SAN MATEO, Calif.--(BUSINESS WIRE)--Jan. 24, 2008--Franklin
Resources, Inc. (Franklin Templeton Investments) (NYSE:BEN) today
announced net income of $518.3 million, or $2.12 per share diluted, on
revenues of $1,685.6 million for the quarter ended December 31, 2007.
In the quarter ended September 30, 2007, net income was $436.9
million, or $1.76 per share diluted, on revenues of $1,629.1 million.
For the quarter ended December 31, 2006, net income was $426.8
million, or $1.67 per share diluted, on revenues of $1,427.8 million.
Operating income for the quarter ended December 31, 2007 was
$635.7 million, as compared to $541.4 million for the prior quarter
and $508.1 million for the quarter ended December 31, 2006. The
company's non-operating income for the quarter ended December 31, 2007
included $80.8 million of investment and other income, net, as
compared to $86.0 million in the prior quarter and $71.1 million for
the quarter ended December 31, 2006.
Total assets under management by the company's subsidiaries were
$643.7 billion at December 31, 2007, as compared to $645.9 billion at
September 30, 2007 and $552.9 billion at December 31, 2006. Simple
monthly average assets under management during the quarter ended
December 31, 2007 were $651.5 billion, as compared to $627.3 billion
in the preceding quarter and $533.1 billion in the same quarter a year
ago. Equity assets comprised 59% of total assets under management at
December 31, 2007, as compared to 60% of total assets under management
at September 30, 2007 and December 31, 2006. Fixed-income assets
comprised 22% of total assets under management at December 31, 2007,
as compared to 21% of total assets under management at September 30,
2007 and December 31, 2006. Hybrid assets accounted for 18% of total
assets under management at December 31, 2007, September 30, 2007 and
December 31, 2006. Sales exceeded redemptions by $4.9 billion for the
quarter ended December 31, 2007, as compared to $9.8 billion for the
prior quarter and $10.0 billion for the comparable quarter a year ago.
Cash and cash equivalents were $2.9 billion at December 31, 2007,
as compared to $3.6 billion at September 30, 2007. Stockholders'
equity was $7.0 billion at December 31, 2007, as compared to $7.3
billion at September 30, 2007. The company had 239.7 million shares of
common stock outstanding at December 31, 2007, as compared to 245.5
million shares outstanding at September 30, 2007. During the quarter
ended December 31, 2007, the company repurchased 6.5 million shares of
its common stock for a total cost of $780.5 million.
On January 24, 2008, the company's Board of Directors authorized
the company to purchase, from time to time, up to an aggregate of 10.0
million shares of its common stock in either open market or off-market
transactions. The size and timing of these purchases will depend on
price, market and business conditions and other factors. The stock
repurchase program is not subject to an expiration date. The new board
authorization is in addition to the existing authorization, of which
1,371,118 shares remained available for repurchase at January 15,
2008. The company repurchased an aggregate of 7.9 million shares
during the period October 1, 2007 to January 15, 2008. Shares
repurchased under the program are retired.
Fiscal First Quarter 2008 Highlights
Global Business Developments(1)
(See important footnotes in "Supplemental Information" section at
the end of this release.)
-- Franklin Resources, Inc. announced a 33.3% increase in its
quarterly dividend over the dividend paid the prior quarter
and the same quarter last year. The company has increased its
annual dividend rate every year since 1981.
-- The Industrial and Commercial Bank of China, China's largest
commercial bank, selected Franklin Templeton Investments to
manage its newest Qualified Domestic Institutional Investor
fund for domestic Chinese retail and institutional investors.
-- The NJBEST college savings program, comprised of NJBEST 529
College Savings Plan - New Jersey and Franklin Templeton 529
College Savings Plan, offered by the State of New Jersey
Higher Education Student Assistance Authority and managed and
distributed by Franklin/Templeton Distributors, Inc., reported
that collective assets in the plans surpassed $2 billion.
-- Franklin Templeton Investments introduced U.S.-registered
Franklin Focused Core Equity Fund and Templeton International
Bond Fund.
