectively, resulting in net unrealized appreciation on investments of $28,503,384. ADR – American Depository Receipt. May not total due to independent rounding. The notes to financial statements form an integral part of these statements. 8 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 9 Portfolio Statistics (Unaudited) November 30, 2018 and November 30, 2017 Geographic Breakdown* 2018 2017 Australia 7.8% 7.2% Bermuda 0.3% 0.4% Canada 51.0% 52.7% Cayman Islands 1.6% 1.9% Channel Islands 10.8% 11.2% Peru 5.1% 4.0% South Africa 6.5% 6.2% United States 15.7% 15.1% Cash 1.3% 1.3% _________ _________ 100.0% 100.0% * Geographic breakdown, which is based on company domiciles, is expressed as a percentage of total net assets including cash. Percentage totals may not equal 100.0% due to independent rounding. Principal Portfolio Changes in Shares for the Years Ended (unaudited) November 30, 2018 and November 30, 2017 2018 2017 Investments Increase Decrease Increase Decrease Agnico Eagle Mines Limited 25,000 Alacer Gold Corp. 2,500,000 Alamos Gold Inc. 275,000 Asanko Gold Inc. 400,000 1,825,000 Atlantic Gold Corporation – 144A, (1) 250,000 Barrick Gold Corporation 150,000 Centamin plc 1,500,000 Eldorado Gold Corporation, (2) 1,296,570 896,570 250,000 Endeavour Mining Corporation 250,000 Golden Star Resource Ltd. 2,900,000 Guyana Goldfields Inc. 50,000 200,000 387,800 IAMGOLD Corp. 675,000 Integra Gold Corp, (2) 707,000 4,957,000 Lydian International Limited –144A, (1) 2,000,000 5,714,475 Lydian International Limited, C$0.36 Warrants, 11/27/2017 585,000 Lydian International Limited, C$0.36 Warrants, 11/27/2017 – 144A, (1) 5,159,475 MAG Silver Corp. 50,000 New Gold Inc. 500,000 Newcrest Mining Limited 200,000 Newmont Mining Corporation 125,000 OceanaGold Corporation 500,000 1,600,000 Perseus Mining Limited 7,067,700 Petra Diamonds Limited, GBp 40 Rights, 06/29/2018, (3) 625,000 625,000 Pretium Resources Inc. 425,000 Randgold Resources Limited - ADRs 25,000 28,000 Roxgold Inc. 303,800 Royal Gold, Inc. 25,000 Sibanye Gold Limited, R11.28 Rights, 06/09/2017, (4) 1,323,741 1,323,741 Sibanye-Stillwater 20,591 Stillwater Mining Company 375,000 Tahoe Resources Inc. 115,000 Torex Gold Resources, (1) 5,000 50,000 (1) Restricted security. (2) Eldorado Gold Corporation acquired Integra Gold Corp. on July 18, 2017 for $0.24135 cash plus 0.18087 Eldorado Gold Corporation shares per 1 Integra Gold Corp share. (3) On June 11, 2018, Petra Diamonds Limited conducted a Rights Offer in which 5 Petra Diamonds Limited, GBp 40 Rights, 06/29/2018 were issued for every 8 Petra Diamonds Limited shares held. (4) On May 26, 2017, Sibanye Gold Limited conducted a Rights Offer in which 9 Sibanye Gold Limited, R11.28 Rights, 06/09/2017 were issued for every 7 Sibanye Gold Limited shares held. 9 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 10 Statements of Assets and Liabilities November 30, 2018 and November 30, 2017 2018 2017 Assets Investments, at value Cost $202,363,539 in 2018 $212,486,693 in 2017 $ 192,336,125 $ 240,990,076 Cash and cash equivalents 3,449,518 3,677,900 Dividends receivable, net of withholding taxes payable 102,658 102,264 Due from broker — 615,885 Other assets 183,921 176,018 Total assets $ 196,072,222 $ 245,562,143 Liabilities Accrued affiliate expenses $ 625,108 $ 709,206 Accounts payable and accrued liabilities 182,942 164,804 Liability for retirement benefits due to current and future retired directors 430,173 486,562 Total liabilities $ 1,238,223 $ 1,360,572 Net assets $ 194,833,999 $ 244,201,571 Common shares $1 par value Authorized: 40,000,000 shares Issued and Outstanding: 19,289,905 shares $ 19,289,905 $ 19,289,905 Share premium (capital surplus) 1,372,500 1,372,500 Distributable earnings 174,171,594 223,539,166* Net assets $ 194,833,999 $ 244,201,571 Net asset value per share $ 10.10 $ 12.66 * Distributable earnings as of November 30, 2017 consist of the following: Undistributed net investment income $ 7,352,171 Undistributed net realized gain from investments 306,757,097 Undistributed net realized loss from foreign currency transactions (119,073,486) Net unrealized appreciation on investments 28,503,384 Total distributable earnings $ 223,539,166 The closing price of the Company’s shares on the New York Stock Exchange was $8.66 and $11.05 on November 30, 2018 and November 30, 2017, respectively. The notes to financial statements form an integral part of these statements. 