Franklin Resources, Inc. Announces Second Quarter Results

Business Wire, April 24, 2008

SAN MATEO, Calif. -- Franklin Resources, Inc. (Franklin Templeton Investments) (NYSE:BEN) today announced net income of $366.1 million, or $1.54 per share diluted, on revenues of $1,503.7 million for the quarter ended March 31, 2008. 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. For the quarter ended March 31, 2007, net income was $440.9 million, or $1.73 per share diluted, on revenues of $1,509.0 million.

Operating income for the quarter ended March 31, 2008 was $519.1 million, as compared to $635.7 million for the prior quarter and $499.1 million for the quarter ended March 31, 2007. The company's non-operating income for the quarter ended March 31, 2008 included $32.4 million of investment and other income, net, as compared to $80.8 million in the prior quarter and $100.9 million for the quarter ended March 31, 2007.

Total assets under management by the company's subsidiaries were $591.1 billion at March 31, 2008, as compared to $643.7 billion at December 31, 2007 and $576.0 billion at March 31, 2007. Simple monthly average assets under management during the quarter ended March 31, 2008 were $610.2 billion, as compared to $651.5 billion in the prior quarter and $563.7 billion in the same quarter a year ago. Equity assets comprised 55% of total assets under management at March 31, 2008, as compared to 59% of total assets under management at December 31, 2007 and 60% of total assets under management at March 31, 2007. Fixed-income assets comprised 25% of total assets under management at March 31, 2008, as compared to 22% of total assets under management at December 31, 2007 and 21% of total assets under management at March 31, 2007. Hybrid assets accounted for 19% of total assets under management at March 31, 2008, as compared to 18% of total assets under management at December 31, 2007 and March 31, 2007. Redemptions exceeded sales by $6.1 billion for the quarter ended March 31, 2008, as compared to sales exceeding redemptions by $4.6 billion for the prior quarter and $10.9 billion for the same quarter a year ago.

Cash and cash equivalents were $3.7 billion at March 31, 2008, as compared to $3.6 billion at September 30, 2007. Stockholders' equity was $7.0 billion at March 31, 2008, as compared to $7.3 billion at September 30, 2007. The company had 236.4 million shares of common stock outstanding at March 31, 2008, as compared to 245.5 million shares outstanding at September 30, 2007. During the quarter ended March 31, 2008, the company repurchased 3.6 million shares of its common stock for a total cost of $360.9 million.

Fiscal Second Quarter 2008 Highlights

Global Business Developments(1)

(See important footnotes in "Supplemental Information" section at the end of this release.)

* Franklin Templeton Investments acquired a 49 percent stake in Vietcombank Fund Management, a Vietnamese investment management company, expanding the company's local asset management capabilities.

* Franklin Templeton Investments was approved to establish a Foreign Fund Management Company in Malaysia by the Malaysian Securities Commission.

* Franklin Templeton Investments introduced U.S.-registered Franklin India Growth Fund, the company's first fund offering for U.S. investors to be sub-advised by one of its local asset management teams.

* Franklin Templeton Investments ranked #3 out of 31 fund companies in a recent study published by Cogent Research that measured loyalty among financial advisors.2

* Since its launch in January 2007, the company's marketing campaign focused on fixed-income has resulted in first time sales from over 14,500 new financial advisors.

* In Canada, DALBAR ranked Franklin Templeton Investments #1 among broker-distributed firms for English and French call center services.

* Franklin Templeton Investments launched new commercials on national television continuing its "Gain From Our Perspective" campaign, which demonstrates how the company's unique perspective on the market has led to successful investments.

Lipper Performance Rankings of Franklin Templeton's U.S.-Registered Long-Term Mutual Funds(1,3)

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Performance quoted above represents past performance, which cannot predict or guarantee future results.

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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, April 24, 2008 at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) to discuss Franklin Resources' fiscal second 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.