-- Franklin Templeton Investments launched Templeton Emerging
Markets Smaller Companies Fund, a new SICAV (Societes
d'Investissement a Capital Variable) fund.
-- Franklin Templeton Investments (India) launched Franklin Asian
Equity Fund, a new open-end equity fund that leverages the
expertise of local asset management teams in India, Korea and
China.
-- In Germany, Templeton Asian Growth Fund and Templeton Global
Bond Fund received the Feri Fund Award 2008 in their
respective categories of Equities Asia ex Japan and Bonds
Global Currencies.
-- In Austria, Geld magazine awarded the Austrian Fund of Funds
Award to Franklin Templeton Strategic Income Fund for the Best
Balanced Fund of Funds/Bonds-Oriented 2007 for the one-year
period.
-- In Canada, DALBAR ranked Franklin Templeton Investments #1
among broker-distributed firms for English and French call
center services.
-- Franklin Templeton Institutional expanded its U.S. Consultant
Relations Team to provide enhanced regional coverage and
capitalize on the increased recognition of FT Institutional's
capabilities among investment consultants.
-- Mutual Fund Education Alliance awarded Franklin Templeton
Investments its STAR Award for Educational Brochure in the
Large Company category.
Lipper Performance Rankings of Franklin Templeton's
U.S.-Registered Long-Term Mutual Funds(1,2)
FRANKLIN TEMPLETON(3,4)
Lipper Quartile Period Ended December 31, 2007
----------------------------------------------------
1-Year 3-Year 5-Year 10-Year
Assets (%) Assets (%) Assets (%) Assets (%)
------------ ------------ ------------ -------------
1st & 2nd 49% 66% 79% 92%
----------------------------------------------------------------------
3rd & 4th 51% 34% 21% 8%
----------------------------------------------------------------------
FRANKLIN TEMPLETON EQUITY(3,5)
Lipper Quartile Period Ended December 31, 2007
----------------------------------------------------
1-Year 3-Year 5-Year 10-Year
Assets (%) Assets (%) Assets (%) Assets (%)
------------ ------------ ------------ -------------
1st & 2nd 29% 51% 70% 88%
----------------------------------------------------------------------
3rd & 4th 71% 49% 30% 12%
----------------------------------------------------------------------
FRANKLIN TEMPLETON FIXED INCOME(3,6)
Lipper Quartile Period Ended December 31, 2007
----------------------------------------------------
1-Year 3-Year 5-Year 10-Year
Assets (%) Assets (%) Assets (%) Assets (%)
------------ ------------ ------------ -------------
1st & 2nd 95% 99% 98% 99%
----------------------------------------------------------------------
3rd & 4th 5% 1% 2% 1%
----------------------------------------------------------------------
FRANKLIN EQUITY(3,7)
Lipper Quartile Period Ended December 31, 2007
----------------------------------------------------
1-Year 3-Year 5-Year 10-Year
Assets (%) Assets (%) Assets (%) Assets (%)
------------ ------------ ------------ -------------
1st & 2nd 12% 73% 73% 84%
----------------------------------------------------------------------
3rd & 4th 88% 27% 27% 16%
----------------------------------------------------------------------
TEMPLETON EQUITY(3,8)
Lipper Quartile Period Ended December 31, 2007
----------------------------------------------------
1-Year 3-Year 5-Year 10-Year
Assets (%) Assets (%) Assets (%) Assets (%)
------------ ------------ ------------ -------------
1st & 2nd 40% 19% 71% 89%
----------------------------------------------------------------------
3rd & 4th 60% 81% 29% 11%
----------------------------------------------------------------------
MUTUAL SERIES EQUITY(3,9)
Lipper Quartile Period Ended December 31, 2007
----------------------------------------------------
1-Year 3-Year 5-Year 10-Year
Assets (%) Assets (%) Assets (%) Assets (%)
------------ ------------ ------------ -------------
1st & 2nd 50% 62% 62% 100%
----------------------------------------------------------------------
3rd & 4th 50% 38% 38% 0%
----------------------------------------------------------------------
FRANKLIN TEMPLETON TAXABLE FIXED INCOME(3,10)
Lipper Quartile Period Ended December 31, 2007
----------------------------------------------------
1-Year 3-Year 5-Year 10-Year
Assets (%) Assets (%) Assets (%) Assets (%)
------------ ------------ ------------ -------------
1st & 2nd 94% 98% 92% 98%
----------------------------------------------------------------------
3rd & 4th 6% 2% 8% 2%
----------------------------------------------------------------------
FRANKLIN TEMPLETON TAX-FREE FIXED INCOME(3,11)
Lipper Quartile Period Ended December 31, 2007
----------------------------------------------------
1-Year 3-Year 5-Year 10-Year
Assets (%) Assets (%) Assets (%) Assets (%)
------------ ------------ ------------ -------------
1st & 2nd 95% 100% 100% 100%
----------------------------------------------------------------------
3rd & 4th 5% 0% 0% 0%
----------------------------------------------------------------------
Performance quoted above represents past performance, which cannot
predict or guarantee future results.
