EXHIBIT 99
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One Franklin Parkway
San Mateo, CA 94403-1906
[LOGO of Franklin Templeton Investments] tel 650/ 312.2000
franklintempleton.com
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Contact: Franklin Resources, Inc.
Investor Relations: Alan Weinfeld (650) 525-8900
Corporate Communications: Holly Gibson Brady (650) 312-4701
franklintempleton.com
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FOR IMMEDIATE RELEASE
FRANKLIN RESOURCES, INC. ANNOUNCES THIRD QUARTER RESULTS
SAN MATEO, CA, JULY 25, 2002 - Franklin Resources, Inc. (Franklin Templeton
Investments) (NYSE: BEN) today reported net income of $125.7 million, or $0.48
per share diluted, on revenues of $666.1 million for the quarter ended June 30,
2002, compared with net income of $120.0 million, or $0.46 per share diluted, on
revenues of $626.0 million in the preceding quarter and net income of $119.7
million, or $0.46 per share diluted, on revenues of $609.5 million in the
comparable quarter a year ago. Operating income increased 4% this quarter over
the prior quarter, 23% over the same quarter in the prior year, and by 6% for
the nine months ended June 30, 2002 over the same period in the prior year.
As of June 30, 2002, assets under management by the company's subsidiaries
were $270.4 billion, as compared to $274.5 billion last quarter and $267.9
billion at this time last year. Simple monthly average assets under management
during the current quarter were $274.8 billion compared to $267.9 billion in the
preceding quarter and $255.9 billion in the same quarter a year ago. Equity
assets now comprise 53% of total assets under management as compared to 54% last
quarter and 55% at June 30, 2001. Fixed-income assets now comprise 31% of total
assets under management, as compared to 30% last quarter and 29% at the same
time last year. As of June 30, 2002 and March 31, 2002, hybrid assets account
for 15% of total assets under management, as compared to 14% at June 30, 2001.
Sales and reinvested dividends exceeded redemptions ("net inflows") for the
seventh consecutive quarter. Complex-wide net inflows were $5.6 billion for the
current quarter compared to $5.0 billion for the prior quarter and $2.7 billion
for the comparable quarter a year ago.
FISCAL THIRD QUARTER 2002 HIGHLIGHTS
PERFORMANCE AND PRODUCTS /1/,/2/
(See important footnotes in "Supplemental Information" section at the end of the
release.)
* Over 79% of Franklin Templeton's long-term U.S. retail mutual fund assets
were in funds ranked in the top two quartiles of their respective LIPPER
peer groups for the one-, three-, five- and 10-year periods ended June 30,
2002. /3/,/4/
* In LIPPER'S mutual fund evaluation tool, LIPPER LEADERS, Franklin Templeton
Investments garnered more awards than any other mutual fund company under
the consistent return and preservation categories combined as of June 30,
2002. /5/
* Over 90% of Templeton equity mutual fund assets were in funds ranked in the
top two quartiles of their respective LIPPER peer groups for the one-,
three-, five- and 10-year periods ended June 30, 2002. Templeton Foreign
Fund and Templeton Growth Fund ranked in the top quintile of their
respective LIPPER peer groups for the one-, three-, five- and 10-year
periods ended June 30, 2002, and outpaced their respective benchmark
indices, the MSCI EAFE Index and MSCI World Index, for the same time
periods./3/,/6/
* Templeton Growth Fund was rated 5 stars overall by MORNINGSTAR as of June
30, 2002. Templeton Foreign Fund and Templeton World Fund were rated 4
stars overall by MORNINGSTAR as of June 30, 2002. /7/,/8/
* All six Mutual Series funds were ranked in the top two quartiles of their
respective LIPPER peer groups for the one-, three-, five- and 10-year
periods ended June 30, 2002. /3/,/9/
* Announced that Franklin California Growth Fund will be renamed Franklin
Flex Cap Growth Fund effective September 1, 2002. The fund was rated 4
stars overall by MORNINGSTAR as of June 30, 2002, and ranked in the top
quintile of its LIPPER peer group for the one-, three-, five- and 10-year
periods ended June 30, 2002. /3/,/7/,/10/,/11/
* Franklin Templeton Investments Corp. (Canada) successfully launched the
Series T group of funds designed for Canadians looking for a tax efficient
withdrawal plan from their investments.