10 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 11 Statements of Operations For the years ended November 30, 2018 and November 30, 2017 2018 2017 Investment income Dividend income (net of withholding taxes of $327,876 and $328,728 respectively, and ADR fees of $4,582 and $5,082, respectively) $ 1,607,015 $ 1,402,806 Interest income 16,735 — Total investment income 1,623,750 1,402,806 Expenses Shareholder reports and proxy expenses 88,932 99,654 Directors’ fees and expenses 243,173 241,588 Retired directors’ fees 63,750 78,750 Investment research 859,878 1,006,310 Administration and operations 1,157,334 1,055,592 Fund accounting 163,076 163,076 Transfer agent, registrar and custodian 137,229 144,733 Legal fees 136,994 127,572 Audit fees 55,000 55,000 Professional fees – other 1,000 1,875 Insurance 157,482 164,582 Dues and listing fees 25,000 25,000 Depreciation expense — 2,527 Total expenses 3,088,848 3,166,259 Change in retirement benefits due to directors (56,389) (94,306) Net expenses 3,032,459 3,071,953 Net investment income (loss) (1,408,709) (1,669,147) Net realized and unrealized gain (loss) from investments and foreign currency transactions Net realized gain (loss) from investments Proceeds from sales 8,823,413 28,383,529 Cost of securities sold 17,874,974 35,348,795 Net realized gain (loss) from investments (9,051,561) (6,965,266) Net realized gain (loss) from foreign currency transactions Investments 202,613 190,384 Foreign currency (420) 8,120 Net realized gain (loss) from foreign currency transactions 202,193 198,504 Net increase (decrease) in unrealized appreciation (depreciation) on investments Balance, beginning of period 28,503,384 18,323,599 Balance, end of period (10,027,414) 28,503,384 Net increase (decrease) in unrealized appreciation (depreciation) on investments (38,530,798) 10,179,785 Net unrealized gain (loss) on translation of assets and liabilities in foreign currency — 5 Net realized and unrealized gain (loss) from investments and foreign currency transactions $(47,380,166) 3,413,028 Net increase (decrease) in net assets resulting from operations $(48,788,875) $ 1,743,881 The notes to financial statements form an integral part of these statements. 11 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 12 Statements of Changes in Net Assets For the years ended November 30, 2018 and 2017 2018 2017 Net investment income (loss) $ (1,408,709) $ (1,669,147) Net realized gain (loss) from investments (9,051,561) (6,965,266) Net realized gain (loss) from foreign currency transactions 202,193 198,504 Net increase (decrease) in unrealized appreciation (depreciation) on investments (38,530,798) 10,179,785 Net unrealized gain (loss) on translation of assets and liabilities in foreign currency — 5 Net increase (decrease) in net assets resulting from operations (48,788,875) 1,743,881 Dividends paid/payable (578,697) (771,596)* Net increase (decrease) in net assets (49,367,572) 972,285 Net assets, beginning of period 244,201,571 243,229,286 Net assets, end of period $194,833,999 $244,201,571** ** Dividends paid from undistributed net investment income. ** Includes undistributed net investment income of $7,352,171 as of November 30, 2017. The notes to financial statements form an integral part of these statements. 12 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 13 Notes to Financial Statements Years ended November 30, 2018 and November 30, 2017 1. Organization ASA Gold and Precious Metals Limited (the “Company”) is a closed-end investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”), and was organized as an exempted limited liability company under the laws of Bermuda. 2. Investment objective and strategy The Company is a non-diversified, closed-end, internally managed fund that seeks long-term capital appreciation primarily through investing in companies engaged in the exploration for, development of projects or mining of precious metals and minerals. It is a fundamental policy of the Company that at least 80% of its total assets must be (i) invested in common shares or securities convertible into common shares of companies engaged, directly or indirectly, in the exploration, mining or processing of gold, silver, platinum, diamonds or other precious minerals, (ii) held as bullion or other direct forms of gold, silver, platinum or other precious minerals, (iii) invested in instruments representing interests in gold, silver, platinum or other precious minerals such as certificates of deposit therefor, and/or (iv) invested in securities of invest- ment companies, including exchange traded funds, or other securities that seek to replicate the price movement of gold, silver or platinum bullion. The Company employs bottom-up fundamental analysis and relies on detailed primary research including meetings with company executives, site visits to key operating assets, and proprietary financial analysis in making its investment decisions. 3. Summary of significant accounting policies The following is a summary of the significant accounting policies: A. Security valuation The net asset value of the Company generally is determined as of the close of regular trading on the New York Stock Exchange (the “NYSE”) or the Toronto Stock Exchange (the “TSX”), whichever is later, on the date for which the val- uation is being made (the “Valuation Time”). Portfolio securities listed on U.S. and foreign stock exchanges generally are valued at the last reported sale price as of the Valuation Time on the exchange on which the securities are pri- marily traded, or the last reported bid price if a sale price is not available. Securities traded over the counter are valued at the last reported sale price or the last reported bid price if a sale price is not available. Securities listed on foreign stock exchanges may be fair valued based on significant events that have occurred subsequent to the close of the foreign markets. Securities for which