Franklin Resources, Inc.
Preliminary Condensed Consolidated Income Statements
Unaudited
(in thousands, except per share data Three months ended
and assets under management) December 31
--------------------------------
2007 2006 % Change
----------- ----------- --------
Operating Revenues
Investment management fees $1,020,315 $ 831,890 23%
Underwriting and distribution fees 573,796 509,773 13%
Shareholder servicing fees 73,175 67,565 8%
Consolidated sponsored investment
products income, net 2,904 837 247%
Other, net 15,401 17,750 (13%)
--------------------------------
Total operating revenues 1,685,591 1,427,815 18%
--------------------------------
Operating Expenses
Underwriting and distribution 552,590 478,051 16%
Compensation and benefits 280,290 251,016 12%
Information systems, technology and
occupancy 79,617 75,063 6%
Advertising and promotion 46,644 34,861 34%
Amortization of deferred sales
commissions 44,551 33,747 32%
Other 46,170 47,007 (2%)
--------------------------------
Total operating expenses 1,049,862 919,745 14%
--------------------------------
Operating income 635,729 508,070 25%
--------------------------------
Other Income (Expenses)
Consolidated sponsored investment
products (losses) gains, net (977) 30,286 N/A
Investment and other income, net 80,773 71,109 14%
Interest expense (6,045) (6,122) (1%)
--------------------------------
Other income, net 73,751 95,273 (23%)
--------------------------------
Income before taxes on income 709,480 603,343 18%
Taxes on income 191,164 176,543 8%
--------------------------------
Net income $ 518,316 $ 426,800 21%
================================
Earnings per Share
Basic $ 2.15 $ 1.69 27%
Diluted 2.12 1.67 27%
Dividends per share $ 0.20 $ 0.15 33%
Average Shares Outstanding (in
thousands)
Basic 241,585 252,400 (4%)
Diluted 244,147 255,547 (4%)
Operating Margin(1) 38% 36%
Assets Under Management (in millions)
Beginning of period $ 645,889 $ 511,330 26%
Sales 50,615 37,611 35%
Reinvested distributions 19,476 12,864 51%
Redemptions (45,661) (27,661) 65%
Distributions (23,074) (15,554) 48%
Dispositions(2) -- (1,968) (100%)
(Depreciation) appreciation (3,500) 36,283 N/A
--------------------------------
End of period $ 643,745 $ 552,905 16%
================================
Simple Monthly Average for Period $ 651,478 $ 533,138 22%
(1) Operating margin: Operating income divided by total operating
revenues.
(2) The quarter ended December 31, 2006 includes the divestiture
of assets under management of a former subsidiary at October 1, 2006.
Franklin Resources, Inc.