GLOBAL BUSINESS DEVELOPMENTS
* Franklin Templeton Investments was recognized as WORTH magazine's Editor's
Choice for "Favorite Mutual Fund Family."
* CEO Charles B. Johnson was recognized by FORBES.COM as one of 12 chief
executives who have successfully led their respective companies for over a
25 year period.
* New assignments for FTI Institutional include a Franklin U.S. multi-cap
equity mandate for CalPERS, the first combined Templeton-Fiduciary global
core strategy mandate for Conference of Seventh Day Adventists and a
Franklin small-cap equity strategy for the New Mexico Educational
Retirement Board.
* Franklin Templeton Private Client Group's new global equity all cap
multiple discipline strategy, which pairs the investment expertise of
Templeton and Fiduciary, was added to Salomon Smith Barney's Consulting
Group's Diversified Strategic Portfolios product.
* Defined Contribution Services received the 2002 achievement award from the
Association of Graphic Communicators for the "The Path to Your Retirement
Future" enrollment book.
FRANKLIN RESOURCES, INC.
CONSOLIDATED INCOME STATEMENTS
(Dollar amounts in thousands except assets THREE MONTHS ENDED NINE MONTHS ENDED
under management and per share data)
JUNE 30 JUNE 30
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2002 2001 % 2002 2001 %
---- ---- CHANGE ---- ---- CHANGE
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OPERATING REVENUES
Investment management fees $384,840 $362,543 6% $1,107,416 $1,048,464 6%
Underwriting and distribution fees 213,300 180,757 18% 602,844 523,284 15%
Shareholder servicing fees 48,832 53,723 (9)% 144,197 153,907 (6)%
Other, net 19,078 12,450 53% 55,768 25,305 120%
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TOTAL OPERATING REVENUES 666,050 609,473 9% 1,910,225 1,750,960 9%
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OPERATING EXPENSES
Underwriting and distribution 191,586 162,977 18% 541,180 470,795 15%
Compensation and benefits 167,570 167,643 - 487,477 449,576 8%
Information systems, technology and 75,573 70,576 7% 223,364 187,106 19%
occupancy
Advertising and promotion 29,268 27,314 7% 81,174 73,873 10%
Amortization of deferred sales commissions 17,677 16,361 8% 51,467 52,176 (1)%
Amortization of intangible assets 4,238 16,672 (75)% 12,871 36,688 (65)%
Other, net 26,286 23,234 13% 67,956 62,599 9%
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TOTAL OPERATING EXPENSES 512,198 484,777 6% 1,465,489 1,332,813 10%
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OPERATING INCOME 153,852 124,696 23% 444,736 418,147 6%
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OTHER INCOME (EXPENSE)
Investment and other income 18,017 34,698 (48)% 51,128 116,708 (56)%
Interest expense (3,158) (1,889) 67% (9,134) (7,418) 23%
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OTHER INCOME (EXPENSE), NET 14,859 32,809 (55)% 41,994 109,290 (62)%
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Income before taxes on income 168,711 157,505 7% 486,730 527,437 (8)%
Taxes on income 43,021 37,802 14% 122,525 126,585 (3)%
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NET INCOME $125,690 $119,703 5% $364,205 $400,852 (9)%
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EARNINGS PER SHARE
Basic $0.48 $0.46 4% $1.39 $1.61 (14)%
Diluted $0.48 $0.46 4% $1.39 $1.60 (13)%
DIVIDENDS PER SHARE $0.07 $0.065 8% $0.21 $0.195 8%
AVERAGE SHARES OUTSTANDING (in thousands)
Basic 261,952 260,815 - 261,507 249,591 5%
Diluted 263,087 262,174 - 262,401 250,622 5%
EBITDA MARGIN /1/ 30% 32% 30% 35%
OPERATING MARGIN /2/ 23% 20% 23% 24%
ASSETS UNDER MANAGEMENT (in millions)
Beginning of period $274,474 $215,716 27% 246,385 $229,923 7%
Sales 18,606 15,416 21% 56,288 43,725 29%
Reinvested dividends 1,113 2,179 (49)% 4,216 8,399 (50)%
Redemptions (14,128) (14,873) (5)% (43,930) (45,025) (2)%
Acquisitions - 45,838 (100)% - 49,546 (100)%
(Depreciation)/appreciation (9,632) 3,652 N/A 7,474 (18,640) N/A
END OF PERIOD $270,433 $267,928 1% $270,433 $267,928 1%
SIMPLE MONTHLY AVERAGE FOR PERIOD $274,816 $255,929 7% $265,578 $238,692 11%
/1/ EBITDA Margin: Earnings before interest, taxes on income, depreciation and the amortization of intangibles
divided by total revenues.