current market quotations are not readily available are valued at their fair value as determined in good faith by, or in accordance with procedures approved by, the Company’s Board of Directors. If a security is valued at a “fair value,” that value may be different from the last quoted price for the security. Various factors may be reviewed in order to make a good faith determination of a security’s fair value. These factors include, but are not lim- ited to, the nature of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion rights on the security; and changes in overall market conditions. Where the Company holds securities listed on foreign stock exchanges and American Depository Receipts (“ADRs”) representing these securities are actively traded in U.S. markets, the securities normally are fair valued based on the last reported sales price of the ADRs. The difference between cost and market value is reflected separately as net unrealized appreciation (depreciation) on investments. The net realized gain or loss from the sale of securities is determined for accounting purposes on the identified cost basis. 13 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 14 Notes to Financial Statements (continued) Years ended November 30, 2018 and November 30, 2017 B. Restricted securities At November 30, 2018 and November 30, 2017, the Company held investments in restricted securities of 3.56% and 5.78% of net assets, respectively, valued in accordance with procedures approved by the Company’s Board of Directors as follows: Restricted Securities November 30, 2018 Value Acquisition ________ _________ ________________________________ _______ _________ ______________ Shares Cost Issuer Per Unit Value Date 5,000 $51,131 Torex Gold Resources, Inc. – 144A $7.85 $39,237 01/31/2018 3,714,475 1,214,778 Lydian International Limited – 144A 0.05 181,657 11/21/2017 1,841,350 1,490,038 Stornoway Diamond Corporation – 144A 0.14 263,228 06/21/2016 6,879,300 1,269,275 Lydian International Limited – 144A 0.05 336,434 05/26/2016 2,750,000 1,285,447 Atlantic Gold Corporation – 144A 1.14 3,144,985 05/09/2016 185,000 898,101 TMAC Resources, Inc. – 144A 4.73 875,517 06/26/2015 7,857,200 4,641,822 Stornoway Diamond Corporation – 144A 0.14 1,123,217 07/08/2014 125,000 1,351,000 Torex Gold Resources, Inc. – 144A 7.85 980,927 01/22/2014 Restricted Securities November 30, 2017 Value Acquisition ________ _________ ________________________________ _______ _________ ______________ Shares Cost Issuer Per Unit Value Date 5,714,475 $1,869,119 Lydian International Limited – 144A $0.28 $1,617,451 11/21/2017 1,841,350 $1,490,038 Stornoway Diamond Corporation – 144A 0.51 942,415 06/21/2016 6,879,300 1,269,275 Lydian International Limited – 144A 0.28 1,947,148 05/26/2016 2,750,000 1,285,447 Atlantic Gold Corporation – 144A 1.19 3,284,091 05/09/2016 185,000 898,101 TMAC Resources, Inc. – 144A 5.78 1,068,784 06/26/2015 7,857,200 4,641,822 Stornoway Diamond Corporation – 144A 0.51 4,021,366 07/08/2014 125,000 1,351,000 Torex Gold Resources, Inc. – 144A 9.90 1,237,835 01/22/2014 C. Fair value measurement In accordance with U.S. GAAP, fair value is defined as the price that the Company would receive to sell an investment or pay to transfer a liability in a timely transaction with an independent buyer in the principal market, or in the absence of a principal market the most advantageous market for the investment or liability. U.S. GAAP establishes a three- tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the cir- cumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Company’s investments. The inputs are summarized in the three broad levels listed below. Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 – Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability either directly or indirectly. These inputs may include quoted prices for identical instruments on an inactive market, prices for similar investments, interest rates, prepayment speeds, credit risk, yield curves, default rates, and similar data. Level 3 – Unobservable inputs for the assets or liability to the extent that relevant observable inputs are not available, representing the Company’s own assumptions about the assumptions that a market par- ticipant would use in valuing the asset or liability, and that would be based on the best information available. The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. 14 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 15 Notes to Financial Statements (continued) Years ended November 30, 2018 and November 30, 2017 The following is a summary of the inputs used as of November 30, 2018 and November 30, 2017 in valuing the Company’s investments at fair value: Investment in Securities Measurements at November 30, 2018 Description (1) Level 1 Level 2 Level 3 Total ______ ______ ______ ____ Common Shares Gold and Silver Investments Gold mining, exploration, development and royalty companies $154,577,979 $33,439,871 $ — $188,017,850 Silver mining, exploration and development companies 2,195,847 — — 2,195,847 Diamond Mining, Exploration and Development Companies 735,983 1,386,445 — 2,122,428 ___________ ___________ ___________ ___________ Total