Preliminary Condensed Consolidated Income Statements
Unaudited
(in thousands, except per share
data, employees and billable
shareholder accounts) Three months ended
-----------------------------------
31-Dec-07 30-Sep-07 % Change
----------- ------------ --------
Operating Revenues
Investment management fees $1,020,315 $ 963,316 6%
Underwriting and distribution fees 573,796 577,762 (1%)
Shareholder servicing fees 73,175 71,035 3%
Consolidated sponsored investment
products income, net 2,904 2,506 16%
Other, net 15,401 14,518 6%
-----------------------------------
Total operating revenues 1,685,591 1,629,137 3%
-----------------------------------
Operating Expenses
Underwriting and distribution 552,590 552,729 --%
Compensation and benefits 280,290 285,631 (2%)
Information systems, technology
and occupancy 79,617 89,187 (11%)
Advertising and promotion 46,644 56,128 (17%)
Amortization of deferred sales
commissions 44,551 45,935 (3%)
Other 46,170 58,139 (21%)
-----------------------------------
Total operating expenses 1,049,862 1,087,749 (3%)
-----------------------------------
Operating income 635,729 541,388 17%
-----------------------------------
Other Income (Expenses)
Consolidated sponsored investment
products (losses) gains, net (977) (2,719) (64%)
Investment and other income, net 80,773 86,034 (6%)
Interest expense (6,045) (4,971) 22%
-----------------------------------
Other income, net 73,751 78,344 (6%)
-----------------------------------
Income before taxes on income 709,480 619,732 14%
Taxes on income 191,164 182,824 5%
-----------------------------------
Net income $ 518,316 $ 436,908 19%
===================================
Earnings per Share
Basic $ 2.15 $ 1.78 21%
Diluted 2.12 1.76 20%
Dividends per share $ 0.20 $ 0.15 33%
Average Shares Outstanding (in
thousands)
Basic 241,585 244,807 (1%)
Diluted 244,147 247,869 (2%)
Operating Margin(1) 38% 33%
Employees 8,875 8,699 2%
Billable Shareholder Accounts (in
millions) 21.2 20.4 4%
(in thousands, except per share
data, employees and billable
shareholder accounts) Three months ended
------------------------------------
30-Jun-07 31-Mar-07 31-Dec-06
----------- ----------- -----------
Operating Revenues
Investment management fees $ 927,843 $ 850,796 $ 831,890
Underwriting and distribution
fees 619,315 570,848 509,773
Shareholder servicing fees 70,126 68,333 67,565
Consolidated sponsored investment
products income, net 3,134 1,327 837
Other, net 19,393 17,702 17,750
------------------------------------
Total operating revenues 1,639,811 1,509,006 1,427,815
------------------------------------
Operating Expenses
Underwriting and distribution 595,905 533,946 478,051
Compensation and benefits 275,516 268,471 251,016
Information systems, technology
and occupancy 79,735 73,953 75,063
Advertising and promotion 52,358 46,035 34,861
Amortization of deferred sales
commissions 40,817 37,615 33,747
Other 76,474 49,903 47,007
------------------------------------
Total operating expenses 1,120,805 1,009,923 919,745
------------------------------------
Operating income 519,006 499,083 508,070
------------------------------------
Other Income (Expenses)
Consolidated sponsored investment
products (losses) gains, net 16,348 13,755 30,286
Investment and other income, net 105,304 100,857 71,109
Interest expense (6,137) (5,990) (6,122)
------------------------------------
Other income, net 115,515 108,622 95,273
------------------------------------
Income before taxes on income 634,521 607,705 603,343
Taxes on income 166,157 166,839 176,543
------------------------------------
Net income $ 468,364 $ 440,866 $ 426,800
====================================
Earnings per Share
Basic $ 1.89 $ 1.75 $ 1.69
Diluted 1.86 1.73 1.67
Dividends per share $ 0.15 $ 0.15 $ 0.15
Average Shares Outstanding (in
thousands)
Basic 247,858 251,763 252,400
Diluted 251,305 255,160 255,547
Operating Margin(1) 32% 33% 36%
Employees 8,665 8,337 8,211
Billable Shareholder Accounts (in
millions) 21.0 20.5 19.5
(1) Operating margin: Operating income divided by total operating
revenues.