/2/ Operating Margin: Operating income divided by total operating revenues.
FRANKLIN RESOURCES, INC.
CONSOLIDATED INCOME STATEMENTS
(Dollar amounts in thousands except
per share data, employees and billable THREE MONTHS ENDED
shareholder accounts)
30-JUN-02 31-MAR-02 % 31-DEC-01 30-SEP-01 30-JUN-01
--------- --------- CHANGE --------- --------- ---------
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OPERATING REVENUES
Investment management fees $384,840 $365,778 5% $356,798 $358,738 $362,543
Underwriting and distribution fees 213,300 197,537 8% 192,007 186,192 180,757
Shareholder servicing fees 48,832 48,024 2% 47,341 45,618 53,723
Other, net 19,078 14,629 30% 22,061 13,335 12,450
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TOTAL OPERATING REVENUES 666,050 625,968 6% 618,207 603,883 609,473
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OPERATING EXPENSES
Underwriting and distribution 191,586 177,327 8% 172,267 166,073 162,977
Compensation and benefits 167,570 159,764 5% 160,143 165,705 167,643
Information systems, technology and 75,573 73,197 3% 74,594 76,191 70,576
occupancy
Advertising and promotion 29,268 25,481 15% 26,425 32,388 27,314
Amortization of deferred sales commissions 17,677 17,047 4% 16,743 16,801 16,361
Amortization of intangible assets 4,238 4,258 - 4,375 19,902 16,672
Other, net 26,286 20,875 26% 20,795 25,326 23,234
September 11, 2001 net expense - - - - 7,649 -
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TOTAL OPERATING EXPENSES 512,198 477,949 7% 475,342 510,035 484,777
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OPERATING INCOME 153,852 148,019 4% 142,865 93,848 124,696
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OTHER INCOME (EXPENSE)
Investment and other income 18,017 14,782 22% 18,329 19,643 34,698
Interest expense (3,158) (2,808) 12% (3,168) (3,138) (1,889)
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OTHER INCOME (EXPENSE), NET 14,859 11,974 24% 15,161 16,505 32,809
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Income before taxes on income 168,711 159,993 5% 158,026 110,353 157,505
Taxes on income 43,021 39,997 8% 39,507 26,484 37,802
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NET INCOME $125,690 $119,996 5% $118,519 $83,869 $119,703
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EARNINGS PER SHARE
Basic $0.48 $0.46 4% $0.45 $0.32 $0.46
Diluted $0.48 $0.46 4% $0.45 $0.32 $0.46
DIVIDENDS PER SHARE $0.070 $0.070 - $0.070 $0.065 $0.065
AVERAGE SHARES OUTSTANDING (in
thousands)
Basic 261,952 261,596 - 260,981 261,639 260,815
Diluted 263,087 262,111 - 261,636 263,005 262,174
EBITDA MARGIN /1/ 30% 30% 30% 26% 32%
OPERATING MARGIN /2/ 23% 24% 23% 16% 20%
EMPLOYEES 6,457 6,444 - 6,603 6,868 7,101
BILLABLE SHAREHOLDER ACCOUNTS (in millions) 9.7 9.5 2% 8.9 8.4 10.1
/1/ EBITDA Margin: Earnings before interest, taxes on income, depreciation and the amortization of intangibles
divided by total revenues.
/2/ Operating Margin: Operating income divided by total operating revenues.
FRANKLIN RESOURCES, INC.