Investments $157,509,808 $34,826,317 $ — $192,336,125 ___________ ___________ ___________ ___________ ___________ ___________ ___________ ___________ Transfers into and out of levels are recognized at the end of the period. During the year ended November 30, 2018, there were no transfers into and out of Levels 1, 2, and 3. (1) See schedules of investments for country classifications. May not total due to independent rounding. Investment in Securities Measurements at November 30, 2017 Description (1) Level 1 Level 2 Level 3 Total ______ ______ ______ ____ Common Shares Gold and Silver Investments Gold mining, exploration, development and royalty companies $188,988,672 $41,971,517 $ — $230,960,189 Silver mining, exploration and development companies 3,445,194 — — 3,445,194 Diamond Mining, Exploration and Development Companies 1,620,913 4,963,780 — 6,584,693 ___________ ___________ ___________ ___________ $ — $240,990,076 Total Investments $194,054,779 $46,935,297 ___________ ___________ ___________ ___________ ___________ ___________ ___________ ___________ Transfers into and out of levels are recognized at the end of the period. During the year ended November 30, 2017, there were no transfers into and out of Levels 1, 2, and 3. (1) See schedules of investments for country classifications. May not total due to independent rounding. D. Cash and Cash Equivalents The Company considers all money market funds and all highly liquid temporary cash investments purchased with an original maturity of less than three months to be cash equivalents. The majority of the Company’s cash and cash equivalents at November 30, 2018 consisted of overnight deposit of excess funds in a commercial paper sweep account held at JPMorgan Chase & Co (“JPM”). E. Foreign Currency Translation Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the rate of exchange reported one hour after the Valuation Time. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Company separately reports the effect of changes in foreign exchange rates from changes in market prices of securities held. The resulting net foreign currency gain or loss is included on the Statements of Operations. Realized foreign currency gains or losses arise from sales of foreign cur- rencies, currency gains or losses realized between the trade and settlement dates on securities transactions, fluctu- ation in exchange rates between the initial purchase date and subsequent sale date on securities transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Company’s books and the U.S. dollar equivalent of the amounts actually received or paid. 15 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 16 Notes to Financial Statements (continued) Years ended November 30, 2018 and November 30, 2017 F. Securities Transactions and Investment Income During the year ended November 30, 2018, sales and purchases of portfolio securities (other than temporary short- term investments) amounted to $8,823,414 and $7,549,208, respectively. During the year ended November 30, 2017, sales and purchases of portfolio securities (other than temporary short-term investments) amounted to $25,484,241 and $23,772,331, respectively. Dividend income is recorded on the ex-dividend date, net of withholding taxes or ADR fees, if any. Interest income is recognized on the accrual basis. G. Dividends to Shareholders Dividends to shareholders are recorded on the ex-dividend date. The reporting for financial statement purposes of dividends paid from net investment income and/or net realized gains may differ from their ultimate reporting for U.S. federal income tax purposes, primarily because of the separate line item reporting for financial statement purposes of foreign exchange gains or losses. H. Use of Estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. It is management’s opinion that all adjustments necessary for a fair statement of the results of the interim periods presented have been made. All adjustments are of a normal recurring nature. I. Basis of Presentation The financial statements are presented in U.S. dollars. The Company is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification, Topic 946 “Financial Services - Investment Companies”. J. Income Taxes In accordance with U.S. GAAP requirements regarding accounting for uncertainties on income taxes, management has analyzed the Company’s tax positions taken on federal and state income tax returns, as applicable, for all open tax years (2015 – 2018). As of November 30, 2018 and November 30, 2017, the Company has not recorded any unrecognized tax benefits. The Company’s policy, if it had unrecognized benefits, is to recognize accrued interest and penalties in operating expenses. 