ASSETS UNDER MANAGEMENT BY INVESTMENT OBJECTIVE
(in billions) Three months ended
-------------------------------------------
31- 30- 30- 31- 31-
Dec- Sep- Jun- Mar- Dec-
07 07 % Change 07 07 06
-------------------------------------------
Equity
Global/international $286.1 $286.7 --% $274.4 $248.7 $240.6
Domestic (U.S.) 95.8 100.5 (5%) 101.6 95.1 91.0
-------------------------------------------
Total equity 381.9 387.2 (1%) 376.0 343.8 331.6
-------------------------------------------
Hybrid 116.4 117.2 (1%) 112.7 105.0 98.7
Fixed-Income
Tax-free 59.3 59.0 1% 58.2 57.3 56.6
Taxable:
Global/international 47.2 43.0 10% 37.8 31.0 27.3
Domestic (U.S.) 31.5 31.8 (1%) 32.8 33.0 32.4
-------------------------------------------
Total fixed-income 138.0 133.8 3% 128.8 121.3 116.3
-------------------------------------------
Money Market 7.4 7.7 (4%) 6.5 5.9 6.3
-------------------------------------------
Total Ending Assets $643.7 $645.9 --% $624.0 $576.0 $552.9
===========================================
Simple Monthly Average
Assets $651.5 $627.3 4% $605.5 $563.7 $533.1
ASSETS UNDER MANAGEMENT AND FLOWS
(in billions) Three months ended
-----------------------------------------------
31-Dec-07 30-Sep-07 % Change 31-Dec-06 % Change
--------- --------- -------- --------- --------
Beginning Assets Under
Management $645.9 $624.0 4% $511.3 26%
U.S. retail assets(1)
Beginning assets $369.7 $366.5 1% $307.2 20%
-------------------------------------------------------------------
Sales 15.8 17.8 (11%) 17.8 (11%)
Reinvested
distributions 16.7 1.2 -- 11.5 45%
Redemptions (15.6) (16.0) (3%) (11.5) 36%
Distributions (21.6) (1.9) -- (14.0) 54%
(Depreciation)
appreciation (2.9) 2.1 N/A 19.9 N/A
-------------------------------------------------------------------
Ending assets $362.1 $369.7 (2%) $330.9 9%
-------------------------------------------------------------------
Other assets, including international and
institutional
Beginning assets $276.2 $257.5 7% $204.1 35%
-------------------------------------------------------------------
Sales 34.8 34.8 --% 19.8 76%
Reinvested
distributions 2.8 0.4 600% 1.4 100%
Redemptions (30.1) (26.8) 12% (16.1) 87%
Distributions (1.5) (0.4) 275% (1.6) (6%)
Dispositions(2) -- -- N/A (2.0) (100%)
(Depreciation)
appreciation (0.6) 10.7 N/A 16.4 N/A
-------------------------------------------------------------------
Ending assets $281.6 $276.2 2% $222.0 27%
-------------------------------------------------------------------
Total Ending Assets $643.7 $645.9 --% $552.9 16%
===================================================================
Total Assets Under Management
Beginning assets $645.9 $624.0 4% $511.3 26%
-------------------------------------------------------------------
Sales 50.6 52.6 (4%) 37.6 35%
Reinvested
distributions 19.5 1.6 -- 12.9 51%
Redemptions (45.7) (42.8) 7% (27.6) 66%
Distributions (23.1) (2.3) 904% (15.6) 48%
Dispositions(2) -- -- N/A (2.0) (100%)
(Depreciation)
appreciation (3.5) 12.8 N/A 36.3 N/A
-------------------------------------------------------------------
Ending assets $643.7 $645.9 --% $552.9 16%
===================================================================
(1) U.S. retail assets include institutional assets totaling
approximately $39.1 billion that are invested in U.S. retail fund and
annuity products. Total institutional and high net-worth assets at
December 31, 2007 were approximately $202.5 billion, of which high
net-worth assets comprised $11.5 billion.
(2) The quarter ended December 31, 2006 includes the divestiture
of assets under management of a former subsidiary at October 1, 2006.