PRELIMINARY SUMMARY BALANCE SHEET
(Dollar amounts in thousands)
PRELIMINARY
JUNE 30, SEPTEMBER
2002 30, 2001
---- --------
ASSETS
Current assets $2,533,545 $1,930,276
Banking/Finance assets 1,078,042 1,229,244
Other assets 2,837,177 3,106,130
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TOTAL ASSETS $6,448,764 $6,265,650
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $480,212 $457,433
Banking/Finance liabilities 880,318 1,070,661
Other liabilities 771,953 759,660
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Total liabilities 2,132,483 2,287,754
Total stockholders' equity 4,316,281 3,977,896
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $6,448,764 $6,265,650
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ENDING SHARES OF COMMON STOCK OUTSTANDING 262,001 260,798
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ASSETS UNDER MANAGEMENT BY INVESTMENT OBJECTIVE
(in billions) 30-JUN-02 31-MAR-02 31-DEC-01 30-SEP-01 30-JUN-01
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EQUITY
Global/international $93.6 $93.9 $89.4 $80.2 $93.4
Domestic 48.5 53.2 51.7 44.5 53.3
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Total equity 142.1 147.1 141.1 124.7 146.7
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HYBRID 39.6 40.8 38.6 36.1 38.3
FIXED-INCOME
Tax-free 50.2 48.7 48.3 48.4 46.9
Taxable:
Domestic 24.7 24.6 25.1 24.4 23.4
Global/international 8.4 7.7 7.4 7.2 7.2
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Total fixed-income 83.3 81.0 80.8 80.0 77.5
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MONEY 5.4 5.6 5.8 5.6 5.4
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TOTAL ENDING ASSETS $270.4 $274.5 $266.3 $246.4 $267.9
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SIMPLE MONTHLY AVERAGE ASSETS $274.8 $267.9 $256.4 $261.3 $255.9
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ASSETS UNDER MANAGEMENT & FLOWS
(in billions) THREE MONTHS ENDED
30-JUN-02 31-MAR-02 % CHANGE 30-JUN-01 % CHANGE
BEGINNING ASSETS UNDER MANAGEMENT $274.5 $266.3 3% $215.7 27%
U.S. RETAIL ASSETS
Beginning assets $172.8 $167.9 3% $161.6 7%
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Sales 11.4 11.3 1% 10.9 5%
Reinvested dividends 1.1 0.5 120% 2.0 (45)%
Redemptions (8.8) (8.7) 1% (10.5) (16)%
Acquisitions - - - - -
(Depreciation)/appreciation (6.6) 1.8 N/A 6.8 N/A
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Ending assets 169.9 172.8 (2)% 170.8 (1)%
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OTHER ASSETS, INCLUDING INTERNATIONAL AND INSTITUTIONAL
Beginning assets $101.7 $98.4 3% 54.1 88%
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Sales 7.2 7.5 (4)% 4.5 60%
Reinvested dividends - - - 0.2 (100)%
Redemptions (5.3) (5.6) (5)% (4.4) 20%
Acquisitions - - - 45.8 -
(Depreciation)/appreciation (3.1) 1.4 N/A (3.1) -
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Ending assets 100.5 101.7 (1)% 97.1 4%
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ENDING ASSETS UNDER MANAGEMENT $270.4 $274.5 (1)% $267.9 1%
TOTAL ASSETS UNDER MANAGEMENT
BEGINNING ASSETS $274.5 $266.3 3% $215.7 27%
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Sales 18.6 18.8 (1)% 15.4 21%
Reinvested dividends 1.1 0.5 120% 2.2 (50)%
Redemptions (14.1) (14.3) (1)% (14.9) (5)%
Acquisitions - - - 45.8 (100)%
(Depreciation)/appreciation (9.7) 3.2 N/A 3.7 N/A
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ENDING ASSETS $270.4 $274.5 (1)% $267.9 1%
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Note: Institutional assets totaling approximately $17.2 billion are invested in U.S. Retail fund and annuity
products and are disclosed in U.S. Retail assets in the above table. Total institutional and high net-worth
assets at June 30, 2002 were approximately $92.3 billion, of which high net-worth assets comprised $10.8 billion.
