Franklin Resources, Inc
Franklin Resources, Inc.
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Franklin Resources, Inc. Announces First Quarter Results

From: Franklin Resources, Inc.
Contact: Matt Walsh
Telephone:(650) 312-2245

San Mateo, CA, January 28, 2009 - Franklin Resources, Inc. (Franklin Templeton Investments) (NYSE: BEN) today announced net income of $120.9 million, or $0.52 per share diluted, on revenues of $969.3 million for the quarter ended December 31, 2008. For the quarter ended September 30, 2008, net income was $300.5 million, or $1.28 per share diluted, on revenues of $1,321.5 million. For the quarter ended December 31, 2007, net income was $518.3 million, or $2.12 per share diluted, on revenues of $1,685.6 million.

Operating income for the quarter ended December 31, 2008 was $268.4 million, as compared to $412.0 million for the prior quarter and $635.7 million for the quarter ended December 31, 2007. Other net, operating revenues for the quarter ended December 31, 2008 included a $17.7 million decline in the fair value of certain retained interests in securitization transactions, as compared to $12.0 million for the prior quarter and $0.3 million for the quarter ended December 31, 2007.

The company’s non-operating income (expenses) for the quarter ended December 31, 2008 included $(45.0) million of investment and other (losses) income, net, as compared to $77.8 million for the prior quarter and $80.8 million for the quarter ended December 31, 2007.

Total assets under management by the company’s subsidiaries were $416.2 billion at December   31, 2008, as compared to $507.3 billion at September 30, 2008 and $643.7 billion at December  31, 2007. Simple monthly average assets under management during the quarter ended December 31, 2008 were $438.7 billion, as compared to $555.4 billion in the prior quarter and $651.5 billion in the same quarter a year ago. Equity assets comprised 47% of total assets under management at December 31, 2008, as compared to 52% of total assets under management at September 30, 2008 and 59% of total assets under management at December  31, 2007. Fixed-income assets comprised 32% of total assets under management at December  31, 2008, as compared to 28% of total assets under management at September 30, 2008 and 22% of total assets under management at December 31, 2007. Hybrid assets accounted for 19% of total assets under management at December 31, 2008 and September 30, 2008 as compared to 18% of total assets under management at December  31, 2007. Net new flows for the quarter ended December 31, 2008 were $(18.2) billion, as compared to $(8.6) billion for the prior quarter and $4.6 billion for the same quarter a year ago.

Cash and cash equivalents were $2.8 billion at December 31, 2008, as compared to $2.5 billion at September 30, 2008. Stockholders’ equity was $7.0 billion at December 31, 2008, as compared to $7.1 billion at September 30, 2008. The company had 232.9 million shares of common stock outstanding at December 31, 2008, as compared to 232.8 million shares outstanding at September 30, 2008.

(The preceding paragraphs only represent a portion of the press release.)

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