Franklin Resources, Inc. · NYSE:BEN
Franklin Resources — Q1 2013 Earnings Presentation
21 slides from Franklin Resources's earnings presentation, Feb 1, 2013
Slide 1: Franklin Resources, Inc. First Quarter Results
FRANKLIN RESOURCES, INC. February 1, 2013 Franklin Resources, Inc. First Quarter Results
Slide 2: Forward-Looking Statements
FRANKLIN RESOURCES, INC. Forward-Looking Statements Statements in this presentation regarding Franklin Resources, Inc. (“Franklin”) and its subsidiaries, which are not historical facts, are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.
Slide 3: Audio Commentary and Conference Call Details
FRANKLIN RESOURCES, INC. Audio Commentary and Conference Call Details Pre-recorded audio commentary on the results from Franklin Resources, Inc.’s President and Chief Executive Officer Greg Johnson and Executive Vice President and Chief Financial Officer Ken Lewis will be available today at approxim
Slide 4: Highlights
FRANKLIN RESOURCES, INC. Highlights • Relative investment performance remains strong over the 1-, 3-, 5- and 10-year periods and improved by most measures • Successfully deployed the Riva Transfer Agent solution across the Company’s international transfer agency operations • Assets under management
Slide 5: Investment Performance
FRANKLIN RESOURCES, INC. Investment Performance
Slide 6: Investment Performance – Lipper Rankings of U.S.-Registered Long-Term Mutual Funds
FRANKLIN RESOURCES, INC. Investment Performance – Lipper Rankings of U.S.-Registered Long-Term Mutual Funds1 Percentage of Assets in the Top Two Quartiles Franklin Templeton By Category As of December 31, 2012 67% 86% 86% Franklin 84% 82% 82% Equity 87% 79% 77% 84% 89% 66% 65% Templeton 86% Equity 8
Slide 7: Assets Under Management and Flows
FRANKLIN RESOURCES, INC. Assets Under Management and Flows
Slide 8: Assets Under Management
FRANKLIN RESOURCES, INC. Assets Under Management (in US$ billions, for the three months ended) End of Period Simple Monthly Average 781.8 763.6 749.9 725.7 707.1 706.9 710.7 726.7 670.3 675.0 12/11 3/12 6/12 9/12 12/12 12/11 3/12 6/12 9/12 12/12 8
Slide 9: Assets Under Management by Investment Objective and Sales Region
FRANKLIN RESOURCES, INC. Assets Under Management (in billions) By Investment Objective By Sales Region As of December 31, 2012 As of December 31, 2012 Equity Latin America1 39% 4% Cash Mgmt Canada 1% 4% Asia-Pacific 10% United States 65% Europe, the Hybrid Middle East 15% and Africa Fixed-Income 17%
Slide 10: Market Appreciation (Depreciation) and Long-Term Flows Summary
FRANKLIN RESOURCES, INC. Market Appreciation (Depreciation) and Long-Term Flows Summary (in US$ billions, for the three months ended) Long-Term Flows1 Appreciation (Depreciation) and Other 48.5 46.0 50.9 41.6 42.5 38.2 40.8 27.2 24.8 6.0 4.7 2.3 1.0 (3.8) (14.9) (41.9) (36.8) (22.5) (14.9) (42.7) (4
Slide 11: United States and International Flows
FRANKLIN RESOURCES, INC. United States and International Flows (in US$ billions, for the three months ended) United States1 International 25.2 23.4 23.3 21.2 21.7 23.0 20.8 23.0 17.0 18.2 (16.4) (20.7) (20.4) (19.0) (19.9) (22.0) (23.2) (22.0) (21.2) (21.5) (33.1) 12/11 3/12 6/12 9/12 12/12 12/11 3/