ASSETS UNDER MANAGEMENT & FLOWS BY INVESTMENT OBJECTIVE
(in billions)
THREE MONTHS ENDED
30-JUN-02 31-MAR-02 30-JUN-01
--------- --------- ---------
GLOBAL/INTERNATIONAL EQUITY
Beginning assets $93.9 $89.4 $87.6
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Sales 7.0 6.9 5.3
Reinvested dividends 0.1 - 0.7
Redemptions (4.7) (5.1) (5.8)
Acquisitions - - 3.2
(Depreciation)/appreciation (2.7) 2.7 2.4
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Ending assets 93.6 93.9 93.4
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DOMESTIC EQUITY
Beginning assets 53.2 51.7 45.5
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Sales 3.6 3.8 3.1
Reinvested dividends 0.3 - 0.7
Redemptions (2.6) (2.2) (2.2)
Acquisitions - - 3.7
(Depreciation)/appreciation (6.0) (0.1) 2.5
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Ending assets 48.5 53.2 53.3
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HYBRID
Beginning assets 40.8 38.6 9.8
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Sales 1.2 1.6 0.6
Reinvested dividends 0.2 0.1 0.2
Redemptions (0.6) (0.4) (0.5)
Acquisitions - - 29.1
(Depreciation)/appreciation (2.0) 0.9 (0.9)
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Ending assets 39.6 40.8 38.3
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TAX-FREE INCOME
Beginning assets 48.7 48.3 45.8
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Sales 1.8 1.7 1.6
Reinvested dividends 0.3 0.3 0.3
Redemptions (1.4) (1.2) (1.2)
Acquisitions - - 0.1
Appreciation/(depreciation) 0.8 (0.4) 0.3
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Ending assets 50.2 48.7 46.9
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TAXABLE FIXED-INCOME
Beginning assets 32.3 32.5 21.1
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Sales 2.7 2.4 1.9
Reinvested dividends 0.2 0.1 0.2
Redemptions (2.3) (2.7) (1.8)
Acquisitions - - 9.7
Appreciation/(depreciation) 0.2 - (0.5)
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Ending assets 33.1 32.3 30.6
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MONEY
Beginning assets 5.6 5.8 5.9
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Sales 2.3 2.4 2.9
Reinvested dividends - - 0.1
Redemptions (2.5) (2.7) (3.4)
Acquisitions - - -
Appreciation/(depreciation) - 0.1 (0.1)
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Ending assets 5.4 5.6 5.4
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ENDING ASSETS UNDER MANAGEMENT $270.4 $274.5 $267.9
CONFERENCE CALL INFORMATION
- ---------------------------
As previously announced, members of the investment community and general
public are invited to listen to the earnings conference call TODAY, THURSDAY,
JULY 25, 2002 AT 1:30 P.M. PACIFIC TIME. Access to the teleconference will be
available via franklintempleton.com 10 minutes before the start of the call or
by dialing (877) 260-8900 in the U.S. or (612) 288-0337 internationally.
A replay of the call will be archived on franklintempleton.com through
August 2, 2002. The replay can also be accessed by calling (800) 475-6701 in the
U.S. or (320) 365-3844 internationally and using access code #642738, after 5:00
p.m. Pacific Time on July 25 through 11:59 p.m. Pacific Time on August 2.
Franklin Templeton Investments provides global and domestic investment
management services through its Franklin, Templeton, Mutual Series and Fiduciary
Trust subsidiaries. The San Mateo, CA-based company has over 50 years of
investment experience. For more information, please visit franklintempleton.com
or call 1-800/DIAL BEN(R).
SUPPLEMENTAL INFORMATION
- ------------------------
1. Nothing in this section shall be considered a solicitation to buy or an offer
to sell a security to any person in any jurisdiction where such offer,
solicitation, purchase or sale would be unlawful under the securities laws of
such jurisdiction. For more information on any U.S. Franklin Templeton fund,
investors should request a prospectus containing more complete information,
including sales charges, expenses and risks, from securities dealers or by
calling Franklin Templeton Distributors, Inc. at 1-800/DIAL BEN(R)
(1-800/342-5236). Investors should read the prospectus carefully before
investing or sending money. Franklin Templeton Distributors, Inc., One Franklin
Parkway, San Mateo, CA, is the funds' principal distributor and a wholly owned
subsidiary of Franklin Resources, Inc.
2. PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. MORNINGSTAR ratings are
based on Class A shares. LIPPER rankings are based on Class A shares, with the
exception of those for Mutual Series, which are based on Class Z shares, which
are offered to qualified investors only and have no sales charges nor Rule 12b-1
fees. All asset data is based on 05/31/02 figures. Indices are unmanaged and one
cannot invest directly in them. Unless otherwise noted, fund returns quoted
reflect Class A shares. Performance returns, ratings and rankings for other
classes may vary. Investment return and principal value will fluctuate with
market conditions and an investor may experience a gain or loss when they sell
their shares.
3. LIPPER calculates averages by taking all the funds in a peer group and
averaging their total returns for the periods indicated. LIPPER tracks 128 peer
groups of long-term U.S. retail mutual funds, and the groups vary in size from 6
to 885. LIPPER total return calculations include reinvested dividends and
capital gains, but do not include sales charges or expense subsidization by the
manager. Results may have been different if these or other factors had been
considered.
4. Source: LIPPER(R) INC., 6/30/02. Of the eligible Franklin Templeton non-money
market funds tracked by LIPPER, 35, 40, 34 and 19 funds ranked in the top
quartile and 24, 25, 22 and 19 funds ranked in the second quartile, for the
one-, three-, five- and 10-year periods, respectively, for their respective
LIPPER peer groups.
5. Source: LIPPER(R) INC., 6/30/02. Franklin Templeton funds received 87 LIPPER
LEADER designations for Preservation and 47 LIPPER LEADER designations for
Consistent Return. LIPPER LEADER for Consistent Return ratings reflect the
degree of a fund's historical success in achieving superior risk-adjusted
returns, adjusted for volatility, relative to peers. LIPPER LEADER for
Preservation ratings reflect the degree of a fund's historical success in
avoiding periods of losses relative to other funds within the same asset class.
Preservation ratings are relative, rather than absolute, measures, and funds
named LIPPER LEADERS for Preservation may still experience losses periodically;
those losses may by larger for equity and mixed equity funds than for
fixed-income funds. Twenty percent of funds analyzed in each category are named
LIPPER LEADERS. LIPPER LEADERS MEASURE PAST FUND PERFORMANCE, AND PAST
PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. LIPPER LEADER STATUS DOES NOT
NECESSARILY IMPLY THAT A FUND HAD THE BEST PERFORMANCE WITHIN ITS CATEGORY.
LIPPER LEADER STATUS IS BASED ON RETURNS FOR A 3-YEAR PERIOD AND IS CALCULATED
MONTHLY USING DATA AVAILABLE AT THE TIME OF THE CALCULATION; LIPPER UNDERTAKES
NO RESPONSIBILITY FOR UPDATING THE CALCULATIONS MORE FREQUENTLY THAN MONTHLY TO
INCORPORATE MORE CURRENT DATA.
6. Source: LIPPER(R) INC., 6/30/02. 10 out of 11 eligible Templeton equity funds
ranked in the top two LIPPER quartiles for the one-year period, 9 of 11 for the
three-year period, 5 of 11 for the five-year period and 6 of 8 for the 10-year
period for their respective LIPPER peer groups. Templeton Growth Fund Class A
ranked 16 in a universe of 317 funds in LIPPER's "Global Funds" group for the
one-year period, 18 of 211 for the three-year period, 19 of 136 for the
five-year period and 5 of 27 for the 10-year period. Templeton Foreign Fund
Class A ranked 55 in a universe of 784 funds in LIPPER'S "International Funds"
group for the one-year period, 52 of 563 for the three-year period, 52 of 381
for the five-year period and 15 of 81 for the 10-year period. Source for MSCI
returns: Standard & Poor's Micropal.