ASSETS UNDER MANAGEMENT AND FLOWS BY INVESTMENT OBJECTIVE
(in billions) Three months ended
-----------------------------
31-Dec-07 30-Sep-07 31-Dec-06
--------- --------- ---------
Global/international equity
Beginning assets $286.7 $274.4 $217.6
------------------------------------------------------------------
Sales 20.8 21.9 15.2
Reinvested distributions 11.3 0.1 7.1
Redemptions (19.4) (17.8) (11.9)
Distributions (12.3) (0.1) (8.1)
Dispositions(1) -- -- (2.0)
(Depreciation) appreciation (1.0) 8.2 22.7
------------------------------------------------------------------
Ending assets 286.1 286.7 240.6
------------------------------------------------------------------
Domestic (U.S.) equity
Beginning assets 100.5 101.6 84.4
------------------------------------------------------------------
Sales 4.0 4.7 4.4
Reinvested distributions 5.0 -- 3.9
Redemptions (4.8) (4.4) (3.6)
Distributions (5.6) (0.1) (4.3)
(Depreciation) appreciation (3.3) (1.3) 6.2
------------------------------------------------------------------
Ending assets 95.8 100.5 91.0
------------------------------------------------------------------
Hybrid
Beginning assets 117.2 112.7 90.6
------------------------------------------------------------------
Sales 3.9 4.7 5.7
Reinvested distributions 2.0 0.6 1.1
Redemptions (2.9) (2.9) (2.2)
Distributions (2.9) (0.9) (1.5)
(Depreciation) appreciation (0.9) 3.0 5.0
------------------------------------------------------------------
Ending assets 116.4 117.2 98.7
------------------------------------------------------------------
Tax-free income
Beginning assets 59.0 58.2 55.6
------------------------------------------------------------------
Sales 2.2 2.2 1.9
Reinvested distributions 0.4 0.4 0.4
Redemptions (1.8) (1.8) (1.4)
Distributions (0.7) (0.6) (0.6)
Appreciation 0.2 0.6 0.7
------------------------------------------------------------------
Ending assets 59.3 59.0 56.6
------------------------------------------------------------------
Taxable fixed-income
Beginning assets 74.8 70.6 56.8
------------------------------------------------------------------
Sales 10.5 10.3 6.8
Reinvested distributions 0.7 0.4 0.3
Redemptions (7.9) (8.5) (4.9)
Distributions (1.5) (0.5) (1.0)
Appreciation 2.1 2.5 1.7
------------------------------------------------------------------
Ending assets 78.7 74.8 59.7
------------------------------------------------------------------
Money market
Beginning assets 7.7 6.5 6.3
------------------------------------------------------------------
Sales 9.2 8.8 3.6
Reinvested distributions 0.1 0.1 0.1
Redemptions (8.9) (7.4) (3.6)
Distributions (0.1) (0.1) (0.1)
Depreciation (0.6) (0.2) --
------------------------------------------------------------------
Ending assets 7.4 7.7 6.3
------------------------------------------------------------------
Ending Assets Under Management $643.7 $645.9 $552.9
======================================================================
(1) The quarter ended December 31, 2006 includes the divestiture
of assets under management of a former subsidiary at October 1, 2006.
Conference Call Information
President and Chief Executive Officer of Franklin Resources, Inc.,
Greg Johnson, and Executive Vice President and Chief Financial
Officer, Ken Lewis, will lead a live conference call on Thursday,
January 24, 2008 at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) to
discuss Franklin Resources' fiscal first quarter 2008 financial
results and answer analysts' questions.
Access to the teleconference will be available via
franklintempleton.com 10 minutes before the start of the call or by
dialing (877) 480-6346 in the U.S. or (706) 902-1906 internationally.
A replay of the call will be archived on the "Our Company" page of
franklintempleton.com through February 8, 2008. The replay can also be
accessed by calling (800) 642-1687 in the U.S. or (706) 645-9291
internationally using access code 30100275, after 5:30 p.m. Eastern
Time on January 24, 2008, through 11:59 p.m. Eastern Time on February
8, 2008.
Questions regarding the teleconference call should be directed to
Franklin Resources, Inc., Investor Relations at (650) 312-4091 or
Corporate Communications at (650) 312-2245.
Franklin Resources, Inc. (NYSE:BEN) is a global investment
management organization operating as Franklin Templeton Investments.
Franklin Templeton Investments provides global and domestic investment
management solutions managed by its Franklin, Templeton, Mutual Series
and Fiduciary Trust investment teams. The San Mateo, CA-based company
has 60 years of investment experience and over $643 billion in assets
under management as of December 31, 2007. For more information, please
call 1-800/DIAL BEN(R) or visit franklintempleton.com.
