UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number_811-00537
__Franklin Custodian Funds
(Exact name of registrant as specified in charter)
One Franklin Parkway, San Mateo, CA 94403-1906
(Address of principal executive offices) (Zip code)
Craig S. Tyle, One Franklin Parkway, San Mateo, CA 94403-1906
(Name and address of agent for service)
Registrant's telephone number, including area code:_650 312-2000
Date of fiscal year end: 9/30
Date of reporting period: _9/30/10
Item 1. Reports to Stockholders.
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SEPTEMBER 30, 2010 ANNUAL REPORT AND SHAREHOLDER LETTER Franklin DynaTech Fund Franklin Growth Fund Franklin Income Fund Franklin U.S. Government Securities Fund Franklin Utilities Fund Sign up for electronic delivery on franklintempleton.com FRANKLIN CUSTODIAN FUNDS |
Shareholder Letter | 1 | |||
Annual Report | ||||
Economic and Market Overview | 3 | |||
Franklin DynaTech Fund | 5 | |||
Franklin Growth Fund | 15 | |||
Franklin Income Fund | 25 | |||
Franklin U.S. Government Securities Fund | 38 | |||
Franklin Utilities Fund | 49 | |||
Financial Highlights and Statements of Investments | 59 | |||
Financial Statements | 111 | |||
Notes to Financial Statements | 120 | |||
Report of Independent Registered Public Accounting Firm | 143 | |||
Tax Designation | 144 | |||
Board Members and Officers | 145 | |||
Shareholder Information | 150 |
1. | Source: Bureau of Labor Statistics. |
2. | Source: © 2010 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. The Dow Jones Industrial Average is price weighted based on the average market price of 30 blue-chip stocks that are generally industry leaders. The S&P 500 is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance. STANDARD & POOR’S®, S&P® and S&P 500® are registered trademarks of Standard & Poor’s Financial Services LLC. Standard & Poor’s does not sponsor, endorse, sell or promote any S&P index-based product. The NASDAQ Composite Index is a broad-based market capitalization-weighted index designed to measure all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market. |
1. | Source: © 2010 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. The Russell 1000 Growth Index is market capitalization weighted and measures performance of those Russell 1000 Index companies with higher price-to-book ratios and higher forecasted growth values. The index return includes reinvested dividends. | |
2. | Source: © 2010 Morningstar. The NASDAQ 100 Index is a modified market capitalization-weighted index of the largest and most active domestic and international non-financial companies listed on The NASDAQ Stock Market. The index reflects companies across major industry groups including computer hardware and software, telecommunications, retail/wholesale trade and biotechnology. Return for this index is price-only and does not include reinvested dividends. | |
3. | Source: © 2010 Morningstar. The S&P 500 is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance and includes reinvested dividends. The NASDAQ Composite Index is a broad-based, market capitalization-weighted index designed to measure all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market and includes reinvested dividends. |
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Portfolio Breakdown Franklin DynaTech Fund Based on Total Net Assets as of 9/30/10 |
4. | The information technology sector comprises communications equipment; computers and peripherals; electronic equipment, instruments and components; Internet software and services; IT services; semiconductors and semiconductor equipment; and software in the SOI. | |
5. | The consumer discretionary sector comprises diversified consumer services; hotels, restaurants and leisure; and Internet and catalog retail in the SOI. | |
6. | The health care sector comprises biotechnology, health care equipment and supplies, health care providers and services, health care technology, life sciences tools and services, and pharmaceuticals in the SOI. |
![]() ![]() Matthew J. Moberg, CPA | ||
![]() ![]() Rupert H. Johnson, Jr. | ||
Portfolio Management Team | ||
Franklin DynaTech Fund |
7. | The financials sector comprises capital markets, commercial banks, consumer finance and diversified financial services in the SOI. |
Franklin DynaTech Fund
9/30/10
Company | % of Total | |||
Sector/Industry, Country | Net Assets | |||
Apple Inc. | 7.6 | % | ||
Computers & Peripherals, U.S. | ||||
Google Inc., A | 3.8 | % | ||
Internet Software & Services, U.S. | ||||
Intel Corp. | 3.1 | % | ||
Semiconductors & Semiconductor Equipment, U.S. | ||||
Baidu Inc. | 3.0 | % | ||
Internet Software & Services, China | ||||
FMC Technologies Inc. | 3.0 | % | ||
Energy Equipment & Services, U.S. | ||||
Teva Pharmaceutical Industries Ltd., ADR | 2.7 | % | ||
Pharmaceuticals, Israel | ||||
ARM Holdings PLC | 2.4 | % | ||
Semiconductors & Semiconductor Equipment, U.K. | ||||
Salesforce.com Inc. | 2.4 | % | ||
Software, U.S. | ||||
Visa Inc., A | 2.4 | % | ||
IT Services, U.S. | ||||
Priceline.com Inc. | 2.4 | % | ||
Internet & Catalog Retail, U.S. |
Class A (Symbol: FKDNX) | Change | 9/30/10 | 9/30/09 | |||||||||
Net Asset Value (NAV) | +$3.96 | $ | 27.16 | $ | 23.20 |
Class B (Symbol: FDNBX) | Change | 9/30/10 | 9/30/09 | |||||||||
Net Asset Value (NAV) | +$3.50 | $ | 25.10 | $ | 21.60 |
Class C (Symbol: FDYNX) | Change | 9/30/10 | 9/30/09 | |||||||||
Net Asset Value (NAV) | +$3.47 | $ | 24.81 | $ | 21.34 |
Class R (Symbol: n/a) | Change | 9/30/10 | 9/30/09 | |||||||||
Net Asset Value (NAV) | +$3.89 | $ | 27.02 | $ | 23.13 |
Advisor Class (Symbol: n/a) | Change | 9/30/10 | 9/30/09 | |||||||||
Net Asset Value (NAV) | +$4.05 | $ | 27.33 | $ | 23.28 |
Class A | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +17.07 | % | +22.38 | % | +11.06 | % | ||||||||||
Average Annual Total Return2 | +10.32 | % | +2.90 | % | +0.46 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,032 | $ | 11,536 | $ | 10,469 | ||||||||||
Total Annual Operating Expenses4 | 1.18 | % | ||||||||||||||
Class B | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +16.20 | % | +17.84 | % | +4.50 | % | ||||||||||
Average Annual Total Return2 | +12.20 | % | +2.98 | % | +0.44 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,220 | $ | 11,584 | $ | 10,450 | ||||||||||
Total Annual Operating Expenses4 | 1.93 | % | ||||||||||||||
Class C | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +16.26 | % | +17.86 | % | +3.08 | % | ||||||||||
Average Annual Total Return2 | +15.26 | % | +3.34 | % | +0.30 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,526 | $ | 11,786 | $ | 10,308 | ||||||||||
Total Annual Operating Expenses4 | 1.93 | % | ||||||||||||||
Class R | 1-Year | Inception (12/1/08) | ||||||||||||||
Cumulative Total Return1 | +16.82 | % | +72.54 | % | ||||||||||||
Average Annual Total Return2 | +16.82 | % | +34.72 | % | ||||||||||||
Value of $10,000 Investment3 | $ | 11,682 | $ | 17,254 | ||||||||||||
Total Annual Operating Expenses4 | 1.43 | % | ||||||||||||||
Advisor Class5 | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +17.40 | % | +23.12 | % | +11.74 | % | ||||||||||
Average Annual Total Return2 | +17.40 | % | +4.25 | % | +1.12 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,740 | $ | 12,312 | $ | 11,174 | ||||||||||
Total Annual Operating Expenses4 | 0.93 | % |
Class A | 9/30/10 | |||
1-Year | +10.32 | % | ||
5-Year | +2.90 | % | ||
10-Year | +0.46 | % |
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Class B | 9/30/10 | |||
1-Year | +12.20 | % | ||
5-Year | +2.98 | % | ||
10-Year | +0.44 | % |
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Class C | 9/30/10 | |||
1-Year | +15.26 | % | ||
5-Year | +3.34 | % | ||
10-Year | +0.30 | % |
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Class R | 9/30/10 | |||
1-Year | +16.82 | % | ||
Since Inception (12/1/08) | +34.72 | % |
Advisor Class5 | 9/30/10 | |||
1-Year | +17.40 | % | ||
5-Year | +4.25 | % | ||
10-Year | +1.12 | % |
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Class B: | These shares have higher annual fees and expenses than Class A shares. | |
Class C: | Prior to 1/1/04, these shares were offered with an initial sales charge; thus actual total returns would have differed. These shares have higher annual fees and expenses than Class A shares. | |
Class R: | Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares. | |
Advisor Class: | Shares are available to certain eligible investors as described in the prospectus. |
1. | Cumulative total return represents the change in value of an investment over the periods indicated. | |
2. | Average annual total return represents the average annual change in value of an investment over the periods indicated. | |
3. | These figures represent the value of a hypothetical $10,000 investment in the Fund over the periods indicated. | |
4. | Figures are as stated in the Fund’s prospectus current as of the date of this report. In periods of market volatility, assets may decline significantly, causing total annual Fund operating expenses to become higher than the figures shown. | |
5. | Effective 5/15/08, the Fund began offering Advisor Class shares, which do not have sales charges or a Rule 12b-1 plan. Performance quotations for this class reflect the following methods of calculation: (a) For periods prior to 5/15/08, a restated figure is used based upon the Fund’s Class A performance, excluding the effect of Class A’s maximum initial sales charge, but reflecting the effect of the Class A Rule 12b-1 fees; and (b) for periods after 5/14/08 actual Advisor Class performance is used reflecting all charges and fees applicable to that class. Since 5/15/08 (commencement of sales), the cumulative and average annual total returns of Advisor Class shares were -4.18% and -1.78%. | |
6. | Source: © 2010 Morningstar. The Russell 1000 Growth Index is market capitalization weighted and measures performance of those Russell 1000 Index companies with higher price-to-book ratios and higher forecasted growth values. The index return includes reinvested dividends. The NASDAQ 100 Index is a modified market capitalization-weighted index of the largest and most active domestic and international non-financial companies listed on The NASDAQ Stock Market. The index reflects companies across major industry groups including computer hardware and software, telecommunications, retail/wholesale trade and biotechnology. Return for this index is price-only and does not include reinvested dividends. The S&P 500 is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance. Index return includes reinvested dividends. The NASDAQ Composite Index is a broad-based, market capitalization-weighted index designed to m easure all NASDAQ domestic and international based common type stocks listed on The NASDAQ Stock Market and includes reinvested dividends. |
• | Transaction costs, including sales charges (loads) on Fund purchases; and | |
• | Ongoing Fund costs, including management fees, distribution and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses. |
1. | Divide your account value by $1,000. | |
If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6. | ||
2. | Multiply the result by the number under the heading “Expenses Paid During Period.” | |
If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50. |
Beginning Account | Ending Account | Expenses Paid During | ||||||||||
Value 4/1/10 | Value 9/30/10 | Period* 4/1/10–9/30/10 | ||||||||||
Class A | ||||||||||||
Actual | $ | 1,000 | $ | 1,022.60 | $ | 4.82 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,020.31 | $ | 4.81 | ||||||
Class B | ||||||||||||
Actual | $ | 1,000 | $ | 1,018.70 | $ | 8.55 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,016.60 | $ | 8.54 | ||||||
Class C | ||||||||||||
Actual | $ | 1,000 | $ | 1,018.90 | $ | 8.60 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,016.55 | $ | 8.59 | ||||||
Class R | ||||||||||||
Actual | $ | 1,000 | $ | 1,021.60 | $ | 6.08 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,019.05 | $ | 6.07 | ||||||
Advisor Class | ||||||||||||
Actual | $ | 1,000 | $ | 1,024.00 | $ | 3.55 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,021.56 | $ | 3.55 |
* | Expenses are calculated using the most recent six-month expense ratio, annualized for each class (A: 0.95%; B: 1.69%; C: 1.70%; R: 1.20%; and Advisor: 0.70%), multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half year period. |
1. | Source: © 2010 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. The S&P 500 is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance. The index is unmanaged and includes reinvested dividends. One cannot invest directly in an index, and an index is not representative of the Fund’s portfolio. |
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Portfolio Breakdown Franklin Growth Fund Based on Total Net Assets as of 9/30/10 |
2. | The industrials sector comprises capital goods, commercial and professional services, and transportation in the SOI. The information technology sector comprises semiconductors and semiconductor equipment, software and services, and technology hardware and equipment in the SOI. The health care sector comprises health care equipment and services; and pharmaceuticals, biotechnology and life sciences in the SOI. |
![]() ![]() V. Jerry Palmieri | ||
![]() ![]() Serena Perin Vinton, CFA | ||
Portfolio Management Team | ||
Franklin Growth Fund |
Franklin Growth Fund
9/30/10
Company | % of Total | |||
Sector/Industry | Net Assets | |||
Apple Inc. | 6.3 | % | ||
Technology Hardware & Equipment | ||||
International Business Machines Corp. | 2.1 | % | ||
Software & Services | ||||
3M Co. | 2.0 | % | ||
Capital Goods | ||||
Johnson & Johnson | 2.0 | % | ||
Pharmaceuticals, Biotechnology & Life Sciences | ||||
The Boeing Co. | 1.9 | % | ||
Capital Goods | ||||
W. W. Grainger Inc. | 1.8 | % | ||
Capital Goods | ||||
Allergan Inc. | 1.7 | % | ||
Pharmaceuticals, Biotechnology & Life Sciences | ||||
General Dynamics Corp. | 1.7 | % | ||
Capital Goods | ||||
Northrop Grumman Corp. | 1.7 | % | ||
Capital Goods | ||||
United Technologies Corp. | 1.7 | % | ||
Capital Goods |
Class A (Symbol: FKGRX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$4.63 | $ | 41.11 | $ | 36.48 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.2820 |
Class B (Symbol: FKGBX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$4.41 | $ | 39.34 | $ | 34.93 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.0257 |
Class C (Symbol: FRGSX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$4.31 | $ | 38.92 | $ | 34.61 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.0672 |
Class R (Symbol: FGSRX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$4.57 | $ | 40.94 | $ | 36.37 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.2255 |
Advisor Class (Symbol: FCGAX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$4.65 | $ | 41.18 | $ | 36.53 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.3576 |
Class A | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +13.52 | % | +21.16 | % | +22.60 | % | ||||||||||
Average Annual Total Return2 | +6.98 | % | +2.69 | % | +1.46 | % | ||||||||||
Value of $10,000 Investment3 | $ | 10,698 | $ | 11,421 | $ | 11,556 | ||||||||||
Total Annual Operating Expenses4 | 1.00 | % | ||||||||||||||
Class B | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +12.70 | % | +16.71 | % | +15.48 | % | ||||||||||
Average Annual Total Return2 | +8.70 | % | +2.78 | % | +1.45 | % | ||||||||||
Value of $10,000 Investment3 | $ | 10,870 | $ | 11,471 | $ | 11,548 | ||||||||||
Total Annual Operating Expenses4 | 1.75 | % | ||||||||||||||
Class C | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +12.69 | % | +16.71 | % | +13.75 | % | ||||||||||
Average Annual Total Return2 | +11.69 | % | +3.14 | % | +1.30 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,169 | $ | 11,671 | $ | 11,375 | ||||||||||
Total Annual Operating Expenses4 | 1.75 | % | ||||||||||||||
Class R | 1-Year | 5-Year | Inception (1/1/02) | |||||||||||||
Cumulative Total Return1 | +13.26 | % | +19.66 | % | +31.36 | % | ||||||||||
Average Annual Total Return2 | +13.26 | % | +3.65 | % | +3.17 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,326 | $ | 11,966 | $ | 13,136 | ||||||||||
Total Annual Operating Expenses4 | 1.25 | % | ||||||||||||||
Advisor Class | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +13.82 | % | +22.68 | % | +25.66 | % | ||||||||||
Average Annual Total Return2 | +13.82 | % | +4.17 | % | +2.31 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,382 | $ | 12,268 | $ | 12,566 | ||||||||||
Total Annual Operating Expenses4 | 0.75 | % |
Class A | 9/30/10 | |||
1-Year | +6.98 | % | ||
5-Year | +2.69 | % | ||
10-Year | +1.46 | % |
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Class B | 9/30/10 | |||
1-Year | +8.70 | % | ||
5-Year | +2.78 | % | ||
10-Year | +1.45 | % |
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Class C | 9/30/10 | |||
1-Year | +11.69 | % | ||
5-Year | +3.14 | % | ||
10-Year | +1.30 | % |
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Class R | 9/30/10 | |||
1-Year | +13.26 | % | ||
5-Year | +3.65 | % | ||
Since Inception (1/1/02) | +3.17 | % |
Advisor Class | 9/30/10 | |||
1-Year | +13.82 | % | ||
5-Year | +4.17 | % | ||
10-Year | +2.31 | % |
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Class B: | These shares have higher annual fees and expenses than Class A shares. | |
Class C: | Prior to 1/1/04, these shares were offered with an initial sales charge; thus actual total returns would have differed. These shares have higher annual fees and expenses than Class A shares. | |
Class R: | Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares. | |
Advisor Class: | Shares are available to certain eligible investors as described in the prospectus. |
1. | Cumulative total return represents the change in value of an investment over the periods indicated. | |
2. | Average annual total return represents the average annual change in value of an investment over the periods indicated. | |
3. | These figures represent the value of a hypothetical $10,000 investment in the Fund over the periods indicated. | |
4. | Figures are as stated in the Fund’s prospectus current as of the date of this report. In periods of market volatility, assets may decline significantly, causing total annual Fund operating expenses to become higher than the figures shown. | |
5. | Source: © 2010 Morningstar. The S&P 500 is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance. |
• | Transaction costs, including sales charges (loads) on Fund purchases; and | |
• | Ongoing Fund costs, including management fees, distribution and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses. |
1. | Divide your account value by $1,000. | |
If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6. | ||
2. | Multiply the result by the number under the heading “Expenses Paid During Period.” | |
If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50. |
Beginning Account | Ending Account | Expenses Paid During | ||||||||||
Value 4/1/10 | Value 9/30/10 | Period* 4/1/10–9/30/10 | ||||||||||
Class A | ||||||||||||
Actual | $ | 1,000 | $ | 988.70 | $ | 4.49 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,020.56 | $ | 4.56 | ||||||
Class B | ||||||||||||
Actual | $ | 1,000 | $ | 985.00 | $ | 8.26 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,016.75 | $ | 8.39 | ||||||
Class C | ||||||||||||
Actual | $ | 1,000 | $ | 984.80 | $ | 8.21 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,016.80 | $ | 8.34 | ||||||
Class R | ||||||||||||
Actual | $ | 1,000 | $ | 987.50 | $ | 5.73 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,019.30 | $ | 5.82 | ||||||
Advisor Class | ||||||||||||
Actual | $ | 1,000 | $ | 989.90 | $ | 3.24 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,021.81 | $ | 3.29 |
* | Expenses are calculated using the most recent six-month expense ratio, annualized for each class (A: 0.90%; B: 1.66%; C: 1.65%; R: 1.15%; and Advisor: 0.65%), multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half year period. |
1. | Source: © 2010 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. The S&P 500 is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance. The BC U.S. Aggregate Index is a market capitalization-weighted index representing the U.S. investment-grade, fixed-rate, taxable bond market with index components for government and corporate, mortgage pass-through and asset-backed securities. All issues included are SEC registered, taxable, dollar denominated and nonconvertible, must have at least one year to final maturity and must be rated investment grade (Baa3/BBB-/BBB-or higher) using the m iddle rating of Moody’s, Standard & Poor’s and Fitch, respectively. |
Franklin Income Fund
10/1/09–9/30/10
Dividend per Share (cents) | ||||||||||||||||||||||||
Month | Class A | Class B | Class B1** | Class C | Class R | Advisor Class | ||||||||||||||||||
October | 1.25 | 1.10 | 1.16 | 1.17 | 1.19 | 1.27 | ||||||||||||||||||
November | 1.25 | 1.10 | 1.16 | 1.17 | 1.19 | 1.27 | ||||||||||||||||||
December | 1.25 | 1.11 | 1.13 | 1.16 | 1.19 | 1.28 | ||||||||||||||||||
January | 1.25 | 1.11 | 1.13 | 1.16 | 1.19 | 1.28 | ||||||||||||||||||
February | 1.20 | 1.06 | 1.08 | 1.11 | 1.14 | 1.23 | ||||||||||||||||||
March | 1.20 | 1.05 | 1.08 | 1.11 | 1.14 | 1.23 | ||||||||||||||||||
April | 1.20 | 1.05 | 1.08 | 1.11 | 1.14 | 1.23 | ||||||||||||||||||
May | 1.20 | 1.05 | 1.08 | 1.11 | 1.14 | 1.23 | ||||||||||||||||||
June | 1.20 | 1.05 | 1.11 | 1.11 | 1.13 | 1.22 | ||||||||||||||||||
July | 1.20 | 1.05 | 1.11 | 1.11 | 1.13 | 1.22 | ||||||||||||||||||
August | 1.20 | 1.05 | 1.11 | 1.11 | 1.13 | 1.22 | ||||||||||||||||||
September | 1.20 | 1.06 | 1.12 | 1.12 | 1.15 | 1.22 | ||||||||||||||||||
Total | 14.60 | 12.84 | 13.35 | 13.55 | 13.86 | 14.90 |
* | All Fund distributions will vary depending upon current market conditions, and past distributions are not indicative of future trends. | |
** | On November 1, 2001, the Fund closed Class B to new investors and changed the name to Class B1; a new Class B became available to investors. |
![(BAR GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x23.gif)
Portfolio Breakdown Franklin Income Fund Based on Total Net Assets as of 9/30/10 |
Franklin Income Fund
9/30/10
Company | % of Total | |||
Sector/Industry | Net Assets | |||
Bank of America Corp. | 2.1 | % | ||
Financials | ||||
Wells Fargo & Co. | 1.8 | % | ||
Financials | ||||
Exxon Mobil Corp. | 1.8 | % | ||
Energy | ||||
Merck & Co. Inc. | 1.7 | % | ||
Health Care | ||||
The Southern Co. | 1.4 | % | ||
Utilities |
Franklin Income Fund
9/30/10
Company | % of Total | |||
Sector/Industry | Net Assets | |||
Texas Competitive Electric Holdings Co. LLC | 3.8 | % | ||
Utilities | ||||
CIT Group Inc. | 3.8 | % | ||
Financials | ||||
First Data Corp. | 2.9 | % | ||
Information Technology | ||||
Freescale Semiconductor Inc. | 2.3 | % | ||
Information Technology | ||||
HCA Inc. | 2.2 | % | ||
Health Care |
* | Does not include convertible bonds. |
![]() ![]() Edward Perks, CFA | ||
![]() ![]() Charles B. Johnson | ||
Portfolio Management Team | ||
Franklin Income Fund |
Class A (Symbol: FKINX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.12 | $ | 2.11 | $ | 1.99 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.1460 |
Class B (Symbol: FBICX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.12 | $ | 2.10 | $ | 1.98 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.1284 |
Class B1 (Symbol: FICBX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.13 | $ | 2.12 | $ | 1.99 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.1335 |
Class C (Symbol: FCISX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.13 | $ | 2.13 | $ | 2.00 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.1355 |
Class R (Symbol: FISRX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.13 | $ | 2.09 | $ | 1.96 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.1386 |
Advisor Class (Symbol: FRIAX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.12 | $ | 2.10 | $ | 1.98 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.1490 |
Class A | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +13.90 | % | +24.03 | % | +95.36 | % | ||||||||||
Average Annual Total Return2 | +8.97 | % | +3.51 | % | +6.48 | % | ||||||||||
Value of $10,000 Investment3 | $ | 10,897 | $ | 11,880 | $ | 18,739 | ||||||||||
Distribution Rate4 | 6.55 | % | ||||||||||||||
30-Day Standardized Yield5 | 6.02 | % | ||||||||||||||
Total Annual Operating Expenses6 | 0.68 | % | ||||||||||||||
Class B | 1-Year | 5-Year | Inception (11/1/01) | |||||||||||||
Cumulative Total Return1 | +12.99 | % | +18.93 | % | +79.67 | % | ||||||||||
Average Annual Total Return2 | +8.99 | % | +3.23 | % | +6.80 | % | ||||||||||
Value of $10,000 Investment3 | $ | 10,899 | $ | 11,725 | $ | 17,967 | ||||||||||
Distribution Rate4 | 6.06 | % | ||||||||||||||
30-Day Standardized Yield5 | 5.43 | % | ||||||||||||||
Total Annual Operating Expenses6 | 1.53 | % | ||||||||||||||
Class B1 | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +13.73 | % | +21.37 | % | +87.68 | % | ||||||||||
Average Annual Total Return2 | +9.73 | % | +3.66 | % | +6.50 | % | ||||||||||
Value of $10,000 Investment3 | $ | 10,973 | $ | 11,968 | $ | 18,768 | ||||||||||
Distribution Rate4 | 6.34 | % | ||||||||||||||
30-Day Standardized Yield5 | 5.80 | % | ||||||||||||||
Total Annual Operating Expenses6 | 1.17 | % | ||||||||||||||
Class C | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +13.76 | % | +21.30 | % | +86.00 | % | ||||||||||
Average Annual Total Return2 | +12.76 | % | +3.94 | % | +6.40 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,276 | $ | 12,130 | $ | 18,600 | ||||||||||
Distribution Rate4 | 6.31 | % | ||||||||||||||
30-Day Standardized Yield5 | 5.78 | % | ||||||||||||||
Total Annual Operating Expenses6 | 1.18 | % |
Class R | 1-Year | 5-Year | Inception (1/1/02) | |||||||||||||
Cumulative Total Return1 | +14.23 | % | +22.18 | % | +81.01 | % | ||||||||||
Average Annual Total Return2 | +14.23 | % | +4.09 | % | +7.02 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,423 | $ | 12,218 | $ | 18,101 | ||||||||||
Distribution Rate4 | 6.60 | % | ||||||||||||||
30-Day Standardized Yield5 | 5.92 | % | ||||||||||||||
Total Annual Operating Expenses6 | 1.03 | % | ||||||||||||||
Advisor Class | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +14.15 | % | +25.09 | % | +98.91 | % | ||||||||||
Average Annual Total Return2 | +14.15 | % | +4.58 | % | +7.12 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,415 | $ | 12,509 | $ | 19,891 | ||||||||||
Distribution Rate4 | 6.97 | % | ||||||||||||||
30-Day Standardized Yield5 | 6.43 | % | ||||||||||||||
Total Annual Operating Expenses6 | 0.53 | % |
Class A | 9/30/10 | |||
1-Year | +8.97 | % | ||
5-Year | +3.51 | % | ||
10-Year | +6.48 | % |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x28.gif)
Class B | 9/30/10 | |||
1-Year | +8.99 | % | ||
5-Year | +3.23 | % | ||
Since Inception (11/1/01) | +6.80 | % |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x29.gif)
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x30.gif)
Class B1 | 9/30/10 | |||
1-Year | +9.73 | % | ||
5-Year | +3.66 | % | ||
10-Year | +6.50 | % |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x31.gif)
Class C | 9/30/10 | |||
1-Year | +12.76 | % | ||
5-Year | +3.94 | % | ||
10-Year | +6.40 | % |
Class R | 9/30/10 | |||
1-Year | +14.23 | % | ||
5-Year | +4.09 | % | ||
Since Inception (1/1/02) | +7.02 | % |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x32.gif)
Advisor Class | 9/30/10 | |||
1-Year | +14.15 | % | ||
5-Year | +4.58 | % | ||
10-Year | +7.12 | % |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x33.gif)
Class B: | These shares have higher annual fees and expenses than Class A shares. | |
Class B1 (formerly Class B): | These shares have higher annual fees and expenses than Class A shares. Effective 11/1/01, closed to new investors. | |
Class C: | Prior to 1/1/04, these shares were offered with an initial sales charge; thus actual total returns would have differed. These shares have higher annual fees and expenses than Class A shares. | |
Class R: | Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares. | |
Advisor Class: | Shares are available to certain eligible investors as described in the prospectus. |
1. | Cumulative total return represents the change in value of an investment over the periods indicated. |
2. | Average annual total return represents the average annual change in value of an investment over the periods indicated. |
3. | These figures represent the value of a hypothetical $10,000 investment in the Fund over the periods indicated. |
4. | Distribution rate is based on an annualization of the respective class’s September dividend and the maximum offering price (NAV for Classes B, B1, C, R and Advisor) per share on 9/30/10. |
5. | The 30-day standardized yield for the 30 days ended 9/30/10 reflects an estimated yield to maturity (assuming all portfolio securities are held to maturity). It should be regarded as an estimate of the Fund’s rate of investment income, and it may not equal the Fund’s actual income distribution rate (which reflects the Fund’s past dividends paid to shareholders) or the income reported in the Fund’s financial statements. |
6. | Figures are as stated in the Fund’s prospectus current as of the date of this report. In periods of market volatility, assets may decline significantly, causing total annual Fund operating expenses to become higher than the figures shown. |
7. | Source: © 2010 Morningstar. The S&P 500 is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance. The BC U.S. Aggregate Index is a market capitalization-weighted index representing the U.S. investment-grade, fixed-rate, taxable bond market with index components for government and corporate, mortgage pass-through and asset-backed securities. All issues included are SEC registered, taxable, dollar denominated and nonconvertible, must have at least one year to final maturity and must be rated investment grade (Baa3/BBB-/BBB- or higher) using the middle rating of Moody’s, Standard & Poor’s and Fitch, respectively. |
