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, 2010 - Franklin Resources, Inc. (Franklin Templeton Investments) (NYSE: BEN) today announced net income1 of $355.6 million, or $1.54 per share diluted, on revenues of $1,377.4 million for the quarter ended December 31, 2009. For the quarter ended September 30, 2009, net income1 was $367.4 million, or $1.59 per share diluted, on revenues of $1,238.9 million. For the quarter ended December 31, 2008, net income1 was $120.9 million, or $0.52 per share diluted, on revenues of $969.3 million.

Operating income for the quarter ended December 31, 2009 was $467.0 million, as compared to $384.7 million for the prior quarter and $268.4 million for the quarter ended December 31, 2008. The company’s non-operating income (expenses) for the quarter ended December 31, 2009 included $33.0 million of investment and other income (losses), net, as compared to $87.3 million for the quarter ended September 30, 2009 and $(45.0) million for the quarter ended December 31, 2008.

Total assets under management by the company’s subsidiaries were $553.5 billion at December 31, 2009, as compared to $523.4 billion at September 30, 2009 and $416.2 billion at December 31, 2008. Simple monthly average assets under management during the quarter ended December 31, 2009 were $534.9 billion, as compared to $488.3 billion in the prior quarter and $438.7 billion in the same quarter a year ago. Equity assets comprised 46% of total assets under management at December 31, 2009, as compared to 47% of total assets under management at September 30, 2009 and December 31, 2008. Fixed-income assets comprised 34% of total assets under management at December 31, 2009, as compared to 33% of total assets under management at September 30, 2009 and 32% of total assets under management at December 31, 2008. Hybrid and other assets accounted for 20% of total assets under management at December 31, 2009 and September 30, 2009, as compared to 21% at December 31, 2008. Net new flows for the quarter ended December 31, 2009 were $14.3 billion, as compared to $12.2 billion for the prior quarter and $(18.2) billion for the same quarter a year ago.

Cash and cash equivalents and investments were $5.4 billion at December 31, 2009, as compared to $5.8 billion at September 30, 2009. Total stockholders’ equity was $7.1 billion at December 31, 2009, as compared to $7.6 billion at September 30, 2009. The company had 228.2 million shares of common stock outstanding at December 31, 2009, as compared to 229.3 million shares outstanding at September 30, 2009. During the quarter ended December 31, 2009, the company repurchased 1.6 million shares of its common stock for a total cost of $174.0 million.

On December 18, 2009, the company declared a regular quarterly cash dividend of $0.22 per share which was paid on January 8, 2010. The quarterly dividend of $0.22 per share represents a 5% increase over the dividend paid in the prior quarter and the same quarter a year ago. Additionally, the company declared a special cash dividend of $3.00 per share which was paid on December 31, 2009. These dividends are consistent with the company’s long-term capital management strategy of continuing to invest in the business, maintaining financial strength and flexibility, and returning a substantial portion of the company’s earnings to stockholders through common stock repurchases and the payment of dividends.

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

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