Supplemental Information
Investors should carefully consider a fund's investment goals,
risks, charges and expenses before investing. To obtain a prospectus,
which contains this and other information, for any U.S.-registered
Franklin Templeton fund, investors should talk to their financial
advisors or call Franklin/Templeton Distributors, Inc. at 1-800/DIAL
BEN(R) (1-800/342-5236). Please read the prospectus carefully before
investing.
1. Nothing in this press release shall be considered a
solicitation to buy or an offer to sell a security to any person in
any jurisdiction where such offer, solicitation, purchase or sale
would be unlawful under the securities laws of such jurisdiction.
Franklin/Templeton Distributors, Inc., One Franklin Parkway, San
Mateo, CA, is the U.S.-registered funds' principal distributor and a
wholly owned subsidiary of Franklin Resources, Inc. The information on
Global Business Developments is being provided for information
purposes only.
2. Lipper rankings for Franklin Templeton U.S.-registered mutual
funds are based on Class A shares. Performance returns, ratings and
rankings for other classes may vary. Franklin Templeton mutual funds
are compared against a universe of all share classes.
3. Lipper calculates averages by taking all of the funds and share
classes in a peer group and averaging their total returns for the
periods indicated. Lipper tracks 146 peer groups of U.S. retail mutual
funds, and the groups vary in size from 2 to 943 funds. Lipper total
return calculations include reinvested dividends and capital gains,
but do not include sales charges or expense subsidization by the
manager. Results may have been different if these or other factors had
been considered.
4. Source: Lipper(R) Inc., 12/31/07. Of the eligible Franklin
Templeton long-term mutual funds tracked by Lipper, 42, 47, 48 and 49
funds ranked in the top quartile and 29, 20, 18 and 15 funds ranked in
the second quartile, for the one-, three-, five- and 10-year periods,
respectively, for their respective Lipper peer groups.
5. Source: Lipper(R) Inc., 12/31/07. Of the eligible Franklin
Templeton equity mutual funds tracked by Lipper, 18, 14, 11 and 15
funds ranked in the top quartile and 12, 10, 13 and 9 funds ranked in
the second quartile, for the one-, three-, five- and 10-year periods,
respectively, for their respective Lipper peer groups.
6. Source: Lipper(R) Inc., 12/31/07. Of the eligible Franklin
Templeton non-money market fixed income mutual funds tracked by
Lipper, 24, 33, 37 and 34 funds ranked in the top quartile and 17, 10,
5 and 6 funds ranked in the second quartile, for the one-, three-,
five- and 10-year periods, respectively, for their respective Lipper
peer groups.
7. Source: Lipper(R) Inc., 12/31/07. Of the eligible Franklin
equity mutual funds tracked by Lipper, 12, 9, 6 and 7 funds ranked in
the top quartile and 7, 6, 9 and 7 funds ranked in the second
quartile, for the one-, three-, five- and 10-year periods,
respectively, for their respective Lipper peer groups.
8. Source: Lipper(R) Inc., 12/31/07. Of the eligible Templeton
equity mutual funds tracked by Lipper, 5, 2, 3 and 3 funds ranked in
the top quartile and 2, 1, 1 and 1 funds ranked in the second
quartile, for the one-, three-, five- and 10-year periods,
respectively, for their respective Lipper peer groups.
9. Source: Lipper(R) Inc., 12/31/07. Of the eligible Mutual Series
equity mutual funds tracked by Lipper, 1, 3, 2 and 5 funds ranked in
the top quartile and 3, 3, 3 and 1 funds ranked in the second
quartile, for the one-, three-, five- and 10-year periods,
respectively, for their respective Lipper peer groups.
10. Source: Lipper(R) Inc., 12/31/07. Of the eligible Franklin
Templeton non-money market taxable fixed income mutual funds tracked
by Lipper, 7, 4, 5 and 3 funds ranked in the top quartile and 2, 6, 4
and 4 funds ranked in the second quartile, for the one-, three-, five-
and 10-year periods, respectively, for their respective Lipper peer
groups.