8. | Source: Lipper, Inc. The Lipper Mixed-Asset Target Allocation Moderate Funds Classification Average is calculated by averaging the total returns of all funds within the Lipper Mixed-Asset Target Allocation Moderate Funds classification in the Lipper Open-End underlying funds universe. Lipper Mixed-Asset Target Allocation Moderate Funds are defined as funds that, by portfolio practice, maintain a mix of between 40%-60% equity securities, with the remainder invested in bonds, cash and cash equivalents. For the 12-month period ended 9/30/10, there were 500 funds in this category. Lipper calculations do not include sales charges or expense subsidization by a fund’s manager. The Fund’s performance relative to the average may have differed if these and other factors had been considered. |
• | Transaction costs, including sales charges (loads) on Fund purchases; and |
• | Ongoing Fund costs, including management fees, distribution and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses. |
1. | Divide your account value by $1,000. | |
If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6. | ||
2. | Multiply the result by the number under the heading “Expenses Paid During Period.” | |
If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50. |
Beginning Account | Ending Account | Expenses Paid During | ||||||||||
Value 4/1/10 | Value 9/30/10 | Period* 4/1/10–9/30/10 | ||||||||||
Class A | ||||||||||||
Actual | $ | 1,000 | $ | 1,040.50 | $ | 3.32 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,021.81 | $ | 3.29 | ||||||
Class B | ||||||||||||
Actual | $ | 1,000 | $ | 1,036.20 | $ | 7.66 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,017.55 | $ | 7.59 | ||||||
Class B1 | ||||||||||||
Actual | $ | 1,000 | $ | 1,042.40 | $ | 5.84 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,019.35 | $ | 5.77 | ||||||
Class C | ||||||||||||
Actual | $ | 1,000 | $ | 1,037.60 | $ | 5.87 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,019.30 | $ | 5.82 | ||||||
Class R | ||||||||||||
Actual | $ | 1,000 | $ | 1,044.10 | $ | 5.12 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,020.05 | $ | 5.06 | ||||||
Advisor Class | ||||||||||||
Actual | $ | 1,000 | $ | 1,041.50 | $ | 2.56 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,022.56 | $ | 2.54 |
* | Expenses are calculated using the most recent six-month expense ratio, annualized for each class (A: 0.65%; B: 1.50%; B1: 1.14%; C: 1.15%; R: 1.00%; and Advisor: 0.50%), multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half year period. |
1. | Securities owned by the Fund, but not shares of the Fund, are guaranteed by the U.S. government, its agencies or instrumentalities as to timely payment of principal and interest. The Fund’s yield and share price are not guaranteed and will vary with market conditions. |
2. | Source: Lipper Inc. The Lipper GNMA Funds Classification Average is calculated by averaging the total return for all funds within the Lipper GNMA Funds classification in the Lipper Open-End underlying funds universe for the period indicated. Lipper GNMA Funds are defined as funds that invest primarily in GNMA securities. For the 12-month period ended 9/30/10, there were 66 funds in this category. Lipper calculations do not include sales charges or expense subsidization by a fund’s manager. The Fund’s performance relative to the average may have differed if these or other factors had been considered. |
3. | Source: © 2010 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. The BC U.S. Government: Intermediate Index is the intermediate component of the BC U.S. Government Index, which includes public obligations of the U.S. Treasury with at least one year to final maturity and publicly issued debt of U.S. government agencies, quasi-federal corporations, and corporate or foreign debt guaranteed by the U.S. government. |
Franklin U.S. Government Securities Fund
10/1/09–9/30/10
Dividend per Share | ||||||||||||||||||||
Month | Class A | Class B | Class C | Class R | Advisor Class | |||||||||||||||
October | 2.39 cents | 2.10 cents | 2.13 cents | 2.20 cents | 2.47 cents | |||||||||||||||
November | 2.39 cents | 2.10 cents | 2.13 cents | 2.20 cents | 2.47 cents | |||||||||||||||
December | 2.21 cents | 1.92 cents | 1.92 cents | 2.00 cents | 2.29 cents | |||||||||||||||
January | 2.21 cents | 1.92 cents | 1.92 cents | 2.00 cents | 2.29 cents | |||||||||||||||
February | 2.21 cents | 1.92 cents | 1.92 cents | 2.00 cents | 2.29 cents | |||||||||||||||
March | 2.21 cents | 1.91 cents | 1.93 cents | 2.00 cents | 2.28 cents | |||||||||||||||
April | 2.21 cents | 1.91 cents | 1.93 cents | 2.00 cents | 2.28 cents | |||||||||||||||
May | 2.21 cents | 1.91 cents | 1.93 cents | 2.00 cents | 2.28 cents | |||||||||||||||
June | 2.21 cents | 1.92 cents | 1.93 cents | 2.00 cents | 2.28 cents | |||||||||||||||
July | 2.21 cents | 1.92 cents | 1.93 cents | 2.00 cents | 2.28 cents | |||||||||||||||
August | 2.21 cents | 1.92 cents | 1.93 cents | 2.00 cents | 2.28 cents | |||||||||||||||
September | 2.21 cents | 1.91 cents | 1.93 cents | 2.01 cents | 2.30 cents | |||||||||||||||
Total | 26.88 cents | 23.36 cents | 23.53 cents | 24.41 cents | 27.79 cents |
* | All Fund distributions will vary depending upon current market conditions, and past distributions are not indicative of future trends. |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x34.gif)
![(PHOTO OF ROGER A. BAYSTON)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x35.gif)
![-s- Roger A. Bayston](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x36.gif)
![(PHOTO OF PAUL VARUNOK)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x37.gif)
![-s- Paul Varunok](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x38.gif)
Franklin U.S. Government Securities Fund
Class A (Symbol: FKUSX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.12 | $ | 6.81 | $ | 6.69 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.2688 |
Class B (Symbol: FUGBX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.12 | $ | 6.80 | $ | 6.68 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.2336 |
Class C (Symbol: FRUGX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.11 | $ | 6.77 | $ | 6.66 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.2353 |
Class R (Symbol: FUSRX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.12 | $ | 6.81 | $ | 6.69 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.2441 |
Advisor Class (Symbol: FUSAX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.12 | $ | 6.83 | $ | 6.71 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.2779 |
Class A | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +5.94 | % | +31.82 | % | +71.63 | % | ||||||||||
Average Annual Total Return2 | +1.39 | % | +4.77 | % | +5.10 | % | ||||||||||
Distribution Rate3 | 3.73 | % | ||||||||||||||
30-Day Standardized Yield4 | 3.38 | % | ||||||||||||||
Total Annual Operating Expenses5 | 0.75 | % | ||||||||||||||
Class B | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +5.39 | % | +28.49 | % | +64.68 | % | ||||||||||
Average Annual Total Return2 | +1.39 | % | +4.81 | % | +5.11 | % | ||||||||||
Distribution Rate3 | 3.37 | % | ||||||||||||||
30-Day Standardized Yield4 | 3.04 | % | ||||||||||||||
Total Annual Operating Expenses5 | 1.26 | % | ||||||||||||||
Class C | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +5.28 | % | +28.48 | % | +62.84 | % | ||||||||||
Average Annual Total Return2 | +4.28 | % | +5.14 | % | +5.00 | % | ||||||||||
Distribution Rate3 | 3.42 | % | ||||||||||||||
30-Day Standardized Yield4 | 3.03 | % | ||||||||||||||
Total Annual Operating Expenses5 | 1.26 | % | ||||||||||||||
Class R | 1-Year | 5-Year | Inception (1/1/02) | |||||||||||||
Cumulative Total Return1 | +5.55 | % | +29.44 | % | +49.43 | % | ||||||||||
Average Annual Total Return2 | +5.55 | % | +5.30 | % | +4.70 | % | ||||||||||
Distribution Rate3 | 3.54 | % | ||||||||||||||
30-Day Standardized Yield4 | 3.18 | % | ||||||||||||||
Total Annual Operating Expenses5 | 1.11 | % | ||||||||||||||
Advisor Class | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +6.06 | % | +32.59 | % | +73.85 | % | ||||||||||
Average Annual Total Return2 | +6.06 | % | +5.80 | % | +5.69 | % | ||||||||||
Distribution Rate3 | 4.04 | % | ||||||||||||||
30-Day Standardized Yield4 | 3.67 | % | ||||||||||||||
Total Annual Operating Expenses5 | 0.61 | % |
Class A | 9/30/10 | |||
1-Year | +1.39 | % | ||
5-Year | +4.77 | % | ||
10-Year | +5.10 | % |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x39.gif)
Class B | 9/30/10 | |||
1-Year | +1.39 | % | ||
5-Year | +4.81 | % | ||
10-Year | +5.11 | % |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x40.gif)
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x41.gif)
Class C | 9/30/10 | |||
1-Year | +4.28 | % | ||
5-Year | +5.14 | % | ||
10-Year | +5.00 | % |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x42.gif)
Class R | 9/30/10 | |||
1-Year | +5.55 | % | ||
5-Year | +5.30 | % | ||
Since Inception (1/1/02) | +4.70 | % |
Advisor Class | 9/30/10 | |||
1-Year | +6.06 | % | ||
5-Year | +5.80 | % | ||
10-Year | +5.69 | % |
![(LINE GRAPH)](https://capedge.com/proxy/N-CSR/0000038721-10-000077/x43.gif)
Class B: | These shares have higher annual fees and expenses than Class A Shares. | |
Class C: | Prior to 1/1/04, these shares were offered with an initial sales charge; thus actual total returns would have differed. These shares have higher annual fees and expenses than Class A shares. | |
Class R: | Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares. | |
Advisor Class: | Shares are available to certain eligible investors as described in the prospectus. |
1. | Cumulative total return represents the change in value of an investment over the periods indicated. |
2. | Average annual total return represents the average annual change in value of an investment over the periods indicated. |
3. | Distribution rate is based on an annualization of the respective class’s September dividend and the maximum offering price (NAV for Classes B, C, R and Advisor) per share on 9/30/10. |
4. | The 30-day standardized yield for the 30 days ended 9/30/10 reflects an estimated yield to maturity (assuming all portfolio securities are held to maturity). It should be regarded as an estimate of the Fund’s rate of investment income, and it may not equal the Fund’s actual income distribution rate (which reflects the Fund’s past dividends paid to shareholders) or the income reported in the Fund’s financial statements. |
5. | Figures are as stated in the Fund’s prospectus current as of the date of this report. In periods of market volatility, assets may decline significantly, causing total annual Fund operating expenses to become higher than the figures shown. |
6. | Source: © 2010 Morningstar. The BC U.S. Government: Intermediate Index is the intermediate component of the BC U.S. Government Index, which includes public obligations of the U.S. Treasury with at least one year to final maturity and publicly issued debt of U.S. government agencies, quasi-federal corporations, and corporate or foreign debt guaranteed by the U.S. government. The Consumer Price Index (CPI), calculated by the U.S. Bureau of Labor Statistics, is a commonly used measure of the inflation rate. |
7. | Source: Lipper Inc. The Lipper GNMA Funds Classification Average is calculated by averaging the total return for all funds within the Lipper GNMA Funds classification in the Lipper Open-End underlying funds universe for the period indicated. Lipper GNMA Funds are defined as funds that invest primarily in GNMA securities. For the 12-month period ended 9/30/10, there were 66 funds in this category. Lipper calculations do not include sales charges or expense subsidization by a fund’s manager. The Fund’s performance relative to the average may have differed if these or other factors had been considered. |
• | Transaction costs, including sales charges (loads) on Fund purchases; and |
• | Ongoing Fund costs, including management fees, distribution and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses. |
1. | Divide your account value by $1,000. | |
If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6. | ||
2. | Multiply the result by the number under the heading “Expenses Paid During Period.” | |
If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50. |
Beginning Account | Ending Account | Expenses Paid During | ||||||||||
Value 4/1/10 | Value 9/30/10 | Period* 4/1/10–9/30/10 | ||||||||||
Class A | ||||||||||||
Actual | $ | 1,000 | $ | 1,038.00 | $ | 3.78 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,021.36 | $ | 3.75 | ||||||
Class B | ||||||||||||
Actual | $ | 1,000 | $ | 1,035.40 | $ | 6.33 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,018.85 | $ | 6.28 | ||||||
Class C | ||||||||||||
Actual | $ | 1,000 | $ | 1,034.10 | $ | 6.32 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,018.85 | $ | 6.28 | ||||||
Class R | ||||||||||||
Actual | $ | 1,000 | $ | 1,036.10 | $ | 5.56 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,019.60 | $ | 5.52 | ||||||
Advisor Class | ||||||||||||
Actual | $ | 1,000 | $ | 1,038.60 | $ | 3.02 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,022.11 | $ | 2.99 |
* | Expenses are calculated using the most recent six-month expense ratio, annualized for each class (A: 0.74%; B: 1.24%; C: 1.24%; R: 1.09%; and Advisor: 0.59%), multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half year period. |
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1. | Source: © 2010 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. The S&P 500 Index is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance. |
2. | Source: © 2010 Morningstar. The S&P 500 Utilities Index is market capitalization weighted and consists of all utility stocks in the S&P 500 Index. |
Franklin Utilities Fund
9/30/10
Company | % of Total | |||
Sector/Industry | Net Assets | |||
Sempra Energy | 4.9 | % | ||
Multi-Utilities | ||||
The Southern Co. | 4.7 | % | ||
Electric Utilities | ||||
Entergy Corp. | 3.9 | % | ||
Electric Utilities | ||||
Public Service Enterprise Group Inc. | 3.8 | % | ||
Multi-Utilities | ||||
PG&E Corp. | 3.8 | % | ||
Multi-Utilities | ||||
American Electric Power Co. Inc. | 3.6 | % | ||
Electric Utilities | ||||
Edison International | 3.2 | % | ||
Electric Utilities | ||||
PPL Corp. | 3.2 | % | ||
Electric Utilities | ||||
Exelon Corp. | 3.0 | % | ||
Electric Utilities | ||||
NextEra Energy Inc. | 3.0 | % | ||
Electric Utilities |
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Franklin Utilities Fund
Class A (Symbol: FKUTX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.70 | $ | 11.44 | $ | 10.74 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.4500 | ||||||||||||||
Long-Term Capital Gain | $ | 0.1618 | ||||||||||||||
Total | $ | 0.6118 |
Class B (Symbol: FRUBX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.70 | $ | 11.44 | $ | 10.74 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.3935 | ||||||||||||||
Long-Term Capital Gain | $ | 0.1618 | ||||||||||||||
Total | $ | 0.5553 |
Class C (Symbol: FRUSX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.69 | $ | 11.40 | $ | 10.71 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.3972 | ||||||||||||||
Long-Term Capital Gain | $ | 0.1618 | ||||||||||||||
Total | $ | 0.5590 |
Class R (Symbol: FRURX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.70 | $ | 11.41 | $ | 10.71 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.4126 | ||||||||||||||
Long-Term Capital Gain | $ | 0.1618 | ||||||||||||||
Total | $ | 0.5744 |
Advisor Class (Symbol: FRUAX) | Change | 9/30/10 | 9/30/09 | |||||||||||||
Net Asset Value (NAV) | +$0.71 | $ | 11.50 | $ | 10.79 | |||||||||||
Distributions (10/1/09–9/30/10) | ||||||||||||||||
Dividend Income | $ | 0.4664 | ||||||||||||||
Long-Term Capital Gain | $ | 0.1618 | ||||||||||||||
Total | $ | 0.6282 |
Class A | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +12.69 | % | +21.18 | % | +83.70 | % | ||||||||||
Average Annual Total Return2 | +7.87 | % | +3.02 | % | +5.81 | % | ||||||||||
Value of $10,000 Investment3 | $ | 10,787 | $ | 11,602 | $ | 17,595 | ||||||||||
Distribution Rate4 | 3.51 | % | ||||||||||||||
30-Day Standardized Yield5 | 3.16 | % | ||||||||||||||
Total Annual Operating Expenses6 | 0.80 | % | ||||||||||||||
Class B | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +12.10 | % | +18.27 | % | +76.47 | % | ||||||||||
Average Annual Total Return2 | +8.10 | % | +3.09 | % | +5.84 | % | ||||||||||
Value of $10,000 Investment3 | $ | 10,810 | $ | 11,645 | $ | 17,647 | ||||||||||
Distribution Rate4 | 3.17 | % | ||||||||||||||
30-Day Standardized Yield5 | 2.81 | % | ||||||||||||||
Total Annual Operating Expenses6 | 1.30 | % | ||||||||||||||
Class C | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +12.08 | % | +18.23 | % | +74.76 | % | ||||||||||
Average Annual Total Return2 | +11.08 | % | +3.41 | % | +5.74 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,108 | $ | 11,823 | $ | 17,476 | ||||||||||
Distribution Rate4 | 3.21 | % | ||||||||||||||
30-Day Standardized Yield5 | 2.81 | % | ||||||||||||||
Total Annual Operating Expenses6 | 1.30 | % | ||||||||||||||
Class R | 1-Year | 5-Year | Inception (1/1/02) | |||||||||||||
Cumulative Total Return1 | +12.33 | % | +19.09 | % | +78.67 | % | ||||||||||
Average Annual Total Return2 | +12.33 | % | +3.56 | % | +5.90 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,233 | $ | 11,909 | $ | 17,867 | ||||||||||
Distribution Rate4 | 3.34 | % | ||||||||||||||
30-Day Standardized Yield5 | 2.97 | % | ||||||||||||||
Total Annual Operating Expenses6 | 1.15 | % | ||||||||||||||
Advisor Class | 1-Year | 5-Year | 10-Year | |||||||||||||
Cumulative Total Return1 | +12.89 | % | +22.08 | % | +86.45 | % | ||||||||||
Average Annual Total Return2 | +12.89 | % | +4.07 | % | +6.43 | % | ||||||||||
Value of $10,000 Investment3 | $ | 11,289 | $ | 12,208 | $ | 18,645 | ||||||||||
Distribution Rate4 | 3.79 | % | ||||||||||||||
30-Day Standardized Yield5 | 3.45 | % | ||||||||||||||
Total Annual Operating Expenses6 | 0.65 | % |
Class A | 9/30/10 | |||
1-Year | +7.87 | % | ||
5-Year | +3.02 | % | ||
10-Year | +5.81 | % |
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Class B | 9/30/10 | |||
1-Year | +8.10 | % | ||
5-Year | +3.09 | % | ||
10-Year | +5.84 | % |
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Class C | 9/30/10 | |||
1-Year | +11.08 | % | ||
5-Year | +3.41 | % | ||
10-Year | +5.74 | % |
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Class R | 9/30/10 | |||
1-Year | +12.33 | % | ||
5-Year | +3.56 | % | ||
Since Inception (1/1/02) | +5.90 | % |
Advisor Class | 9/30/10 | |||
1-Year | +12.89 | % | ||
5-Year | +4.07 | % | ||
10-Year | +6.43 | % |
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Class B: | These shares have higher annual fees and expenses than Class A shares. | |
Class C: | Prior to 1/1/04, these shares were offered with an initial sales charge; thus actual total returns would have differed. These shares have higher annual fees and expenses than Class A shares. | |
Class R: | Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares. | |
Advisor Class: | Shares are available to certain eligible investors as described in the prospectus. |
1. | Cumulative total return represents the change in value of an investment over the periods indicated. |
2. | Average annual total return represents the average annual change in value of an investment over the periods indicated. |
3. | These figures represent the value of a hypothetical $10,000 investment in the Fund over the periods indicated. |
4. | Distribution rate is based on an annualization of the respective class’s current quarterly dividend and the maximum offering price (NAV for Classes B, C, R and Advisor) per share on 9/30/10. |
5. | The 30-day standardized yield for the 30 days ended 9/30/10 reflects an estimated yield to maturity (assuming all portfolio securities are held to maturity). It should be regarded as an estimate of the Fund’s rate of investment income, and it may not equal the Fund’s actual income distribution rate (which reflects the Fund’s past dividends paid to shareholders) or the income reported in the Fund’s financial statements. |
6. | Figures are as stated in the Fund’s prospectus current as of the date of this report. In periods of market volatility, assets may decline significantly, causing total annual Fund operating expenses to become higher than the figures shown. |
7. | Source: © 2010 Morningstar. The S&P 500 Index is a market capitalization-weighted index of 500 stocks designed to measure total U.S. equity market performance. The S&P 500 Utilities Index is market capitalization weighted and consists of all utility stocks in the S&P 500 Index. |
• | Transaction costs, including sales charges (loads) on Fund purchases; and | |
• | Ongoing Fund costs, including management fees, distribution and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses. |
1. | Divide your account value by $1,000. | |
If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6. | ||
2. | Multiply the result by the number under the heading “Expenses Paid During Period.” | |
If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50. |
Beginning Account | Ending Account | Expenses Paid During | ||||||||||
Value 4/1/10 | Value 9/30/10 | Period* 4/1/10–9/30/10 | ||||||||||
Class A | ||||||||||||
Actual | $ | 1,000 | $ | 1,070.30 | $ | 4.00 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,021.21 | $ | 3.90 | ||||||
Class B | ||||||||||||
Actual | $ | 1,000 | $ | 1,067.40 | $ | 6.58 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,018.70 | $ | 6.43 | ||||||
Class C | ||||||||||||
Actual | $ | 1,000 | $ | 1,067.80 | $ | 6.58 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,018.70 | $ | 6.43 | ||||||
Class R | ||||||||||||
Actual | $ | 1,000 | $ | 1,068.50 | $ | 5.81 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,019.45 | $ | 5.67 | ||||||
Advisor Class | ||||||||||||
Actual | $ | 1,000 | $ | 1,071.70 | $ | 3.22 | ||||||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,021.96 | $ | 3.14 |
* | Expenses are calculated using the most recent six-month expense ratio, annualized for each class (A: 0.77%; B: 1.27%; C: 1.27%; R: 1.12%; and Advisor: 0.62%), multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half year period. |
Year Ended September 30, | ||||||||||||||||||||
Class A | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 23.20 | $ | 24.87 | $ | 32.33 | $ | 25.80 | $ | 24.98 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment income (loss)b | (0.11 | ) | (0.06 | ) | (0.08 | ) | (0.08 | ) | (0.05 | ) | ||||||||||
Net realized and unrealized gains (losses) | 4.07 | (0.03 | ) | (6.67 | ) | 6.61 | 0.87 | |||||||||||||
Total from investment operations | 3.96 | (0.09 | ) | (6.75 | ) | 6.53 | 0.82 | |||||||||||||
Less distributions from net realized gains | — | (1.58 | ) | (0.71 | ) | — | — | |||||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 27.16 | $ | 23.20 | $ | 24.87 | $ | 32.33 | $ | 25.80 | ||||||||||
Total returne | 17.07 | % | 2.71 | % | (21.36 | )% | 25.31 | % | 3.28 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.03 | % | 1.16 | %f | 0.97 | %f | 0.99 | %f | 0.97 | %f | ||||||||||
Net investment income (loss) | (0.44 | )% | (0.34 | )% | (0.26 | )% | (0.30 | )% | (0.20 | )% | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 566,764 | $ | 503,472 | $ | 388,843 | $ | 553,347 | $ | 590,633 | ||||||||||
Portfolio turnover rate | 31.39 | % | 46.05 | % | 41.01 | % | 18.03 | % | 18.61 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class B | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 21.60 | $ | 23.48 | $ | 30.78 | $ | 24.75 | $ | 24.15 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment income (loss)b | (0.28 | ) | (0.19 | ) | (0.29 | ) | (0.28 | ) | (0.23 | ) | ||||||||||
Net realized and unrealized gains (losses) | 3.78 | (0.11 | ) | (6.30 | ) | 6.31 | 0.83 | |||||||||||||
Total from investment operations | 3.50 | (0.30 | ) | (6.59 | ) | 6.03 | 0.60 | |||||||||||||
Less distributions from net realized gains | — | (1.58 | ) | (0.71 | ) | — | — | |||||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 25.10 | $ | 21.60 | $ | 23.48 | $ | 30.78 | $ | 24.75 | ||||||||||
Total returne | 16.20 | % | 1.96 | % | (21.96 | )% | 24.36 | % | 2.48 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.76 | % | 1.91 | %f | 1.73 | %f | 1.75 | %f | 1.72 | %f | ||||||||||
Net investment income (loss) | (1.17 | )% | (1.09 | )% | (1.02 | )% | (1.06 | )% | (0.95 | )% | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 10,125 | $ | 13,682 | $ | 10,704 | $ | 16,625 | $ | 18,718 | ||||||||||
Portfolio turnover rate | 31.39 | % | 46.05 | % | 41.01 | % | 18.03 | % | 18.61 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class C | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 21.34 | $ | 23.23 | $ | 30.46 | $ | 24.50 | $ | 23.90 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment income (loss)b | (0.28 | ) | (0.19 | ) | (0.28 | ) | (0.28 | ) | (0.23 | ) | ||||||||||
Net realized and unrealized gains (losses) | 3.75 | (0.12 | ) | (6.24 | ) | 6.24 | 0.83 | |||||||||||||
Total from investment operations | 3.47 | (0.31 | ) | (6.52 | ) | 5.96 | 0.60 | |||||||||||||
Less distributions from net realized gains | — | (1.58 | ) | (0.71 | ) | — | — | |||||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 24.81 | $ | 21.34 | $ | 23.23 | $ | 30.46 | $ | 24.50 | ||||||||||
Total returne | 16.26 | % | 1.89 | % | (21.93 | )% | 24.33 | % | 2.51 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.78 | % | 1.91 | %f | 1.73 | %f | 1.74 | %f | 1.71 | %f | ||||||||||
Net investment income (loss) | (1.19 | )% | (1.09 | )% | (1.02 | )% | (1.05 | )% | (0.94 | )% | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 93,927 | $ | 83,435 | $ | 53,289 | $ | 70,413 | $ | 69,069 | ||||||||||
Portfolio turnover rate | 31.39 | % | 46.05 | % | 41.01 | % | 18.03 | % | 18.61 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||
Class R | 2010 | 2009a | ||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||
Net asset value, beginning of year | $ | 23.13 | $ | 15.66 | ||||
Income from investment operationsb: | ||||||||
Net investment income (loss)c | (0.17 | ) | (0.09 | ) | ||||
Net realized and unrealized gains (losses) | 4.06 | 7.56 | ||||||
Total from investment operations | 3.89 | 7.47 | ||||||
Net asset value, end of year | $ | 27.02 | $ | 23.13 | ||||
Total returnd | 16.82 | % | 47.70 | % | ||||
Ratios to average net assetse | ||||||||
Expenses | 1.28 | % | 1.41 | %f | ||||
Net investment income (loss) | (0.69 | )% | (0.59 | )% | ||||
Supplemental data | ||||||||
Net assets, end of year (000’s) | $ | 7,034 | $ | 6,345 | ||||
Portfolio turnover rate | 31.39 | % | 46.05 | % |
a | For the period December 1, 2008 (effective date) to September 30, 2009. | |
b | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
c | Based on average daily shares outstanding. | |
d | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year. | |
e | Ratios are annualized for periods less than one year. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||
Advisor Class | 2010 | 2009 | 2008a | |||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||
Net asset value, beginning of year | $ | 23.28 | $ | 24.90 | $ | 31.40 | ||||||
Income from investment operationsb: | ||||||||||||
Net investment income (loss)c | (0.05 | ) | (0.02 | ) | (0.01 | ) | ||||||
Net realized and unrealized gains (losses) | 4.10 | (0.02 | ) | (6.49 | ) | |||||||
Total from investment operations | 4.05 | (0.04 | ) | (6.50 | ) | |||||||
Less distributions from net realized gains | — | (1.58 | ) | — | ||||||||
Redemption feesd | — | — | — | e | ||||||||
Net asset value, end of year | $ | 27.33 | $ | 23.28 | $ | 24.90 | ||||||
Total returnf | 17.40 | % | 2.92 | % | (20.70 | )% | ||||||
Ratios to average net assetsg | ||||||||||||
Expenses | 0.78 | % | 0.91 | %h | 0.73 | %h | ||||||
Net investment income (loss) | (0.19 | )% | (0.09 | )% | (0.02 | )% | ||||||
Supplemental data | ||||||||||||
Net assets, end of year (000’s) | $ | 11,541 | $ | 8,208 | $ | 1,938 | ||||||
Portfolio turnover rate | 31.39 | % | 46.05 | % | 41.01 | % |
a | For the period May 15, 2008 (effective date) to September 30, 2008. | |
b | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
c | Based on average daily shares outstanding. | |
d | Effective September 1, 2008, the redemption fee was eliminated. | |
e | Amount rounds to less than $0.01 per share. | |
f | Total return is not annualized for periods less than one year. | |
g | Ratios are annualized for periods less than one year. | |
h | Benefit of expense reduction rounds to less than 0.01%. |
Franklin DynaTech Fund | Country | Shares | Value | ||||||||||
Common Stocks 99.7% | |||||||||||||
Aerospace & Defense 3.1% | |||||||||||||
The Boeing Co. | United States | 110,000 | $ | 7,319,400 | |||||||||
Precision Castparts Corp. | United States | 110,000 | 14,008,500 | ||||||||||
21,327,900 | |||||||||||||
Air Freight & Logistics 1.9% | |||||||||||||
C.H. Robinson Worldwide Inc. | United States | 100,000 | 6,992,000 | ||||||||||
FedEx Corp. | United States | 70,000 | 5,985,000 | ||||||||||
12,977,000 | |||||||||||||
Biotechnology 2.1% | |||||||||||||
a | Celgene Corp. | United States | 250,000 | 14,402,500 | |||||||||
Capital Markets 0.8% | |||||||||||||
The Goldman Sachs Group Inc. | United States | 40,000 | 5,783,200 | ||||||||||
Chemicals 2.0% | |||||||||||||
Sigma-Aldrich Corp. | United States | 225,000 | 13,585,500 | ||||||||||
Communications Equipment 4.7% | |||||||||||||
a | Cisco Systems Inc. | United States | 500,000 | 10,950,000 | |||||||||
a | F5 Networks Inc. | United States | 100,000 | 10,381,000 | |||||||||
a | Juniper Networks Inc. | United States | 150,000 | 4,552,500 | |||||||||
QUALCOMM Inc. | United States | 75,000 | 3,384,000 | ||||||||||
ZTE Corp., H | China | 750,000 | 2,986,815 | ||||||||||
32,254,315 | |||||||||||||
Computers & Peripherals 9.6% | |||||||||||||
a | Apple Inc. | United States | 185,000 | 52,493,750 | |||||||||
Hewlett-Packard Co. | United States | 225,000 | 9,465,750 | ||||||||||
a | NetApp Inc. | United States | 85,000 | 4,232,150 | |||||||||
