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Mar 31, 2024

Franklin Resources Q2 2024 Earnings Report

Franklin Resources reported mixed second quarter results, marked by increased AUM and long-term net inflows, but also a decrease in net income and operating income compared to the previous quarter and prior year.

Key Takeaways

Franklin Resources reported a net income of $124.2 million, or $0.23 per diluted share, for the quarter ended March 31, 2024. The company saw positive contributions across asset classes, investment vehicles, and geographies, including long-term net inflows of $6.9 billion. Total assets under management (AUM) were $1,644.7 billion at the end of the quarter, up 13% due to the acquisition of Putnam Investments and positive net market changes.

Long-term net inflows reached $6.9 billion, driven by fixed income, multi-asset, and alternative assets.

Acquisition of Putnam Investments was completed in January, expanding investment capabilities and AUM.

Institutional pipeline of won-but-unfunded mandates grew to nearly $20 billion.

Total assets under management (AUM) reached $1,644.7 billion, a 13% increase during the quarter.

Total Revenue
$2.15B
Previous year: $1.93B
+11.7%
EPS
$0.56
Previous year: $0.61
-8.2%
Total AUM
$1.64T
Previous year: $1.42T
+15.7%
Equity AUM
$593B
Previous year: $437B
+35.6%
Fixed Income AUM
$571B
Previous year: $510B
+12.0%
Gross Profit
$1.53B
Previous year: $673M
+127.8%
Cash and Equivalents
$5.7B
Previous year: $5.8B
-1.7%
Free Cash Flow
$94.9M
Previous year: -$48.8M
-294.5%
Total Assets
$1.64T
Previous year: $1.42T
+15.7%

Franklin Resources

Franklin Resources

Franklin Resources Revenue by Segment

Franklin Resources Revenue by Geographic Location

Forward Guidance

The company will continue to focus on deepening client relationships, diversifying the firm, and disciplined expense management.

Positive Outlook

  • Deepening client relationships and further diversifying the firm.
  • Contributions across asset classes, investment vehicles and geographies.
  • Positive net flows across separately managed account, ETF and Canvas® offerings.
  • Aggregate positive net flows in non-US regions.
  • Focus on disciplined expense management while leveraging net cash and investments to invest in growth and innovation.

Challenges Ahead

  • Market and volatility risks
  • Investment performance and reputational risks
  • Global operational risks
  • Competition and distribution risks
  • Third-party risks

Revenue & Expenses

Visualization of income flow from segment revenue to net income