Franklin saw earnings slip to $403.3 mln during its 3rd quarter FY 2008 compared to $468.4 mln a year ago. Franklin's earnings slipped due to lower assets under management, which fell to $580 bln from $624 bln a year earlier. The decrease was a result of capital depreciation and net outflows by investors. Weak financial prices adversely impact BEN's revenues.
Falling international and domestic equity weakened BEN's shares. Equity account for 54% of BEN's assets and hybrid funds (mix stock and bond funds) are 20%. Falling equity prices translates to capital depreciation for these funds. Changes in capital depreciation/appreciation affect BEN's AUM more than net flows by customers.
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