4. Tax status of the Company The Company is a “passive foreign investment company” (“PFIC”) for the U.S. federal income tax purposes and is not subject to Bermuda tax as an exempted limited liability company organized under the laws of Bermuda. Nor is the Company generally subject to U.S. federal income tax, since it is a non-U.S. corporation whose only business activity in the United States is trading in stocks or securities for its own account; under the U.S. federal tax law that activity does not constitute engaging in the conduct of a trade or business within the United States, even if its principal office is located therein. As a result, its gross income is not subject to U.S. federal income tax, though certain types of income it earns from U.S. sources (such as dividends of U.S. payors) are subject to U.S. federal withholding tax. 5. Exemptive order The Company is a closed-end investment company and operates pursuant to an exemptive order issued by the Securities and Exchange Commission (the “SEC”) pursuant to Section 7(d) of the 1940 Act (the “Order”). The Order is conditioned upon, among other things, the Company complying with certain requirements relating to the custody of assets and settlement of securities transactions outside of the United States different than those required of other reg- istered investment companies. These conditions make it more difficult for the Company to implement a flexible invest- ment strategy and to fully achieve its desired portfolio diversification than if it were not subject to such requirements. 6. Retirement plans The Company has recorded a liability for retirement benefits due to retired directors and one director who served on the Board through January 8, 2019 and is now retired. See Note 12. Subsequent events. The liability for these benefits at November 30, 2018 and November 30, 2017 was $430,173 and $486,562, respectively. A director whose first election to the Board of Directors was prior to January 1, 2008 qualifies to receive retirement benefits if he has served the Company (and any of its predecessors) for at least twelve years prior to retirement. Directors first elected on or after January 1, 2008 are not eligible to participate in the plan. 7. Concentration risk The Company invests at least 80% of its total assets in securities of companies engaged, directly or indirectly, in the exploration, mining or processing of gold or other precious minerals. The Company also invests a substantial portion of its assets in companies that are domiciled and/or have operations outside of the United States, including emerging 16 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 17 Notes to Financial Statements (continued) Years ended November 30, 2018 and November 30, 2017 market countries, such as South Africa. The Company is, therefore, subject to gold and precious metals-related risk as well as risk related to investing in foreign securities, including political, economic, regulatory, liquidity, currency fluctuation, and foreign exchange risks. The Company currently is invested in a limited number of securities and thus holds large positions in certain securities. Because the Company’s investments are concentrated in a limited number of securities of companies involved in the holding or mining of gold and other precious minerals and related activities, the net asset value of the Company may be subject to greater volatility than that of a more broadly diversified invest- ment company. 8. Indemnifications In the ordinary course of business, the Company enters into contracts that contain a variety of indemnification pro- visions. The Company’s maximum exposure under these arrangements is unknown. 9. Compensation matters For the year ended November 30, 2018 and November 30, 2017, the aggregate remuneration paid to the Company’s officers was $1,465,918 and $1,485,685, respectively. In addition, $518,500 and $602,500, respectively was accrued for bonuses to the Company’s officers and employees. The accrued bonuses are reflected in the “Accrued affiliated expenses” on the Statements of Assets and Liabilities. The aggregate remuneration paid to the Company’s directors was $213,000 and $213,000, respectively. 10. Operating lease commitment In June 2017, the Company entered into a three-year operating lease agreement, commencing March 1, 2018, in San Mateo, CA for approximately 2,500 square feet to be used as office space for its employees. The lease provides for future minimum rental payments in the aggregate amount of $479,782 as of November 30, 2018. The lease con- tains escalation clauses relating to the tenant’s share of insurance, operating expenses and tax expenses of the les- sor. Future minimum rental commitments under the lease are as follows: 12/01/2018 – 11/30/2019 $209,584 12/01/2019 – 11/30/2020 215,842 12/01/2020 – 02/28/2021 54,356 ________ Total $479,782 ________ ________ 11. Share repurchase The Company may from time to time purchase its common shares at a discount to NAV on the open market in such amounts and at such prices as the Company may deem advisable. The Company had 19,289,905 shares outstanding as of November 30, 2018 and November 30, 2017. There were no repurchases during the years ended November 30, 2018 and November 30, 2017. 12. Subsequent events On December 14, 2018, the Company announced that its Board of Directors has reached an agreement, in principle, for Merk Investments LLC, an SEC registered investment adviser (“Merk”), to become ASA’s investment adviser, subject to approval of the advisory agreement with Merk by ASA shareholders at the annual meeting of shareholders scheduled for March 26, 2019. If the agreement is approved by shareholders, the Board anticipates that the transition to Merk will be completed on or about March 31, 2019, with ASA closing its office and terminating employees as of that date. On January 8, 2019, a director of the company resigned and now receives retirement benefits. See Note 6. Retirement plans. 