66,191,650 | |||||||||||||
Consumer Finance 0.1% | |||||||||||||
a | Green Dot Corp. | United States | 19,200 | 930,816 | |||||||||
Diversified Consumer Services 0.3% | |||||||||||||
a | Coinstar Inc. | United States | 40,000 | 1,719,600 | |||||||||
Diversified Financial Services 0.8% | |||||||||||||
CME Group Inc. | United States | 21,000 | 5,469,450 | ||||||||||
Electronic Equipment, Instruments & Components 1.6% | |||||||||||||
a | Dolby Laboratories Inc., A | United States | 190,000 | 10,793,900 | |||||||||
Energy Equipment & Services 5.7% | |||||||||||||
a | FMC Technologies Inc. | United States | 300,000 | 20,487,000 | |||||||||
National Oilwell Varco Inc. | United States | 150,000 | 6,670,500 | ||||||||||
Schlumberger Ltd. | United States | 200,000 | 12,322,000 | ||||||||||
39,479,500 | |||||||||||||
Health Care Equipment & Supplies 5.2% | |||||||||||||
a | Edwards Lifesciences Corp. | United States | 200,000 | 13,410,000 | |||||||||
a | HeartWare International Inc. | Australia | 50,000 | 3,438,000 | |||||||||
a | Intuitive Surgical Inc. | United States | 30,000 | 8,512,200 | |||||||||
Stryker Corp. | United States | 150,000 | 7,507,500 |
Franklin DynaTech Fund | Country | Shares | Value | ||||||||||
Common Stocks (continued) | |||||||||||||
Health Care Equipment & Supplies (continued) | |||||||||||||
a | Thoratec Corp. | United States | 80,000 | $ | 2,958,400 | ||||||||
35,826,100 | |||||||||||||
Health Care Providers & Services 3.0% | |||||||||||||
a | Express Scripts Inc. | United States | 300,000 | 14,610,000 | |||||||||
McKesson Corp. | United States | 100,000 | 6,178,000 | ||||||||||
20,788,000 | |||||||||||||
Health Care Technology 1.8% | |||||||||||||
a | Cerner Corp. | United States | 150,000 | 12,598,500 | |||||||||
Hotels, Restaurants & Leisure 1.0% | |||||||||||||
a | Ctrip.com International Ltd., ADR | China | 75,000 | 3,581,250 | |||||||||
Wynn Resorts Ltd. | United States | 40,000 | 3,470,800 | ||||||||||
7,052,050 | |||||||||||||
Industrial Conglomerates 0.8% | |||||||||||||
General Electric Co. | United States | 150,000 | 2,437,500 | ||||||||||
Koninklijke Philips Electronics NV, N.Y. shs. | Netherlands | 100,000 | 3,132,000 | ||||||||||
5,569,500 | |||||||||||||
Internet & Catalog Retail 5.9% | |||||||||||||
a | Amazon.com Inc. | United States | 100,000 | 15,706,000 | |||||||||
a | Netflix Inc. | United States | 50,000 | 8,108,000 | |||||||||
a | Priceline.com Inc. | United States | 47,500 | 16,546,150 | |||||||||
40,360,150 | |||||||||||||
Internet Software & Services 10.9% | |||||||||||||
a | Akamai Technologies Inc. | United States | 70,000 | 3,512,600 | |||||||||
a | Baidu Inc., ADR | China | 200,000 | 20,524,000 | |||||||||
a | Google Inc., A | United States | 50,000 | 26,289,500 | |||||||||
a | MercadoLibre Inc. | Argentina | 125,000 | 9,022,500 | |||||||||
Tencent Holdings Ltd. | China | 500,000 | 10,922,659 | ||||||||||
a | WebMD Health Corp. | United States | 100,000 | 4,987,000 | |||||||||
75,258,259 | |||||||||||||
IT Services 3.9% | |||||||||||||
MasterCard Inc., A | United States | 45,000 | 10,080,000 | ||||||||||
Visa Inc., A | United States | 225,000 | 16,708,500 | ||||||||||
26,788,500 | |||||||||||||
Life Sciences Tools & Services 2.4% | |||||||||||||
a | Thermo Fisher Scientific Inc. | United States | 125,000 | 5,985,000 | |||||||||
a | Waters Corp. | United States | 150,000 | 10,617,000 | |||||||||
16,602,000 | |||||||||||||
Machinery 1.6% | |||||||||||||
Flowserve Corp. | United States | 100,000 | 10,942,000 | ||||||||||
Oil, Gas & Consumable Fuels 1.3% | |||||||||||||
Noble Energy Inc. | United States | 50,000 | 3,754,500 | ||||||||||
Petroleo Brasileiro SA, ADR | Brazil | 150,000 | 5,440,500 | ||||||||||
9,195,000 | |||||||||||||
Franklin DynaTech Fund | Country | Shares | Value | ||||||||||
Common Stocks (continued) | |||||||||||||
Pharmaceuticals 5.6% | |||||||||||||
Allergan Inc. | United States | 150,000 | $ | 9,979,500 | |||||||||
Johnson & Johnson | United States | 75,000 | 4,647,000 | ||||||||||
Roche Holding AG | Switzerland | 40,000 | 5,463,613 | ||||||||||
Teva Pharmaceutical Industries Ltd., ADR | Israel | 350,000 | 18,462,500 | ||||||||||
38,552,613 | |||||||||||||
Semiconductors & Semiconductor Equipment 10.6% | |||||||||||||
ARM Holdings PLC, ADR | United Kingdom | 900,000 | 16,884,000 | ||||||||||
a | Cree Inc. | United States | 70,000 | 3,800,300 | |||||||||
First Solar Inc. | United States | 5,000 | 736,750 | ||||||||||
a | Hittite Microwave Corp. | United States | 100,000 | 4,765,000 | |||||||||
Intel Corp. | United States | 1,125,000 | 21,633,750 | ||||||||||
a | Lam Research Corp. | United States | 150,000 | 6,277,500 | |||||||||
a | Netlogic Microsystems Inc. | United States | 250,000 | 6,895,000 | |||||||||
Power Integrations Inc. | United States | 150,000 | 4,768,500 | ||||||||||
a | Silicon Laboratories Inc. | United States | 200,000 | 7,330,000 | |||||||||
73,090,800 | |||||||||||||
Software 10.9% | |||||||||||||
a | Adobe Systems Inc. | United States | 175,000 | 4,576,250 | |||||||||
a | ANSYS Inc. | United States | 200,000 | 8,450,000 | |||||||||
a | Check Point Software Technologies Ltd. | Israel | 200,000 | 7,386,000 | |||||||||
b | ChinaCache International Holdings Ltd., ADR | China | 7,300 | 87,600 | |||||||||
a | Citrix Systems Inc. | United States | 65,000 | 4,435,600 | |||||||||
FactSet Research Systems Inc. | United States | 75,000 | 6,084,750 | ||||||||||
a | Informatica Corp. | United States | 150,000 | 5,761,500 | |||||||||
Microsoft Corp. | United States | 200,000 | 4,898,000 | ||||||||||
Oracle Corp. | United States | 250,000 | 6,712,500 | ||||||||||
a | QLIK Technologies Inc. | United States | 52,700 | 1,162,035 | |||||||||
a | Salesforce.com Inc. | United States | 150,000 | 16,770,000 | |||||||||
a | VMware Inc., A | United States | 100,000 | 8,494,000 | |||||||||
74,818,235 | |||||||||||||
Wireless Telecommunication Services 2.1% | |||||||||||||
America Movil SAB de CV, L, ADR | Mexico | 85,000 | 4,533,050 | ||||||||||
a | American Tower Corp., A | United States | 200,000 | 10,252,000 | |||||||||
14,785,050 | |||||||||||||
Total Common Stocks (Cost $364,688,370) | 687,142,088 | ||||||||||||
Short Term Investments (Cost $5,804,707) 0.8% | |||||||||||||
Money Market Funds 0.8% | |||||||||||||
a,c | Institutional Fiduciary Trust Money Market Portfolio, 0.00% | United States | 5,804,707 | 5,804,707 | |||||||||
Total Investments (Cost $370,493,077) 100.5% | 692,946,795 | ||||||||||||
Other Assets, less Liabilities (0.5)% | (3,555,949 | ) | |||||||||||
Net Assets 100.0% | $ | 689,390,846 | |||||||||||
See Abbreviations on page 142. | ||
a | Non-income producing. | |
b | A portion or all of the security purchased on a delayed delivery basis. See Note 1(d). | |
c | See Note 7 regarding investments in the Institutional Fiduciary Trust Money Market Portfolio. The rate shown is the annualized seven-day yield at period end. |
Year Ended September 30, | ||||||||||||||||||||
Class A | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 36.48 | $ | 37.17 | $ | 46.36 | $ | 39.10 | $ | 34.83 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.20 | 0.29 | 0.24 | 0.16 | 0.12 | |||||||||||||||
Net realized and unrealized gains (losses) | 4.71 | (0.67 | ) | (9.30 | ) | 7.21 | 4.21 | |||||||||||||
Total from investment operations | 4.91 | (0.38 | ) | (9.06 | ) | 7.37 | 4.33 | |||||||||||||
Less distributions from net investment income | (0.28 | ) | (0.31 | ) | (0.13 | ) | (0.11 | ) | (0.06 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 41.11 | $ | 36.48 | $ | 37.17 | $ | 46.36 | $ | 39.10 | ||||||||||
Total returne | 13.52 | % | (0.71 | )% | (19.59 | )% | 18.87 | % | 12.46 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 0.94 | % | 1.00 | %f | 0.89 | %f | 0.93 | %f | 0.91 | %f | ||||||||||
Net investment income | 0.50 | % | 0.95 | % | 0.56 | % | 0.37 | % | 0.34 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 2,587,802 | $ | 2,173,714 | $ | 1,708,612 | $ | 2,123,419 | $ | 1,695,802 | ||||||||||
Portfolio turnover rate | 4.36 | % | 3.92 | % | 5.64 | % | 0.37 | % | 2.21 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class B | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 34.93 | $ | 35.44 | $ | 44.42 | $ | 37.65 | $ | 33.73 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment income (loss)b | (0.06 | ) | 0.07 | (0.08 | ) | (0.16 | ) | (0.15 | ) | |||||||||||
Net realized and unrealized gains (losses) | 4.50 | (0.58 | ) | (8.90 | ) | 6.93 | 4.07 | |||||||||||||
Total from investment operations | 4.44 | (0.51 | ) | (8.98 | ) | 6.77 | 3.92 | |||||||||||||
Less distributions from net investment income | (0.03 | ) | — | — | — | — | ||||||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 39.34 | $ | 34.93 | $ | 35.44 | $ | 44.42 | $ | 37.65 | ||||||||||
Total returne | 12.70 | % | (1.44 | )% | (20.22 | )% | 17.98 | % | 11.62 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.68 | % | 1.75 | %f | 1.64 | %f | 1.69 | %f | 1.67 | %f | ||||||||||
Net investment income (loss) | (0.24 | )% | 0.20 | % | (0.19 | )% | (0.39 | )% | (0.42 | )% | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 51,594 | $ | 87,790 | $ | 89,779 | $ | 138,640 | $ | 122,871 | ||||||||||
Portfolio turnover rate | 4.36 | % | 3.92 | % | 5.64 | % | 0.37 | % | 2.21 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class C | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance | ||||||||||||||||||||
(for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 34.61 | $ | 35.14 | $ | 44.03 | $ | 37.32 | $ | 33.43 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment income (loss)b | (0.09 | ) | 0.06 | (0.08 | ) | (0.16 | ) | (0.15 | ) | |||||||||||
Net realized and unrealized gains (losses) | 4.47 | (0.57 | ) | (8.81 | ) | 6.87 | 4.04 | |||||||||||||
Total from investment operations | 4.38 | (0.51 | ) | (8.89 | ) | 6.71 | 3.89 | |||||||||||||
Less distributions from net investment income | (0.07 | ) | (0.02 | ) | — | — | — | |||||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 38.92 | $ | 34.61 | $ | 35.14 | $ | 44.03 | $ | 37.32 | ||||||||||
Total returne | 12.69 | % | (1.45 | )% | (20.19 | )% | 17.98 | % | 11.60 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.69 | % | 1.75 | %f | 1.64 | %f | 1.69 | %f | 1.66 | %f | ||||||||||
Net investment income (loss) | (0.25 | )% | 0.20 | % | (0.19 | )% | (0.39 | )% | (0.41 | )% | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 349,188 | $ | 315,305 | $ | 255,425 | $ | 340,671 | $ | 273,512 | ||||||||||
Portfolio turnover rate | 4.36 | % | 3.92 | % | 5.64 | % | 0.37 | % | 2.21 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class R | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 36.37 | $ | 36.87 | $ | 45.99 | $ | 38.80 | $ | 34.59 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.08 | 0.20 | 0.14 | 0.04 | 0.02 | |||||||||||||||
Net realized and unrealized gains (losses) | 4.72 | (0.59 | ) | (9.23 | ) | 7.16 | 4.19 | |||||||||||||
Total from investment operations | 4.80 | (0.39 | ) | (9.09 | ) | 7.20 | 4.21 | |||||||||||||
Less distributions from net investment income | (0.23 | ) | (0.11 | ) | (0.03 | ) | (0.01 | ) | — | c | ||||||||||
Redemption feesd | — | — | — | c | — | c | — | c | ||||||||||||
Net asset value, end of year | $ | 40.94 | $ | 36.37 | $ | 36.87 | $ | 45.99 | $ | 38.80 | ||||||||||
Total returne | 13.26 | % | (0.98 | )% | (19.78 | )% | 18.55 | % | 12.18 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.19 | % | 1.25 | %f | 1.14 | %f | 1.19 | %f | 1.17 | %f | ||||||||||
Net investment income | 0.25 | % | 0.70 | % | 0.31 | % | 0.11 | % | 0.08 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 117,484 | $ | 65,113 | $ | 30,175 | $ | 53,134 | $ | 37,804 | ||||||||||
Portfolio turnover rate | 4.36 | % | 3.92 | % | 5.64 | % | 0.37 | % | 2.21 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Amount rounds to less than $0.01 per share. | |
d | Effective September 1, 2008, the redemption fee was eliminated. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Advisor Class | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 36.53 | $ | 37.25 | $ | 46.45 | $ | 39.17 | $ | 34.89 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.29 | 0.36 | 0.34 | 0.27 | 0.22 | |||||||||||||||
Net realized and unrealized gains (losses) | 4.72 | (0.68 | ) | (9.31 | ) | 7.21 | 4.21 | |||||||||||||
Total from investment operations | 5.01 | (0.32 | ) | (8.97 | ) | 7.48 | 4.43 | |||||||||||||
Less distributions from net investment income | (0.36 | ) | (0.40 | ) | (0.23 | ) | (0.20 | ) | (0.15 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 41.18 | $ | 36.53 | $ | 37.25 | $ | 46.45 | $ | 39.17 | ||||||||||
Total return | 13.82 | % | (0.45 | )% | (19.39 | )% | 19.16 | % | 12.73 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 0.69 | % | 0.75 | %e | 0.64 | %e | 0.69 | %e | 0.67 | %e | ||||||||||
Net investment income | 0.75 | % | 1.20 | % | 0.81 | % | 0.61 | % | 0.58 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 544,936 | $ | 430,926 | $ | 256,988 | $ | 363,221 | $ | 274,603 | ||||||||||
Portfolio turnover rate | 4.36 | % | 3.92 | % | 5.64 | % | 0.37 | % | 2.21 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Benefit of expense reduction rounds to less than 0.01%. |
Franklin Growth Fund | Shares | Value | |||||||
Common Stocks 93.3% | |||||||||
Automobiles & Components 2.2% | |||||||||
a | Ford Motor Co. | 1,100,000 | $ | 13,464,000 | |||||
Harley-Davidson Inc. | 838,096 | 23,835,450 | |||||||
Johnson Controls Inc. | 1,400,000 | 42,700,000 | |||||||
Toyota Motor Corp., ADR (Japan) | 30,000 | 2,147,400 | |||||||
82,146,850 | |||||||||
Banks 0.3% | |||||||||
Wells Fargo & Co. | 505,600 | 12,705,728 | |||||||
Capital Goods 21.4% | |||||||||
3M Co. | 855,000 | 74,137,050 | |||||||
a | ABB Ltd., ADR (Switzerland) | 850,000 | 17,952,000 | ||||||
The Boeing Co. | 1,045,000 | 69,534,300 | |||||||
Caterpillar Inc. | 200,000 | 15,736,000 | |||||||
Danaher Corp. | 550,000 | 22,335,500 | |||||||
Deere & Co. | 100,000 | 6,978,000 | |||||||
Emerson Electric Co. | 1,000,000 | 52,660,000 | |||||||
General Dynamics Corp. | 1,000,000 | 62,810,000 | |||||||
General Electric Co. | 720,000 | 11,700,000 | |||||||
Illinois Tool Works Inc. | 1,000,000 | 47,020,000 | |||||||
Ingersoll-Rand PLC. | 1,002,000 | 35,781,420 | |||||||
Lockheed Martin Corp. | 500,000 | 35,640,000 | |||||||
Northrop Grumman Corp. | 1,000,000 | 60,630,000 | |||||||
Pall Corp. | 500,000 | 20,820,000 | |||||||
Precision Castparts Corp. | 240,000 | 30,564,000 | |||||||
Raytheon Co. | 600,000 | 27,426,000 | |||||||
Rockwell Collins Inc. | 350,000 | 20,387,500 | |||||||
Textron Inc. | 1,050,000 | 21,588,000 | |||||||
a | Thomas & Betts Corp. | 500,000 | 20,510,000 | ||||||
United Technologies Corp. | 850,000 | 60,545,500 | |||||||
W.W. Grainger Inc. | 550,000 | 65,510,500 | |||||||
780,265,770 | |||||||||
Commercial & Professional Services 1.6% | |||||||||
Avery Dennison Corp. | 462,000 | 17,149,440 | |||||||
Dun & Bradstreet Corp. | 122,000 | 9,045,080 | |||||||
Equifax Inc. | 400,000 | 12,480,000 | |||||||
Robert Half International Inc. | 150,000 | 3,900,000 | |||||||
a | Stericycle Inc. | 100,000 | 6,948,000 | ||||||
a | Verisk Analytics Inc., A | 300,000 | 8,403,000 | ||||||
57,925,520 | |||||||||
Consumer Durables & Apparel 1.3% | |||||||||
NIKE Inc., B | 75,000 | 6,010,500 | |||||||
VF Corp. | 500,000 | 40,510,000 | |||||||
46,520,500 | |||||||||
Franklin Growth Fund | Shares | Value | |||||||
Common Stocks (continued) | |||||||||
Consumer Services 1.7% | |||||||||
a | Apollo Group Inc., A | 150,000 | $ | 7,702,500 | |||||
Carnival Corp. | 1,065,000 | 40,693,650 | |||||||
a | Interval Leisure Group Inc. | 60,020 | 808,469 | ||||||
Starwood Hotels & Resorts Worldwide Inc. | 250,000 | 13,137,500 | |||||||
62,342,119 | |||||||||
Diversified Financials 1.2% | |||||||||
American Express Co. | 242,300 | 10,183,869 | |||||||
BlackRock Inc. | 125,000 | 21,281,250 | |||||||
JPMorgan Chase & Co. | 334,300 | 12,726,801 | |||||||
44,191,920 | |||||||||
Energy 4.3% | |||||||||
BP PLC, ADR (United Kingdom) | 350,200 | 14,417,734 | |||||||
ConocoPhillips | 35,000 | 2,010,050 | |||||||
Devon Energy Corp. | 290,000 | 18,774,600 | |||||||
Exxon Mobil Corp. | 70,000 | 4,325,300 | |||||||
a | FMC Technologies Inc. | 300,000 | 20,487,000 | ||||||
Halliburton Co. | 600,000 | 19,842,000 | |||||||
National Oilwell Varco Inc. | 175,000 | 7,782,250 | |||||||
Occidental Petroleum Corp. | 200,000 | 15,660,000 | |||||||
Peabody Energy Corp. | 350,000 | 17,153,500 | |||||||
Royal Dutch Shell PLC, A, ADR (Netherlands) | 280,000 | 16,884,000 | |||||||
Schlumberger Ltd. | 309,100 | 19,043,651 | |||||||
a | Transocean Ltd. | 15,222 | 978,622 | ||||||
157,358,707 | |||||||||
Food & Staples Retailing 0.5% | |||||||||
CVS Caremark Corp. | 600,000 | 18,882,000 | |||||||
Food, Beverage & Tobacco 1.3% | |||||||||
Bunge Ltd. | 211,500 | 12,512,340 | |||||||
a | Hansen Natural Corp. | 300,000 | 13,986,000 | ||||||
PepsiCo Inc. | 300,000 | 19,932,000 | |||||||
46,430,340 | |||||||||
Health Care Equipment & Services 4.6% | |||||||||
Aetna Inc. | 400,000 | 12,644,000 | |||||||
a | Allscripts Healthcare Solutions Inc. | 450,000 | 8,311,500 | ||||||
Baxter International Inc. | 400,000 | 19,084,000 | |||||||
Cardinal Health Inc. | 300,000 | 9,912,000 | |||||||
a | CareFusion Corp. | 150,000 | 3,726,000 | ||||||
Covidien PLC | 350,000 | 14,066,500 | |||||||
a | Edwards Lifesciences Corp. | 100,000 | 6,705,000 | ||||||
a | Intuitive Surgical Inc. | 34,000 | 9,647,160 | ||||||
a | Medco Health Solutions Inc. | 96,480 | 5,022,749 | ||||||
Medtronic Inc. | 60,000 | 2,014,800 | |||||||
Quest Diagnostics Inc. | 500,000 | 25,235,000 | |||||||
Teleflex Inc. | 500,000 | 28,390,000 |
Franklin Growth Fund | Shares | Value | |||||||
Common Stocks (continued) | |||||||||
Health Care Equipment & Services (continued) | |||||||||
a | Varian Medical Systems Inc. | 300,000 | $ | 18,150,000 | |||||
a | Zimmer Holdings Inc. | 64,000 | 3,349,120 | ||||||
166,257,829 | |||||||||
Household & Personal Products 0.5% | |||||||||
The Procter & Gamble Co. | 335,000 | 20,089,950 | |||||||
Insurance 1.1% | |||||||||
Aflac Inc. | 333,300 | 17,234,943 | |||||||
a | Berkshire Hathaway Inc., A | 184 | 22,908,000 | ||||||
40,142,943 | |||||||||
Materials 3.6% | |||||||||
Air Products and Chemicals Inc. | 500,000 | 41,410,000 | |||||||
Celanese Corp., A | 500,000 | 16,050,000 | |||||||
Ecolab Inc. | 353,700 | 17,946,738 | |||||||
Martin Marietta Materials Inc. | 90,000 | 6,927,300 | |||||||
Praxair Inc. | 120,000 | 10,831,200 | |||||||
Randgold Resources Ltd., ADR (United Kingdom) | 150,000 | 15,219,000 | |||||||
Sigma-Aldrich Corp. | 400,000 | 24,152,000 | |||||||
132,536,238 | |||||||||
Media 1.6% | |||||||||
a | Live Nation Entertainment Inc. | 88,491 | 874,291 | ||||||
The Walt Disney Co. | 1,687,290 | 55,866,172 | |||||||
56,740,463 | |||||||||
Pharmaceuticals, Biotechnology & Life Sciences 12.7% | |||||||||
Abbott Laboratories | 400,000 | 20,896,000 | |||||||
Allergan Inc. | 950,000 | 63,203,500 | |||||||
a | Amgen Inc. | 932,000 | 51,362,520 | ||||||
a | Biogen Idec Inc. | 400,000 | 22,448,000 | ||||||
a | Celgene Corp. | 324,400 | 18,688,684 | ||||||
a | Covance Inc. | 200,000 | 9,358,000 | ||||||
a | Dionex Corp. | 250,000 | 21,610,000 | ||||||
Eli Lilly & Co. | 400,000 | 14,612,000 | |||||||
a | Gilead Sciences Inc. | 250,000 | 8,902,500 | ||||||
Johnson & Johnson | 1,181,010 | 73,175,380 | |||||||
Merck & Co. Inc. | 788,350 | 29,019,163 | |||||||
a | Mettler-Toledo International Inc. | 50,000 | 6,222,000 | ||||||
Pfizer Inc. | 2,761,000 | 47,406,370 | |||||||
Pharmaceutical Product Development Inc. | 300,000 | 7,437,000 | |||||||
Roche Holding AG, ADR (Switzerland) | 530,000 | 18,088,900 | |||||||
Teva Pharmaceutical Industries Ltd., ADR (Israel) | 275,000 | 14,506,250 | |||||||
a | Waters Corp. | 500,000 | 35,390,000 | ||||||
462,326,267 | |||||||||
Retailing 0.3% | |||||||||
a | Amazon.com Inc. | 10,000 | 1,570,600 | ||||||
Expedia Inc. | 300,100 | 8,465,821 |
Franklin Growth Fund | Shares | Value | |||||||
Common Stocks (continued) | |||||||||
Retailing (continued) | |||||||||
a | HSN Inc. | 60,020 | $ | 1,794,598 | |||||
11,831,019 | |||||||||
Semiconductors & Semiconductor Equipment 0.7% | |||||||||
a | First Solar Inc. | 50,000 | 7,367,500 | ||||||
Intel Corp. | 500,000 | 9,615,000 | |||||||
a | SunPower Corp., A | 2,000 | 28,800 | ||||||
a | SunPower Corp., B | 48,000 | 665,280 | ||||||
Texas Instruments Inc. | 250,000 | 6,785,000 | |||||||
24,461,580 | |||||||||
Software & Services 9.1% | |||||||||
a | Adobe Systems Inc. | 527,900 | 13,804,585 | ||||||
a | Autodesk Inc. | 800,000 | 25,576,000 | ||||||
Automatic Data Processing Inc. | 700,000 | 29,421,000 | |||||||
a | Citrix Systems Inc. | 200,000 | 13,648,000 | ||||||
Computer Sciences Corp. | 1,000,000 | 46,000,000 | |||||||
a | Google Inc., A | 76,300 | 40,117,777 | ||||||
a | lAC/lnterActiveCorp | 150,050 | 3,941,814 | ||||||
International Business Machines Corp. | 580,000 | 77,801,200 | |||||||
MasterCard Inc., A | 80,000 | 17,920,000 | |||||||
Microsoft Corp. | 325,000 | 7,959,250 | |||||||
Oracle Corp. | 500,000 | 13,425,000 | |||||||
Visa Inc., A | 250,000 | 18,565,000 | |||||||
a | Yahoo! Inc. | 1,600,000 | 22,672,000 | ||||||
330,851,626 | |||||||||
Technology Hardware & Equipment 12.6% | |||||||||
a | Agilent Technologies Inc. | 1,150,000 | 38,375,500 | ||||||
a | Apple Inc. | 811,000 | 230,121,250 | ||||||
a | Cisco Systems Inc. | 2,695,000 | 59,020,500 | ||||||
a | EMC Corp. | 1,000,000 | 20,310,000 | ||||||
Hewlett-Packard Co. | 1,156,250 | 48,643,438 | |||||||
a | Logitech International SA (Switzerland) | 150,000 | 2,610,000 | ||||||
Molex Inc. | 71,483 | 1,496,139 | |||||||
Molex Inc., A | 133,100 | 2,326,588 | |||||||
QUALCOMM Inc. | 660,000 | 29,779,200 | |||||||
a | Research In Motion Ltd. (Canada) | 600,000 | 29,214,000 | ||||||
461,896,615 | |||||||||
Telecommunication Services 1.4% | |||||||||
America Movil SAB de CV, L, ADR (Mexico) | 259,300 | 13,828,469 | |||||||
a | American Tower Corp., A | 715,000 | 36,650,900 | ||||||
50,479,369 | |||||||||
Transportation 8.0% | |||||||||
a | Air France-KLM, ADR (France) | 600,000 | 9,204,000 | ||||||
a | Alaska Air Group Inc. | 600,000 | 30,618,000 | ||||||
Allegiant Travel Co. | 100,000 | 4,232,000 | |||||||
Arkansas Best Corp. | 500,000 | 12,115,000 |
Franklin Growth Fund | Shares | Value | |||||||
Common Stocks (continued) | |||||||||
Transportation (continued) | |||||||||
a | British Airways PLC, ADR (United Kingdom) | 1,200,000 | $ | 22,704,000 | |||||
C.H. Robinson Worldwide Inc. | 267,300 | 18,689,616 | |||||||
Canadian National Railway Co. (Canada) | 500,000 | 32,010,000 | |||||||
Canadian Pacific Railway Ltd. (Canada) | 500,000 | 30,465,000 | |||||||
a | Continental Airlines Inc., B | 1,000,000 | 24,840,000 | ||||||
Expeditors International of Washington Inc. | 404,200 | 18,686,166 | |||||||
Forward Air Corp. | 495,333 | 12,878,658 | |||||||
Heartland Express Inc. | 500,000 | 7,435,000 | |||||||
Ryanair Holdings PLC, ADR (Ireland) | 239,200 | 7,369,752 | |||||||
Southwest Airlines Co. | 65,200 | 852,164 | |||||||
Union Pacific Corp. | 600,000 | 49,080,000 | |||||||
Werner Enterprises Inc. | 462,000 | 9,466,380 | |||||||
290,645,736 | |||||||||
Utilities 1.3% | |||||||||
American Water Works Co. Inc. | 700,000 | 16,289,000 | |||||||
International Power PLC (United Kingdom) | 3,058,904 | 18,652,015 | |||||||
NextEra Energy Inc. | 250,000 | 13,597,500 | |||||||
48,538,515 | |||||||||
Total Common Stocks (Cost $1,745,179,804) | 3,405,567,604 | ||||||||
Short Term Investments 5.8% | |||||||||
Money Market Funds (Cost $181,648,270) 5.0% | |||||||||
a,b | Institutional Fiduciary Trust Money Market Portfolio, 0.00% | 181,648,270 | 181,648,270 | ||||||
Principal Amount | |||||||||
Repurchase Agreements (Cost $31,822,988) 0.8% | |||||||||
c | Joint Repurchase Agreement, 0.205%, 10/01/10 (Maturity Value $31,823,169) | $ | 31,822,988 | 31,822,988 | |||||
Banc of America Securities LLC (Maturity Value $3,874,789) | |||||||||
Barclays Capital Inc. (Maturity Value $1,808,192) | |||||||||
BNP Paribas Securities Corp. (Maturity Value $6,716,280) | |||||||||
Credit Suisse Securities (USA) LLC (Maturity Value $6,458,512) | |||||||||
Deutsche Bank Securities Inc. (Maturity Value $2,632,731) | |||||||||
HSBC Securities (USA) Inc. (Maturity Value $3,874,789) | |||||||||
Morgan Stanley & Co. Inc. (Maturity Value $3,874,789) | |||||||||
UBS Securities LLC (Maturity Value $2,583,087) | |||||||||
Collateralized by U.S. Government Agency Securities, 0.146% - 6.25%, 2/01/11 - 4/18/17; | |||||||||
dU.S. Government Agency Discount Notes, 1/14/11 - 2/28/14 and U.S. Treasury Notes, 0.875% - 10.625%, 2/28/11 - 8/15/15 | |||||||||
Total Investments (Cost $1,958,651,062) 99.1% | 3,619,038,862 | ||||||||
Other Assets, less Liabilities 0.9% | 31,965,725 | ||||||||
Net Assets 100.0% | $ | 3,651,004,587 | |||||||
See Abbreviations on page 142. | ||
a | Non-income producing. | |
b | See Note 7 regarding investments in the Institutional Fiduciary Trust Money Market Portfolio. The rate shown is the annualized seven-day yield at period end. | |
c | See Note 1(c) regarding joint repurchase agreement. | |
d | The security is traded on a discount basis with no stated coupon rate. |
Year Ended September 30, | ||||||||||||||||||||
Class A | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 1.99 | $ | 1.98 | $ | 2.74 | $ | 2.57 | $ | 2.50 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.13 | 0.13 | 0.16 | 0.14 | 0.14 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.14 | 0.04 | (0.71 | ) | 0.21 | 0.09 | ||||||||||||||
Total from investment operations | 0.27 | 0.17 | (0.55 | ) | 0.35 | 0.23 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.15 | ) | (0.16 | ) | (0.15 | ) | (0.14 | ) | (0.15 | ) | ||||||||||
Net realized gains | — | — | c | (0.06 | ) | (0.04 | ) | (0.01 | ) | |||||||||||
Total distributions | (0.15 | ) | (0.16 | ) | (0.21 | ) | (0.18 | ) | (0.16 | ) | ||||||||||
Redemption feesd | — | — | — | c | — | c | — | c | ||||||||||||
Net asset value, end of year | $ | 2.11 | $ | 1.99 | $ | 1.98 | $ | 2.74 | $ | 2.57 | ||||||||||
Total returne | 13.90 | % | 10.56 | % | (21.36 | )% | 14.14 | % | 9.73 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 0.65 | %f | 0.68 | %f | 0.62 | %f | 0.63 | %f | 0.64 | %g | ||||||||||
Net investment income | 6.40 | % | 7.93 | % | 6.44 | % | 5.31 | % | 5.61 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 32,281,991 | $ | 27,773,006 | $ | 26,892,973 | $ | 35,476,603 | $ | 26,641,398 | ||||||||||
Portfolio turnover rate | 46.85 | % | 51.36 | % | 39.92 | % | 25.45 | % | 28.35 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Amount rounds to less than $0.01 per share. | |
d | Effective September 1, 2008, the redemption fee was eliminated. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. | |
g | Benefit of waiver and payment by affiliate and expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class B | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 1.98 | $ | 1.97 | $ | 2.73 | $ | 2.56 | $ | 2.49 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.12 | 0.12 | 0.14 | 0.12 | 0.12 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.13 | 0.04 | (0.71 | ) | 0.21 | 0.08 | ||||||||||||||
Total from investment operations | 0.25 | 0.16 | (0.57 | ) | 0.33 | 0.20 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.13 | ) | (0.15 | ) | (0.13 | ) | (0.12 | ) | (0.12 | ) | ||||||||||
Net realized gains | — | — | c | (0.06 | ) | (0.04 | ) | (0.01 | ) | |||||||||||
Total distributions | (0.13 | ) | (0.15 | ) | (0.19 | ) | (0.16 | ) | (0.13 | ) | ||||||||||
Redemption feesd | — | — | — | c | — | c | — | c | ||||||||||||
Net asset value, end of year | $ | 2.10 | $ | 1.98 | $ | 1.97 | $ | 2.73 | $ | 2.56 | ||||||||||
Total returne | 12.99 | % | 9.70 | % | (22.13 | )% | 13.23 | % | 8.83 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.49 | %f | 1.53 | %f | 1.47 | %f | 1.48 | %f | 1.49 | %g | ||||||||||
Net investment income | 5.56 | % | 7.08 | % | 5.59 | % | 4.46 | % | 4.76 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 1,629,726 | $ | 2,051,280 | $ | 2,428,765 | $ | 3,745,636 | $ | 3,743,374 | ||||||||||
Portfolio turnover rate | 46.85 | % | 51.36 | % | 39.92 | % | 25.45 | % | 28.35 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Amount rounds to less than $0.01 per share. | |
d | Effective September 1, 2008, the redemption fee was eliminated. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. | |
g | Benefit of waiver and payment by affiliate and expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class B1 | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 1.99 | $ | 1.98 | $ | 2.74 | $ | 2.57 | $ | 2.50 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.13 | 0.13 | 0.15 | 0.13 | 0.13 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.13 | 0.03 | (0.71 | ) | 0.21 | 0.08 | ||||||||||||||
Total from investment operations | 0.26 | 0.16 | (0.56 | ) | 0.34 | 0.21 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.13 | ) | (0.15 | ) | (0.14 | ) | (0.13 | ) | (0.13 | ) | ||||||||||
Net realized gains | — | — | c | (0.06 | ) | (0.04 | ) | (0.01 | ) | |||||||||||
Total distributions | (0.13 | ) | (0.15 | ) | (0.20 | ) | (0.30 | ) | (0.14 | ) | ||||||||||
Redemption feesd | — | — | — | c | — | c | — | c | ||||||||||||
Net asset value, end of year | $ | 2.12 | $ | 1.99 | $ | 1.98 | $ | 2.74 | $ | 2.57 | ||||||||||
Total returne | 13.73 | % | 10.03 | % | (21.77 | )% | 13.57 | % | 9.17 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.14 | %f | 1.17 | %f | 1.12 | %f | 1.13 | %f | 1.14 | %g | ||||||||||
Net investment income | 5.91 | % | 7.44 | % | 5.94 | % | 4.81 | % | 5.11 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 23,551 | $ | 68,825 | $ | 224,713 | $ | 397,224 | $ | 459,302 | ||||||||||
Portfolio turnover rate | 46.85 | % | 51.36 | % | 39.92 | % | 25.45 | % | 28.35 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Amount rounds to less than $0.01 per share. | |
d | Effective September 1, 2008, the redemption fee was eliminated. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. | |
