SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 22, 1999
(July 22, 1999)
FRANKLIN RESOURCES, INC.
(Exact name of registrant as specified in its charter)
.... DELAWARE ................. 1-9318 ....... 13-2670991 ...
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
777 MARINERS ISLAND BLVD., SAN MATEO, CALIFORNIA ........ 94404...
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code..(650) 312-3000
-------------------------------------------------
(Former name or former address, if changed since last report)
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Item 5. Other Events
Registrant is filing this Form 8-K in order to file a current earnings press
release. By this filing, Registrant is not establishing the practice of filing
all earnings press releases in the future and may discontinue such filings at
any time.
Item 7. Financial Statements and Exhibits
(c)Exhibits
Exhibit "A" - Press Release issued on July 22, 1999 by Franklin Resources,
Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FRANKLIN RESOURCES, INC.
(Registrant)
Date: July 22, 1999 /s/ Leslie M. Kratter
----------------------
LESLIE M. KRATTER
Vice President
Exhibits
A. Press Release issued on July 22, 1999 by Franklin Resources, Inc.
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FROM: Franklin Resources, Inc.
Public Relations: Holly Gibson (650) 312-4701
Investor Relations: Bijan Modanlou (650) 525-8900
www.frk.com
For Immediate Release
Franklin Resources Announces Third Quarter Results
San Mateo, CA, July 22, 1999-- Franklin Resources, Inc. (NYSE: BEN) today
reported net income of $123.3 million, or $0.49 per share diluted on revenues of
$566.8 million for the quarter ended June 30, 1999. Net income for the quarter
ended June 30, 1998 was $131.0 million, or $0.52 per share diluted, on revenues
of $672.6 million.
Net income for the nine months ended June 30, 1999 was $294.3 million, or
$1.16 per share diluted, on revenues of $1,688.5 million. These results included
pretax restructuring charges of $58.5 million. Had the Company not taken these
charges, diluted per share earnings would have been approximately $1.33 during
this period. Net income for the nine months ended June 30, 1998 was $388.2
million, or $1.53 per share diluted, on revenues of $1,978.7 million.
Assets under management by the Company's subsidiaries were $228.7 billion,
compared to $216.0 billion in the preceding quarter and $236.6 billion at this
time last year. Quarterly average assets under management during the current
quarter were $223.9 billion compared to $216.4 billion in the preceding quarter
and $240.5 billion in the same quarter a year ago.
Franklin Resources, Inc. provides global and domestic investment
management, shareholder and distribution services to the Franklin Templeton
mutual funds and institutional accounts in over 100 different nations worldwide.
Franklin's headquarters are located at 777 Mariners Island Blvd., San Mateo, CA.
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FRANKLIN RESOURCES, INC.
Consolidated Income Statements
(Dollar amounts in thousands except
assets under management and per share data.)
Three months ended Nine months ended
June 30 June 30
------------------------------------------------
1999 1998 1999 1998
Operating revenues:
Investment management fees $340,515 $373,820 $993,304 $1,073,622
Underwriting and distribution
fees 176,118 252,354 543,128 774,164
Shareholder servicing fees 45,376 40,793 138,872 117,798
Other 4,766 5,629 13,221 13,102
------------------------------------------------
Total operating revenues 566,775 672,596 1,688,525 1,978,686
------------------------------------------------
Operating expenses:
Underwriting and distribution 151,353 220,660 467,699 668,378
Compensation and benefits 126,821 152,688 389,451 418,723
Information systems, technology
and occupancy 53,829 37,312 154,419 129,770
Advertising and promotion 26,379 33,782 80,010 92,387
Amortization of deferred sales
commissions 23,600 27,753 71,582 78,174
Amortization of intangible assets 9,283 9,336 27,939 27,280
Other 19,004 22,846 60,579 64,889
Restructuring charges - - 58,455 -
------------------------------------------------
Total operating expenses 410,269 504,377 1,310,134 1,479,601
------------------------------------------------
Operating income 156,506 168,219 378,391 499,085
------------------------------------------------
Other income (expense):
Investment and other income 12,227 15,435 37,253 42,006
Interest expense (4,876) (6,523) (15,825) (16,501)
------------------------------------------------
Other income (expense), net 7,351 8,912 21,428 25,505
------------------------------------------------
Income before taxes on income 163,857 177,131 399,819 524,590
Taxes on income 40,550 46,118 105,549 136,393
------------------------------------------------
Net income $123,307 $131,013 $294,270 $388,197
================================================
Earnings per share:
Basic $0.49 $0.52 $1.17 $1.54
Diluted $0.49 $0.52 $1.16 $1.53
Dividends per share $0.055 $0.05 $0.165 $0.15
Average shares outstanding
(in thousands):
Basic 252,103 252,860 252,161 252,771
Diluted 252,595 253,095 252,685 253,383
Assets under management
(in millions):
End of period $228,724 $236,574 $228,724 $236,574
Simple monthly average
for period $223,867 $240,513 $219,287 $229,916
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<TABLE>
<CAPTION>
Franklin Resources, Inc.