17 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 18 Financial Highlights Year ended November 30 2018 2017 2016 2015 2014 Per share operating performance (1) Net asset value, beginning of year $12.66 $12.61 $8.33 $11.50 $12.98 Net investment income (loss) (0.07) (0.09) (0.10) (0.09) (0.08) Net realized gain (loss) from investments (0.47) (0.36) (0.79) 0.13 (0.48) Net realized gain (loss) from foreign currency transactions 0.01 0.01 (0.14) (0.21) (0.05) Net increase (decrease) in unrealized appreciation on investments (2.00) 0.53 5.35 (2.96) (0.83) Net unrealized (loss) on translation of assets and liabilities in foreign currency — 0.00 0.00 (0.00) — Net increase (decrease) in net assets resulting from operations (2.53) 0.09 4.32 (3.13) (1.44) Dividends From net investment income (0.03) (0.04) (0.04) (0.04) (0.04) From net realized gain on investments — — — — — Net asset value, end of year $10.10 $12.66 $12.61 $8.33 $11.50 Market value per share, end of year $8.66 $11.05 $10.81 $7.16 $10.74 Total investment return Based on market price (2) (21.39%) 2.57% 51.50% (33.02%) (15.69%) Based on net asset value (3) (19.97%) 0.74% 51.86% (27.20%) (11.11%) Ratio to average net assets Expenses 1.35% 1.19% 1.26% 1.64% 1.37% Net investment income (loss) (0.63%) (0.65%) (0.79%) (0.83%) (0.54%) Supplemental data Net assets, end of year (000 omitted) $194,834 $244,202 $243,229 $160,744 $221,800 Portfolio turnover rate 3% 9% 10% 10% 7% Shares outstanding (000 omitted) 19,290 19,290 19,290 19,290 19,290 (1) Per share amounts from operations have been calculated using the average shares method. (2) Total investment return is calculated assuming a purchase of common shares at the current market price at close the day before and a sale at the current market price on the last day of each year reported. Dividends are assumed, for purposes of this calculation, to be reinvested at prices obtained under the Company’s dividend reinvestment plan. (3) Total investment return is calculated assuming a purchase of common shares at the current net asset value at close the day before and a sale at the current net asset value on the last day of each year reported. Dividends are assumed, for purposes of this calculation, to be reinvested at prices obtained under the Company’s dividend reinvestment plan. 18 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 19 Certain Tax Information for U.S. Shareholders The Company is a “passive foreign investment company” (“PFIC”) for U.S. federal income tax purposes. In view of this, U.S. investors holding common shares in taxable accounts are strongly urged to review the impor- tant tax information regarding the consequences of an investment in the common shares of the Company, which may be found at www.asaltd.com under “Investor Information | Taxpayer Information - PFIC”. Due to the complexity and potentially adverse effect of the applicable tax rules, U.S. shareholders are strongly urged to consult their own tax advisors concerning the impact of these rules on their investment in the Company and on their individual situations, and any additional informational filing requirements. Dividend Reinvestment and Stock Purchase Plan Computershare Trust Company, N.A. (“Computer - share”) has been authorized by the Company to offer and administer the Computershare Investment Plan, a dividend reinvestment and stock purchase plan (“CIP”) to shareholders as well as new investors or non- shareholders. Shareholders and new investors may elect to participate in the CIP by signing an enrollment form or by going to www.computershare.com/investor and following the instructions. New investors or non- shareholders must include a minimum initial invest - ment of at least $500. Computershare as agent will apply to the purchase of common shares of the Com - pany in the open market (i) all cash dividends (after deduction of the service charge described below) that become payable to such participant on the Company’s shares (including shares registered in his or her name and shares accumulated under the CIP) and (ii) any optional cash purchases ($50 minimum, subject to an annual maximum of $250,000) received from such participant. be in bulk requests combined, requests may Computershare may combine CIP participant purchase requests with other purchase requests received from other CIP participants and may submit the combined purchase to Computershare’s broker as a single purchase order. Purchase at Computershare’s discretion, according to one or more type (e.g., dividend factors such as purchase reinvestment, one-time ACH, check, etc.), request date, or request delivery method (e.g., online, regular mail, etc.). Computershare will submit bulk purchase orders to its broker as and when required under the terms of the CIP. Computershare’s broker may execute each bulk purchase order in one or more transactions over