g | Benefit of waiver and payment by affiliate and expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class C | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 2.00 | $ | 1.99 | $ | 2.76 | $ | 2.59 | $ | 2.51 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.12 | 0.13 | 0.15 | 0.13 | 0.13 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.15 | 0.03 | (0.72 | ) | 0.21 | 0.09 | ||||||||||||||
Total from investment operations | 0.27 | 0.16 | (0.57 | ) | 0.34 | 0.22 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.14 | ) | (0.15 | ) | (0.14 | ) | (0.13 | ) | (0.13 | ) | ||||||||||
Net realized gains | — | — | c | (0.06 | ) | (0.04 | ) | (0.01 | ) | |||||||||||
Total distributions | (0.14 | ) | (0.15 | ) | (0.20 | ) | (0.17 | ) | (0.14 | ) | ||||||||||
Redemption feesd | — | — | — | c | — | c | — | c | ||||||||||||
Net asset value, end of year | $ | 2.13 | $ | 2.00 | $ | 1.99 | $ | 2.76 | $ | 2.59 | ||||||||||
Total returne | 13.76 | % | 9.93 | % | (21.98 | )% | 13.47 | % | 9.56 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.15 | %f | 1.18 | %f | 1.12 | %f | 1.13 | %f | 1.14 | %g | ||||||||||
Net investment income | 5.90 | % | 7.43 | % | 5.94 | % | 4.81 | % | 5.11 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 15,605,055 | $ | 13,054,203 | $ | 12,443,143 | $ | 16,203,796 | $ | 12,138,969 | ||||||||||
Portfolio turnover rate | 46.85 | % | 51.36 | % | 39.92 | % | 25.45 | % | 28.35 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Amount rounds to less than $0.01 per share. | |
d | Effective September 1, 2008, the redemption fee was eliminated. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. | |
g | Benefit of waiver and payment by affiliate and expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class R | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 1.96 | $ | 1.95 | $ | 2.71 | $ | 2.55 | $ | 2.48 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.12 | 0.13 | 0.15 | 0.13 | 0.13 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.15 | 0.03 | (0.71 | ) | 0.20 | 0.09 | ||||||||||||||
Total from investment operations | 0.27 | 0.16 | (0.56 | ) | 0.33 | 0.22 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.14 | ) | (0.15 | ) | (0.14 | ) | (0.13) | ) | (0.14 | ) | ||||||||||
Net realized gains | — | — | c | (0.06 | ) | (0.04 | ) | (0.01 | ) | |||||||||||
Total distributions | (0.14 | ) | (0.15 | ) | (0.20 | ) | (0.17 | ) | (0.15 | ) | ||||||||||
Redemption feesd | — | — | — | c | — | c | — | c | ||||||||||||
Net asset value, end of year | $ | 2.09 | $ | 1.96 | $ | 1.95 | $ | 2.71 | $ | 2.55 | ||||||||||
Total returne | 14.23 | % | 10.31 | % | (21.91 | )% | 13.47 | % | 9.43 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.00 | %f | 1.03 | %f | 0.97 | %f | 0.98 | %f | 0.99 | %g | ||||||||||
Net investment income | 6.05 | % | 7.58 | % | 6.09 | % | 4.96 | % | 5.26 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 370,564 | $ | 315,298 | $ | 267,956 | $ | 286,670 | $ | 183,609 | ||||||||||
Portfolio turnover rate | 46.85 | % | 51.36 | % | 39.92 | % | 25.45 | % | 28.35 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Amount rounds to less than $0.01 per share. | |
d | Effective September 1, 2008, the redemption fee was eliminated. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. | |
g | Benefit of waiver and payment by affiliate and expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Advisor Class | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 1.98 | $ | 1.97 | $ | 2.73 | $ | 2.56 | $ | 2.49 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.13 | 0.14 | 0.16 | 0.15 | 0.14 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.14 | 0.03 | (0.70 | ) | 0.21 | 0.09 | ||||||||||||||
Total from investment operations | 0.27 | 0.17 | (0.54 | ) | 0.36 | 0.23 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.15 | ) | (0.16 | ) | (0.16 | ) | (0.15 | ) | (0.15 | ) | ||||||||||
Net realized gains | — | — | c | (0.06 | ) | (0.04 | ) | (0.01 | ) | |||||||||||
Total distributions | (0.15 | ) | (0.16 | ) | (0.22 | ) | (0.19 | ) | (0.16 | ) | ||||||||||
Redemption feesd | — | — | — | c | — | c | — | c | ||||||||||||
Net asset value, end of year | $ | 2.10 | $ | 1.98 | $ | 1.97 | $ | 2.73 | $ | 2.56 | ||||||||||
Total return | 14.15 | % | 10.79 | % | (21.33 | )% | 14.36 | % | 9.94 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 0.50 | %e | 0.53 | %e | 0.47 | %e | 0.48 | %e | 0.49 | %f | ||||||||||
Net investment income | 6.55 | % | 8.08 | % | 6.59 | % | 5.46 | % | 5.76 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 4,593,709 | $ | 4,183,925 | $ | 4,259,806 | $ | 6,195,966 | $ | 3,786,643 | ||||||||||
Portfolio turnover rate | 46.85 | % | 51.36 | % | 39.92 | % | 25.45 | % | 28.35 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Amount rounds to less than $0.01 per share. | |
d | Effective September 1, 2008, the redemption fee was eliminated. | |
e | Benefit of expense reduction rounds to less than 0.01%. | |
f | Benefit of waiver and payment by affiliate and expense reduction rounds to less than 0.01%. |
Franklin Income Fund | Country | Shares/Warrants | Value | ||||||||||
Common Stocks and Other Equity Interests 30.4% | |||||||||||||
Consumer Discretionary 1.2% | |||||||||||||
a | Charter Communications Inc. | United States | 11,871,333 | $ | 385,818,322 | ||||||||
a | Charter Communications Inc., A | United States | 4,084,845 | 132,757,463 | |||||||||
a | Charter Communications Inc., wts., 11/30/14 | United States | 2,112,650 | 11,619,575 | |||||||||
a,b | Dex One Corp. | United States | 10,242,757 | 125,781,056 | |||||||||
a | SuperMedia Inc., Litigation Trust | United States | 30,326,101 | 75,815 | |||||||||
656,052,231 | |||||||||||||
Consumer Staples 0.5% | |||||||||||||
Diageo PLC | United Kingdom | 9,000,000 | 155,159,126 | ||||||||||
PepsiCo Inc. | United States | 1,500,000 | 99,660,000 | ||||||||||
254,819,126 | |||||||||||||
Energy 5.1% | |||||||||||||
BP PLC, ADR | United Kingdom | 6,000,000 | 247,020,000 | ||||||||||
a,b | Callon Petroleum Co. | United States | 4,181,258 | 20,697,227 | |||||||||
b | Canadian Oil Sands Trust | United States | 26,000,000 | 643,773,401 | |||||||||
ConocoPhillips | United States | 8,000,000 | 459,440,000 | ||||||||||
Exxon Mobil Corp. | United States | 16,000,000 | 988,640,000 | ||||||||||
Schlumberger Ltd. | United States | 1,019,000 | 62,780,590 | ||||||||||
Spectra Energy Corp. | United States | 10,000,000 | 225,500,000 | ||||||||||
a | Weatherford International Ltd. | United States | 6,315,000 | 107,986,500 | |||||||||
2,755,837,718 | |||||||||||||
Financials 3.7% | |||||||||||||
Bank of America Corp. | United States | 35,000,000 | 458,850,000 | ||||||||||
Barclays PLC | United Kingdom | 15,000,000 | 70,613,667 | ||||||||||
a | CIT Group Inc. | United States | 3,000,000 | 122,460,000 | |||||||||
a | Citigroup Inc. | United States | 22,000,000 | 85,800,000 | |||||||||
b | Colony Financial Inc. | United States | 1,250,000 | 23,100,000 | |||||||||
HSBC Holdings PLC | United Kingdom | 35,000,000 | 354,832,398 | ||||||||||
JPMorgan Chase & Co. | United States | 10,250,000 | 390,217,500 | ||||||||||
c | Wells Fargo & Co. | United States | 19,000,000 | 477,470,000 | |||||||||
1,983,343,565 | |||||||||||||
Health Care 4.4% | |||||||||||||
Johnson & Johnson | United States | 10,000,000 | 619,600,000 | ||||||||||
Merck & Co. Inc. | United States | 25,000,000 | 920,250,000 | ||||||||||
Pfizer Inc. | United States | 26,750,000 | 459,297,500 | ||||||||||
Roche Holding AG | Switzerland | 3,000,000 | 409,770,992 | ||||||||||
2,408,918,492 | |||||||||||||
Industrials 0.2% | |||||||||||||
General Electric Co. | United States | 7,500,000 | 121,875,000 | ||||||||||
a | Nortek Inc. | United States | 40,000 | 1,600,000 | |||||||||
123,475,000 | |||||||||||||
Information Technology 0.2% | |||||||||||||
Intel Corp. | United States | 5,000,000 | 96,150,000 | ||||||||||
Franklin Income Fund | Country | Shares/Warrants | Value | ||||||||||
Common Stocks and Other Equity Interests (continued) | |||||||||||||
Materials 0.5% | |||||||||||||
AngloGold Ashanti Ltd., ADR | South Africa | 2,677,365 | $ | 123,801,358 | |||||||||
Barrick Gold Corp. | Canada | 2,000,000 | 92,580,000 | ||||||||||
Weyerhaeuser Co. | United States | 4,886,816 | 77,016,220 | ||||||||||
293,397,578 | |||||||||||||
Telecommunication Services 3.2% | |||||||||||||
AT&T Inc. | United States | 18,250,000 | 521,950,000 | ||||||||||
CenturyLink Inc. | United States | 5,000,000 | 197,300,000 | ||||||||||
Frontier Communications Corp. | United States | 10,160,357 | 83,010,117 | ||||||||||
Telstra Corp. Ltd. | Australia | 75,000,000 | 190,005,682 | ||||||||||
Verizon Communications Inc. | United States | 9,000,000 | 293,310,000 | ||||||||||
Vodafone Group PLC | United Kingdom | 180,000,000 | 444,402,885 | ||||||||||
1,729,978,684 | |||||||||||||
Utilities 11.4% | |||||||||||||
AGL Resources Inc. | United States | 2,650,000 | 101,654,000 | ||||||||||
Ameren Corp. | United States | 3,000,000 | 85,200,000 | ||||||||||
American Electric Power Co. Inc. | United States | 10,000,000 | 362,300,000 | ||||||||||
CenterPoint Energy Inc. | United States | 5,500,000 | 86,460,000 | ||||||||||
Consolidated Edison Inc. | United States | 5,300,000 | 255,566,000 | ||||||||||
Dominion Resources Inc. | United States | 10,500,000 | 458,430,000 | ||||||||||
DTE Energy Co. | United States | 2,750,000 | 126,307,500 | ||||||||||
Duke Energy Corp. | United States | 34,000,000 | 602,140,000 | ||||||||||
FirstEnergy Corp. | United States | 2,800,000 | 107,912,000 | ||||||||||
NextEra Energy Inc. | United States | 7,375,000 | 401,126,250 | ||||||||||
NiSource Inc. | United States | 2,500,000 | 43,500,000 | ||||||||||
PG&E Corp. | United States | 11,500,000 | 522,330,000 | ||||||||||
Pinnacle West Capital Corp. | United States | 5,000,000 | 206,350,000 | ||||||||||
Portland General Electric Co. | United States | 2,400,000 | 48,672,000 | ||||||||||
PPL Corp. | United States | 6,665,600 | 181,504,288 | ||||||||||
Progress Energy Inc. | United States | 9,400,000 | 417,548,000 | ||||||||||
Public Service Enterprise Group Inc. | United States | 15,000,000 | 496,200,000 | ||||||||||
Sempra Energy | United States | 6,500,000 | 349,700,000 | ||||||||||
The Southern Co. | United States | 21,000,000 | 782,040,000 | ||||||||||
TECO Energy Inc. | United States | 10,000,000 | 173,200,000 | ||||||||||
Xcel Energy Inc. | United States | 18,500,000 | 424,945,000 | ||||||||||
6,233,085,038 | |||||||||||||
Total Common Stocks and Other Equity Interests (Cost $15,275,214,935) | 16,535,057,432 | ||||||||||||
d | Equity-Linked Securities 4.5% | ||||||||||||
Consumer Discretionary 0.1% | |||||||||||||
e | JPMorgan Chase & Co. into Comcast Corp., 8.00%, 144A | United States | 5,000,000 | 91,108,000 | |||||||||
Franklin Income Fund | Country | Shares/Warrants | Value | ||||||||||
d | Equity-Linked Securities (continued) | ||||||||||||
Energy 1.2% | |||||||||||||
e | Barclays Bank PLC into Weatherford International Ltd., 12.00%, 144A | United States | 7,350,000 | $ | 130,878,510 | ||||||||
Credit Suisse into ConocoPhillips, 8.00% | United States | 3,600,000 | 206,832,960 | ||||||||||
Credit Suisse into Schlumberger Ltd., 8.00% | United States | 1,500,000 | 91,560,000 | ||||||||||
e | Deutsche Bank AG into Chesapeake Energy Corp., 12.00%, 144A | United States | 6,200,000 | 145,283,980 | |||||||||
e | Morgan Stanley into Baker Hughes Inc., 8.00%, 144A | United States | 2,500,000 | 105,187,500 | |||||||||
679,742,950 | |||||||||||||
Financials 0.7% | |||||||||||||
e | Barclays Capital PLC into Wells Fargo & Co., 8.00%, 144A | United States | 5,406,000 | 138,206,012 | |||||||||
e | Deutsche Bank AG into Citigroup Inc., 10.00%, 144A | United States | 24,500,000 | 105,745,430 | |||||||||
e | JPMorgan Chase & Co. into Bank of America, 9.00%, 144A | United States | 5,000,000 | 70,650,000 | |||||||||
e | JPMorgan Chase & Co. into Citigroup Inc., 10.00%, 144A | United States | 21,276,000 | 86,048,441 | |||||||||
400,649,883 | |||||||||||||
Industrials 0.2% | |||||||||||||
e | JPMorgan Chase & Co. into First Solar Inc., 10.00%, 144A | United States | 687,800 | 93,077,911 | |||||||||
Information Technology 1.0% | |||||||||||||
e | Barclays Bank PLC into Intel Corp., 8.00%., 144A | United States | 9,653,000 | 189,911,191 | |||||||||
e | The Goldman Sachs Group Inc. into Xerox Corp., 12.00%, 144A | United States | 13,400,000 | 124,442,450 | |||||||||
e | Morgan Stanley into Qualcomm Inc., 7.50%, 144A | United States | 2,500,000 | 109,356,750 | |||||||||
e | Morgan Stanley into Xilinx Inc., 8.00%, 144A | United States | 4,000,000 | 104,354,800 | |||||||||
528,065,191 | |||||||||||||
Materials 1.1% | |||||||||||||
e | Barclays Capital PLC into Newmont Mining Corp., 8.50%, 144A | United States | 3,044,000 | 177,169,628 | |||||||||
Credit Suisse into Barrick Gold Corp., 9.00% | United States | 4,910,000 | 215,042,288 | ||||||||||
e | JPMorgan Chase & Co. into Nucor Corp., 9.00%, 144A | United States | 2,100,000 | 85,007,370 | |||||||||
e | Morgan Stanley into Freeport-Mcmoran Copper & Gold Inc., 9.00%, 144A | United States | 1,250,000 | 104,526,000 | |||||||||
581,745,286 | |||||||||||||
Utilities 0.2% | |||||||||||||
Credit Suisse into Calpine Corp., 8.00% | United States | 8,000,000 | 96,326,400 | ||||||||||
Total Equity-Linked Securities (Cost $2,447,724,306) | 2,470,715,621 | ||||||||||||
Convertible Preferred Stocks 3.4% | |||||||||||||
Consumer Discretionary 0.2% | |||||||||||||
a | General Motors Corp., 6.25%, cvt. pfd., C | United States | 11,000,000 | 85,470,000 | |||||||||
Energy 0.3% | |||||||||||||
e | Chesapeake Energy Corp., 5.75%, cvt. pfd., 144A | United States | 160,000 | 164,739,200 | |||||||||
Franklin Income Fund | Country | Shares/Warrants | Value | ||||||||||
Convertible Preferred Stocks (continued) | |||||||||||||
Financials 2.4% | |||||||||||||
Bank of America Corp., 7.25%, cvt. pfd., L | United States | 679,738 | $ | 667,842,585 | |||||||||
aFannie Mae, 5.375%, cvt. pfd. | United States | 4,700 | 8,648,000 | ||||||||||
aFannie Mae, 8.75%, cvt. pfd. | United States | 3,239,000 | 1,580,405 | ||||||||||
aFelcor Lodging Trust Inc., 7.80%, cvt. pfd., A | United States | 3,050,000 | 65,422,500 | ||||||||||
eForest City Enterprises Inc., 7.00%, cvt. pfd., 144A | United States | 1,000,000 | 53,799,500 | ||||||||||
aLehman Brothers Holdings Inc., 7.25%, cvt. pfd., P | United States | 1,000,650 | 800,520 | ||||||||||
aLehman Brothers Holdings Inc., 8.75%, cvt. pfd., Q | United States | 550,000 | 55 | ||||||||||
Wells Fargo & Co., 7.50%, cvt. pfd., A | United States | 512,900 | 515,977,400 | ||||||||||
1,314,070,965 | |||||||||||||
Health Care 0.4% | |||||||||||||
Tenet Healthcare Corp., 7.00%, cvt. pfd. | United States | 250,000 | 213,750,000 | ||||||||||
Materials 0.1% | |||||||||||||
aAnglogold Ashanti Holdings Finance PLC, 6.00%, cvt. pfd. | South Africa | 1,000,000 | 53,000,000 | ||||||||||
Utilities 0.0%† | |||||||||||||
Nextera Energy Inc., 8.375%, cvt. pfd. | United States | 500,000 | 26,550,000 | ||||||||||
Total Convertible Preferred Stocks (Cost $3,945,926,583) | 1,857,580,165 | ||||||||||||
Preferred Stocks 0.5% | |||||||||||||
Financials 0.5% | |||||||||||||
aFannie Mae, 6.75%, pfd. | United States | 3,000,000 | 1,050,000 | ||||||||||
aFannie Mae, 8.25%, pfd. | United States | 11,784,000 | 5,126,040 | ||||||||||
aFannie Mae, 7.625%, pfd., R | United States | 2,399,400 | 890,177 | ||||||||||
aFreddie Mac, 8.375%, pfd., Z | United States | 16,608,000 | 7,141,440 | ||||||||||
eGMAC Inc., 7.00%, pfd., 144A | United States | 267,636 | 245,556,030 | ||||||||||
Total Preferred Stocks (Cost $928,695,780) | 259,763,687 | ||||||||||||
Principal Amount* | |||||||||||||
Convertible Bonds 0.6% | |||||||||||||
Financials 0.6% | |||||||||||||
CapitalSource Inc., cvt., senior sub. note, | |||||||||||||
4.00%, 7/15/34 | United States | 118,925,000 | 118,330,375 | ||||||||||
7.25%, 7/15/37 | United States | 12,676,000 | 12,612,620 | ||||||||||
fiStar Financial Inc., cvt., senior note, FRN, 1.033%, 10/01/12 | United States | 240,000,000 | 186,600,000 | ||||||||||
317,542,995 | |||||||||||||
Information Technology 0.0%† | |||||||||||||
Advanced Micro Devices Inc., cvt., senior note, 6.00%, 5/01/15 | United States | 17,172,000 | 16,978,815 | ||||||||||
Total Convertible Bonds (Cost $380,091,382) | 334,521,810 | ||||||||||||
Franklin Income Fund | Country | Principal Amount* | Value | ||||||||||
Corporate Bonds 51.8% | |||||||||||||
Consumer Discretionary 8.1% | |||||||||||||
Cablevision Systems Corp., senior note, | |||||||||||||
8.625%, 9/15/17 | United States | 100,000,000 | $ | 110,500,000 | |||||||||
7.75%, 4/15/18 | United States | 200,000,000 | 212,500,000 | ||||||||||
8.00%, 4/15/20 | United States | 150,000,000 | 162,187,500 | ||||||||||
CCH II LLC/CCH II Capital Corp., senior note, 13.50%, 11/30/16 | United States | 227,347,163 | 271,111,492 | ||||||||||
e | CCO Holdings LLC, senior note, 144A, 7.875%, 4/30/18 | United States | 84,900,000 | 88,508,250 | |||||||||
e | Cequel Communications Holdings I LLC, senior note, 144A, 8.625%, 11/15/17 | United States | 60,000,000 | 63,600,000 | |||||||||
e | CKE Restaurants Inc., senior secured note, 144A, 11.375%, 7/15/18 | United States | 66,000,000 | 67,980,000 | |||||||||
Clear Channel Worldwide Holdings Inc., senior note, | |||||||||||||
A, 9.25%, 12/15/17 | United States | 24,900,000 | 26,518,500 | ||||||||||
B, 9.25%, 12/15/17 | United States | 116,050,000 | 124,463,625 | ||||||||||
CSC Holdings Inc., senior note, 8.50%, 4/15/14 | United States | 67,300,000 | 74,450,625 | ||||||||||
b,g | Dex One Corp., senior sub. note, PIK, 12.00%, 1/29/17 | United States | 81,136,340 | 64,199,129 | |||||||||
EchoStar DBS Corp., senior note, | |||||||||||||
7.75%, 5/31/15 | United States | 40,000,000 | 42,850,000 | ||||||||||
7.125%, 2/01/16 | United States | 152,000,000 | 160,550,000 | ||||||||||
Ford Motor Credit Co. LLC, | |||||||||||||
8.00%, 6/01/14 | United States | 400,000,000 | 437,896,400 | ||||||||||
senior note, 8.70%, 10/01/14 | United States | 40,000,000 | 45,100,000 | ||||||||||
senior note, 7.00%, 4/15/15 | United States | 450,000,000 | 481,514,400 | ||||||||||
senior note, 12.00%, 5/15/15 | United States | 55,000,000 | 69,300,000 | ||||||||||
senior note, 8.125%, 1/15/20 | United States | 47,700,000 | 54,902,128 | ||||||||||
h | General Motors Corp., senior deb., 8.375%, 7/15/33 | United States | 510,000,000 | 174,675,000 | |||||||||
The Goodyear Tire & Rubber Co., senior note, 8.25%, 8/15/20 | United States | 112,700,000 | 119,180,250 | ||||||||||
Harrah’s Operating Co. Inc., | |||||||||||||
esenior note, 144A, 12.75%, 4/15/18 | United States | 25,000,000 | 23,437,500 | ||||||||||
senior secured note, 11.25%, 6/01/17 | United States | 150,000,000 | 165,000,000 | ||||||||||
Host Hotels & Resorts LP, senior note, | |||||||||||||
O, 6.375%, 3/15/15 | United States | 100,000,000 | 102,875,000 | ||||||||||
Q, 6.75%, 6/01/16 | United States | 83,000,000 | 86,423,750 | ||||||||||
T, 9.00%, 5/15/17 | United States | 116,750,000 | 130,905,937 | ||||||||||
KB Home, senior note, | |||||||||||||
5.75%, 2/01/14 | United States | 75,000,000 | 72,843,750 | ||||||||||
6.25%, 6/15/15 | United States | 90,000,000 | 86,400,000 | ||||||||||
9.10%, 9/15/17 | United States | 49,000,000 | 50,592,500 | ||||||||||
7.25%, 6/15/18 | United States | 70,500,000 | 66,446,250 | ||||||||||
MGM Resorts International, senior note, | |||||||||||||
6.75%, 4/01/13 | United States | 70,000,000 | 65,362,500 | ||||||||||
11.375%, 3/01/18 | United States | 25,000,000 | 23,937,500 | ||||||||||
Michaels Stores Inc., senior note, 10.00%, 11/01/14 | United States | 48,235,000 | 51,068,806 | ||||||||||
e,g | Univision Communications Inc., senior note, 144A, PIK, 10.50%, 3/15/15 | United States | 308,967,064 | 296,085,300 | |||||||||
e | UPC Germany GmbH, senior secured note, 144A, | ||||||||||||
8.125%, 12/01/17 | Germany | 52,700,000 | 55,302,062 | ||||||||||
8.125%, 12/01/17 | Germany | 43,900,000 | EUR | 63,079,624 | |||||||||
9.625%, 12/01/19 | Germany | 23,100,000 | EUR | 34,178,872 |
Franklin Income Fund | Country | Principal Amount* | Value | ||||||||||
Corporate Bonds (continued) | |||||||||||||
Consumer Discretionary (continued) | |||||||||||||
Virgin Media Secured Finance, senior secured note, 7.00%, 1/15/18 | United Kingdom | 70,000,000 | GBP | $ | 116,622,755 | ||||||||
e | Visant Corp., senior note, 144A, 10.00%, 10/01/17 | United States | 46,800,000 | 49,023,000 | |||||||||
4,391,572,405 | |||||||||||||
Consumer Staples 0.5% | |||||||||||||
e | JBS USA LLC, senior note, 144A, 11.625%, 5/01/14 | United States | 134,500,000 | 156,692,500 | |||||||||
SUPERVALU Inc., senior note, 8.00%, 5/01/16 | United States | 108,500,000 | 109,856,250 | ||||||||||
266,548,750 | |||||||||||||
Energy 9.8% | |||||||||||||
Alon Refining Krotz Springs Inc., senior secured note, 13.50%, 10/15/14 | United States | 30,000,000 | 29,400,000 | ||||||||||
Anadarko Petroleum Corp., senior note, 5.95%, 9/15/16 | United States | 90,000,000 | 98,446,860 | ||||||||||
Antero Resources Finance, senior note, 9.375%, 12/01/17 | United States | 106,200,000 | 113,368,500 | ||||||||||
e | ATP Oil & Gas Corp., senior secured note, 144A, 11.875%, 5/01/15 | United States | 125,000,000 | 108,437,500 | |||||||||
b | Callon Petroleum Co., senior secured note, 13.00%, 9/15/16 | United States | 75,000,000 | 75,656,250 | |||||||||
Chesapeake Energy Corp., senior note, | |||||||||||||
9.50%, 2/15/15 | United States | 100,000,000 | 116,250,000 | ||||||||||
6.50%, 8/15/17 | United States | 183,000,000 | 190,777,500 | ||||||||||
6.875%, 8/15/18 | United States | 104,000,000 | 109,460,000 | ||||||||||
7.25%, 12/15/18 | United States | 188,065,000 | 203,580,362 | ||||||||||
6.875%, 11/15/20 | United States | 143,000,000 | 152,295,000 | ||||||||||
e | Consol Energy Inc., senior note, 144A, | ||||||||||||
8.00%, 4/01/17 | United States | 42,450,000 | 46,164,375 | ||||||||||
8.25%, 4/01/20 | United States | 80,850,000 | 88,732,875 | ||||||||||
Crosstex Energy LP/Crosstex Energy Finance Corp., senior note, 8.875%, 2/15/18 | United States | 32,800,000 | 34,522,000 | ||||||||||
Denbury Resources Inc., senior sub. note, 8.25%, 2/15/20 | United States | 72,446,000 | 79,418,928 | ||||||||||
El Paso Corp., | |||||||||||||
esenior bond, 144A, 6.50%, 9/15/20 | United States | 161,600,000 | 165,236,000 | ||||||||||
senior note, 7.25%, 6/01/18 | United States | 60,000,000 | 64,961,460 | ||||||||||
senior note, MTN, 7.75%, 1/15/32 | United States | 250,000,000 | 260,785,000 | ||||||||||
Energy Transfer Equity LP, senior note, 7.50%, 10/15/20 | United States | 153,700,000 | 162,537,750 | ||||||||||
EXCO Resources Inc., senior note, 7.50%, 9/15/18 | United States | 52,400,000 | 52,007,000 | ||||||||||
e | Expro Finance Luxembourg, senior secured note, 144A, 8.50%, 12/15/16 | United Kingdom | 56,800,000 | 54,386,000 | |||||||||
Forest Oil Corp., senior note, | |||||||||||||
8.50%, 2/15/14 | United States | 45,000,000 | 49,387,500 | ||||||||||
7.25%, 6/15/19 | United States | 47,875,000 | 49,191,563 | ||||||||||
Holly Corp., senior note, 9.875%, 6/15/17 | United States | 35,000,000 | 37,231,250 | ||||||||||
e | Linn Energy Corp., senior note, 144A, | ||||||||||||
8.625%, 4/15/20 | United States | 100,000,000 | 106,500,000 | ||||||||||
7.75%, 2/01/21 | United States | 75,000,000 | 76,031,250 | ||||||||||
Newfield Exploration Co., | |||||||||||||
senior sub. bond, 6.875%, 2/01/20 | United States | 100,000,000 | 106,750,000 | ||||||||||
senior sub. note, 6.625%, 4/15/16 | United States | 42,000,000 | 43,890,000 |
Franklin Income Fund | Country | Principal Amount* | Value | ||||||||||
Corporate Bonds (continued) | |||||||||||||
Energy (continued) | |||||||||||||
eNFR Energy LLC/NFR Finance Corp., senior note, 144A, 9.75%, 2/15/17 | United States | 60,000,000 | $ | 60,000,000 | |||||||||
OPTI Canada Inc., senior note, 7.875%, 12/15/14 | Canada | 70,000,000 | 53,025,000 | ||||||||||
Petrohawk Energy Corp., senior note, | |||||||||||||
10.50%, 8/01/14 | United States | 129,050,000 | 145,665,187 | ||||||||||
7.875%, 6/01/15 | United States | 141,000,000 | 148,402,500 | ||||||||||
ePetroplus Finance Ltd., senior note, 144A, | |||||||||||||
6.75%, 5/01/14 | Switzerland | 145,000,000 | 133,400,000 | ||||||||||
7.00%, 5/01/17 | Switzerland | 125,000,000 | 109,375,000 | ||||||||||
9.375%, 9/15/19 | Bermuda | 94,930,000 | 86,860,950 | ||||||||||
Pioneer Natural Resources Co., senior bond, 6.875%, 5/01/18 | United States | 100,000,000 | 107,518,600 | ||||||||||
Plains Exploration & Production Co., senior note, | |||||||||||||
7.75%, 6/15/15 | United States | 95,500,000 | 100,633,125 | ||||||||||
10.00%, 3/01/16 | United States | 80,000,000 | 91,600,000 | ||||||||||
8.625%, 10/15/19 | United States | 50,000,000 | 54,875,000 | ||||||||||
Quicksilver Resources Inc., senior note, 9.125%, 8/15/19 | United States | 90,000,000 | 99,112,500 | ||||||||||
Sabine Pass LNG LP, senior secured note, | |||||||||||||
7.25%, 11/30/13 | United States | 100,000,000 | 97,000,000 | ||||||||||
7.50%, 11/30/16 | United States | 240,000,000 | 220,200,000 | ||||||||||
SandRidge Energy Inc., senior note, | |||||||||||||
e144A, 9.875%, 5/15/16 | United States | 106,300,000 | 110,286,250 | ||||||||||
e144A, 8.00%, 6/01/18 | United States | 232,500,000 | 227,850,000 | ||||||||||
e144A, 8.75%, 1/15/20 | United States | 100,000,000 | 99,500,000 | ||||||||||
fFRN, 4.158%, 4/01/14 | United States | 80,000,000 | 74,160,800 | ||||||||||
gPIK, 8.625%, 4/01/15 | United States | 120,131,000 | 120,731,655 | ||||||||||
SEACOR Holdings Inc., senior note, 7.375%, 10/01/19 | United States | 23,800,000 | 25,996,669 | ||||||||||
SESI LLC, senior note, 6.875%, 6/01/14 | United States | 117,000,000 | 118,462,500 | ||||||||||
Tesoro Corp., | |||||||||||||
i7.50%, 7/17/12 | United States | 100,000,000 | 94,587,070 | ||||||||||
senior note, 6.50%, 6/01/17 | United States | 16,050,000 | 15,889,500 | ||||||||||
senior note, 9.75%, 6/01/19 | United States | 36,400,000 | 40,222,000 | ||||||||||
eW&T Offshore Inc., senior note, 144A, 8.25%, 6/15/14 | United States | 192,500,000 | 184,800,000 | ||||||||||
eWestern Refining Inc., | |||||||||||||
fsenior note, 144A, FRN, 10.75%, 6/15/14 | United States | 25,000,000 | 23,875,000 | ||||||||||
senior secured note, 144A, 11.25%, 6/15/17 | United States | 25,000,000 | 23,625,000 | ||||||||||
5,343,059,229 | |||||||||||||
Financials 9.2% | |||||||||||||
jBank of America Corp., pfd., sub. bond, M, 8.125%, Perpetual | United States | 100,000,000 | 103,279,000 | ||||||||||
CIT Group Inc., senior secured sub. bond, 7.00%, | |||||||||||||
5/01/14 | United States | 115,100,000 | 115,100,000 | ||||||||||
5/01/15 | United States | 475,000,000 | 472,625,000 | ||||||||||
5/01/16 | United States | 825,000,000 | 816,750,000 | ||||||||||
5/01/17 | United States | 655,000,000 | 644,356,250 | ||||||||||
FelCor Lodging LP, senior secured note, 10.00%, 10/01/14 | United States | 142,450,000 | 155,626,625 | ||||||||||
Forest City Enterprises Inc., senior note, 7.625%, 6/01/15 | United States | 42,250,000 | 39,503,750 | ||||||||||
eGMAC Inc., senior note, 144A, 8.00%, 3/15/20 | United States | 205,000,000 | 224,475,000 | ||||||||||
Hexion U.S. Finance Corp., senior secured note, 8.875%, 2/01/18 | United States | 35,000,000 | 34,475,000 |
Franklin Income Fund | Country | Principal Amount* | Value | ||||||||||
Corporate Bonds (continued) | |||||||||||||
Financials (continued) | |||||||||||||
International Lease Finance Corp., | |||||||||||||
senior note, 8.875%, 9/01/17 | United States | 73,300,000 | $ | 79,530,500 | |||||||||
esenior note, 144A, 8.625%, 9/15/15 | United States | 58,300,000 | 62,526,750 | ||||||||||
esenior note, 144A, 8.75%, 3/15/17 | United States | 171,500,000 | 184,362,500 | ||||||||||
esenior secured note, 144A, 6.75%, 9/01/16 | United States | 79,200,000 | 85,140,000 | ||||||||||
esenior secured note, 144A, 7.125%, 9/01/18 | United States | 122,300,000 | 132,389,750 | ||||||||||
iStar Financial Inc., | |||||||||||||
senior note, 8.625%, 6/01/13 | United States | 190,000,000 | 156,987,500 | ||||||||||
senior secured note, 10.00%, 6/15/14 | United States | 110,000,000 | 110,000,000 | ||||||||||
j | JPMorgan Chase & Co., junior sub. note, 1, 7.90%, Perpetual | United States | 865,000,000 | 930,109,415 | |||||||||
e,f | Liberty Mutual Group, junior sub. note, 144A, FRN, 10.75%, 6/15/88 | United States | 100,000,000 | 119,000,000 | |||||||||
j | Wells Fargo Capital XIII, 7.70%, Perpetual | United States | 44,500,000 | 46,391,250 | |||||||||
j | Wells Fargo Capital XV, pfd., 9.75%, Perpetual | United States | 449,600,000 | 496,808,000 | |||||||||
5,009,436,290 | |||||||||||||
Health Care 5.4% | |||||||||||||
Community Health Systems Inc., senior sub. note, 8.875%, 7/15/15 | United States | 375,000,000 | 399,375,000 | ||||||||||
HCA Inc., | |||||||||||||
6.75%, 7/15/13 | United States | 79,320,000 | 81,303,000 | ||||||||||
senior note, 6.375%, 1/15/15 | United States | 169,455,000 | 169,878,638 | ||||||||||
senior note, 6.50%, 2/15/16 | United States | 195,000,000 | 195,975,000 | ||||||||||
senior secured bond, 7.25%, 9/15/20 | United States | 51,700,000 | 55,577,500 | ||||||||||
senior secured note, 9.25%, 11/15/16 | United States | 300,000,000 | 325,500,000 | ||||||||||
senior secured note, 8.50%, 4/15/19 | United States | 190,000,000 | 212,800,000 | ||||||||||
senior secured note, 7.875%, 2/15/20 | United States | 165,000,000 | 181,293,750 | ||||||||||
e,g | Quintiles Transnational Corp., senior note, 144A, PIK, 9.50%, 12/30/14 | United States | 100,000,000 | 103,000,000 | |||||||||
Tenet Healthcare Corp., | |||||||||||||
senior note, 9.875%, 7/01/14 | United States | 30,000,000 | 32,400,000 | ||||||||||
esenior note, 144A, 8.00%, 8/01/20 | United States | 178,600,000 | 178,600,000 | ||||||||||
fsenior note, FRN, 9.25%, 2/01/15 | United States | 115,000,000 | 124,056,250 | ||||||||||
senior secured note, 9.00%, 5/01/15 | United States | 300,000,000 | 327,750,000 | ||||||||||
senior secured note, 10.00%, 5/01/18 | United States | 300,000,000 | 344,250,000 | ||||||||||
f,g | US Oncology Holdings Inc., senior note, PIK, FRN, 6.737%, 3/15/12 | United States | 67,272,000 | 63,877,320 | |||||||||