Slide 12: Net New Flows by Investment Objective
FRANKLIN RESOURCES, INC. Net New Flows by Investment Objective (in billions, for the three months ended) 31-Dec-12 30-Sep-12 Dec-12 vs. Sep-12 31-Dec-11 Dec-12 vs. Dec-11 Equity sales $ 13.0 $ 13.4 (3%) $ 13.5 (4%) Equity redemptions (18.9) (15.4) 23% (14.7) 29% Equity net exchanges (0.5) (0.3) 67%
Slide 13: Operating Results and Capital Management
FRANKLIN RESOURCES, INC. Operating Results and Capital Management
Slide 14: Quarterly Financial Highlights
Unaudited FRANKLIN RESOURCES, INC. Quarterly Financial Highlights (in US$ millions, except per share data, for the three months ended) Operating and Net Income1 Diluted Earnings Per Share $2.42 685 632 643 $2.32 $2.31 617 623 $2.20 $2.12 503 516 481 492 455 12/11 3/12 6/12 9/12 12/12 12/11 3/12 6/12
Slide 15: Operating Revenues
Unaudited FRANKLIN RESOURCES, INC. Operating Revenues (in millions, for the three months ended) 31-Dec-12 30-Sep-12 Dec-12 vs. Sep-12 30-Jun-12 31-Mar-12 31-Dec-11 Dec-12 vs. Dec-11 Investment management fees $ 1,199.9 $ 1,142.8 5% $ 1,114.4 $ 1,126.4 $ 1,075.1 12% Sales and distribution fees 604.1
Slide 16: Operating Expenses
Unaudited FRANKLIN RESOURCES, INC. Operating Expenses (in millions, for the three months ended) 31-Dec-12 30-Sep-12 Dec-12 vs. Sep-12 30-Jun-12 31-Mar-12 31-Dec-11 Dec-12 vs. Dec-11 Sales, distribution and marketing $ 730.9 $ 701.6 4% $ 692.0 $ 715.5 $ 630.6 16% Compensation and benefits 335.1 317.5
Slide 17: Other Income – U.S. GAAP
Unaudited FRANKLIN RESOURCES, INC. Other Income – U.S. GAAP (in US$ millions, for the three months ended December 31, 2012) 5.3 (14.5) 20.9 (19.1) 14.9 20.9 (10.2) 45.9 21.8 31.0 5.9 Dividend and Equity Available- Trading Interest Other Consolidated Consolidated Total other Noncontrolling Other inco
Slide 18: Consolidation of SIPs and VIEs Summary
Unaudited FRANKLIN RESOURCES, INC. Consolidation of SIPs and VIEs Summary (in millions, for the three months ended) The table below summarizes the impact of consolidating SIPs and VIEs on the Company’s reported U.S. GAAP operating results. SIP and VIE Related Adjustments 31-Dec-12 30-Sep-12 Operatin
Slide 19: Operating Results
Unaudited FRANKLIN RESOURCES, INC. Operating Results (in millions, except per share data, for the three months ended) 31-Dec-12 30-Sep-12 Dec-12 vs. Sep-12 30-Jun-12 31-Mar-12 31-Dec-11 Dec-12 vs. Dec-11 Income Before Taxes $ 716.1 $ 678.4 6% $ 614.9 $ 689.9 $ 695.0 3% Taxes on income 211.4 174.4 21
Slide 20: Profitability
Unaudited FRANKLIN RESOURCES, INC. Profitability (for the fiscal period) Operating Margin 37.3% 35.4% 36.0% 33.5% 28.7% FY 2009 FY 2010 FY 2011 FY 2012 FYTD 2013 20
Slide 21: Capital Management
Unaudited FRANKLIN RESOURCES, INC. Capital Management (in US$ billions, except as noted, as of and for the period ended) Change in Ending Shares Outstanding 20% 15% U.S. Asset Managers (ex-BEN)1: 2.9% 10% Compound Annual 5% Dilution 0% -5% BEN: 2.4% Compound Annual -10% Accretion -15% 12/07 6/08 12/