one or more days, depending on market conditions. Each participant whose purchase request is included in each bulk purchase order will receive the weighted average market price of all shares purchased by Computershare’s broker for such order. Any stock dividends or split shares distributed on shares held in the CIP will be credited to the participant’s account. A one-time $10 enrollment fee to establish a new account for a new investor or non-shareholder will be deducted from the purchase amount. For each participant, each dividend reinvestment will entail a transaction fee of 5% of the amount reinvested, up to a maximum of $3 plus $0.03 per share purchased. Each optional cash purchase by check or one-time online bank debit will entail a transaction fee of $5 plus $0.03 per share purchased. If a participant has funds automatically deducted monthly from his or her savings or checking account, for each debit the transaction fee is $2.50 plus $0.03 per share purchased. Fees will be deducted from the purchase amount. Each batch order sale will entail a transaction fee of $15 plus $0.12 per share sold. Each market order sale will entail a transaction fee of $25 plus $0.12 per share sold. Fees are deducted from the proceeds derived from the sale. All per share fees include any brokerage commissions Computershare is required to pay. Any fractional share will be rounded up to a whole share for purposes of calculating the per share fee. Additional fees are charged by Computershare for specific shareholder requests such as copies of account statements for prior years ($10 per year requested) and a returned check and ACH reject fee of $25. Participation in the CIP may be terminated by a participant at any time by written, telephone or Internet instructions to Computershare. Upon termination, a participant will receive a certificate for the whole number of shares credited to his or her account, unless he or she requests the sale of all or part of such shares. Dividends reinvested by a shareholder under the CIP will generally be treated for U.S. federal income tax purposes in the same manner as dividends paid to such shareholder in cash. See “Certain Tax Information for more for U.S. Shareholders” tax consequences of an information regarding investment in shares of the Company, including the effect of the Company’s status as a PFIC. The amount of the service charge is deductible for U.S. federal income tax purposes, subject to limitations. To participate in the CIP, shareholders may not hold their shares in a “street name” brokerage account. Additional information regarding the CIP may from Computershare, P.O. Box be obtained Information 505000, Louisville, KY 40233-5000. Internet at may also be obtained on or by calling www.computershare.com/investor Computershare’s Telephone Response Center at (800) 317-4445 between 9:00 a.m. and 5:00 p.m., Eastern time, Monday through Friday. the 19 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 20 Privacy Notice The Company is committed to protecting the financial privacy of its shareholders. We do not share any nonpublic, personal information that we may collect about shareholders with anyone, including our affiliates, except to service and administer shareholders’ share accounts, to process transactions, to comply with shareholders’ requests of legal requirements or for other limited purposes permitted by law. For example, the Company may disclose a shareholder’s name, address, social security number and the number of shares owned to its administrator, transfer agent or other service providers in order to provide the shareholder with proxy statements, tax reporting forms, annual reports or other information about the Company. This policy applies to all of the Company’s shareholders and former shareholders. We keep nonpublic personal information in a secure environment. We restrict access to nonpublic personal information to Company employees, agents and service providers who have a need to know the information based on their role in servicing or administering shareholders’ accounts. The Company also maintains physical, electronic and procedural safeguards to protect the confidentiality of nonpublic personal information. Form N-PX/Proxy Voting The company files a list of its proxy votes with the SEC for the period of July 1 - June 30 of each year on Form N-PX. The policies and procedures used by the Company to determine how to vote proxies relating to portfolio securities and information regarding how the Company voted proxies relating to portfolio securities during the most recent twelve month period are available on the Company’s website at www.asaltd.com and on the SEC’s website at www.sec.gov. A written copy of the Company’s policies and procedures is available without charge, upon request, by calling (800) 432-3378. Form N-Q/Portfolio Holdings The Company files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Company’s Forms N-Q are available on the SEC’s website at www.sec.gov. The Company’s Forms N-Q also may be reviewed and copied at the Reference Room in Washington, D.C.; information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The schedule of portfolio holdings