US Oncology Inc., senior note, 10.75%, 8/15/14 | United States | 15,000,000 | 15,675,000 | ||||||||||
Vanguard Health Holding Co. II LLC, senior note, 8.00%, 2/01/18 | United States | 151,000,000 | 154,020,000 | ||||||||||
2,965,331,458 | |||||||||||||
Industrials 4.9% | |||||||||||||
e | American Airlines Inc., senior secured note, 144A, 10.50%, 10/15/12 | United States | 57,500,000 | 62,531,250 | |||||||||
e | Bombardier Inc., senior note, 144A, 7.75%, 3/15/20 | Canada | 50,000,000 | 54,375,000 | |||||||||
e | Case New Holland Inc., senior note, 144A, 7.875%, 12/01/17 | United States | 255,000,000 | 280,500,000 |
Franklin Income Fund | Country | Principal Amount* | Value | ||||||||||
Corporate Bonds (continued) | |||||||||||||
Industrials (continued) | |||||||||||||
e | Ceva Group PLC, senior secured note, 144A, | ||||||||||||
11.625%, 10/01/16 | United Kingdom | 11,800,000 | $ | 12,595,227 | |||||||||
11.50%, 4/01/18 | United Kingdom | 212,525,000 | 222,334,954 | ||||||||||
e,k | CHC Helicopter SA, senior secured note, 144A, 9.25%, 10/15/20 | Canada | 196,700,000 | 199,650,500 | |||||||||
e | Delta Air Lines Inc., senior secured note, 144A, 9.50%, 9/15/14 | United States | 61,178,000 | 66,684,020 | |||||||||
g | Diversey Holdings Inc., senior note, PIK, 10.50%, 5/15/20 | United States | 49,200,000 | 54,642,750 | |||||||||
Diversey Inc., senior note, 8.25%, 11/15/19 | United States | 30,000,000 | 32,250,000 | ||||||||||
Greenbrier Cos. Inc., senior note, 8.375%, 5/15/15 | United States | 31,706,000 | 30,913,350 | ||||||||||
Hertz Corp., | |||||||||||||
senior note, 8.875%, 1/01/14 | United States | 450,000,000 | 464,062,500 | ||||||||||
esenior note, 144A, 7.50%, 10/15/18 | United States | 73,900,000 | 74,269,500 | ||||||||||
senior sub. note, 10.50%, 1/01/16 | United States | 140,000,000 | 149,450,000 | ||||||||||
Icahn Enterprises LP, senior note, | |||||||||||||
7.75%, 1/15/16 | United States | 85,000,000 | 85,850,000 | ||||||||||
8.00%, 1/15/18 | United States | 30,000,000 | 30,300,000 | ||||||||||
e | Interactive Data Corp., senior note, 144A, 10.25%, 8/01/18 | United States | 39,100,000 | 42,032,500 | |||||||||
Manitowoc Co. Inc., senior note, 9.50%, 2/15/18 | United States | 63,800,000 | 66,990,000 | ||||||||||
Navistar International Corp., senior note, 8.25%, 11/01/21 | United States | 28,300,000 | 30,351,750 | ||||||||||
Nortek Inc., senior secured note, 11.00%, 12/01/13 | United States | 40,177,777 | 42,889,777 | ||||||||||
e | Pinafore LLC/Inc., senior secured note, 144A, 9.00%, 10/01/18 | United States | 35,700,000 | 37,663,500 | |||||||||
RBS Global & Rexnord Corp., | |||||||||||||
senior note, 8.50%, 5/01/18 | United States | 144,350,000 | 147,417,438 | ||||||||||
senior sub. note, 11.75%, 8/01/16 | United States | 97,000,000 | 104,275,000 | ||||||||||
RSC Equipment Rental Inc./RSC Holdings III LLC, | |||||||||||||
lsenior note, 10.25%, 11/15/19 | United States | 58,000,000 | 61,915,000 | ||||||||||
esenior secured note, 144A, 10.00%, 7/15/17 | United States | 30,000,000 | 33,525,000 | ||||||||||
e | Severstal Columbus LLC, senior secured note, 144A, 10.25%, 2/15/18 | United States | 15,000,000 | 15,825,000 | |||||||||
Terex Corp., senior sub. note, 8.00%, 11/15/17 | United States | 185,000,000 | 186,156,250 | ||||||||||
Transdigm Inc., senior sub. note, 7.75%, 7/15/14 | United States | 25,000,000 | 25,406,250 | ||||||||||
United Rentals North America Inc., senior sub. note, 7.75%, 11/15/13 | United States | 77,910,000 | 79,078,650 | ||||||||||
2,693,935,166 | |||||||||||||
Information Technology 5.3% | |||||||||||||
Advanced Micro Devices Inc., senior note, | |||||||||||||
8.125%, 12/15/17 | United States | 61,700,000 | 65,402,000 | ||||||||||
e144A, 7.75%, 8/01/20 | United States | 27,700,000 | 28,738,750 | ||||||||||
Ceridian Corp., senior note, 11.25%, 11/15/15 | United States | 75,000,000 | 69,562,500 | ||||||||||
First Data Corp., | |||||||||||||
senior note, 9.875%, 9/24/15 | United States | 799,822,000 | 655,904,930 | ||||||||||
senior sub. note, 11.25%, 3/31/16 | United States | 409,000,000 | 296,525,000 |
Franklin Income Fund | Country | Principal Amount* | Value | ||||||||||
Corporate Bonds (continued) | |||||||||||||
Information Technology (continued) | |||||||||||||
Freescale Semiconductor Inc., | |||||||||||||
senior note, 8.875%, 12/15/14 | United States | 490,000,000 | $ | 492,450,000 | |||||||||
senior note, 10.125%, 12/15/16 | United States | 205,000,000 | 187,575,000 | ||||||||||
esenior note, 144A, 10.75%, 8/01/20 | United States | 200,000,000 | 201,500,000 | ||||||||||
esenior secured note, 144A, 10.125%, 3/15/18 | United States | 90,000,000 | 96,075,000 | ||||||||||
esenior secured note, 144A, 9.25%, 4/15/18 | United States | 200,000,000 | 208,000,000 | ||||||||||
Lucent Technologies Inc., 6.45%, 3/15/29 | United States | 95,900,000 | 70,246,750 | ||||||||||
e | NXP BV/NXP Funding LLC, senior secured note, 144A, 9.75%, 8/01/18 | Netherlands | 61,800,000 | 66,126,000 | |||||||||
Sanmina-SCI Corp., senior sub. note, | |||||||||||||
6.75%, 3/01/13 | United States | 116,500,000 | 118,247,500 | ||||||||||
8.125%, 3/01/16 | United States | 100,000,000 | 103,000,000 | ||||||||||
SunGard Data Systems Inc., | |||||||||||||
senior note, 9.125%, 8/15/13 | United States | 35,000,000 | 35,918,750 | ||||||||||
senior note, 10.625%, 5/15/15 | United States | 55,000,000 | 61,600,000 | ||||||||||
senior sub. note, 10.25%, 8/15/15 | United States | 85,000,000 | 89,887,500 | ||||||||||
ViaSat Inc., senior note, 8.875%, 9/15/16 | United States | 49,250,000 | 53,251,562 | ||||||||||
2,900,011,242 | |||||||||||||
Materials 2.3% | |||||||||||||
e | Cemex Finance LLC, senior secured note, 144A, 9.50%, 12/14/16 | United States | 50,000,000 | 50,560,000 | |||||||||
Huntsman International LLC, | |||||||||||||
senior note, 5.50%, 6/30/16 | United States | 126,500,000 | 121,756,250 | ||||||||||
senior sub. note, 7.875%, 11/15/14 | United States | 58,400,000 | 60,882,000 | ||||||||||
senior sub. note, 7.375%, 1/01/15 | United States | 27,100,000 | 27,642,000 | ||||||||||
esenior sub. note, 144A, 8.625%, 3/15/21 | United States | 8,100,000 | 8,424,000 | ||||||||||
e | Ineos Finance PLC, senior secured note, 144A, 9.00%, 5/15/15 | United Kingdom | 30,600,000 | 32,130,000 | |||||||||
e | Ineos Group Holdings PLC, senior sub. note, 144A, 7.875%, 2/15/16 | United Kingdom | 190,000,000 | EUR | 216,982,847 | ||||||||
e | Kerling PLC, senior secured note, 144A, 10.625%, 1/28/17 | United Kingdom | 53,700,000 | EUR | 77,526,940 | ||||||||
e | LBI Escrow Corp., senior secured note, 144A, 8.00%, 11/01/17 | United States | 80,000,000 | 87,600,000 | |||||||||
Nalco Co., senior note, 8.25%, 5/15/17 | United States | 21,650,000 | 24,031,500 | ||||||||||
Nalco Finance Holdings LLC, senior note, 9.00%, 2/01/14 | United States | 380,000,000 | 390,450,000 | ||||||||||
NewPage Corp., senior secured note, | |||||||||||||
10.00%, 5/01/12 | United States | 52,800,000 | 26,400,000 | ||||||||||
11.375%, 12/31/14 | United States | 50,000,000 | 45,500,000 | ||||||||||
e | Reynolds Group Issuer Inc./LLCA, senior note, 144A, 8.50%, 5/15/18 | United States | 39,200,000 | 38,514,000 | |||||||||
United States Steel Corp., senior note, 7.375%, 4/01/20 | United States | 40,000,000 | 41,900,000 | ||||||||||
1,250,299,537 | |||||||||||||
Telecommunication Services 1.5% | |||||||||||||
e | Clearwire Communications LLC/Finance, senior secured note, 144A, 12.00%, 12/01/15 | United States | 50,000,000 | 54,000,000 | |||||||||
e | Clearwire Corp., senior secured note, 144A, 12.00%, 12/01/15 | United States | 145,000,000 | 156,962,500 | |||||||||
Cricket Communications Inc., | |||||||||||||
senior note, 9.375%, 11/01/14 | United States | 65,000,000 | 67,600,000 | ||||||||||
senior secured note, 7.75%, 5/15/16 | United States | 30,000,000 | 31,987,500 |
Franklin Income Fund | Country | Principal Amount* | Value | ||||||||||
Corporate Bonds (continued) | |||||||||||||
Telecommunication Services (continued) | |||||||||||||
e | Digicel Group Ltd., senior note, 144A, 8.875%, 1/15/15 | Jamaica | 61,900,000 | $ | 63,447,500 | ||||||||
Frontier Communications Corp., senior note, | |||||||||||||
7.875%, 4/15/15 | United States | 47,900,000 | 51,971,500 | ||||||||||
8.25%, 4/15/17 | United States | 57,975,000 | 63,700,031 | ||||||||||
8.50%, 4/15/20 | United States | 64,150,000 | 71,126,313 | ||||||||||
8.75%, 4/15/22 | United States | 63,900,000 | 70,609,500 | ||||||||||
Sprint Nextel Corp., senior note, 8.375%, 8/15/17 | United States | 80,200,000 | 87,418,000 | ||||||||||
Virgin Media Finance PLC, senior note, 1, 9.50%, 8/15/16 | United Kingdom | 74,800,000 | 84,898,000 | ||||||||||
803,720,844 | |||||||||||||
Utilities 4.8% | |||||||||||||
The AES Corp., senior note, 8.00%, 10/15/17 | United States | 80,000,000 | 86,800,000 | ||||||||||
e | Calpine Construction Finance, senior secured note, 144A, 8.00%, 6/01/16 | United States | 100,000,000 | 107,500,000 | |||||||||
e | Calpine Corp., senior secured note, 144A, | ||||||||||||
7.25%, 10/15/17 | United States | 21,000,000 | 21,472,500 | ||||||||||
7.875%, 7/31/20 | United States | 61,000,000 | 62,982,500 | ||||||||||
Dynegy Holdings Inc., senior note, | |||||||||||||
7.50%, 6/01/15 | United States | 198,500,000 | 157,311,250 | ||||||||||
8.375%, 5/01/16 | United States | 295,000,000 | 231,575,000 | ||||||||||
7.75%, 6/01/19 | United States | 105,000,000 | 72,450,000 | ||||||||||
e144A, 7.50%, 6/01/15 | United States | 150,000,000 | 118,125,000 | ||||||||||
Dynegy Roseton Danskammer Pass Through Trust, secured bond, B, 7.67%, 11/08/16 | United States | 64,500,000 | 59,823,750 | ||||||||||
Energy Future Holdings Corp., senior note, | |||||||||||||
10.875%, 11/01/17 | United States | 6,658,000 | 4,028,090 | ||||||||||
gPIK, 12.00%, 11/01/17 | United States | 77,000,000 | 35,394,590 | ||||||||||
R, 6.55%, 11/15/34 | United States | 141,515,000 | 54,483,275 | ||||||||||
e | Intergen NV, senior secured note, 144A, 9.00%, 6/30/17 | Netherlands | 80,000,000 | 85,000,000 | |||||||||
e | Niska Gas Storage U.S./Canada, senior note, 144A, 8.875%, 3/15/18 | United States | 75,000,000 | 80,625,000 | |||||||||
Public Service Co. of New Mexico, senior note, 7.95%, 5/15/18 | United States | 50,200,000 | 55,532,495 | ||||||||||
Reliant Energy Inc., senior note, | |||||||||||||
7.625%, 6/15/14 | United States | 150,000,000 | 149,250,000 | ||||||||||
7.875%, 6/15/17 | United States | 180,000,000 | 168,750,000 | ||||||||||
Texas Competitive Electric Holdings Co. LLC, senior note, | |||||||||||||
A, 10.25%, 11/01/15 | United States | 890,700,000 | 587,862,000 | ||||||||||
B, 10.25%, 11/01/15 | United States | 310,000,000 | 204,600,000 | ||||||||||
gPIK, 11.25%, 11/01/16 | United States | 450,000,000 | 251,537,850 | ||||||||||
2,595,103,300 | |||||||||||||
Total Corporate Bonds (Cost $27,005,893,865) | 28,219,018,221 | ||||||||||||
f,m | Senior Floating Rate Interests 5.8% | ||||||||||||
Consumer Discretionary 1.7% | |||||||||||||
Clear Channel Communications Inc., Term Loan B, 3.906%, 1/29/16 | United States | 537,786,283 | 425,590,619 | ||||||||||
b | Dex Media West LLC, Term Loan B, 7.00%, 10/24/14 | United States | 6,393,713 | 5,574,078 | |||||||||
Harrah’s Operating Co. Inc., Incremental Term Loan, 9.50%, 10/01/16 | United States | 99,250,000 | 101,928,857 |
Franklin Income Fund | Country | Principal Amount* | Value | ||||||||||
f,m | Senior Floating Rate Interests (continued) | ||||||||||||
Consumer Discretionary (continued) | |||||||||||||
Jarden Corp., Term Loan B-3, 2.283%, 1/24/12 | United States | 18,518,835 | $ | 18,455,093 | |||||||||
b | R.H. Donnelley Inc., Term Loan B, 9.00%, 10/24/14 | United States | 37,206,015 | 31,744,693 | |||||||||
SuperMedia Inc., Exit Term Loan, 11.00%, 12/31/15 | United States | 24,963,302 | 19,507,048 | ||||||||||
Univision Communications Inc., Initial Term Loan, 2.065% - 2.506%, 9/29/14 | United States | 19,747,651 | 17,349,891 | ||||||||||
Visant Corp. (Jostens), Tranche B Term Loan, 7.00%, 12/22/16 | United States | 300,000,000 | 302,040,000 | ||||||||||
922,190,279 | |||||||||||||
Financials 0.1% | |||||||||||||
k | iStar Financial Inc., 2nd Lien Term Loan, 3.25%, 6/28/11 | United States | 45,000,000 | 42,041,250 | |||||||||
Industrials 0.7% | |||||||||||||
Allison Transmission Inc., Term Loan B, 3.01% - 3.05%, 8/07/14 | United States | 97,713,223 | 91,942,085 | ||||||||||
Altegrity Inc., | |||||||||||||
Term Loan B, 3.292%, 2/21/15 | United States | 96,768,652 | 89,027,160 | ||||||||||
Tranche D Term Loan, 7.75%, 2/21/15 | United States | 60,000,000 | 60,112,500 | ||||||||||
Ceva Group PLC, | |||||||||||||
Dollar Pre-Refunded L/C Commitment, 3.289%, 8/01/12 | United States | 13,684,211 | 12,230,263 | ||||||||||
EGL Term Loans, 3.256%, 8/01/12 | United States | 112,535,526 | 101,141,305 | ||||||||||
Interactive Data Corp., Term Loan B, 6.75%, 1/29/17 | United States | 54,862,500 | 55,645,223 | ||||||||||
410,098,536 | |||||||||||||
Information Technology 1.3% | |||||||||||||
k | First Data Corp., | ||||||||||||
Term Loan B-1, 3.006%, 9/24/14 | United States | 69,805,136 | 61,620,484 | ||||||||||
Term Loan B-2, 3.006%, 9/24/14 | United States | 301,928,548 | 266,414,202 | ||||||||||
Term Loan B-3, 3.006%, 9/24/14 | United States | 357,170,841 | 315,157,906 | ||||||||||
Freescale Semiconductor Inc., Extended Term Loan, 4.509%, 12/01/16 | United States | 61,845,379 | 56,691,618 | ||||||||||
699,884,210 | |||||||||||||
Materials 0.1% | |||||||||||||
Novelis Corp., U.S. Term Loan, 2.26%, 7/07/14 | United States | 62,627,806 | 60,748,972 | ||||||||||
Utilities 1.9% | |||||||||||||
k | Texas Competitive Electric Holdings Co. LLC, | ||||||||||||
Term Loan, 3.25%, 10/10/14 | United States | 269,911,625 | 208,750,460 | ||||||||||
Term Loan B-1, 3.758% - 3.789%, 10/10/14 | United States | 316,293,749 | 246,204,003 | ||||||||||
Term Loan B-2, 3.758% - 4.066%, 10/10/14 | United States | 317,915,998 | 247,422,576 | ||||||||||
Term Loan B-3, 3.758% - 3.789%, 10/10/14 | United States | 412,374,678 | 319,991,204 | ||||||||||
1,022,368,243 | |||||||||||||
Total Senior Floating Rate Interests (Cost $3,376,194,713) | 3,157,331,490 | ||||||||||||
Municipal Bonds (Cost $180,206,433) 0.3% | |||||||||||||
California State GO, 7.95%, 3/01/36 | United States | 180,000,000 | 193,158,000 | ||||||||||
Total Investments before Short Term Investments (Cost $53,539,947,997) | 53,027,146,426 | ||||||||||||
Franklin Income Fund | Country | Principal Amount* | Value | ||||||||||
Short Term Investments 2.3% | |||||||||||||
U.S. Government and Agency Securities 0.8% | |||||||||||||
n | FHLB 10/01/10 - 10/05/10 | United States | 398,383,000 | $ | 398,382,000 | ||||||||
n | FNMA, 10/04/10 | United States | 35,000,000 | 34,999,755 | |||||||||
Total U.S. Government and Agency Securities (Cost $433,381,470) | 433,381,755 | ||||||||||||
Total Investments before Money Market Funds and Repurchase Agreements (Cost $53,973,329,467) | 53,460,528,181 | ||||||||||||
Shares | |||||||||||||
Money Market Funds (Cost $330,912,398) 0.6% | |||||||||||||
a,o | Institutional Fiduciary Trust Money Market Portfolio, 0.00% | United States | 330,912,398 | 330,912,398 | |||||||||
Investments from Cash Collateral Received for Loaned Securities 0.0%† | |||||||||||||
Money Market Funds 0.0%† | |||||||||||||
a | Bank of New York Institutional Cash Reserve Fund, Series B | United States | 451,668 | 361,334 | |||||||||
p | BNY Mellon Overnight Government Fund, 0.23% | United States | 4,874,000 | 4,874,000 | |||||||||
Total Investments from Cash Collateral Received for Loaned Securities (Cost $5,325,668) | 5,235,334 | ||||||||||||
Principal Amount* | |||||||||||||
Repurchase Agreements (Cost $490,186,154) 0.9% | |||||||||||||
q | Joint Repurchase Agreement, 0.205%, 10/01/10 (Maturity Value $490,188,945) | United States | 490,186,154 | 490,186,154 | |||||||||
Banc of America Securities LLC (Maturity Value $59,685,406) | |||||||||||||
Barclays Capital Inc. (Maturity Value $27,852,536) | |||||||||||||
BNP Paribas Securities Corp. (Maturity Value $103,454,377) | |||||||||||||
Credit Suisse Securities (USA) LLC (Maturity Value $99,483,846) | |||||||||||||
Deutsche Bank Securities Inc. (Maturity Value $40,553,331) | |||||||||||||
HSBC Securities (USA) Inc. (Maturity Value $59,685,406) | |||||||||||||
Morgan Stanley & Co. Inc. (Maturity Value $59,685,406) | |||||||||||||
UBS Securities LLC (Maturity Value $39,788,637) | |||||||||||||
Collateralized by U.S. Government Agency Securities, 0.146% - 6.25%, 2/01/11 - 4/18/17; n U.S. Government Agency Discount Notes, 1/14/11 - 2/28/14 and U.S. Treasury Notes, 0.875% - 10.625%, 2/28/11 - 8/15/15 | |||||||||||||
Total Investments (Cost $54,799,753,687) 99.6% | 54,286,862,067 | ||||||||||||
Other Assets, less Liabilities 0.4% | 217,733,378 | ||||||||||||
Net Assets 100.0% | $ | 54,504,595,445 | |||||||||||
Contracts | |||||||||||||
Options Written (Premium Received $40,999) 0.0% | |||||||||||||
Call Options 0.0% | |||||||||||||
Financials 0.0% | |||||||||||||
Wells Fargo & Co., Oct. $35 Calls, 10/16/10 | United States | 1,000 | $ | — |
* | The principal amount is stated in U.S. dollars unless otherwise indicated. | |
† | Rounds to less than 0.1% of net assets. | |
a | Non-income producing. | |
b | See Note 10 regarding holdings of 5% voting securities. | |
c | A portion or all of the security is held in connection with written option contracts open at year end. | |
d | See Note 1(f) regarding equity-linked securities. | |
e | Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in a public offering registered under the Securities Act of 1933. These securities have been deemed liquid under guidelines approved by the Trust’s Board of Trustees. At September 30, 2010, the aggregate value of these securities was $8,981,768,999, representing 16.48% of net assets. | |
f | The coupon rate shown represents the rate at period end. | |
g | Income may be received in additional securities and/or cash. | |
h | See Note 8 regarding defaulted securities. | |
i | Security has been deemed illiquid because it may not be able to be sold within seven days. At September 30, 2010, the value of this security was $94,587,070, representing 0.17% of net assets. | |
j | Perpetual security with no stated maturity date. | |
k | A portion or all of the security purchased on a when-issued or delayed delivery basis. See Note 1(d). | |
l | A portion or all of the security is on loan at September 30, 2010. See Note 1(g). | |
m | See Note 1(h) regarding senior floating rate interests. | |
n | The security is traded on a discount basis with no stated coupon rate. | |
o | See Note 7 regarding investments in the Institutional Fiduciary Trust Money Market Portfolio. The rate shown is the annualized seven-day yield at period end. | |
p | The rate shown is the annualized seven-day yield at period end. | |
q | See Note 1(c) regarding joint repurchase agreement. |
Year Ended September 30, | ||||||||||||||||||||
Class A | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 6.69 | $ | 6.45 | $ | 6.39 | $ | 6.43 | $ | 6.53 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.25 | 0.27 | 0.30 | 0.31 | 0.30 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.14 | 0.27 | 0.08 | (0.02 | ) | (0.09 | ) | |||||||||||||
Total from investment operations | 0.39 | 0.54 | 0.38 | 0.29 | 0.21 | |||||||||||||||
Less distributions from net investment income | (0.27 | ) | (0.30 | ) | (0.32 | ) | (0.33 | ) | (0.31 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 6.81 | $ | 6.69 | $ | 6.45 | $ | 6.39 | $ | 6.43 | ||||||||||
Total returne | 5.94 | % | 8.50 | % | 6.00 | % | 4.63 | % | 3.40 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 0.73 | % | 0.73 | %f | 0.72 | %f | 0.72 | %f | 0.72 | %f | ||||||||||
Net investment income | 3.70 | % | 4.11 | % | 4.64 | % | 4.78 | % | 4.64 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 6,771,471 | $ | 6,275,792 | $ | 5,353,961 | $ | 5,073,449 | $ | 5,291,117 | ||||||||||
Portfolio turnover rate | 47.41 | % | 34.74 | % | 21.66 | % | 12.34 | % | 20.54 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class B | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 6.68 | $ | 6.44 | $ | 6.38 | $ | 6.42 | $ | 6.52 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.22 | 0.24 | 0.27 | 0.27 | 0.26 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.13 | 0.26 | 0.07 | (0.01 | ) | (0.08 | ) | |||||||||||||
Total from investment operations | 0.35 | 0.50 | 0.34 | 0.26 | 0.18 | |||||||||||||||
Less distributions from net investment income | (0.23 | ) | (0.26 | ) | (0.28 | ) | (0.30 | ) | (0.28 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 6.80 | $ | 6.68 | $ | 6.44 | $ | 6.38 | $ | 6.42 | ||||||||||
Total returne | 5.39 | % | 7.79 | % | 5.61 | % | 4.10 | % | 2.87 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.23 | % | 1.24 | %f | 1.24 | %f | 1.25 | %f | 1.24 | %f | ||||||||||
Net investment income | 3.20 | % | 3.60 | % | 4.12 | % | 4.25 | % | 4.12 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 126,803 | $ | 230,575 | $ | 284,649 | $ | 316,720 | $ | 388,807 | ||||||||||
Portfolio turnover rate | 47.41 | % | 34.74 | % | 21.66 | % | 12.34 | % | 20.54 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class C | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 6.66 | $ | 6.42 | $ | 6.36 | $ | 6.40 | $ | 6.50 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.21 | 0.23 | 0.27 | 0.27 | 0.26 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.14 | 0.27 | 0.07 | (0.01 | ) | (0.08 | ) | |||||||||||||
Total from investment operations | 0.35 | 0.50 | 0.34 | 0.26 | 0.18 | |||||||||||||||
Less distributions from net investment income | (0.24 | ) | (0.26 | ) | (0.28 | ) | (0.30 | ) | (0.28 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 6.77 | $ | 6.66 | $ | 6.42 | $ | 6.36 | $ | 6.40 | ||||||||||
Total returne | 5.28 | % | 8.01 | % | 5.48 | % | 4.12 | % | 2.88 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.24 | % | 1.24 | %f | 1.24 | %f | 1.25 | %f | 1.23 | %f | ||||||||||
Net investment income | 3.19 | % | 3.60 | % | 4.12 | % | 4.25 | % | 4.13 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 2,484,847 | $ | 1,464,614 | $ | 610,148 | $ | 418,951 | $ | 424,462 | ||||||||||
Portfolio turnover rate | 47.41 | % | 34.74 | % | 21.66 | % | 12.34 | % | 20.54 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class R | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 6.69 | $ | 6.45 | $ | 6.39 | $ | 6.43 | $ | 6.53 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.23 | 0.25 | 0.28 | 0.28 | 0.27 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.13 | 0.26 | 0.07 | (0.01 | ) | (0.08 | ) | |||||||||||||
Total from investment operations | 0.36 | 0.51 | 0.35 | 0.27 | 0.19 | |||||||||||||||
Less distributions from net investment income | (0.24 | ) | (0.27 | ) | (0.29 | ) | (0.31 | ) | (0.29 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 6.81 | $ | 6.69 | $ | 6.45 | $ | 6.39 | $ | 6.43 | ||||||||||
Total returne | 5.55 | % | 8.12 | % | 5.61 | % | 4.25 | % | 3.01 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.09 | % | 1.09 | %f | 1.09 | %f | 1.10 | %f | 1.09 | %f | ||||||||||
Net investment income | 3.34 | % | 3.75 | % | 4.27 | % | 4.40 | % | 4.27 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 140,147 | $ | 138,548 | $ | 104,648 | $ | 74,537 | $ | 71,104 | ||||||||||
Portfolio turnover rate | 47.41 | % | 34.74 | % | 21.66 | % | 12.34 | % | 20.54 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Advisor Class | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 6.71 | $ | 6.47 | $ | 6.41 | $ | 6.45 | $ | 6.55 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.26 | 0.28 | 0.31 | 0.31 | 0.31 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.14 | 0.27 | 0.08 | (0.01 | ) | (0.09 | ) | |||||||||||||
Total from investment operations | 0.40 | 0.55 | 0.39 | 0.30 | 0.22 | |||||||||||||||
Less distributions from net investment income | (0.28 | ) | (0.31 | ) | (0.33 | ) | (0.34 | ) | (0.32 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 6.83 | $ | 6.71 | $ | 6.47 | $ | 6.41 | $ | 6.45 | ||||||||||
Total return | 6.06 | % | 8.63 | % | 6.11 | % | 4.75 | % | 3.53 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 0.59 | % | 0.59 | %e | 0.59 | %e | 0.60 | %e | 0.59 | %e | ||||||||||
Net investment income | 3.84 | % | 4.25 | % | 4.77 | % | 4.90 | % | 4.77 | % | ||||||||||
Supplemental data | �� | |||||||||||||||||||
Net assets, end of year (000’s) | $ | 1,193,213 | $ | 863,951 | $ | 612,026 | $ | 470,751 | $ | 387,239 | ||||||||||
Portfolio turnover rate | 47.41 | % | 34.74 | % | 21.66 | % | 12.34 | % | 20.54 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Benefit of expense reduction rounds to less than 0.01%. |
Franklin U.S. Government Securities Fund | Principal Amount | Value | |||||||
Mortgage-Backed Securities 99.1% | |||||||||
Government National Mortgage Association (GNMA) Fixed Rate 99.1% | |||||||||
GNMA GP 30 Year, 8.25%, 3/15/17 - 10/15/17 | $ | 85,192 | $ | 94,627 | |||||
GNMA GP 30 Year, 9.25%, 5/15/16 - 12/15/16 | 187,882 | 204,126 | |||||||
GNMA GP 30 Year, 11.25%, 7/15/13 - 12/15/15 | 110,902 | 119,696 | |||||||
GNMA GP 30 Year, 11.50%, 2/15/13 - 5/15/13 | 15,329 | 15,482 | |||||||
GNMA GP 30 Year, 11.75%, 7/15/13 - 8/15/13 | 11,778 | 11,898 | |||||||
GNMA GP 30 Year, 12.75%, 5/15/14 | 3,296 | 3,332 | |||||||
GNMA I SF 15 Year, 6.50%, 5/15/18 | 638,720 | 662,937 | |||||||
a | GNMA I SF 30 Year, 4.50%, 1/15/39 - 8/15/40 | 2,177,065,460 | 2,295,764,910 | ||||||
GNMA I SF 30 Year, 4.50%, 8/15/40 | 180,006,866 | 189,788,920 | |||||||
GNMA I SF 30 Year, 5.00%, 8/15/39 | 165,801,680 | 176,838,747 | |||||||
GNMA I SF 30 Year, 5.00%, 2/15/33 - 6/15/40 | 2,217,634,303 | 2,371,302,036 | |||||||
GNMA I SF 30 Year, 5.50%, 2/15/39 | 119,288,336 | 128,433,561 | |||||||
GNMA I SF 30 Year, 5.50%, 5/15/28 - 2/15/40 | 1,250,254,794 | 1,350,099,666 | |||||||
GNMA I SF 30 Year, 6.00%, 10/15/23 - 2/15/39 | 886,043,857 | 967,803,210 | |||||||
GNMA I SF 30 Year, 6.00%, 12/15/39 | 100,076,565 | 108,779,075 | |||||||
GNMA I SF 30 Year, 6.50%, 5/15/23 - 8/15/37 | 215,528,777 | 240,857,326 | |||||||
GNMA I SF 30 Year, 6.75%, 3/15/26 | 37,865 | 43,002 | |||||||
GNMA I SF 30 Year, 7.00%, 4/15/16 - 9/15/32 | 132,718,245 | 151,199,123 | |||||||
GNMA I SF 30 Year, 7.25%, 11/15/25 - 1/15/26 | 461,487 | 523,431 | |||||||
GNMA I SF 30 Year, 7.50%, 7/15/16 - 8/15/33 | 42,476,915 | 48,540,025 | |||||||
GNMA I SF 30 Year, 7.70%, 1/15/21 - 1/15/22 | 301,598 | 346,725 | |||||||
GNMA I SF 30 Year, 8.00%, 11/15/15 - 9/15/30 | 25,406,221 | 28,860,347 | |||||||
GNMA I SF 30 Year, 8.50%, 5/15/16 - 6/15/25 | 5,540,714 | 6,351,198 | |||||||
GNMA I SF 30 Year, 9.00%, 11/15/15 - 7/15/23 | 6,833,744 | 7,692,282 | |||||||
GNMA I SF 30 Year, 9.50%, 5/15/16 - 8/15/22 | 4,229,182 | 4,826,121 | |||||||
GNMA I SF 30 Year, 10.00%, 2/15/16 - 3/15/25 | 5,492,131 | 6,183,566 | |||||||
GNMA I SF 30 Year, 10.50%, 2/15/12 - 10/15/21 | 4,121,781 | 4,556,591 | |||||||
GNMA I SF 30 Year, 11.00%, 10/15/10 - 5/15/21 | 2,420,905 | 2,623,292 | |||||||
GNMA I SF 30 Year, 11.50%, 3/15/13 - 2/15/16 | 647,766 | 673,493 | |||||||
GNMA I SF 30 Year, 12.00%, 5/15/11 - 1/15/18 | 3,252,293 | 3,374,908 | |||||||
GNMA I SF 30 Year, 12.50%, 11/15/10 - 1/15/16 | 1,834,554 | 1,907,468 | |||||||
GNMA I SF 30 Year, 13.00%, 1/15/11 - 9/15/15 | 2,013,823 | 2,075,411 | |||||||
GNMA II GP 30 Year, 8.75%, 3/20/17 - 7/20/17 | 34,485 | 37,611 | |||||||
GNMA II GP 30 Year, 11.50%, 8/20/13 | 8,495 | 8,578 | |||||||
GNMA II SF 30 Year, 4.50%, 12/20/39 | 133,370,088 | 140,786,205 | |||||||
GNMA II SF 30 Year, 4.50%, 5/20/33 - 9/20/40 | 356,304,401 | 376,399,243 | |||||||
GNMA II SF 30 Year, 5.00%, 9/20/33 | 133,664,973 | 143,686,372 | |||||||
GNMA II SF 30 Year, 5.00%, 7/20/33 - 5/20/40 | 328,258,514 | 351,706,598 | |||||||
GNMA II SF 30 Year, 5.00%, 6/20/40 | 105,682,870 | 112,932,095 | |||||||
GNMA II SF 30 Year, 5.50%, 6/20/34 - 4/20/40 | 627,407,100 | 676,508,499 | |||||||
GNMA II SF 30 Year, 6.00%, 10/20/23 - 7/20/39 | 469,438,705 | 511,338,071 | |||||||
GNMA II SF 30 Year, 6.50%, 6/20/24 - 1/20/39 | 147,591,157 | 163,017,138 | |||||||
GNMA II SF 30 Year, 7.00%, 2/20/28 - 7/20/33 | 24,047,951 | 27,352,520 | |||||||
GNMA II SF 30 Year, 7.50%, 10/20/22 - 4/20/32 | 4,524,388 | 5,149,022 | |||||||
GNMA II SF 30 Year, 8.00%, 8/20/16 - 6/20/30 | 2,245,570 | 2,597,601 | |||||||
GNMA II SF 30 Year, 8.50%, 4/20/16 - 6/20/25 | 1,132,243 | 1,295,994 | |||||||
GNMA II SF 30 Year, 9.00%, 8/20/16 - 11/20/21 | 333,609 | 378,991 | |||||||
GNMA II SF 30 Year, 9.50%, 3/20/18 - 4/20/25 | 227,008 | 262,639 |
Franklin U.S. Government Securities Fund | Principal Amount | Value | |||||||
Mortgage-Backed Securities (continued) | |||||||||
Government National Mortgage Association (GNMA) Fixed Rate (continued) | |||||||||
GNMA II SF 30 Year, 10.00%, 8/20/15 - 3/20/21 | $ | 430,651 | $ | 497,910 | |||||
GNMA II SF 30 Year, 10.50%, 8/20/14 - 3/20/21 | 1,110,607 | 1,238,637 | |||||||
GNMA II SF 30 Year, 11.00%, 8/20/13 - 1/20/21 | 177,308 | 197,779 | |||||||
GNMA II SF 30 Year, 11.50%, 9/20/13 - 2/20/18 | 92,602 | 98,334 | |||||||
GNMA II SF 30 Year, 12.00%, 9/20/13 - 2/20/16 | 149,238 | 160,473 | |||||||
GNMA II SF 30 Year, 12.50%, 10/20/13 - 11/20/15 | 100,926 | 110,167 | |||||||
GNMA II SF 30 Year, 13.00%, 10/20/13 - 9/20/15 | 73,289 | 79,674 | |||||||
Total Mortgage-Backed Securities (Cost $10,164,106,856) | 10,616,396,683 | ||||||||
Shares | |||||||||
Short Term Investments (Cost $112,396,476) 1.0% | |||||||||
Money Market Funds 1.0% | |||||||||
b,c | Institutional Fiduciary Trust Money Market Portfolio, 0.00% | 112,396,476 | 112,396,476 | ||||||
Total Investments (Cost $10,276,503,332) 100.1% | 10,728,793,159 | ||||||||
Other Assets, less Liabilities (0.1)% | (12,312,681 | ) | |||||||
Net Assets 100.0% | $ | 10,716,480,478 | |||||||
a | A portion or all of the security purchased on a TBA basis. See Note 1(d). | |
b | Non-income producing. | |
c | See Note 7 regarding investments in the Institutional Fiduciary Trust Money Market Portfolio. The rate shown is the annualized seven-day yield at period end. |
Year Ended September 30, | ||||||||||||||||||||
