Franklin Resources Q3 Results Beat Estimates

(RTTNews) - Franklin Resources Inc. (BEN) on Monday reported a 21 percent increase in profit for the third quarter from last year, reflecting higher investment management fees as well as sales and distribution fees. Assets under management increased 15 percent from last year. Both revenue and earnings per share for the quarter beat analysts' estimates.

San Mateo, California-based Franklin Resources is an asset management holding company that offers investment vehicles for clients, including individuals, institutions, pension plans, trusts and partnerships.

The company's investment management fees for the third quarter grew 18 percent from the year-ago period to $1.32 billion, while sales and distribution fees increased 17 percent to $664.5 million. Shareholder servicing fees were flat with last year at $77.5 million, while other revenues rose 8 percent to $24.5 million.

Franklin Resources' third-quarter net income was $552.3 million or $0.86 per share, up from $455.3 million or $0.71 per share in the year-ago quarter. On average, twenty analysts polled by Thomson Reuters expected the company to report earnings of $0.85 per share for the quarter. Analysts' estimates typically exclude special items.

Total operating revenues for the quarter rose 17 percent to $2.08 billion from $1.78 billion in the prior-year quarter. Analysts had a consensus revenue estimate for the quarter of $2.06 billion.

Operating margin for the quarter expanded to 37.0 percent from 36.1 percent in the same period last year.

Total assets under management or AUM at the end of the quarter were $815.0 billion, up 15 percent year over year. The increase was primarily due to $73.8 billion in market appreciation and $29.9 billion of net new flows. However, AUM declined 1 percent from the preceding second quarter.

BEN closed Friday's trading at $48.66. In Monday's pre-market trading, the stock is up $0.58 or 1.19 percent to $49.24.