on Form N-Q also is included in the Company’s financial statements for the first and third quarters of each fiscal year which are available on the Company’s website at www.asaltd.com. Common Shares Repurchased Notice is hereby given in accordance with Section 23(c) of the 1940 Act that the Company is authorized to purchase its common shares in the open market if the discount to net asset value exceeds a certain threshold as determined by the Board of Directors from time to time. The Company may purchase its common shares in such amounts and at such prices as the Company may deem advisable. There can be no assurance that such action will reduce the discount. There were no repurchases during twelve months ended November 30, 2018 or November 30, 2017. The Company had 19,289,905 shares outstanding on November 30, 2018. the 20 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 21 Board of Directors and Officers of ASA Gold and Precious Metals Limited Directors are elected at each annual general meeting of shareholders to serve until the next annual general meeting. The address of each director and officer is c/o ASA Gold and Precious Metals Limited, 400 S. El Camino Real, Suite 710, San Mateo, CA 94402. Interested Director* David Christensen (56) Position held with the Company: Director since 2008; President, Chief Executive Officer and Chief Investment Officer since February 2009. Other Directorships held by Director: Director of Denver Gold Group from 2010 to 2015. Independent Directors Mary Joan Hoene, (69) Position held with the Company: Chair (non-executive) since January 2019. Deputy Chair (non-executive) from 2016 to 2018. Director since 2014. Principal occupations during past 5 years: Counsel, Carter Ledyard & Milburn LLP since 2010. Other Directorships held by Director: None. Gary Glynn (72) Position held with the Company: Director since 2013. Chairman (non-executive) from 2014 to 2016. Principal occupations during past 5 years: Retired. Other Directorships held by Director: Director of Taiwan Opportunities Fund Ltd. since 2012. Bruce Hansen (61) Position held with the Company: Director since 2014. Principal occupations during past 5 years: Chief Executive Officer, General Moly, Inc. since 2007. Other Directorships held by Director: Director of Energy Fuels Inc. since 2006; Director of General Moly Inc. since 2007; Director and past Chairman (2011) of the Nevada Mining Association since 2010. Other Officers Jack Huntington (48) Position held with the Company: Chief Compliance Officer since September 2015. Principal occupations during past 5 years: Fund Chief Compliance Officer at Foreside Fund Officer Services, LLC since 2015; Senior Vice President and Counsel at Citi Fund Services from 2008 to 2015. James Nash (38) Position held with the Company: Corporate Secretary and Deputy Chief Compliance Officer since September 2018. Principal occupations during past 5 years: Fund Chief Compliance Officer at Foreside Fund Officer Services, LLC since 2016; Regulatory Administration Advisor with JPMorgan Chase Bank, N.A. from 2014 to 2016; Product Analyst with Linedata Services, Inc. from 2011 to 2014. * By reason of being an Officer of the Company. Sara Heston (39) Position held with the Company: Vice President Investments since December 2013; Analyst from January 2010 to December 2013. Other Directorships held by Officer: Director of Denver Gold Group since December 2017. David Lin (40) Position held with the Company: Chief Financial Officer since December 2015; Controller from September 2014 to December 2015. Other principal occupations during past 5 years: Director of Finance from 2012 to 2014 and Controller from 2008 to 2012 at White Oak Global Advisors, LLC; Chief Financial Officer at White Oak Merchant Partners, LLC from 2010 to 2014. 21 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 22 Other Information Executive Office and Shareholder Services ASA Gold and Precious Metals Limited 400 S. El Camino Real, Suite 710 San Mateo, CA 94402 U.S.A. (800) 432-3378 Registered Office Canon’s Court 22 Victoria Street Hamilton HM 12, Bermuda Independent Registered Public Accounting Firm Tait, Weller & Baker LLP, Philadelphia, PA, U.S.A. Counsel Appleby, Hamilton, Bermuda K&L Gates LLP, Washington, DC, U.S.A. Custodian JPMorgan Chase Bank, N.A. New York, NY, U.S.A. Fund Accountants ALPS Alternative Investment Services, LLC Miami, FL, U.S.A. Transfer Agent Computershare Trust Company, N.A. P.O. Box 505000, Louisville, KY 40233-5000 (800) 317-4445 Website: www.asaltd.com The Semi-annual and Annual Reports of the Company and the latest valuation of net assets per share may be viewed on the Company’s website or may be requested from the Executive Office (800- 432-3378). Shareholders are reminded to notify Computershare of any change of address. 22 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 23 [This Page Intentionally Left Blank] 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 24 [This Page Intentionally Left Blank] 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 25 92552_01_ASA_AR.qxp 1/18/19 2:26 PM Page 26 Gold and Precious Metals Limited 

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