Class A | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 10.74 | $ | 11.92 | $ | 14.58 | $ | 12.89 | $ | 12.59 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.43 | 0.43 | 0.41 | 0.40 | 0.43 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.88 | (1.11 | ) | (1.93 | ) | 2.16 | 0.37 | |||||||||||||
Total from investment operations | 1.31 | (0.68 | ) | (1.52 | ) | 2.56 | 0.80 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.45 | ) | (0.42 | ) | (0.40 | ) | (0.40 | ) | (0.41 | ) | ||||||||||
Net realized gains | (0.16 | ) | (0.08 | ) | (0.74 | ) | (0.47 | ) | (0.09 | ) | ||||||||||
Total distributions | (0.61 | ) | (0.50 | ) | (1.14 | ) | (0.87 | ) | (0.50 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 11.44 | $ | 10.74 | $ | 11.92 | $ | 14.58 | $ | 12.89 | ||||||||||
Total returne | 12.69 | % | (5.20 | )% | (11.63 | )% | 20.32 | % | 6.69 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 0.78 | % | 0.80 | %f | 0.74 | %f | 0.75 | %f | 0.76 | %f | ||||||||||
Net investment income | 3.91 | % | 4.29 | % | 2.92 | % | 2.83 | % | 3.54 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 1,823,972 | $ | 1,543,060 | $ | 1,769,397 | $ | 2,157,614 | $ | 1,926,732 | ||||||||||
Portfolio turnover rate | 5.27 | % | 15.49 | % | 8.32 | % | 10.84 | % | 7.97 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class B | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 10.74 | $ | 11.91 | $ | 14.56 | $ | 12.88 | $ | 12.57 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.37 | 0.38 | 0.33 | 0.33 | 0.37 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.88 | (1.10 | ) | (1.91 | ) | 2.15 | 0.38 | |||||||||||||
Total from investment operations | 1.25 | (0.72 | ) | (1.58 | ) | 2.48 | 0.75 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.39 | ) | (0.37 | ) | (0.33 | ) | (0.33 | ) | (0.35 | ) | ||||||||||
Net realized gains | (0.16 | ) | (0.08 | ) | (0.74 | ) | (0.47 | ) | (0.09 | ) | ||||||||||
Total distributions | (0.55 | ) | (0.45 | ) | (1.07 | ) | (0.80 | ) | (0.44 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 11.44 | $ | 10.74 | $ | 11.91 | $ | 14.56 | $ | 12.88 | ||||||||||
Total returne | 12.10 | % | (5.65 | )% | (12.04 | )% | 19.66 | % | 6.25 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.28 | % | 1.30 | %f | 1.24 | %f | 1.26 | %f | 1.26 | %f | ||||||||||
Net investment income | 3.41 | % | 3.79 | % | 2.42 | % | 2.32 | % | 3.04 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 50,439 | $ | 64,176 | $ | 92,695 | $ | 127,587 | $ | 133,824 | ||||||||||
Portfolio turnover rate | 5.27 | % | 15.49 | % | 8.32 | % | 10.84 | % | 7.97 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | |||||||||||||||||||||
Class C | 2010 | 2009 | 2008 | 2007 | 2006 | ||||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | |||||||||||||||||||||
Net asset value, beginning of year | $ | 10.71 | $ | 11.88 | $ | 14.53 | $ | 12.85 | $ | 12.55 | |||||||||||
Income from investment operationsa: | |||||||||||||||||||||
Net investment incomeb | 0.37 | 0.38 | 0.33 | 0.33 | 0.37 | ||||||||||||||||
Net realized and unrealized gains (losses) | 0.88 | (1.10 | ) | (1.91 | ) | 2.15 | 0.37 | ||||||||||||||
Total from investment operations | 1.25 | (0.72 | ) | (1.58 | ) | 2.48 | 0.74 | ||||||||||||||
Less distributions from: | |||||||||||||||||||||
Net investment income | (0.40 | ) | (0.37 | ) | (0.33 | ) | (0.33 | ) | (0.35 | ) | |||||||||||
Net realized gains | (0.16 | ) | (0.08 | ) | (0.74 | ) | (0.47 | ) | (0.09 | ) | |||||||||||
Total distributions | (0.56 | ) | (0.45 | ) | (1.07 | ) | (0.80 | ) | (0.44 | ) | |||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | |||||||||||||
Net asset value, end of year | $ | 11.40 | $ | 10.71 | $ | 11.88 | $ | 14.53 | $ | 12.85 | |||||||||||
Total returne | 12.08 | % | (5.64 | )% | (12.06 | )% | 19.72 | % | 6.19 | % | |||||||||||
Ratios to average net assets | |||||||||||||||||||||
Expenses | 1.28 | % | 1.30 | %f | 1.24 | %f | 1.26 | %f | 1.25 | %f | |||||||||||
Net investment income | 3.41 | % | 3.79 | % | 2.42 | % | 2.32 | % | 3.05 | % | |||||||||||
Supplemental data | |||||||||||||||||||||
Net assets, end of year (000’s) | $ | 405,024 | $ | 300,544 | $ | 339,247 | $ | 424,977 | $ | 391,509 | |||||||||||
Portfolio turnover rate | 5.27 | % | 15.49 | % | 8.32 | % | 10.84 | % | 7.97 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Class R | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 10.71 | $ | 11.89 | $ | 14.54 | $ | 12.86 | $ | 12.57 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.39 | 0.40 | 0.36 | 0.35 | 0.39 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.88 | (1.11 | ) | (1.92 | ) | 2.16 | 0.36 | |||||||||||||
Total from investment operations | 1.27 | (0.71 | ) | (1.56 | ) | 2.51 | 0.75 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.41 | ) | (0.39 | ) | (0.35 | ) | (0.36 | ) | (0.37 | ) | ||||||||||
Net realized gains | (0.16 | ) | (0.08 | ) | (0.74 | ) | (0.47 | ) | (0.09 | ) | ||||||||||
Total distributions | (0.57 | ) | (0.47 | ) | (1.09 | ) | (0.83 | ) | (0.46 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 11.41 | $ | 10.71 | $ | 11.89 | $ | 14.54 | $ | 12.86 | ||||||||||
Total returne | 12.33 | % | (5.57 | )% | (11.92 | )% | 19.92 | % | 6.29 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 1.13 | % | 1.15 | %f | 1.09 | %f | 1.11 | %f | 1.11 | %f | ||||||||||
Net investment income | 3.56 | % | 3.94 | % | 2.57 | % | 2.47 | % | 3.19 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 42,285 | $ | 37,795 | $ | 36,596 | $ | 41,845 | $ | 27,736 | ||||||||||
Portfolio turnover rate | 5.27 | % | 15.49 | % | 8.32 | % | 10.84 | % | 7.97 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Total return does not reflect sales commissions or contingent deferred sales charges, if applicable. | |
f | Benefit of expense reduction rounds to less than 0.01%. |
Year Ended September 30, | ||||||||||||||||||||
Advisor Class | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Per share operating performance (for a share outstanding throughout the year) | ||||||||||||||||||||
Net asset value, beginning of year | $ | 10.79 | $ | 11.98 | $ | 14.64 | $ | 12.95 | $ | 12.64 | ||||||||||
Income from investment operationsa: | ||||||||||||||||||||
Net investment incomeb | 0.45 | 0.45 | 0.42 | 0.42 | 0.45 | |||||||||||||||
Net realized and unrealized gains (losses) | 0.89 | (1.12 | ) | (1.92 | ) | 2.17 | 0.38 | |||||||||||||
Total from investment operations | 1.34 | (0.67 | ) | (1.50 | ) | 2.59 | 0.83 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | (0.47 | ) | (0.44 | ) | (0.42 | ) | (0.43 | ) | (0.43 | ) | ||||||||||
Net realized gains | (0.16 | ) | (0.08 | ) | (0.74 | ) | (0.47 | ) | (0.09 | ) | ||||||||||
Total distributions | (0.63 | ) | (0.52 | ) | (1.16 | ) | (0.90 | ) | (0.52 | ) | ||||||||||
Redemption feesc | — | — | — | d | — | d | — | d | ||||||||||||
Net asset value, end of year | $ | 11.50 | $ | 10.79 | $ | 11.98 | $ | 14.64 | $ | 12.95 | ||||||||||
Total return | 12.89 | % | (5.12 | )% | (11.45 | )% | 20.43 | % | 6.88 | % | ||||||||||
Ratios to average net assets | ||||||||||||||||||||
Expenses | 0.63 | % | 0.65 | %e | 0.59 | %e | 0.61 | %e | 0.61 | %e | ||||||||||
Net investment income | 4.06 | % | 4.44 | % | 3.07 | % | 2.97 | % | 3.69 | % | ||||||||||
Supplemental data | ||||||||||||||||||||
Net assets, end of year (000’s) | $ | 222,788 | $ | 124,454 | $ | 58,817 | $ | 86,823 | $ | 103,041 | ||||||||||
Portfolio turnover rate | 5.27 | % | 15.49 | % | 8.32 | % | 10.84 | % | 7.97 | % |
a | The amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Fund shares in relation to income earned and/or fluctuating market value of the investments of the Fund. | |
b | Based on average daily shares outstanding. | |
c | Effective September 1, 2008, the redemption fee was eliminated. | |
d | Amount rounds to less than $0.01 per share. | |
e | Benefit of expense reduction rounds to less than 0.01%. |
Franklin Utilities Fund | Country | Shares | Value | ||||||||
Common Stocks 95.4% | |||||||||||
Diversified Telecommunication Services 2.4% | |||||||||||
AT&T Inc. | United States | 1,200,000 | $ | 34,320,000 | |||||||
Frontier Communications Corp. | United States | 192,031 | 1,568,893 | ||||||||
Verizon Communications Inc. | United States | 800,000 | 26,072,000 | ||||||||
61,960,893 | |||||||||||
Electric Utilities 48.4% | |||||||||||
Allegheny Energy Inc. | United States | 1,100,000 | 26,972,000 | ||||||||
American Electric Power Co. Inc. | United States | 2,500,000 | 90,575,000 | ||||||||
Cleco Corp. | United States | 1,000,000 | 29,620,000 | ||||||||
Duke Energy Corp. | United States | 3,800,000 | 67,298,000 | ||||||||
Edison International | United States | 2,400,000 | 82,536,000 | ||||||||
Entergy Corp. | United States | 1,300,000 | 99,489,000 | ||||||||
Exelon Corp. | United States | 1,800,000 | 76,644,000 | ||||||||
FirstEnergy Corp. | United States | 1,700,000 | 65,518,000 | ||||||||
Great Plains Energy Inc. | United States | 1,400,000 | 26,460,000 | ||||||||
Hawaiian Electric Industries Inc. | United States | 600,000 | 13,524,000 | ||||||||
NextEra Energy Inc. | United States | 1,400,000 | 76,146,000 | ||||||||
Northeast Utilities | United States | 900,000 | 26,613,000 | ||||||||
NV Energy Inc. | United States | 5,600,000 | 73,640,000 | ||||||||
Pinnacle West Capital Corp. | United States | 1,200,000 | 49,524,000 | ||||||||
PNM Resources Inc. | United States | 3,300,000 | 37,587,000 | ||||||||
Portland General Electric Co. | United States | 1,100,000 | 22,308,000 | ||||||||
PPL Corp. | United States | 3,030,800 | 82,528,684 | ||||||||
Progress Energy Inc. | United States | 1,700,000 | 75,514,000 | ||||||||
Scottish and Southern Energy PLC | United Kingdom | 1,500,000 | 26,402,039 | ||||||||
The Southern Co. | United States | 3,200,000 | 119,168,000 | ||||||||
UIL Holdings Corp. | United States | 1,360,000 | 38,297,600 | ||||||||
Westar Energy Inc. | United States | 1,080,600 | 26,182,938 | ||||||||
1,232,547,261 | |||||||||||
Gas Utilities 0.6% | |||||||||||
Questar Corp. | United States | 800,000 | 14,024,000 | ||||||||
Independent Power Producers & Energy Traders 2.3% | |||||||||||
Constellation Energy Group | United States | 1,800,000 | 58,032,000 | ||||||||
Multi-Utilities 37.2% | |||||||||||
Alliant Energy Corp. | United States | 1,500,000 | 54,525,000 | ||||||||
Ameren Corp. | United States | 200,000 | 5,680,000 | ||||||||
CenterPoint Energy Inc. | United States | 3,800,000 | 59,736,000 | ||||||||
CMS Energy Corp. | United States | 1,400,000 | 25,228,000 | ||||||||
Consolidated Edison Inc. | United States | 1,100,000 | 53,042,000 | ||||||||
Dominion Resources Inc. | United States | 1,500,000 | 65,490,000 | ||||||||
DTE Energy Co. | United States | 500,000 | 22,965,000 | ||||||||
GDF Suez | France | 700,000 | 25,065,695 | ||||||||
National Grid PLC | United Kingdom | 6,982,857 | 59,313,975 | ||||||||
NiSource Inc. | United States | 1,800,000 | 31,320,000 | ||||||||
PG&E Corp. | United States | 2,100,000 | 95,382,000 | ||||||||
Public Service Enterprise Group Inc. | United States | 2,900,000 | 95,932,000 | ||||||||
RWE AG | Germany | 300,000 | 20,314,912 | ||||||||
SCANA Corp. | United States | 775,000 | 31,248,000 | ||||||||
Sempra Energy | United States | 2,300,000 | 123,740,000 | ||||||||
TECO Energy Inc. | United States | 1,000,000 | 17,320,000 | ||||||||
United Utilities Group PLC | United Kingdom | 2,960,189 | 26,679,706 |
Franklin Utilities Fund | Country | Shares | Value | ||||||||
Common Stocks (continued) | |||||||||||
Multi-Utilities (continued) | |||||||||||
Vectren Corp. | United States | 800,000 | $ | 20,696,000 | |||||||
Wisconsin Energy Corp. | United States | 900,000 | 52,020,000 | ||||||||
Xcel Energy Inc. | United States | 2,600,000 | 59,722,000 | ||||||||
945,420,288 | |||||||||||
Oil, Gas & Consumable Fuels 2.9% | |||||||||||
Spectra Energy Corp. | United States | 2,197,600 | 49,555,880 | ||||||||
The Williams Cos. Inc. | United States | 1,300,000 | 24,843,000 | ||||||||
74,398,880 | |||||||||||
Water Utilities 1.6% | |||||||||||
American Water Works Co. Inc. | United States | 1,800,000 | 41,886,000 | ||||||||
Total Common Stocks (Cost $1,843,624,370) | 2,428,269,322 | ||||||||||
Principal Amount | |||||||||||
Corporate Bonds 3.2% | |||||||||||
Electric Utilities 1.6% | |||||||||||
MidAmerican Energy Holdings Co., senior note, 8.48%, 9/15/28 | United States | 25,000,000 | 33,203,375 | ||||||||
Northeast Generation Co., senior secured note, B-1, 8.812%, 10/15/26 | United States | 7,048,829 | 7,788,392 | ||||||||
40,991,767 | |||||||||||
Independent Power Producers & Energy Traders 1.1% | |||||||||||
Energy Future Holdings Corp., | |||||||||||
asecured senior note, 144A, 10.00%, 1/15/20 | United States | 24,225,000 | 24,167,877 | ||||||||
senior note, R, 6.55%, 11/15/34 | United States | 5,700,000 | 2,194,500 | ||||||||
26,362,377 | |||||||||||
Multi-Utilities 0.5% | |||||||||||
Aquila Inc., senior note, | |||||||||||
7.95%, 2/01/11 | United States | 6,000,000 | 6,127,596 | ||||||||
8.27%, 11/15/21 | United States | 6,100,000 | 7,159,564 | ||||||||
13,287,160 | |||||||||||
Total Corporate Bonds (Cost $77,776,007) | 80,641,304 | ||||||||||
Total Investments before Short Term Investments (Cost $1,921,400,377) | 2,508,910,626 | ||||||||||
Shares | |||||||||||
Short Term Investments (Cost $40,993,986) 1.6% | |||||||||||
Money Market Funds 1.6% | |||||||||||
b,c | Institutional Fiduciary Trust Money Market Portfolio, 0.00% | United States | 40,993,986 | 40,993,986 | |||||||
Total Investments (Cost $1,962,394,363) 100.2% | 2,549,904,612 | ||||||||||
Other Assets, less Liabilities (0.2)% | (5,396,574 | ) | |||||||||
Net Assets 100.0% | $ | 2,544,508,038 | |||||||||
a | Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in a public offering registered under the Securities Act of 1933. This security has been deemed liquid under guidelines approved by the Trust’s Board of Trustees. At September 30, 2010, the value of this security was $24,167,877, representing 0.95% of net assets. | |
b | Non-income producing. | |
c | See Note 7 regarding investments in the Institutional Fiduciary Trust Money Market Portfolio. The rate shown is the annualized seven-day yield at period end. |
September 30, 2010
Franklin | Franklin | Franklin | ||||||||||
DynaTech Fund | Growth Fund | Income Fund | ||||||||||
Assets: | ||||||||||||
Investments in securities: | ||||||||||||
Cost — Unaffiliated issuers | $ | 364,688,370 | $ | 1,745,179,804 | $ | 52,686,735,686 | ||||||
Cost — Non-controlled affiliated issuers (Note 10) | — | — | 1,291,919,449 | |||||||||
Cost — Sweep Money Fund (Note 7) | 5,804,707 | 181,648,270 | 330,912,398 | |||||||||
Cost — Repurchase agreements | — | 31,822,988 | 490,186,154 | |||||||||
Total cost of investments | $ | 370,493,077 | $ | 1,958,651,062 | $ | 54,799,753,687 | ||||||
Value — Unaffiliated issuers | $ | 687,142,088 | $ | 3,405,567,604 | $ | 52,475,237,681 | ||||||
Value — Non-controlled affiliated issuers (Note 10) | — | — | 990,525,834 | |||||||||
Value — Sweep Money Fund (Note 7) | 5,804,707 | 181,648,270 | 330,912,398 | |||||||||
Value — Repurchase agreements | — | 31,822,988 | 490,186,154 | |||||||||
Total value of investmentsa | 692,946,795 | 3,619,038,862 | 54,286,862,067 | |||||||||
Cash | 525 | 111,181 | 13,632,118 | |||||||||
Receivables: | ||||||||||||
Investment securities sold | — | 5,798,839 | 102,153,529 | |||||||||
Capital shares sold | 677,864 | 31,504,660 | 152,145,641 | |||||||||
Dividends and interest | 365,176 | 3,951,039 | 671,137,811 | |||||||||
Other assets | 764 | 3,151 | 45,993 | |||||||||
Total assets | 693,991,124 | 3,660,407,732 | 55,225,977,159 | |||||||||
Liabilities: | ||||||||||||
Payables: | ||||||||||||
Investment securities purchased | 2,612,040 | — | 565,688,334 | |||||||||
Capital shares redeemed | 1,034,015 | 5,099,052 | 94,127,646 | |||||||||
Affiliates | 752,015 | 3,454,861 | 46,587,269 | |||||||||
Allocator Funds (Note 11) | — | 35,929 | 209,972 | |||||||||
Unaffiliated transfer agent fees | 120,420 | 533,723 | 5,983,222 | |||||||||
Payable upon return of securities loaned | — | — | 5,325,668 | |||||||||
Accrued expenses and other liabilities | 81,788 | 279,580 | 3,459,603 | |||||||||
Total liabilities | 4,600,278 | 9,403,145 | 721,381,714 | |||||||||
Net assets, at value | $ | 689,390,846 | $ | 3,651,004,587 | $ | 54,504,595,445 | ||||||
Net assets consist of: | ||||||||||||
Paid-in capital | $ | 405,785,859 | $ | 2,072,811,029 | $ | 61,811,616,016 | ||||||
Undistributed net investment income (loss) | — | 5,612,427 | — | |||||||||
Distributions in excess of net investment income | — | — | (112,725,558 | ) | ||||||||
Net unrealized appreciation (depreciation) | 322,467,882 | 1,660,386,659 | (512,339,451 | ) | ||||||||
Accumulated net realized gain (loss) | (38,862,895 | ) | (87,805,528 | ) | (6,681,955,562 | ) | ||||||
Net assets, at value | $ | 689,390,846 | $ | 3,651,004,587 | $ | 54,504,595,445 | ||||||
a | The Franklin Income Fund includes $5,031,128 of securities loaned. |
September 30, 2010
Franklin | Franklin | Franklin | ||||||||||
DynaTech Fund | Growth Fund | Income Fund | ||||||||||
Class A: | ||||||||||||
Net assets, at value | $ | 566,764,085 | $ | 2,587,802,201 | $ | 32,281,990,803 | ||||||
Shares outstanding | 20,866,934 | 62,946,781 | 15,277,623,716 | |||||||||
Net asset value per sharea | $ | 27.16 | $ | 41.11 | $ | 2.11 | ||||||
Maximum offering price per share (net asset value per share ÷ 94.25%, 94.25% and 95.75%, respectively) | $ | 28.82 | $ | 43.62 | $ | 2.20 | ||||||
Class B: | ||||||||||||
Net assets, at value | $ | 10,125,386 | $ | 51,594,149 | $ | 1,629,726,332 | ||||||
Shares outstanding | 403,353 | 1,311,541 | 774,930,924 | |||||||||
Net asset value and maximum offering price per sharea | $ | 25.10 | $ | 39.34 | $ | 2.10 | ||||||
Class B1: | ||||||||||||
Net assets, at value | — | — | $ | 23,550,921 | ||||||||
Shares outstanding | — | — | 11,123,528 | |||||||||
Net asset value and maximum offering price per sharea | — | — | $ | 2.12 | ||||||||
Class C: | ||||||||||||
Net assets, at value | $ | 93,926,515 | $ | 349,188,086 | $ | 15,605,054,970 | ||||||
Shares outstanding | 3,786,546 | 8,971,595 | 7,324,846,474 | |||||||||
Net asset value and maximum offering price per sharea | $ | 24.81 | $ | 38.92 | $ | 2.13 | ||||||
Class R: | ||||||||||||
Net assets, at value | $ | 7,034,342 | $ | 117,484,015 | $ | 370,563,846 | ||||||
Shares outstanding | 260,365 | 2,869,430 | 177,545,954 | |||||||||
Net asset value and maximum offering price per share | $ | 27.02 | $ | 40.94 | $ | 2.09 | ||||||
Advisor Class: | ||||||||||||
Net assets, at value | $ | 11,540,518 | $ | 544,936,136 | $ | 4,593,708,573 | ||||||
Shares outstanding | 422,320 | 13,232,344 | 2,186,565,973 | |||||||||
Net asset value and maximum offering price per share | $ | 27.33 | $ | 41.18 | $ | 2.10 | ||||||
a | Redemption price is equal to net asset value less contingent deferred sales charges, if applicable. |
September 30, 2010
Franklin | ||||||||
U.S. Government | Franklin | |||||||
Securities Fund | Utilities Fund | |||||||
Assets: | ||||||||
Investments in securities: | ||||||||
Cost — Unaffiliated issuers | $ | 10,164,106,856 | $ | 1,921,400,377 | ||||
Cost — Sweep Money Fund (Note 7) | 112,396,476 | 40,993,986 | ||||||
Total cost of investments | $ | 10,276,503,332 | $ | 1,962,394,363 | ||||
Value — Unaffiliated issuers | $ | 10,616,396,683 | $ | 2,508,910,626 | ||||
Value — Sweep Money Fund (Note 7) | 112,396,476 | 40,993,986 | ||||||
Total value of investments | 10,728,793,159 | 2,549,904,612 | ||||||
Receivables: | ||||||||
Capital shares sold | 33,652,015 | 7,901,358 | ||||||
Dividends and interest | 41,515,320 | 7,621,223 | ||||||
Other assets | 8,499 | 2,188 | ||||||
Total assets | 10,803,968,993 | 2,565,429,381 | ||||||
Liabilities: | ||||||||
Payables: | ||||||||
Investment securities purchased | 44,611,014 | 13,901,790 | ||||||
Capital shares redeemed | 32,305,091 | 4,471,838 | ||||||
Affiliates | 9,016,096 | 2,035,342 | ||||||
Allocator Funds (Note 11) | 41,646 | 10,058 | ||||||
Unaffiliated transfer agent fees | 1,038,149 | 332,420 | ||||||
Accrued expenses and other liabilities | 476,519 | 169,895 | ||||||
Total liabilities | 87,488,515 | 20,921,343 | ||||||
Net assets, at value | $ | 10,716,480,478 | $ | 2,544,508,038 | ||||
Net assets consist of: | ||||||||
Paid-in capital | $ | 10,610,268,259 | $ | 1,969,219,636 | ||||
Undistributed net investment income | 22,769,757 | 2,786,464 | ||||||
Net unrealized appreciation (depreciation) | 452,289,827 | 587,523,981 | ||||||
Accumulated net realized gain (loss) | (368,847,365 | ) | (15,022,043 | ) | ||||
Net assets, at value | $ | 10,716,480,478 | $ | 2,544,508,038 | ||||
September 30, 2010
Franklin | ||||||||
U.S. Government | Franklin | |||||||
Securities Fund | Utilities Fund | |||||||
Class A: | ||||||||
Net assets, at value | $ | 6,771,471,155 | $ | 1,823,971,732 | ||||
Shares outstanding | 993,976,948 | 159,442,916 | ||||||
Net asset value per sharea | $ | 6.81 | $ | 11.44 | ||||
Maximum offering price per share (net asset value per share ÷ 95.75%) | $ | 7.11 | $ | 11.95 | ||||
Class B: | ||||||||
Net assets, at value | $ | 126,802,595 | $ | 50,439,368 | ||||
Shares outstanding | 18,640,926 | 4,408,979 | ||||||
Net asset value and maximum offering price per sharea | $ | 6.80 | $ | 11.44 | ||||
Class C: | ||||||||
Net assets, at value | $ | 2,484,846,921 | $ | 405,023,717 | ||||
Shares outstanding | 366,918,168 | 35,527,064 | ||||||
Net asset value and maximum offering price per sharea | $ | 6.77 | $ | 11.40 | ||||
Class R: | ||||||||
Net assets, at value | $ | 140,146,848 | $ | 42,285,227 | ||||
Shares outstanding | 20,589,522 | 3,706,422 | ||||||
Net asset value and maximum offering price per share | $ | 6.81 | $ | 11.41 | ||||
Advisor Class: | ||||||||
Net assets, at value | $ | 1,193,212,959 | $ | 222,787,994 | ||||
Shares outstanding | 174,675,568 | 19,371,836 | ||||||
Net asset value and maximum offering price per share | $ | 6.83 | $ | 11.50 | ||||
a | Redemption price is equal to net asset value less contingent deferred sales charges, if applicable. |
for the year ended September 30, 2010
Franklin | Franklin | Franklin | ||||||||||
DynaTech Fund | Growth Fund | Income Fund | ||||||||||
Investment income: | ||||||||||||
Dividends: | ||||||||||||
Unaffiliated issuers | $ | 3,860,661 | $ | 48,415,305 | $ | 692,932,013 | ||||||
Non-controlled affiliated issuers (Note 10) | — | — | 50,556,952 | |||||||||
Interest: | ||||||||||||
Unaffiliated issuers | — | 14,435 | 2,841,761,749 | |||||||||
Non-controlled affiliated issuers (Note 10) | — | — | 52,188,551 | |||||||||
Income from securities loaned | — | — | 1,303,497 | |||||||||
Total investment income | 3,860,661 | 48,429,740 | 3,638,742,762 | |||||||||
Expenses: | ||||||||||||
Management fees (Note 3a) | 3,175,313 | 15,026,525 | 196,626,526 | |||||||||
Distribution fees: (Note 3c) | ||||||||||||
Class A | 1,347,891 | 5,959,116 | 45,111,822 | |||||||||
Class B | 118,944 | 706,722 | 18,481,539 | |||||||||
Class B1 | — | — | 221,952 | |||||||||
Class C | 897,352 | 3,338,340 | 93,323,299 | |||||||||
Class R | 32,840 | 428,982 | 1,732,148 | |||||||||
Transfer agent fees (Note 3e) | 1,610,275 | 6,705,190 | 45,401,588 | |||||||||
Special servicing agreement fees (Note 11) | — | 500,762 | 2,486,688 | |||||||||
Custodian fees (Note 4) | 18,824 | 51,703 | 1,000,634 | |||||||||
Reports to shareholders | 149,697 | 587,731 | 5,366,622 | |||||||||
Registration and filing fees | 88,845 | 159,690 | 1,212,503 | |||||||||
Professional fees | 63,942 | 103,311 | 535,264 | |||||||||
Trustees’ fees and expenses | 3,754 | 18,750 | 296,318 | |||||||||
Other | 14,872 | 65,928 | 1,403,136 | |||||||||
Total expenses | 7,522,549 | 33,652,750 | 413,200,039 | |||||||||
Expense reductions (Note 4) | — | — | (346 | ) | ||||||||
Net expenses | — | — | 413,199,693 | |||||||||
Net investment income (loss) | (3,661,888 | ) | 14,776,990 | 3,225,543,069 | ||||||||
Realized and unrealized gains (losses): | ||||||||||||
Net realized gain (loss) from: | ||||||||||||
Investments: | ||||||||||||
Unaffiliated issuers | 41,167,617 | 42,757,008 | (917,339,548 | ) | ||||||||
Non-controlled affiliated issuers (Note 10) | — | — | (309,968,803 | ) | ||||||||
Written options | — | — | 1,249,390 | |||||||||
Foreign currency transactions | 110,404 | 14,111 | 418,347 | |||||||||
Net realized gain (loss) | 41,278,021 | 42,771,119 | (1,225,640,614 | ) | ||||||||
Net change in unrealized appreciation (depreciation) on: | ||||||||||||
Investments | 64,024,955 | 355,329,494 | 4,660,344,611 | |||||||||
Translation of other assets and liabilities denominated in foreign currencies | 7,881 | (1,512 | ) | 704,061 | ||||||||
Net change in unrealized appreciation (depreciation) | 64,032,836 | 355,327,982 | 4,661,048,672 | |||||||||
Net realized and unrealized gain (loss) | 105,310,857 | 398,099,101 | 3,435,408,058 | |||||||||
Net increase (decrease) in net assets resulting from operations | $ | 101,648,969 | $ | 412,876,091 | $ | 6,660,951,127 | ||||||
for the year ended September 30, 2010
Franklin | ||||||||
U.S. Government | Franklin | |||||||
Securities Fund | Utilities Fund | |||||||
Investment income: | ||||||||
Dividends | $ | — | $ | 99,828,114 | ||||
Interest | 435,826,400 | 6,485,252 | ||||||
Total investment income | 435,826,400 | 106,313,366 | ||||||
Expenses: | ||||||||
Management fees (Note 3a) | 44,164,597 | 10,410,967 | ||||||
Distribution fees: (Note 3c) | ||||||||
Class A | 8,987,735 | 2,487,659 | ||||||
Class B | 1,149,041 | 373,463 | ||||||
Class C | 12,916,634 | 2,270,093 | ||||||
Class R | 685,783 | 195,135 | ||||||
Transfer agent fees (Note 3e) | 10,856,833 | 3,150,924 | ||||||
Special servicing agreement fees (Note 11) | 405,258 | 95,375 | ||||||
Custodian fees (Note 4) | 145,273 | 52,631 | ||||||
Reports to shareholders | 758,239 | 304,558 | ||||||
Registration and filing fees | 503,906 | 127,175 | ||||||
Professional fees | 149,709 | 60,561 | ||||||
Trustees’ fees and expenses | 55,732 | 12,663 | ||||||
Other | 751,270 | 28,155 | ||||||
Total expenses | 81,530,010 | 19,569,359 | ||||||
Net investment income | 354,296,390 | 86,744,007 | ||||||
Realized and unrealized gains (losses): | ||||||||
Net realized gain (loss) from: | ||||||||
Investments | 43,597,077 | (13,905,910 | ) | |||||
Foreign currency transactions | — | 52,511 | ||||||
Net realized gain (loss) | 43,597,077 | (13,853,399 | ) | |||||
Net change in unrealized appreciation (depreciation) on: | ||||||||
Investments | 151,179,514 | 195,596,660 | ||||||
Translation of other assets and liabilities denominated in foreign currencies | — | (11,344 | ) | |||||
Net change in unrealized appreciation (depreciation) | 151,179,514 | 195,585,316 | ||||||
Net realized and unrealized gain (loss) | 194,776,591 | 181,731,917 | ||||||
Net increase (decrease) in net assets resulting from operations | $ | 549,072,981 | $ | 268,475,924 | ||||
Franklin DynaTech Fund | Franklin Growth Fund | |||||||||||||||
Year Ended September 30, | Year Ended September 30, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Increase (decrease) in net assets: | ||||||||||||||||
Operations: | ||||||||||||||||
Net investment income (loss) | $ | (3,661,888 | ) | $ | (2,203,451 | ) | $ | 14,776,990 | $ | 19,035,425 | ||||||
Net realized gain (loss) from investments and foreign currency transactions | 41,278,021 | (59,040,251 | ) | 42,771,119 | 18,944,348 | |||||||||||
Net change in unrealized appreciation (depreciation) on investments and translation of other assets and liabilities denominated in foreign currencies | 64,032,836 | 117,993,942 | 355,327,982 | 50,707,596 | ||||||||||||
Net increase (decrease) in net assets resulting from operations | 101,648,969 | 56,750,240 | 412,876,091 | 88,687,369 | ||||||||||||
Distributions to shareholders from: | ||||||||||||||||
Net investment income: | ||||||||||||||||
Class A | — | — | (16,704,632 | ) | (13,937,611 | ) | ||||||||||
Class B | — | — | (59,099 | ) | — | |||||||||||
Class C | — | — | (605,181 | ) | (158,739 | ) | ||||||||||
Class R | — | — | (424,812 | ) | (93,243 | ) | ||||||||||
Advisor Class | — | — | (4,186,666 | ) | (2,842,374 | ) | ||||||||||
Net realized gains: | ||||||||||||||||
Class A | — | (23,817,251 | ) | — | — | |||||||||||
Class B | — | (674,313 | ) | — | — | |||||||||||
Class C | — | (3,500,844 | ) | — | — | |||||||||||
Advisor Class | — | (211,314 | ) | — | — | |||||||||||
Total distributions to shareholders | — | (28,203,722 | ) | (21,980,390 | ) | (17,031,967 | ) | |||||||||
Capital share transactions: (Note 2) | ||||||||||||||||
Class A | (20,813,805 | ) | 95,693,757 | 137,271,042 | 423,439,580 | |||||||||||
Class B | (5,373,387 | ) | 2,223,304 | (45,199,219 | ) | 64,703 | ||||||||||
Class C | (2,733,120 | ) | 24,245,692 | (4,673,037 | ) | 55,014,386 | ||||||||||
Class R | (332,337 | ) | 4,561,511 | 42,381,653 | 30,600,261 | |||||||||||
Advisor Class | 1,852,034 | 5,097,576 | 57,480,773 | 151,094,118 | ||||||||||||
Total capital share transactions | (27,400,615 | ) | 131,821,840 | 187,261,212 | 660,213,048 | |||||||||||
Net increase (decrease) in net assets | 74,248,354 | 160,368,358 | 578,156,913 | 731,868,450 | ||||||||||||
Net assets: | ||||||||||||||||
Beginning of year | 615,142,492 | 454,774,134 | 3,072,847,674 | 2,340,979,224 | ||||||||||||
End of year | $ | 689,390,846 | $ | 615,142,492 | $ | 3,651,004,587 | $ | 3,072,847,674 | ||||||||
Undistributed net investment income included in net assets: | ||||||||||||||||
End of year | $ | — | $ | — | $ | 5,612,427 | $ | 12,735,382 | ||||||||
Franklin | ||||||||||||||||
Franklin Income Fund | U.S. Government Securities Fund | |||||||||||||||
Year Ended September 30, | Year Ended September 30, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Increase (decrease) in net assets: | ||||||||||||||||
Operations: | ||||||||||||||||
Net investment income | $ | 3,225,543,069 | $ | 3,021,185,783 | $ | 354,296,390 | $ | 326,946,470 | ||||||||
Net realized gain (loss) from investments, written options and foreign currency transactions | (1,225,640,614 | ) | (4,679,001,452 | ) | 43,597,077 | 8,947,805 | ||||||||||
Net change in unrealized appreciation (depreciation) on investments and translation of other assets and liabilities denominated in foreign currencies | 4,661,048,672 | 5,364,093,012 | 151,179,514 | 306,262,342 | ||||||||||||