7. Source: MORNINGSTAR (C) 6/30/02. For each fund with at least a three-year
history, MORNINGSTAR calculates a Morningstar Rating(TM) based on a Morningstar
Risk-Adjusted Return measure that accounts for variation in a fund's monthly
performance (including the effects of sales charges, loads and redemption fees),
placing more emphasis on downward variations and rewarding consistent
performance. The top 10% of funds in each category receive 5 stars, the next
22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2
stars and the bottom 10% receive 1 star. (Each share class is counted as a
fraction of one fund within this scale and rated separately, which may cause
slight variations in the distribution percentages.) The Overall Morningstar
Rating for a fund is derived from a weighted-average of the performance figures
associated with its three-, five- and 10-year (if applicable) Morningstar Rating
metrics.
8. Source: MORNINGSTAR (C) 6/30/02. Based on Class A shares, Templeton Growth
Fund was rated against the following numbers of U.S. domiciled "World Stock"
funds over the following time period: 241 funds in the last three years, 164 in
the last five years and 33 in the last 10 years. With respect to these "World
Stock" funds, the fund received a Morningstar Rating of 4 stars, 4 stars and 5
stars for the three-, five-, 10-year periods, respectively. Based on Class A
shares, Templeton Foreign Fund was rated against the following numbers of U.S.
domiciled "Foreign Stock" funds over the following time period: 621 funds in the
last three years, 420 in the last five years and 84 in the last 10 years. With
respect to these "Foreign Stock" funds, the fund received a Morningstar Rating
of 4 stars, 4 stars and 4 stars for the three-, five-, 10-year periods,
respectively. Based on Class A shares, Templeton World Fund was rated against
the following numbers of U.S. domiciled "World Stock" funds over the following
time period: 241 funds in the last three years, 164 in the last five years and
33 in the last 10 years. With respect to these "World Stock" funds, the fund
received a Morningstar Rating of 4 stars, 4 stars and 4 stars for the three-,
five-, 10-year periods, respectively.
9. Source: LIPPER(R) INC., 6/30/02. 6 out of 6 eligible Mutual Series equity
funds ranked in the top two LIPPER quartiles for the one-year period, 6 of 6 for
the three-year period, 5 of 5 for the five-year period and 3 of 3 for the
10-year period for their respective LIPPER peer groups.
10. Source: MORNINGSTAR (C) 6/30/02. Based on Class A shares, Franklin
California Growth Fund was rated against the following numbers of U.S. domiciled
"Mid-Cap Growth" funds over the following time periods: 475 funds in the last
three years, 322 in the last five years and 79 in the last 10 years. With
respect to these "Mid-Cap Growth" funds, the fund received a Morningstar Rating
of 3 stars, 3 stars and 5 stars for the three-, five-, 10-year periods,
respectively.
11. Source: LIPPER(R)INC., 6/30/02. Franklin California Growth Fund Class A
ranked 77 in a universe of 406 funds in Lipper's "Multi-Cap Growth Funds" group
for the one-year period, 13 of 233 for the three-year period, 12 of 154 for the
five-year period and 1 of 45 for the 10-year period.
FORWARD-LOOKING STATEMENTS
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Statements in this press release regarding Franklin Resources, Inc.'s
business which are not historical facts are "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements involve a number of risks, uncertainties and other
important factors that could cause the actual results and outcomes to differ
materially from any future results or outcomes expressed or implied by such
forward-looking statements. These risks, uncertainties and other important
factors are described in more detail in the "Risk Factors" section in Franklin's
recent filings with the U.S. Securities and Exchange Commission, including,
without limitation, the "Risk Factors" section of the Management's Discussion
and Analysis of Financial Condition and Results of Operations in Franklin's
Annual Report on Form 10-K for the fiscal year ended September 30, 2001.
* The levels of our assets under management are subject to significant
fluctuations.
* We face strong competition from numerous and sometimes larger
companies.
* Changes in the distribution channels on which we depend could reduce
our revenues or hinder our growth.
* Previously announced revenue and cost synergies from the acquisition
of Fiduciary Trust Company International may not be fully realized and
may take longer to realize than originally anticipated.
* For the next several years, insurance costs may increase materially
and we may not be able to obtain the same types or amounts of
coverage.
* We may not recover all losses on insurance claims for property damage
and business interruptions arising out of the terrorist attacks on
September 11, 2001.
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