11. Source: Lipper(R) Inc., 12/31/07. Of the eligible Franklin
Templeton non-money market tax-free fixed income mutual funds tracked
by Lipper, 17, 29, 32 and 31 funds ranked in the top quartile and 15,
4, 1 and 2 funds ranked in the second quartile, for the one-, three-,
five- and 10-year periods, respectively, for their respective Lipper
peer groups.
Forward-Looking Statements:
The financial results in this press release are preliminary.
Statements in this press release regarding Franklin Resources, Inc.,
which are not historical facts, are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements involve a number of known and
unknown risks, uncertainties and other important factors, some of
which are listed below, that could cause the actual results and
outcomes to differ materially from any future results or outcomes
expressed or implied by such forward-looking statements. These and
other risks, uncertainties and other important factors are described
in more detail in Franklin's recent filings with the U.S. Securities
and Exchange Commission, including, without limitation, in Risk
Factors and Management's Discussion and Analysis of Financial
Condition and Results of Operations in Franklin's Annual Report on
Form 10-K for the fiscal year ended September 30, 2007.
-- We are subject to extensive and often complex, overlapping and
frequently changing rules, regulations and legal
interpretations in the United States and abroad.
-- Regulatory and legislative actions and reforms have made the
regulatory environment in which we operate more costly and
future actions and reforms could adversely impact our assets
under management, increase costs and negatively impact our
profitability and future financial results.
-- Our ability to maintain the beneficial tax treatment we
anticipate with respect to non-U.S. earnings we have
repatriated is based on current interpretations of the
American Jobs Creation Act of 2004 (the "Jobs Act") and timely
and permitted use of such amounts in accordance with our
domestic reinvestment plan and the Jobs Act.
-- Any significant limitation or failure of our software
applications and other technology systems that are critical to
our operations could constrain our operations.
-- We face risks, and corresponding potential costs and expenses,
associated with conducting operations and growing our business
in numerous countries.
-- We depend on key personnel and our financial performance could
be negatively affected by the loss of their services.
-- Strong competition from numerous and sometimes larger
companies with competing offerings and products could limit or
reduce sales of our products, potentially resulting in a
decline in our market share, revenues and net income.
-- Changes in the distribution channels on which we depend could
reduce our revenues and hinder our growth.
-- The amount or mix of our assets under management are subject
to significant fluctuations and could negatively impact our
revenues and income.
-- Our increasing focus on international markets as a source of
investments and sales of investment products subjects us to
increased exchange rate and other risks in connection with
earnings and income generated overseas.
-- Poor investment performance of our products could affect our
sales or reduce the level of assets under management,
potentially negatively impacting our revenues and income.
-- We could suffer losses in earnings or revenue if our
reputation is harmed.
-- Our future results are dependent upon maintaining an
appropriate level of expenses, which is subject to
fluctuation.
-- Our ability to successfully integrate widely varied business
lines can be impeded by systems and other technological
limitations.
-- Our inability to successfully recover should we experience a
disaster or other business continuity problem could cause
material financial loss, loss of human capital, regulatory
actions, reputational harm or legal liability.
-- Certain of the portfolios we manage, including our emerging
market portfolios, are vulnerable to market-specific
political, economic or other risks, any of which may
negatively impact our revenues and income.
-- Our revenues, earnings and income could be adversely affected
if the terms of our management agreements are significantly
altered or these agreements are terminated by the funds we
advise.
-- Diverse and strong competition limits the interest rates that
we can charge on consumer loans.
-- Civil litigation arising out of or relating to previously
settled governmental investigations or other matters,
governmental or regulatory investigations and/or examinations
and the legal risks associated with our business could
adversely impact our assets under management, increase costs
and negatively impact our profitability and/or our future
financial results.
-- Our ability to meet cash needs depends upon certain factors,
including our asset value, credit worthiness and the market
value of our stock.
CONTACT: Franklin Resources, Inc.
Investor Relations:
Brian Sevilla, 650-312-4091
or
Corporate Communications:
Lisa Gallegos, 650-312-3395
franklintempleton.com
SOURCE: Franklin Resources, Inc.