Consolidated Income Statements
(Dollar amounts in thousands except assets
under management and per share data.) Three months ended
30-Jun-99 31-Mar-99 31-Dec-98 30-Sep-98 30-Jun-98
<S> <C> <C> <C> <C> <C>
Operating revenues:
Investment management fees $340,515 $322,419 $330,370 $339,651 $373,820
Underwriting and distribution fees 176,118 178,406 188,604 208,483 252,354
Shareholder servicing fees 45,376 47,762 45,734 42,762 40,793
Other 4,766 5,484 2,971 7,690 5,629
-------------------------------------------------------------
Total operating revenues 566,775 554,071 567,679 598,586 672,596
-------------------------------------------------------------
Operating expenses:
Underwriting and distribution 151,353 153,300 163,046 173,328 220,660
Compensation and benefits 126,821 128,816 133,814 134,362 152,688
Information systems, technology and occupancy 53,829 52,111 48,479 51,895 37,312
Advertising and promotion 26,379 25,393 28,238 33,538 33,782
Amortization of deferred sales commissions 23,600 22,963 25,019 27,231 27,753
Amortization of intangible assets 9,283 9,283 9,373 9,577 9,336
Other 19,004 18,770 22,805 25,644 22,846
Restructuring charges - 12,315 46,140 - -
-------------------------------------------------------------
Total operating expenses 410,269 422,951 476,914 455,575 504,377
-------------------------------------------------------------
Operating income 156,506 131,120 90,765 143,011 168,219
-------------------------------------------------------------
Other income (expense):
Investment and other income 12,227 14,490 10,536 14,717 15,435
Interest expense (4,876) (4,776) (6,173) (6,034) (6,523)
-------------------------------------------------------------
Other income (expense), net 7,351 9,714 4,363 8,683 8,912
-------------------------------------------------------------
Income before taxes on income 163,857 140,834 95,128 151,694 177,131
Taxes on income 40,550 38,363 26,636 39,441 46,118
-------------------------------------------------------------
Net income $123,307 $102,471 $68,492 $112,253 $131,013
=============================================================
Earnings per share:
Basic $0.49 $0.41 $0.27 $0.44 $0.52
Diluted $0.49 $0.41 $0.27 $0.44 $0.52
Dividends per share $0.055 $0.055 $0.055 $0.05 $0.05
Average shares outstanding (in thousands):
Basic 252,103 252,189 251,860 252,579 252,860
Diluted 252,595 252,579 252,055 252,707 253,095
Assets under management (in millions):
End of period $228,724 $215,960 $220,236 $208,591 $236,574
Simple monthly average for period $223,867 $216,439 $216,959 $221,633 $240,513
</TABLE>
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ASSETS UNDER MANAGEMENT
(In billions) 30-Jun-99 31-Mar-99 31-Dec-98 30-Sep-98 30-Jun-98
-----------------------------------------------------
Franklin Templeton Group:
Equity:
Global/international $102.0 $91.4 $92.8 $84.8 $105.4
Domestic (U.S.) 40.4 37.4 40.4 37.6 45.9
-------- --------------------------------------------
Total Equity 142.4 128.8 133.2 122.4 151.3
-----------------------------------------------------
Hybrid funds <F1> 10.8 10.7 11.5 11.2 12.4
Fixed income:
Tax-free 50.0 51.6 50.9 50.5 49.1
Taxable:
Domestic
(primarily
US Govt.) 15.9 16.1 16.0 16.0 15.7
Global/international 3.9 4.0 4.0 3.7 4.1
-----------------------------------------------------
Total Fixed Income 69.8 71.7 70.9 70.2 68.9
-----------------------------------------------------
Money funds 5.7 4.8 4.6 4.8 4.0
=====================================================
Total Franklin
Templeton Group $228.7 $216.0 $220.2 $208.6 $236.6
=====================================================
<F1> Hybrid funds include asset allocation, balanced, flexible and income-mixed
funds as defined by the Investment Company Institute. Periods prior to March 31,
1999 have been restated to reflect the reclassification of certain funds to
Domestic Equity from the Hybrid category.
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