Franklin Resources, Inc. · NYSE:BEN
Franklin Resources — Q4 2012 Earnings Presentation
21 slides from Franklin Resources's earnings presentation, Oct 25, 2012
Slide 1: Preliminary Fourth Quarter Results
FRANKLIN RESOURCES, INC. October 25, 2012 Franklin Resources, Inc. Preliminary Fourth Quarter Results
Slide 2: Forward-Looking Statements
FRANKLIN RESOURCES, INC. Forward-Looking Statements The financial results in this presentation are preliminary. 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
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 notably in several key areas • Assets under management, net income and earnings per share for the fiscal year set all-time highs • Announced agreement to acquire
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 September 30, 2012 67% 86% 86% Franklin 77% 82% Equity 82% 77% 77% 87% 87% 69% 91% 65% Templeton Equity 86%
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 749.9 725.7 714.4 710.7 726.7 707.1 706.9 659.9 670.3 675.0 9/11 12/11 3/12 6/12 9/12 9/11 12/11 3/12 6/12 9/12 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 September 30, 2012 As of September 30, 2012 Latin America1 Equity 3% 39% Cash Mgmt Canada 1% 5% Asia-Pacific 10% United States 66% Europe, the Middle East Hybrid and Africa Fixed-Income 15% 1
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 52.9 50.9 48.5 40.8 41.6 42.5 27.2 38.2 6.0 4.7 2.5 2.3 (22.5) (3.8) (14.9) (41.9) (14.9) (36.8) (42.7) (40.2)
Slide 11: United States and International Flows
FRANKLIN RESOURCES, INC. United States and International Flows1 (in US$ billions, for the three months ended) United States2 International 28.7 24.2 25.2 23.4 21.2 23.3 21.7 20.8 17.0 18.2 (16.4) (20.7) (20.4) (19.0) (19.9) (22.0) (22.0) (21.2) (24.8) (24.9) (33.1) 9/11 12/11 3/12 6/12 9/12 9/11 12/
Slide 12: Net New Flows by Investment Objective
FRANKLIN RESOURCES, INC. Net New Flows by Investment Objective (in billions, for the three months ended) 30-Sep-12 30-Jun-12 Sep-12 vs. Jun-12 30-Sep-11 Sep-12 vs. Sep-11 Equity sales $ 13.4 $ 13.5 (1%) $ 15.2 (12%) Equity redemptions (15.4) (14.2) 8% (21.3) (28%) Equity net exchanges (0.3) (0.4) (2
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 $2.32 $2.31 688 $2.20 643 $2.12 632 617 623 $1.88 503 492 481 455 416 9/11 12/11 3/12 6/12 9/12 9/11 12/11 3/12
Slide 15: Operating Revenues
Unaudited FRANKLIN RESOURCES, INC. Operating Revenues (in millions, for the three months ended) 30-Sep-12 30-Jun-12 Sep-12 vs. Jun-12 31-Mar-12 31-Dec-11 30-Sep-11 Sep-12 vs. Sep-11 Investment management fees $ 1,142.8 $ 1,114.4 3% $ 1,126.4 $ 1,075.1 $ 1,193.2 (4%) Sales and distribution fees 579.9
Slide 16: Operating Expenses
Unaudited FRANKLIN RESOURCES, INC. Operating Expenses (in millions, for the three months ended) 30-Sep-12 30-Jun-12 Sep-12 vs. Jun-12 31-Mar-12 31-Dec-11 30-Sep-11 Sep-12 vs. Sep-11 Sales, distribution and marketing $ 701.6 $ 692.0 1% $ 715.5 $ 630.6 $ 669.4 5% Compensation and benefits 317.5 314.6
Slide 17: Other Income – U.S. GAAP
Unaudited FRANKLIN RESOURCES, INC. Other Income – U.S. GAAP (in US$ millions, for the three months ended September 30, 2012) 8.8 (9.8) 18.9 10.8 (8.4) (3.6) 2.7 55.7 45.9 77.7 18.3 72.8 8.2 Dividend and Equity Available- Trading Interest Other Consolidated Consolidated Total other Noncontrolling Oth
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 30-Sep-12 30-Jun-12 Operatin
Slide 19: Operating Results
Unaudited FRANKLIN RESOURCES, INC. Operating Results (in millions, except per share data, for the three months ended) 30-Sep-12 30-Jun-12 Sep-12 vs. Jun-12 31-Mar-12 31-Dec-11 30-Sep-11 Sep-12 vs. Sep-11 Income Before Taxes $ 678.4 $ 614.9 10% $ 689.9 $ 695.0 $ 560.8 21% Taxes on income 174.4 184.9
Slide 20: Profitability
Unaudited FRANKLIN RESOURCES, INC. Profitability (for the fiscal period) Operating Margin 37.3% 34.8% 35.4% 33.5% 28.7% FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 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: 3% 10% Compound Annual 5% Dilution 0% -5% BEN: 3% Compound -10% Annual Accretion -15% 9/07 3/08 9/08 3/0