Net increase (decrease) in net assets resulting from operations | 6,660,951,127 | 3,706,277,343 | 549,072,981 | 642,156,617 | ||||||||||||
Distributions to shareholders from: | ||||||||||||||||
Net investment income: | ||||||||||||||||
Class A | (2,130,895,815 | ) | (2,122,519,292 | ) | (258,072,430 | ) | (266,824,581 | ) | ||||||||
Class B | (118,302,615 | ) | (162,039,544 | ) | (6,345,333 | ) | (10,979,232 | ) | ||||||||
Class B1 | (2,367,258 | ) | (12,892,120 | ) | — | — | ||||||||||
Class C | (935,146,104 | ) | (924,754,117 | ) | (67,975,758 | ) | (39,006,086 | ) | ||||||||
Class R | (23,521,043 | ) | (22,649,572 | ) | (4,950,161 | ) | (5,108,595 | ) | ||||||||
Advisor Class | (317,015,455 | ) | (322,719,140 | ) | (41,720,232 | ) | (32,473,805 | ) | ||||||||
Net realized gains: | ||||||||||||||||
Class A | — | (15,591,600 | ) | — | — | |||||||||||
Class B | — | (1,384,690 | ) | — | — | |||||||||||
Class B1 | — | (124,160 | ) | — | — | |||||||||||
Class C | — | (7,179,957 | ) | — | — | |||||||||||
Class R | — | (166,198 | ) | — | — | |||||||||||
Advisor Class | — | (2,449,031 | ) | — | — | |||||||||||
Total distributions to shareholders | (3,527,248,290 | ) | (3,594,469,421 | ) | (379,063,914 | ) | (354,392,299 | ) | ||||||||
Capital share transactions: (Note 2) | ||||||||||||||||
Class A | 2,663,148,549 | 729,974,966 | 382,989,796 | 707,313,300 | ||||||||||||
Class B | (536,384,118 | ) | (324,408,642 | ) | (106,822,122 | ) | (64,174,344 | ) | ||||||||
Class B1 | (47,563,018 | ) | (136,813,461 | ) | — | — | ||||||||||
Class C | 1,661,877,069 | 543,188,709 | 986,641,643 | 820,560,727 | ||||||||||||
Class R | 34,240,036 | 40,235,428 | (628,625 | ) | 29,529,703 | |||||||||||
Advisor Class | 149,037,262 | (24,803,405 | ) | 310,809,591 | 227,056,372 | |||||||||||
Total capital share transactions | 3,924,355,780 | 827,373,595 | 1,572,990,283 | 1,720,285,758 | ||||||||||||
Net increase (decrease) in net assets | 7,058,058,617 | 939,181,517 | 1,742,999,350 | 2,008,050,076 | ||||||||||||
Net assets: | ||||||||||||||||
Beginning of year | 47,446,536,828 | 46,507,355,311 | 8,973,481,128 | 6,965,431,052 | ||||||||||||
End of year | $ | 54,504,595,445 | $ | 47,446,536,828 | $ | 10,716,480,478 | $ | 8,973,481,128 | ||||||||
Undistributed net investment income (distributions in excess of net investment income) included in net assets: | ||||||||||||||||
End of year | $ | (112,725,558 | ) | $ | (293,103,420 | ) | $ | 22,769,757 | $ | 2,451,318 | ||||||
Franklin Utilities Fund | ||||||||
Year Ended September 30, | ||||||||
2010 | 2009 | |||||||
Increase (decrease) in net assets: | ||||||||
Operations: | ||||||||
Net investment income | $ | 86,744,007 | $ | 79,810,590 | ||||
Net realized gain (loss) from investments and foreign currency transactions | (13,853,399 | ) | 28,009,600 | |||||
Net change in unrealized appreciation (depreciation) on investments and translation of other assets and liabilities denominated in foreign currencies | 195,585,316 | (249,432,367 | ) | |||||
Net increase (decrease) in net assets resulting from operations | 268,475,924 | (141,612,177 | ) | |||||
Distributions to shareholders from: | ||||||||
Net investment income: | ||||||||
Class A | (68,149,865 | ) | (60,897,517 | ) | ||||
Class B | (2,057,071 | ) | (2,457,137 | ) | ||||
Class C | (12,635,206 | ) | (10,325,076 | ) | ||||
Class R | (1,462,964 | ) | (1,233,300 | ) | ||||
Advisor Class | (6,837,755 | ) | (2,775,441 | ) | ||||
Net realized gains: | ||||||||
Class A | (23,199,153 | ) | (11,143,330 | ) | ||||
Class B | (922,593 | ) | (556,682 | ) | ||||
Class C | (4,562,415 | ) | (2,138,465 | ) | ||||
Class R | (555,438 | ) | (236,227 | ) | ||||
Advisor Class | (1,930,079 | ) | (407,396 | ) | ||||
Total distributions to shareholders | (122,312,539 | ) | (92,170,571 | ) | ||||
Capital share transactions: (Note 2) | ||||||||
Class A | 173,810,246 | (47,298,609 | ) | |||||
Class B | (17,162,713 | ) | (18,007,546 | ) | ||||
Class C | 81,972,824 | (4,044,700 | ) | |||||
Class R | 1,998,821 | 4,676,850 | ||||||
Advisor Class | 87,695,496 | 71,734,045 | ||||||
Total capital share transactions | 328,314,674 | 7,060,040 | ||||||
Net increase (decrease) in net assets | 474,478,059 | (226,722,708 | ) | |||||
Net assets: | ||||||||
Beginning of year | 2,070,029,979 | 2,296,752,687 | ||||||
End of year | $ | 2,544,508,038 | $ | 2,070,029,979 | ||||
Undistributed net investment income included in net assets: | ||||||||
End of year | $ | 2,786,464 | $ | 9,424,658 | ||||
Class A, Class B, Class C, Class R | Class A, Class B, Class B1, | |
& Advisor Class | Class C, Class R & Advisor Class | |
Franklin DynaTech Fund | Franklin Income Fund | |
Franklin Growth Fund | ||
Franklin U.S. Government Securities Fund | ||
Franklin Utilities Fund |
Franklin DynaTech Fund | Franklin Growth Fund | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Class A Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 3,861,404 | $ | 97,617,815 | 15,008,884 | $ | 592,373,612 | ||||||||||
Shares issued in reinvestment of distributions | — | — | 402,846 | 15,404,808 | ||||||||||||
Shares redeemed | (4,698,990 | ) | (118,431,620 | ) | (12,049,005 | ) | (470,507,378 | ) | ||||||||
Net increase (decrease) | (837,586 | ) | $ | (20,813,805 | ) | 3,362,725 | $ | 137,271,042 | ||||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 2,782,002 | $ | 53,411,677 | 12,015,889 | $ | 359,509,553 | ||||||||||
Shares issued on reorganization (Note 12) | 7,598,915 | 126,195,671 | 14,593,037 | 451,362,637 | ||||||||||||
Shares issued in reinvestment of distributions | 1,359,432 | 21,288,705 | 486,462 | 12,711,248 | ||||||||||||
Shares redeemed | (5,668,339 | ) | (105,202,296 | ) | (13,479,108 | ) | (400,143,858 | ) | ||||||||
Net increase (decrease) | 6,072,010 | $ | 95,693,757 | 13,616,280 | $ | 423,439,580 | ||||||||||
Class B Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 39,193 | $ | 908,906 | 59,910 | $ | 2,278,747 | ||||||||||
Shares issued in reinvestment of distributions | — | — | 1,489 | 54,809 | ||||||||||||
Shares redeemed | (269,319 | ) | (6,282,293 | ) | (1,262,819 | ) | (47,532,775 | ) | ||||||||
Net increase (decrease) | (230,126 | ) | $ | (5,373,387 | ) | (1,201,420 | ) | $ | (45,199,219 | ) | ||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 68,034 | $ | 1,166,470 | 269,458 | $ | 7,369,648 | ||||||||||
Shares issued on reorganization (Note 12) | 471,140 | 7,329,289 | 897,036 | 26,650,945 | ||||||||||||
Shares issued in reinvestment of distributions | 39,296 | 576,475 | — | — | ||||||||||||
Shares redeemed | (400,924 | ) | (6,848,930 | ) | (1,186,449 | ) | (33,955,890 | ) | ||||||||
Net increase (decrease) | 177,546 | $ | 2,223,304 | (19,955 | ) | $ | 64,703 | |||||||||
Class C Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 767,752 | $ | 17,728,055 | 1,757,368 | $ | 65,780,420 | ||||||||||
Shares issued in reinvestment of distributions | — | — | 15,351 | 559,243 | ||||||||||||
Shares redeemed | (890,252 | ) | (20,461,175 | ) | (1,912,255 | ) | (71,012,700 | ) | ||||||||
Net increase (decrease) | (122,500 | ) | $ | (2,733,120 | ) | (139,536 | ) | $ | (4,673,037 | ) | ||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 610,534 | $ | 10,952,317 | 1,769,875 | $ | 50,036,992 | ||||||||||
Shares issued on reorganization (Note 12) | 1,986,027 | 30,539,237 | 2,280,868 | 67,125,954 | ||||||||||||
Shares issued in reinvestment of distributions | 219,790 | 3,186,956 | 5,806 | 144,797 | ||||||||||||
Shares redeemed | (1,201,455 | ) | (20,432,818 | ) | (2,213,519 | ) | (62,293,357 | ) | ||||||||
Net increase (decrease) | 1,614,896 | $ | 24,245,692 | 1,843,030 | $ | 55,014,386 | ||||||||||
Franklin DynaTech Fund | Franklin Growth Fund | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Class R Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 84,648 | $ | 2,108,343 | 1,596,152 | $ | 62,395,159 | ||||||||||
Shares issued in reinvestment of distributions | — | — | 10,831 | 413,311 | ||||||||||||
Shares redeemed | (98,580 | ) | (2,440,680 | ) | (527,829 | ) | (20,426,817 | ) | ||||||||
Net increase (decrease) | (13,932 | ) | $ | (332,337 | ) | 1,079,154 | $ | 42,381,653 | ||||||||
Year ended September 30, 2009a | ||||||||||||||||
Shares sold | 105,135 | $ | 1,878,341 | 2,050,622 | $ | 61,397,829 | ||||||||||
Shares issued on reorganization (Note 12) | 269,510 | 4,473,861 | 308,381 | 9,519,723 | ||||||||||||
Shares issued in reinvestment of distributions | — | — | 3,545 | 92,515 | ||||||||||||
Shares redeemed | (100,348 | ) | (1,790,691 | ) | (1,390,720 | ) | (40,409,806 | ) | ||||||||
Net increase (decrease) | 274,297 | $ | 4,561,511 | 971,828 | $ | 30,600,261 | ||||||||||
Advisor Class Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 112,665 | $ | 2,925,854 | 6,348,692 | $ | 247,260,820 | ||||||||||
Shares issued in reinvestment of distributions | — | — | 102,177 | 3,905,212 | ||||||||||||
Shares redeemed | (42,936 | ) | (1,073,820 | ) | (5,016,397 | ) | (193,685,259 | ) | ||||||||
Net increase (decrease) | 69,729 | $ | 1,852,034 | 1,434,472 | $ | 57,480,773 | ||||||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 193,916 | $ | 3,835,277 | 1,828,858 | $ | 54,651,357 | ||||||||||
Shares issued on reorganization (Note 12) | 99,151 | 1,649,870 | 4,691,275 | 145,148,039 | ||||||||||||
Shares issued in reinvestment of distributions | 13,467 | 211,295 | 102,244 | 2,668,575 | ||||||||||||
Shares redeemed | (31,772 | ) | (598,866 | ) | (1,722,646 | ) | (51,373,853 | ) | ||||||||
Net increase (decrease) | 274,762 | $ | 5,097,576 | 4,899,731 | $ | 151,094,118 | ||||||||||
a | For the period December 1, 2008 (effective date) to September 30, 2009, for the Franklin DynaTech Fund. |
Franklin U.S. Government | ||||||||||||||||
Franklin Income Fund | Securities Fund | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Class A Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 3,122,047,774 | $ | 6,401,965,279 | 255,107,116 | $ | 1,722,046,431 | ||||||||||
Shares issued in reinvestment of distributions | 795,698,609 | 1,618,086,910 | 28,399,723 | 191,100,894 | ||||||||||||
Shares redeemed | (2,616,323,977 | ) | (5,356,903,640 | ) | (227,148,749 | ) | (1,530,157,529 | ) | ||||||||
Net increase (decrease) | 1,301,422,406 | $ | 2,663,148,549 | 56,358,090 | $ | 382,989,796 | ||||||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 3,194,615,875 | $ | 5,446,582,263 | 327,684,616 | $ | 2,154,557,471 | ||||||||||
Shares issued in reinvestment of distributions | 929,761,078 | 1,563,293,948 | 28,818,237 | 189,352,370 | ||||||||||||
Shares redeemed | (3,760,506,184 | ) | (6,279,901,245 | ) | (248,416,455 | ) | (1,636,596,541 | ) | ||||||||
Net increase (decrease) | 363,870,769 | $ | 729,974,966 | 108,086,398 | $ | 707,313,300 | ||||||||||
Franklin U.S. Government | ||||||||||||||||
Franklin Income Fund | Securities Fund | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Class B Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 13,878,110 | $ | 28,322,228 | 1,842,598 | $ | 12,415,351 | ||||||||||
Shares issued in reinvestment of distributions | 40,513,875 | 81,924,023 | 742,529 | 4,985,042 | ||||||||||||
Shares redeemed | (316,412,820 | ) | (646,630,369 | ) | (18,446,529 | ) | (124,222,515 | ) | ||||||||
Net increase (decrease) | (262,020,835 | ) | $ | (536,384,118 | ) | (15,861,402 | ) | $ | (106,822,122 | ) | ||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 34,580,449 | $ | 58,074,216 | 8,056,168 | $ | 52,523,598 | ||||||||||
Shares issued in reinvestment of distributions | 63,807,057 | 106,531,528 | 1,218,659 | 7,988,052 | ||||||||||||
Shares redeemed | (295,644,541 | ) | (489,014,386 | ) | (18,942,006 | ) | (124,685,994 | ) | ||||||||
Net increase (decrease) | (197,257,035 | ) | $ | (324,408,642 | ) | (9,667,179 | ) | $ | (64,174,344 | ) | ||||||
Class B1 Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 223,452 | $ | 458,088 | |||||||||||||
Shares issued in reinvestment of distributions | 659,909 | 1,334,988 | ||||||||||||||
Shares redeemed | (24,397,067 | ) | (49,356,094 | ) | ||||||||||||
Net increase (decrease) | (23,513,706 | ) | (47,563,018 | ) | ||||||||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 616,259 | $ | 1,006,991 | |||||||||||||
Shares issued in reinvestment of distributions | 4,478,768 | 7,437,357 | ||||||||||||||
Shares redeemed | (84,121,447 | ) | (145,257,809 | ) | ||||||||||||
Net increase (decrease) | (79,026,420 | ) | (136,813,461 | ) | ||||||||||||
Class C Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 1,596,716,655 | $ | 3,301,950,026 | 212,527,927 | $ | 1,426,604,550 | ||||||||||
Shares issued in reinvestment of distributions | 320,155,286 | 656,144,553 | 7,931,210 | 53,125,111 | ||||||||||||
Shares redeemed | (1,112,022,517 | ) | (2,296,217,510 | ) | (73,580,512 | ) | (493,088,018 | ) | ||||||||
Net increase (decrease) | 804,849,424 | $ | 1,661,877,069 | 146,878,625 | $ | 986,641,643 | ||||||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 1,490,228,499 | $ | 2,568,269,575 | 177,348,206 | $ | 1,163,765,108 | ||||||||||
Shares issued in reinvestment of distributions | 372,417,014 | 631,594,234 | 4,298,963 | 28,151,041 | ||||||||||||
Shares redeemed | (1,592,519,479 | ) | (2,656,675,100 | ) | (56,632,697 | ) | (371,355,422 | ) | ||||||||
Net increase (decrease) | 270,126,034 | $ | 543,188,709 | 125,014,472 | $ | 820,560,727 | ||||||||||
Franklin U.S. Government | ||||||||||||||||
Franklin Income Fund | Securities Fund | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Class R Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 55,322,582 | $ | 111,791,528 | 10,173,157 | $ | 68,640,631 | ||||||||||
Shares issued in reinvestment of distributions | 10,944,621 | 21,995,589 | 713,551 | 4,797,215 | ||||||||||||
Shares redeemed | (49,258,198 | ) | (99,547,081 | ) | (11,015,574 | ) | (74,066,471 | ) | ||||||||
Net increase (decrease) | 17,009,005 | $ | 34,240,036 | (128,866 | ) | $ | (628,625 | ) | ||||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 68,996,085 | $ | 115,848,208 | 13,507,302 | $ | 88,919,423 | ||||||||||
Shares issued in reinvestment of distributions | 12,725,193 | 21,140,911 | 758,236 | 4,977,846 | ||||||||||||
Shares redeemed | (58,266,413 | ) | (96,753,691 | ) | (9,774,179 | ) | (64,367,566 | ) | ||||||||
Net increase (decrease) | 23,454,865 | $ | 40,235,428 | 4,491,359 | $ | 29,529,703 | ||||||||||
Advisor Class Shares: | ||||||||||||||||
Year ended September 30, 2010 | ||||||||||||||||
Shares sold | 476,839,253 | $ | 974,685,741 | 68,407,061 | $ | 462,448,131 | ||||||||||
Shares issued in reinvestment of distributions | 139,718,744 | 282,316,193 | 5,162,635 | 34,844,804 | ||||||||||||
Shares redeemed | (546,851,471 | ) | (1,107,964,672 | ) | (27,638,036 | ) | (186,483,344 | ) | ||||||||
Net increase (decrease) | 69,706,526 | $ | 149,037,262 | 45,931,660 | $ | 310,809,591 | ||||||||||
Year ended September 30, 2009 | ||||||||||||||||
Shares sold | 537,139,078 | $ | 923,014,317 | 56,386,916 | $ | 373,566,694 | ||||||||||
Shares issued in reinvestment of distributions | 185,103,308 | 309,081,671 | 4,110,288 | 27,061,258 | ||||||||||||
Shares redeemed | (772,328,637 | ) | (1,256,899,393 | ) | (26,340,863 | ) | (173,571,580 | ) | ||||||||
Net increase (decrease) | (50,086,251 | ) | $ | (24,803,405 | ) | 34,156,341 | $ | 227,056,372 | ||||||||
Franklin Utilities Fund | ||||||||
Shares | Amount | |||||||
Class A Shares: | ||||||||
Year ended September 30, 2010 | ||||||||
Shares sold | 35,022,184 | $ | 384,837,941 | |||||
Shares issued in reinvestment of distributions | 7,008,916 | 75,475,936 | ||||||
Shares redeemed | (26,258,647 | ) | (286,503,631 | ) | ||||
Net increase (decrease) | 15,772,453 | $ | 173,810,246 | |||||
Year ended September 30, 2009 | ||||||||
Shares sold | 21,564,244 | $ | 217,252,356 | |||||
Shares issued in reinvestment of distributions | 5,861,644 | 57,450,592 | ||||||
Shares redeemed | (32,180,738 | ) | (322,001,557 | ) | ||||
Net increase (decrease) | (4,754,850 | ) | $ | (47,298,609 | ) | |||
Franklin Utilities Fund | ||||||||
Shares | Amount | |||||||
Class B Shares: | ||||||||
Year ended September 30, 2010 | ||||||||
Shares sold | 353,630 | $ | 3,843,661 | |||||
Shares issued in reinvestment of distributions | 177,266 | 1,910,217 | ||||||
Shares redeemed | (2,098,673 | ) | (22,916,591 | ) | ||||
Net increase (decrease) | (1,567,777 | ) | $ | (17,162,713 | ) | |||
Year ended September 30, 2009 | ||||||||
Shares sold | 320,985 | $ | 3,200,510 | |||||
Shares issued in reinvestment of distributions | 184,409 | 1,806,989 | ||||||
Shares redeemed | (2,310,669 | ) | (23,015,045 | ) | ||||
Net increase (decrease) | (1,805,275 | ) | $ | (18,007,546 | ) | |||
Class C Shares: | ||||||||
Year ended September 30, 2010 | ||||||||
Shares sold | 12,669,924 | $ | 138,793,399 | |||||
Shares issued in reinvestment of distributions | 998,302 | 10,724,815 | ||||||
Shares redeemed | (6,213,093 | ) | (67,545,390 | ) | ||||
Net increase (decrease) | 7,455,133 | $ | 81,972,824 | |||||
Year ended September 30, 2009 | ||||||||
Shares sold | 6,347,474 | $ | 64,084,256 | |||||
Shares issued in reinvestment of distributions | 738,883 | 7,227,247 | ||||||
Shares redeemed | (7,568,351 | ) | (75,356,203 | ) | ||||
Net increase (decrease) | (481,994 | ) | $ | (4,044,700 | ) | |||
Class R Shares: | ||||||||
Year ended September 30, 2010 | ||||||||
Shares sold | 1,198,667 | $ | 13,083,869 | |||||
Shares issued in reinvestment of distributions | 185,276 | 1,990,558 | ||||||
Shares redeemed | (1,205,407 | ) | (13,075,606 | ) | ||||
Net increase (decrease) | 178,536 | $ | 1,998,821 | |||||
Year ended September 30, 2009 | ||||||||
Shares sold | 1,545,267 | $ | 15,712,097 | |||||
Shares issued in reinvestment of distributions | 147,603 | 1,446,259 | ||||||
Shares redeemed | (1,242,997 | ) | (12,481,506 | ) | ||||
Net increase (decrease) | 449,873 | $ | 4,676,850 | |||||
Advisor Class Shares: | ||||||||
Year ended September 30, 2010 | ||||||||
Shares sold | 10,770,245 | $ | 119,820,517 | |||||
Shares issued in reinvestment of distributions | 689,152 | 7,473,842 | ||||||
Shares redeemed | (3,617,556 | ) | (39,598,863 | ) | ||||
Net increase (decrease) | 7,841,841 | $ | 87,695,496 | |||||
Year ended September 30, 2009 | ||||||||
Shares sold | 8,908,323 | $ | 94,646,702 | |||||
Shares issued in reinvestment of distributions | 267,630 | 2,655,239 | ||||||
Shares redeemed | (2,556,521 | ) | (25,567,896 | ) | ||||
Net increase (decrease) | 6,619,432 | $ | 71,734,045 | |||||
Subsidiary | Affiliation | |
Franklin Advisers, Inc. (Advisers) | Investment manager | |
Franklin Investment Advisory Services, LLC (Investment Advisory) | Investment manager | |
Franklin Templeton Services, LLC (FT Services) | Administrative manager | |
Franklin Templeton Distributors, Inc. (Distributors) | Principal underwriter | |
Franklin Templeton Investor Services, LLC (Investor Services) | Transfer agent |
Annualized Fee | Rate Net Assets | |||
0.625 | % | Up to and including $100 million | ||
0.500 | % | Over $100 million, up to and including $250 million | ||
0.450 | % | Over $250 million, up to and including $7.5 billion | ||
0.440 | % | Over $7.5 billion, up to and including $10 billion | ||
0.430 | % | Over $10 billion, up to and including $12.5 billion | ||
0.420 | % | Over $12.5 billion, up to and including $15 billion | ||
0.400 | % | Over $15 billion, up to and including $17.5 billion | ||
0.380 | % | Over $17.5 billion, up to and including $20 billion | ||
0.360 | % | Over $20 billion, up to and including $35 billion | ||
0.355 | % | Over $35 billion, up to and including $50 billion | ||
0.350 | % | Over $50 billion, up to and including $65 billion | ||
0.345 | % | Over $65 billion, up to and including $80 billion | ||
0.340 | % | In excess of $80 billion |
Annualized Fee | Rate Net Assets | |||
0.625 | % | Up to and including $100 million | ||
0.500 | % | Over $100 million, up to and including $250 million | ||
0.450 | % | Over $250 million, up to and including $7.5 billion | ||
0.440 | % | Over $7.5 billion, up to and including $10 billion | ||
0.430 | % | Over $10 billion, up to and including $12.5 billion | ||
0.420 | % | Over $12.5 billion, up to and including $15 billion | ||
0.400 | % | Over $15 billion, up to and including $17.5 billion | ||
0.380 | % | Over $17.5 billion, up to and including $20 billion | ||
0.360 | % | Over $20 billion, up to and including $35 billion | ||
0.355 | % | Over $35 billion, up to and including $50 billion | ||
0.350 | % | In excess of $50 billion |
Franklin | ||||||||||||||||||||
Franklin | Franklin | Franklin | U.S. Government | Franklin | ||||||||||||||||
DynaTech | Growth | Income | Securities | Utilities | ||||||||||||||||
Fund | Fund | Fund | Fund | Fund | ||||||||||||||||
Reimbursement Plans: | ||||||||||||||||||||
Class A | 0.25 | % | 0.25 | % | 0.15 | % | 0.15 | % | 0.15 | % | ||||||||||
Compensation Plans: | ||||||||||||||||||||
Class B | 1.00 | % | 1.00 | % | 1.00 | % | 0.65 | % | 0.65 | % | ||||||||||
Class B1 | — | — | 0.65 | % | — | — | ||||||||||||||
Class C | 1.00 | % | 1.00 | % | 0.65 | % | 0.65 | % | 0.65 | % | ||||||||||
Class R | 0.50 | % | 0.50 | % | 0.50 | % | 0.50 | % | 0.50 | % |
Franklin | Franklin | Franklin | ||||||||||
DynaTech | Growth | Income | ||||||||||
Fund | Fund | Fund | ||||||||||
Sales charges retained net of commissions paid to unaffiliated broker/dealers | $ | 161,584 | $ | 1,481,545 | $ | 15,294,255 | ||||||
Contingent deferred sales charges retained | $ | 11,084 | $ | 49,128 | $ | 2,135,310 |
Franklin U.S. | ||||||||
Government | Franklin | |||||||
Securities | Utilities | |||||||
Fund | Fund | |||||||
Sales charges retained net of commissions paid to unaffiliated broker/dealers | $ | 3,332,731 | $ | 609,879 | ||||
Contingent deferred sales charges retained | $ | 869,536 | $ | 56,370 |
Franklin | Franklin | Franklin | Franklin | Franklin | ||||||||||||||||
DynaTech | Growth | Income | U.S. Government | Utilities | ||||||||||||||||
Fund | Fund | Fund | Securities Fund | Fund | ||||||||||||||||
Transfer agent fees | $ | 1,132,451 | $ | 4,221,956 | $ | 22,367,629 | $ | 6,376,862 | $ | 1,862,442 |
Franklin | Franklin | |||||||||||||||
DynaTech | Franklin | Franklin | U.S. Government | |||||||||||||
Fund | Growth Fund | Income Fund | Securities Fund | |||||||||||||
Capital loss carryforwards expiring in: | ||||||||||||||||
2011 | $ | — | $ | — | $ | — | $ | 33,556,845 | ||||||||
2012 | — | — | — | 129,102,166 | ||||||||||||
2013 | — | — | — | 74,283,298 | ||||||||||||
2014 | — | — | — | 47,763,112 | ||||||||||||
2015 | — | — | — | 28,034,940 | ||||||||||||
2016 | 8,729,949 | 84,084,287 | — | 20,514,778 | ||||||||||||
2017 | 29,338,979 | — | 589,874,490 | 18,668,917 | ||||||||||||
2018 | — | — | 4,428,035,897 | 16,923,309 | ||||||||||||
$ | 38,068,928 | a | $ | 84,084,287 | b | $ | 5,017,910,387 | $ | 368,847,365 | |||||||
a | Includes $34,098,719 from the merged Franklin Global Communications Fund, Franklin Global Health Care Fund and Franklin Technology Fund, which may be carried over to offset future capital gains, subject to certain limitations. | |
b | Includes $84,084,287 from the merged Franklin Capital Growth Fund, which may be carried over to offset future capital gains, subject to certain limitations. |
Franklin DynaTech Fund | Franklin Growth Fund | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Distributions paid from: | ||||||||||||||||
Ordinary income | $ | — | $ | — | $ | 21,980,390 | $ | 17,031,967 | ||||||||
Long term capital gain | — | 28,203,722 | — | — | ||||||||||||
$ | — | $ | 28,203,722 | $ | 21,980,390 | $ | 17,031,967 | |||||||||
Franklin | ||||||||||||||||
Franklin | U.S. Government | |||||||||||||||
Income Fund | Securities Fund | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Distributions paid from — ordinary income | $ | 3,527,248,290 | $ | 3,594,469,421 | $ | 379,063,914 | $ | 354,392,299 | ||||||||
Franklin Utilities Fund | ||||||||
2010 | 2009 | |||||||
Distributions paid from: | ||||||||
Ordinary income | $ | 91,153,934 | $ | 77,688,471 | ||||
Long term capital gain | 31,158,605 | 14,482,100 | ||||||
$ | 122,312,539 | $ | 92,170,571 | |||||
Franklin | Franklin | Franklin | ||||||||||
DynaTech Fund | Growth Fund | Income Fund | ||||||||||
Cost of investments | $ | 371,287,044 | $ | 1,967,622,302 | $ | 55,125,126,443 | ||||||
Unrealized appreciation | $ | 325,646,832 | $ | 1,717,401,392 | $ | 5,420,716,961 | ||||||
Unrealized depreciation | (3,987,081 | ) | (65,984,832 | ) | (6,258,981,337 | ) | ||||||
Net unrealized appreciation (depreciation) | $ | 321,659,751 | $ | 1,651,416,560 | $ | (838,264,376 | ) | |||||
Distributable earnings — undistributed ordinary income | — | $ | 10,862,427 | $ | 22,882,152 | |||||||
Franklin | ||||||||
U.S. Government | ||||||||
Securities | Franklin | |||||||
Fund | Utilities Fund | |||||||
Cost of investments | $ | 10,276,503,332 | $ | 1,963,315,349 | ||||
Unrealized appreciation | $ | 456,388,073 | $ | 636,002,624 | ||||
Unrealized depreciation | (4,098,246 | ) | (49,413,361 | ) | ||||
Net unrealized appreciation (depreciation) | $ | 452,289,827 | $ | 586,589,263 | ||||
Distributable earnings — undistributed ordinary income | $ | 22,769,777 | $ | 1,536,045 | ||||
Franklin | Franklin | Franklin | ||||||||||
DynaTech Fund | Growth Fund | Income Fund | ||||||||||
Purchases | $ | 202,165,615 | $ | 139,912,261 | $ | 26,917,363,212 | ||||||
Sales | $ | 235,343,797 | $ | 159,186,308 | $ | 23,306,640,917 |
Franklin | ||||||||
U.S. Government | Franklin | |||||||
Securities | Utilities | |||||||
Fund | Fund | |||||||
Purchases | $ | 6,691,090,530 | $ | 420,493,152 | ||||
Sales | $ | 4,542,572,645 | $ | 116,885,240 |
Number of | Premiums | |||||||
Contracts | Received | |||||||
Franklin Income Fund | ||||||||
Options outstanding at September 30, 2009 | — | $ | — | |||||
Options written | 38,796 | 1,290,389 | ||||||
Options expired | (37,796 | ) | (1,249,390 | ) | ||||
Options exercised | — | — | ||||||
Options closed | — | — | ||||||
Options outstanding at September 30, 2010 | 1,000 | $ | 40,999 | |||||
Change in | Average | |||||||||||||||
Unrealized | Amount | |||||||||||||||
Derivative Contracts | Realized Gain | Appreciation | Outstanding | |||||||||||||
Not Accounted for as | Statement of Operations | (Loss) for | (Depreciation) | During the | ||||||||||||
Hedging Instruments | Locations | the Year | for the Year | the Yeara | ||||||||||||
Equity contracts | Net realized gain (loss) from written options | $ | 1,249,390 | $ | 40,999 | $ | 3,869 |
a | Represents the average number of option contracts or notional amount for other derivative contracts outstanding during the year. |
�� | ||||||||||||||||||||||||||||
Number of | Number of | |||||||||||||||||||||||||||
Shares/ | Shares/ | Realized | ||||||||||||||||||||||||||
Principal Held | Principal | Value | Capital | |||||||||||||||||||||||||
at Beginning | Gross | Gross | Held at End | at End | Investment | Gain | ||||||||||||||||||||||
Name of Issuer | of Year | Additions | Reductions | of Year | of Year | Income | (Loss) | |||||||||||||||||||||
Franklin Income Fund | ||||||||||||||||||||||||||||
Non-Controlled Affiliates | ||||||||||||||||||||||||||||
Ameren Corp. | 12,100,000 | — | 9,100,000 | 3,000,000 | $ | — | a | $ | 12,169,850 | $ | (179,462,333 | ) | ||||||||||||||||
Ameren Corp., senior note, 8.875%, 5/15/14 | 58,200,000 | — | 58,200,000 | — | — | a | 638,704 | 7,173,310 | ||||||||||||||||||||
Callon Petroleum Co. | — | 4,181,258 | — | 4,181,258 | 20,697,227 | — | — | |||||||||||||||||||||
Callon Petroleum Co., senior secured note, 13.00%, 9/15/16 | — | 83,625,000 | 8,625,000 | 75,000,000 | 75,656,250 | 11,449,750 | (1,611,596 | ) | ||||||||||||||||||||
Canadian Oil Sands Trust | 25,847,400 | 152,600 | — | 26,000,000 | 643,773,401 | 37,524,602 | — | |||||||||||||||||||||
Colony Financial Inc. | 1,250,000 | — | — | 1,250,000 | 23,100,000 | 862,500 | — |
Number of | Number of | ||||||||||||||||||||||||||||
Shares/ | Shares/ | Realized | |||||||||||||||||||||||||||
Principal Held | Principal | Value | Capital | ||||||||||||||||||||||||||
at Beginning | Gross | Gross | Held at End | at End | Investment | Gain | |||||||||||||||||||||||
Name of Issuer | of Year | Additions | Reductions | of Year | of Year | Income | (Loss) | ||||||||||||||||||||||
Franklin Income Fund (continued) | |||||||||||||||||||||||||||||
Non-Controlled Affiliates (continued) | |||||||||||||||||||||||||||||
b | Dex Media West LLC, Term Loan B, 7.00%, 10/24/14 | — | 7,771,319 | 1,377,606 | 6,393,713 | 5,574,078 | 294,818 | 411,745 | |||||||||||||||||||||
Dex One Corp. | — | 10,242,757 | — | 10,242,757 | 125,781,056 | — | — | ||||||||||||||||||||||
Dex One Corp., senior sub. note, PIK, 12.00%, 1/29/17 | — | 81,136,340 | — | 81,136,340 | 64,199,129 | 6,572,044 | — | ||||||||||||||||||||||
iStar Financial Inc. | 5,213,500 | — | 5,213,500 | — | — | a | — | (131,827,123 | ) | ||||||||||||||||||||
iStar Financial Inc., 8.625%, 6/01/13 | 169,100,000 | 20,900,000 | — | 190,000,000 | — | a | 15,429,037 | — | |||||||||||||||||||||
iStar Financial Inc., cvt., senior note, FRN, 1.033%, 10/01/12 | 250,000,000 | — | 10,000,000 | 240,000,000 | — | a | 2,134,754 | (2,225,000 | ) | ||||||||||||||||||||
iStar Financial Inc., senior secured note, 144A, 8.00%, 3/15/11 | — | 20,392,000 | 20,392,000 | — | — | a | 236,454 | 461,230 | |||||||||||||||||||||
iStar Financial Inc.,senior secured note, 10.00%, 6/15/14 | 54,850,000 | 92,923,000 | 37,773,000 | 110,000,000 | — | a | 13,783,475 | (3,433,103 | ) | ||||||||||||||||||||
b | R.H. Donnelley Inc., Term Loan B, 9.00%, 10/24/14 | — | 42,659,116 | 5,453,101 | 37,206,015 | 31,744,693 | 1,649,515 | 544,067 | |||||||||||||||||||||
Total Affiliated Securities (1.82% of Net Assets) | $ | 990,525,834 | $ | 102,745,503 | $ | (309,968,803 | ) | ||||||||||||||||||||||
a | As of September 30, 2010, no longer an affiliate. | |
b | Company is a wholly owned subsidiary of Dex One Corp. |
Franklin | ||||||
Franklin | Franklin | U.S. Government | Franklin | |||
Growth Fund | Income Fund | Securities Fund | Utilities Fund | |||
7.85% | 4.53% | 3.90% | 0.95% |
Shares Issued | Unrealized | |||||||||||
by Franklin | Appreciation | |||||||||||
Fund Name | Net Assets | DynaTech Fund | (Depreciation) | |||||||||
Franklin Global Communications Fund | $ | 47,740,803 | 2,914,752 | $ | (18,325,185 | ) | ||||||
Franklin Global Health Care Fund | 89,644,203 | 5,503,466 | (8,804,887 | ) | ||||||||
Franklin Technology Fund | 32,802,922 | 2,006,525 | (10,136,675 | ) | ||||||||
Total | $ | 170,187,928 | 10,424,743 | $ | (37,266,747 | ) | ||||||
• | Level 1 — quoted prices in active markets for identical securities | ||
• | Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speed, credit risk, etc.) | ||
• | Level 3 — significant unobservable inputs (including the Funds’ own assumptions in determining the fair value of investments) |
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Franklin DynaTech Fund | ||||||||||||||||
Assets: | ||||||||||||||||
Investments in Securities: | ||||||||||||||||
Equity Investmentsa | $ | 687,142,088 | $ | — | $ | — | $ | 687,142,088 | ||||||||
Short Term Investments | 5,804,707 | — | — | 5,804,707 | ||||||||||||
Total Investments in Securities | $ | 692,946,795 | $ | — | $ | — | $ | 692,946,795 | ||||||||
Franklin Growth Fund | ||||||||||||||||
Assets: | ||||||||||||||||
Investments in Securities: | ||||||||||||||||
Equity Investmentsa | $ | 3,405,567,604 | $ | — | $ | — | $ | 3,405,567,604 | ||||||||
Short Term Investments | 181,648,270 | 31,822,988 | — | 213,471,258 | ||||||||||||
Total Investments in Securities | $ | 3,587,215,874 | $ | 31,822,988 | $ | — | $ | 3,619,038,862 | ||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Franklin Income Fund | ||||||||||||||||
Assets: | ||||||||||||||||
Investments in Securities: | ||||||||||||||||
Equity Investments:b | ||||||||||||||||
Consumer Discretionary | $ | 644,356,841 | $ | 97,165,390 | $ | — | $ | 741,522,231 | ||||||||
Energy | 2,112,064,317 | 164,739,200 | — | 2,276,803,517 | ||||||||||||
Financials | 3,247,594,227 | 309,583,990 | — | 3,557,178,217 | ||||||||||||
Health Care | 2,408,918,492 | 213,750,000 | — | 2,622,668,492 | ||||||||||||
Industrials | 121,875,000 | 1,600,000 | — | 123,475,000 | ||||||||||||
Other Equity Investmentsa | 8,686,980,426 | — | — | 8,686,980,426 | ||||||||||||
Equity-Linked Securities | — | 2,470,715,621 | — | 2,470,715,621 | ||||||||||||
Convertible Bonds | — | 334,521,810 | — | 334,521,810 | ||||||||||||
Corporate Bonds | — | 28,124,431,151 | 94,587,070 | 28,219,018,221 | ||||||||||||
Senior Floating Rate Interests | — | 3,157,331,490 | — | 3,157,331,490 | ||||||||||||
Municipal Bonds | — | 193,158,000 | — | 193,158,000 | ||||||||||||
Mutual Funds | 643,773,401 | — | — | 643,773,401 | ||||||||||||
Short Term Investments | 335,786,398 | 923,929,243 | — | 1,259,715,641 | ||||||||||||
Total Investments in Securities | $ | 18,201,349,102 | $ | 35,990,925,895 | $ | 94,587,070 | $ | 54,286,862,067 | ||||||||
Franklin U.S. Government Securities Fund | ||||||||||||||||
Assets: | ||||||||||||||||
Investments in Securities: | ||||||||||||||||
Mortgage-Backed Securities | $ | — | $ | 10,616,396,683 | $ | — | $ | 10,616,396,683 | ||||||||
Short Term Investments | 112,396,476 | — | — | 112,396,476 | ||||||||||||
Total Investments in Securities | $ | 112,396,476 | $ | 10,616,396,683 | $ | — | $ | 10,728,793,159 | ||||||||
Franklin Utilities Fund | ||||||||||||||||
Assets: | ||||||||||||||||
Investments in Securities: | ||||||||||||||||
Equity Investmentsa | $ | 2,428,269,322 | $ | — | $ | — | $ | 2,428,269,322 | ||||||||
Corporate Bonds | — | 80,641,304 | — | 80,641,304 | ||||||||||||
Short Term Investments | 40,993,986 | — | — | 40,993,986 | ||||||||||||
Total Investments in Securities | $ | 2,469,263,308 | $ | 80,641,304 | $ | — | $ | 2,549,904,612 | ||||||||
a | For detailed industry descriptions, see the accompanying Statements of Investments. | |
b | Includes common, preferred and convertible preferred stock as well as other equity investments. |
Net Change | ||||||||||||||||||||||||||||
Net Change | in Unrealized | |||||||||||||||||||||||||||
in | Appreciation | |||||||||||||||||||||||||||
Balance at | Net | Unrealized | Net | Transfer | Balance | (Depreciation) | ||||||||||||||||||||||
Beginning | Realized | Appreciation | Purchases | In (Out) of | at End | on Assets Held | ||||||||||||||||||||||
of Year | Gain (Loss) | (Depreciation) | (Sales) | Level 3 | of Year | at Year End | ||||||||||||||||||||||
Franklin Income Fund | ||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||
Corporate Bonds | $ | — | $ | — | $ | 2,337,070 | $ | 92,250,000 | $ | — | $ | 94,587,070 | $ | 2,337,070 |
ABBREVIATIONS | ||
Currency | ||
EUR | — Euro | |
GBP | — British Pound | |
Selected Portfolio | ||
ADR | — American Depository Receipt | |
FHLB | — Federal Home Loan Bank | |
FNMA | — Federal National Mortgage Association | |
FRN | — Floating Rate Note | |
GO | — General Obligation | |
GP | — Graduated Payment | |
L/C | — Letter of Credit | |
MTN | — Medium Term Note | |
PIK | — Payment-In-Kind | |
SF | — Single Family |
November 16, 2010
Franklin | ||||||
Utilities Fund | ||||||
$31,158,605 |
Franklin | Franklin | Franklin | ||
Growth Fund | Income Fund | Utilities Fund | ||
100% | 17.56% | 100% |
Franklin | Franklin | Franklin | Franklin | |||
DynaTech Fund | Growth Fund | Income Fund | Utilities Fund | |||
$3,891,060 | $48,125,611 | $666,952,003 | $100,252,215 |
Franklin | ||||||
Franklin | Franklin | U.S. Government | Franklin | |||
Growth Fund | Income Fund | Securities Fund | Utilities Fund | |||
$5,426 | $2,428,161,743 | $398,328,315 | $5,389,717 |
Number of Portfolios in | ||||||||||
Name, Year of Birth | Length of | Fund Complex Overseen | ||||||||
and Address | Position | Time Served | by Board Member* | Other Directorships Held | ||||||
Harris J. Ashton (1932) | Trustee | Since 1976 | 129 | Bar-S Foods (meat packing company) (1981-2010). | ||||||
One Franklin Parkway | ||||||||||
San Mateo, CA 94403-1906 | ||||||||||
Principal Occupation During Past 5 Years: | ||||||||||
Director of various companies; and formerly, Director, RBC Holdings, Inc. (bank holding company) (until 2002); and President, Chief Executive Officer and Chairman of the Board, General Host Corporation (nursery and craft centers) (until 1998). | ||||||||||
Sam Ginn (1937) One Franklin Parkway San Mateo, CA 94403-1906 | Trustee | Since 2007 | 106 | ICO Global Communications (Holdings) Limited (satellite company). | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Private investor; and formerly, Chairman of the Board, Vodafone AirTouch, PLC (wireless company); Chairman of the Board and Chief Executive Officer, AirTouch Communications (cellular communications) (1993-1998) and Pacific Telesis Group (telephone holding company) (1988-1994). | ||||||||||
Edith E. Holiday (1952) One Franklin Parkway San Mateo, CA 94403-1906 | Trustee | Since 1998 | 129 | Hess Corporation (exploration and refining of oil and gas), H.J. Heinz Company (processed foods and allied products), RTI International Metals, Inc. (manufacture and distribution of titanium), Canadian National Railway (railroad) and White Mountains Insurance Group, Ltd. (holding company). | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Director or Trustee of various companies and trusts; and formerly, Assistant to the President of the United States and Secretary of the Cabinet (1990-1993); General Counsel to the United States Treasury Department (1989-1990); and Counselor to the Secretary and Assistant Secretary for Public Affairs and Public Liaison-United States Treasury Department (1988-1989). | ||||||||||
J. Michael Luttig (1954) One Franklin Parkway San Mateo, CA 94403-1906 | Trustee | Since December 2009 | 129 | Boeing Capital Corporation (aircraft financing). | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Executive Vice President, General Counsel and member of Executive Council, The Boeing Company; and formerly, Federal Appeals Court Judge, U.S. Court of Appeals for the Fourth Circuit (1991-2006). |
Number of Portfolios in | ||||||||||
Name, Year of Birth | Length of | Fund Complex Overseen | ||||||||
and Address | Position | Time Served | by Board Member* | Other Directorships Held | ||||||
Frank A. Olson (1932) One Franklin Parkway | Trustee | Since 2005 | 129 | Hess Corporation (exploration and refining of oil and gas). | ||||||
San Mateo, CA 94403-1906 | ||||||||||
Principal Occupation During Past 5 Years: | ||||||||||
Chairman Emeritus, The Hertz Corporation (car rental) (since 2000) (Chairman of the Board (1980-2000) and Chief Executive Officer (1977-1999)); and formerly, Chairman of the Board, President and Chief Executive Officer, UAL Corporation (airlines). | ||||||||||
Larry D. Thompson (1945) One Franklin Parkway San Mateo, CA 94403-1906 | Trustee | Since 2007 | 137 | Cbeyond, Inc. (business communications provider) and The Southern Company (energy company). | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Senior Vice President — Government Affairs, General Counsel and Secretary, PepsiCo, Inc. (consumer products); and formerly, Director, Delta Airlines (aviation) (2003-2005) and Providian Financial Corp. (credit card provider) (1997-2001); Senior Fellow of The Brookings Institution (2003-2004); Visiting Professor, University of Georgia School of Law (2004); and Deputy Attorney General, U.S. Department of Justice (2001-2003). | ||||||||||
John B. Wilson (1959) One Franklin Parkway San Mateo, CA 94403-1906 | Lead Independent Trustee | Trustee since 2007 and Lead Independent Trustee since 2008 | 106 | None | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
President and Founder, Hyannis Port Capital, Inc. (real estate and private equity investing); serves on private and non-profit boards; and formerly, Chief Operating Officer and Executive Vice President, Gap, Inc. (retail) (1996-2000); Chief Financial Officer and Executive Vice President — Finance and Strategy, Staples, Inc. (office supplies) (1992-1996); Senior Vice President — Corporate Planning, Northwest Airlines, Inc. (airlines) (1990-1992); and Vice President and Partner, Bain & Company (consulting firm) (1986-1990). | ||||||||||
Interested Board Members and Officers | ||||||||||
Number of Portfolios in | ||||||||||
Name, Year of Birth | Length of | Fund Complex Overseen | ||||||||
and Address | Position | Time Served | by Board Member* | Other Directorships Held | ||||||
**Charles B. Johnson (1933) One Franklin Parkway San Mateo, CA 94403-1906 | Trustee and Chairman of the Board | Trustee since 1969 and Chairman of the Board since 2007 | 129 | None | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Chairman of the Board, Member — Office of the Chairman and Director, Franklin Resources, Inc.; and officer and/or director or trustee, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 41 of the investment companies in Franklin Templeton Investments. |
Number of Portfolios in | ||||||||||
Name, Year of Birth | Length of | Fund Complex Overseen | ||||||||
and Address | Position | Time Served | by Board Member* | Other Directorships Held | ||||||
**Rupert H. Johnson, Jr. (1940) One Franklin Parkway San Mateo, CA 94403-1906 | Trustee and Vice President | Trustee since 1983 and Vice President since 1982 | 51 | None | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Vice Chairman, Member — Office of the Chairman and Director, Franklin Resources, Inc.; Director, Franklin Advisers, Inc.; Senior Vice President, Franklin Advisory Services, LLC; and officer and/or director or trustee, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 25 of the investment companies in Franklin Templeton Investments. | ||||||||||
James M. Davis (1952) One Franklin Parkway San Mateo, CA 94403-1906 | Chief Compliance Officer and Vice President — AML Compliance | Chief Compliance Officer since 2004 and Vice President — AML Compliance since 2006 | Not Applicable | Not Applicable | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Director, Global Compliance, Franklin Resources, Inc.; officer of some of the other subsidiaries of Franklin Resources, Inc. and of 45 of the investment companies in Franklin Templeton Investments; and formerly, Director of Compliance, Franklin Resources, Inc. (1994-2001). | ||||||||||
Laura F. Fergerson (1962) One Franklin Parkway San Mateo, CA 94403-1906 | Chief Executive Officer — Finance and Administration | Since 2009 | Not Applicable | Not Applicable | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Vice President, Franklin Templeton Services, LLC; officer of 45 of the investment companies in Franklin Templeton Investments; and formerly, Director and member of Audit and Valuation Committees, Runkel Funds, Inc. (2003-2004); Assistant Treasurer of most of the investment companies in Franklin Templeton Investments (1997-2003); and Vice President, Franklin Templeton Services, LLC (1997-2003). | ||||||||||
Gaston Gardey (1967) One Franklin Parkway San Mateo, CA 94403-1906 | Treasurer, Chief Financial Officer and Chief Accounting Officer | Since 2009 | Not Applicable | Not Applicable | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Director, Fund Accounting, Franklin Templeton Investments; and officer of 27 of the investment companies in Franklin Templeton Investments. | ||||||||||
Aliya S. Gordon (1973) One Franklin Parkway San Mateo, CA 94403-1906 | Vice President | Since 2009 | Not Applicable | Not Applicable | ||||||
Principal Occupation During Past 5 Years: | ||||||||||
Associate General Counsel, Franklin Templeton Investments; officer of 45 of the investment companies in Franklin Templeton Investments; and formerly, Litigation Associate, Steefel, Levitt & Weiss, LLP (2000-2004). |
Number of Portfolios in | ||||||||
Name, Year of Birth | Length of | Fund Complex Overseen | ||||||
and Address | Position | Time Served | by Board Member* | Other Directorships Held | ||||
David P. Goss (1947) One Franklin Parkway San Mateo, CA 94403-1906 | Vice President | Since 2000 | Not Applicable | Not Applicable | ||||
Principal Occupation During Past 5 Years: | ||||||||
Senior Associate General Counsel, Franklin Templeton Investments; and officer and/or director, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 45 of the investment companies in Franklin Templeton Investments. | ||||||||
Steven J. Gray (1955) One Franklin Parkway San Mateo, CA 94403-1906 | Vice President | Since 2009 | Not Applicable | Not Applicable | ||||
Principal Occupation During Past 5 Years: | ||||||||
Senior Associate General Counsel, Franklin Templeton Investments; Vice President, Franklin Templeton Distributors, Inc.; and officer of 45 of the investment companies in Franklin Templeton Investments. | ||||||||
Edward B. Jamieson (1948) One Franklin Parkway San Mateo, CA 94403-1906 | President and Chief Executive Officer — Investment Management | Since April 2010 | Not Applicable | Not Applicable | ||||
Principal Occupation During Past 5 Years: | ||||||||
President, Chief Investment Officer and Director, Franklin Advisers, Inc.; Executive Vice President, Franklin Templeton Institutional, LLC; and officer and/or trustee, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 10 of the investment companies in Franklin Templeton Investments. | ||||||||
Robert C. Rosselot (1960) 500 East Broward Blvd. Suite 2100 Fort Lauderdale, FL 33394-3091 | Vice President | Since 2009 | Not Applicable | Not Applicable | ||||
Principal Occupation During Past 5 Years: | ||||||||
Senior Associate General Counsel, Franklin Templeton Investments; Assistant Secretary, Franklin Resources, Inc.; Vice President and Secretary, Templeton Investment Counsel, LLC; Vice President, Secretary and Trust Officer, Fiduciary Trust International of the South; and officer of 45 of the investment companies in Franklin Templeton Investments. | ||||||||
Karen L. Skidmore (1952) One Franklin Parkway San Mateo, CA 94403-1906 | Vice President and Secretary | Since 2006 | Not Applicable | Not Applicable | ||||
Principal Occupation During Past 5 Years: | ||||||||
Senior Associate General Counsel, Franklin Templeton Investments; and officer of 45 of the investment companies in Franklin Templeton Investments. |
Number of Portfolios in | ||||||||
Name, Year of Birth | Length of | Fund Complex Overseen | ||||||
and Address | Position | Time Served | by Board Member* | Other Directorships Held | ||||
Craig S. Tyle (1960) One Franklin Parkway San Mateo, CA 94403-1906 | Vice President | Since 2005 | Not Applicable | Not Applicable | ||||
Principal Occupation During Past 5 Years: | ||||||||
General Counsel and Executive Vice President, Franklin Resources, Inc.; officer of some of the other subsidiaries of Franklin Resources, Inc. and of 45 of the investment companies in Franklin Templeton Investments; and formerly, Partner, Shearman & Sterling, LLP (2004-2005); and General Counsel, Investment Company Institute (ICI) (1997-2004). |
* | We base the number of portfolios on each separate series of the U.S. registered investment companies within the Franklin Templeton Investments fund complex. These portfolios have a common investment manager or affiliated investment managers. | |
** | Charles B. Johnson and Rupert H. Johnson, Jr. are considered to be interested persons of the Fund under the federal securities laws due to their positions as officers and directors and major shareholders of Franklin Resources, Inc., which is the parent company of the Fund’s investment manager and distributor. | |
Note 1: | Charles B. Johnson and Rupert H. Johnson, Jr. are brothers. | |
Note 2: | Officer information is current as of the date of this report. It is possible that after this date, information about officers may change. | |
Note 3: | Prior to September 30, 2010, Robert F. Carlson and Frank W.T. LaHaye each ceased to be a trustee of the Trust. |
Franklin Balance Sheet Investment Fund
Franklin Large Cap Value Fund
Franklin MicroCap Value Fund1
Franklin MidCap Value Fund
Franklin Small Cap Value Fund
Mutual Beacon Fund
Mutual Quest Fund
Mutual Recovery Fund2
Mutual Shares Fund
Franklin Large Cap Equity Fund
Franklin Rising Dividends Fund
Franklin Flex Cap Growth Fund
Franklin Growth Fund
Franklin Growth Opportunities Fund
Franklin Small Cap Growth Fund
Franklin Small-Mid Cap Growth Fund
Franklin Global Real Estate Fund
Franklin Gold & Precious Metals Fund
Franklin Natural Resources Fund
Franklin Real Estate Securities Fund
Franklin Utilities Fund
Mutual Financial Services Fund
Templeton Global Opportunities Trust
Templeton Global Smaller Companies Fund
Templeton Growth Fund
Templeton World Fund
Franklin International Growth Fund
Franklin International Small Cap Growth Fund
Mutual European Fund
Mutual International Fund
Templeton BRIC Fund
Templeton China World Fund
Templeton Developing Markets Trust
Templeton Emerging Markets Small Cap Fund
Templeton Foreign Fund
Templeton Foreign Smaller Companies Fund
Templeton Frontier Markets Fund
Franklin Convertible Securities Fund
Franklin Equity Income Fund
Franklin Income Fund
Templeton Income Fund
Franklin Templeton Founding Funds Allocation Fund
Franklin Templeton Conservative Allocation Fund3
Franklin Templeton Growth Allocation Fund3
Franklin Templeton Moderate Allocation Fund3
Franklin Templeton 2015 Retirement Target Fund
Franklin Templeton 2025 Retirement Target Fund
Franklin Templeton 2035 Retirement Target Fund
Franklin Templeton 2045 Retirement Target Fund
Franklin Floating Rate Daily Access Fund
Franklin High Income Fund
Franklin Limited Maturity U.S. Government Securities Fund4
Franklin Real Return Fund
Franklin Strategic Income Fund
Franklin Strategic Mortgage Portfolio
Franklin Templeton Hard Currency Fund
Franklin Total Return Fund
Franklin U.S. Government Securities Fund4
Templeton Global Bond Fund
Templeton Global Total Return Fund
Templeton International Bond Fund
Federal Tax-Free Income Fund High
Yield Tax-Free Income Fund
Insured Tax-Free Income
Fund6
Federal Intermediate-Term Tax-Free Income Fund
Federal Limited-Term Tax-Free Income Fund
New York Intermediate-Term Tax-Free Income Fund
Alabama | Michigan8 | |
Arizona | Minnesota8 | |
California7 | Missouri | |
Colorado | New Jersey | |
Connecticut | New York7 | |
Florida | North Carolina | |
Georgia | Ohio8 | |
Kentucky | Oregon | |
Louisiana | Pennsylvania | |
Maryland | Tennessee | |
Massachusetts8 | Virginia |
1. | The fund is closed to new investors. Existing shareholders and select retirement plans can continue adding to their accounts. | |
2. | The fund is a continuously offered, closed-end fund. Shares may be purchased daily; there is no daily redemption. However, each quarter, pending board approval, the fund will authorize the repurchase of 5%–25% of the outstanding number of shares. Investors may tender all or a portion of their shares during the tender period. | |
3. | Effective 5/1/10, the Franklin Templeton Target Funds changed their name to the Franklin Templeton Allocation Funds. The funds’ investment goals and principal investment strategies remained unchanged. | |
4. | An investment in the fund is neither insured nor guaranteed by the U.S. government or by any other entity or institution. | |
5. | For investors subject to the alternative minimum tax, a small portion of fund dividends may be taxable. Distributions of capital gains are generally taxable. | |
6. | The fund invests primarily in insured municipal securities. | |
7. | These funds are available in three or more variations, including long-term portfolios, intermediate-term portfolios, portfolios of insured securities, a high-yield portfolio (CA only) and a money market portfolio (CA only). | |
8. | The Board of Trustees approved the elimination of the non-fundamental policy requiring the fund to invest at least 80% of net assets in insured municipal securities and the removal of the word “Insured” from the fund name. The changes became effective 2/15/09. | |
9. | The funds of the Franklin Templeton Variable Insurance Products Trust are generally available only through insurance company variable contracts. |
07/10 | Not part of the annual report |
![]() | One Franklin Parkway San Mateo, CA 94403-1906 |
on franklintempleton.com
Franklin Custodian Funds
Franklin Advisers, Inc.
Franklin Templeton Distributors, Inc.
(800) DIAL BEN®
franklintempleton.com
(800) 632-2301
Item 2. Code of Ethics.
(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer.
(c) N/A
(d) N/A
(f) Pursuant to Item 12(a)(1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.
Item 3. Audit Committee Financial Expert.
(a)(1) The Registrant has an audit committee financial expert serving on its audit committee.
(2) The audit committee financial expert is John B. Wilson and he is "independent" as defined under the relevant Securities and Exchange Commission Rules and Releases.
Item 4. Principal Accountant Fees and Services.
(a) Audit Fees
The aggregate fees paid to the principal accountant for professional services rendered by the principal accountant for the audit of the registrant’s annual financial statements or for services that are normally provided by the principal accountant in connection with statutory and regulatory filings or engagements were $372,044 for the fiscal year ended September 30, 2010 and $403,223 for the fiscal year ended September 30, 2009.
(b) Audit-Related Fees
The aggregate fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrant that are reasonably related to the performance of the audit of the registrant's financial statements and are not reported under paragraph (a) of Item 4 were $8,307 for the fiscal year ended September 30, 2010 and $2,650 for the fiscal year ended September 30, 2009. The services for which these fees were paid included attestation services.
There were no fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrant's investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant that are reasonably related to the performance of the audit of their financial statements.
(c) Tax Fees
There were no fees paid to the principal accountant for professional services rendered by the principal accountant to the registrant for tax compliance, tax advice and tax planning.
The aggregate fees paid to the principal accountant for professional services rendered by the principal accountant to the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant for tax compliance, tax advice and tax planning were $35,000 for the fiscal year ended September 30, 2010 and $2,000 for the fiscal year ended September 30, 2009. The services for whic h these fees were paid included technical tax consultation for capital gain tax reporting to foreign governments and derivative investments.
(d) All Other Fees
The aggregate fees paid to the principal accountant for products and services rendered by the principal accountant to the registrant not reported in paragraphs (a)-(c) of Item 4 were $26,774 for the fiscal year ended September 30, 2010 and $0 for the fiscal year ended September 30, 2009. The services for which these fees were paid include review of materials provided to the fund Board in connection with the investment management contract renewal process.
The aggregate fees paid to the principal accountant for products and services rendered by the principal accountant to the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant not reported in paragraphs (a)-(c) of Item 4 were $118,026 for the fiscal year ended September 30, 2010 and $0 for the fiscal year ended September 30, 2009. The services for which these fees were paid include review of materials provided to the fund Board in connection with the investment management contract renewal process.
(e) (1) The registrant’s audit committee is directly responsible for approving the services to be provided by the auditors, including:
(i) pre-approval of all audit and audit related services;
(ii) pre-approval of all non-audit related services to be provided to the Fund by the auditors;
(iii) pre-approval of all non-audit related services to be provided to the registrant by the auditors to the registrant’s investment adviser or to any entity that controls, is controlled by or is under common control with the registrant’s investment adviser and that provides ongoing services to the registrant where the non-audit services relate directly to the operations or financial reporting of the registrant; and
(iv) establishment by the audit committee, if deemed necessary or appropriate, as an alternative to committee pre-approval of services to be provided by the auditors, as required by paragraphs (ii) and (iii) above, of policies and procedures to permit such services to be pre-approved by other means, such as through establishment of guidelines or by action of a designated member or members of the committee; provided the policies and procedures are detailed as to the particular service and the committee is informed of each service and such policies and procedures do not include delegation of audit committee responsibilities, as contemplated under the Securities Exchange Act of 1934, to management; subject, in the case of (ii) through (iv), to any waivers, exceptions or exemptions that may be available under applicable law or rules.
(e) (2) None of the services provided to the registrant described in paragraphs (b)-(d) of Item 4 were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of regulation S-X.
(f) No disclosures are required by this Item 4(f).
(g) The aggregate non-audit fees paid to the principal accountant for services rendered by the principal accountant to the registrant and the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant were $188,107 for the fiscal year ended September 30, 2010 and $4,650 for the fiscal year ended September 30, 2009.
(h) The registrant’s audit committee of the board has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.
Item 5. Audit Committee of Listed Registrants. N/A
Item 6. Schedule of Investments. N/A
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. N/A
Item 8. Portfolio Managers of Closed-End Management Investment Companies. N/A
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. N/A
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant's Board of Trustees that would require disclosure herein.
Item 11. Controls and Procedures.
(a) Evaluation of Disclosure Controls and Procedures. The Registrant maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Registrant’s filings under the Securities Exchange Act of 1934 and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant’s management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.
Within 90 days prior to the filing date of this Shareholder Report on Form N-CSR, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant’s management, including the Registrant’s principal executive officer and the Registrant’s principal financial officer, of the effectiveness of the design and operation of the Registrant’s disclosure controls and procedures. Based on such evaluation, the Registrant’s principal executive officer and principal financial officer concluded that the Registrant’s disclosure controls and procedures are effective.
(b) Changes in Internal Controls. There have been no significant changes in the Registrant’s internal controls or in other factors that could significantly affect the internal controls subsequent to the date of their evaluation in connection with the preparation of this Shareholder Report on Form N-CSR.
Item 12. Exhibits.
(a) (1) Code of Ethics
(a) (2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Laura F. Fergerson,, Chief Executive Officer - Finance and Administration, and Gaston Gardey, Chief Financial Officer and Chief Accounting Officer
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Laura F. Fergerson,, Chief Executive Officer - Finance and Administration, and Gaston Gardey, Chief Financial Officer and Chief Accounting Officer
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
FRANKLIN CUSTODIAN FUNDS
By /s/LAURA F. FERGERSON
Laura F. Fergerson
Chief Executive Officer - Finance and Administration
Date November 24, 2010
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By /s/LAURA F. FERGERSON
Laura F. Fergerson
Chief Executive Officer - Finance and Administration
Date November 24, 2010
By /s/GASTON GARDEY
Gaston Gardey
Chief Financial Officer and
Chief Accounting Officer
Date November 24, 2010