富蘭克林資源 (BEN) 2018 Q3 法說會逐字稿

Good morning, and welcome to Franklin Resources' earnings conference call for the quarter ended March 31, 2018.

早安，歡迎參加富蘭克林資源（Franklin Resources）截至2018年3月31日止季度的財報電話會議。

Statements made in this conference call regarding Franklin Resources, Inc., 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 known and unknown risks, uncertainties and other important factors that could cause actual results to differ materially from any future results expressed or implied by such forward-looking statements. These and other risks, uncertainties and other important factors are described in more detail in Franklin's recent filings with the Securities and Exchange Commission, including in the Risk Factors and MD&A sections of Franklin's most recent Form 10-K and 10-Q filings.

本次電話會議中關於富蘭克林資源公司（Franklin Resources, Inc.）所作之陳述，凡非歷史事實者，均屬《1995年私人證券訴訟改革法》（Private Securities Litigation Reform Act of 1995）所定義之「前瞻性陳述」。此等前瞻性陳述涉及多項已知與未知之風險、不確定性及其他重要因素，可能導致實際結果與該等前瞻性陳述所明示或暗示之任何未來結果存在重大差異。上述及其他風險、不確定性與其他重要因素，已於富蘭克林近期向美國證券交易委員會（SEC）提交之文件中更為詳盡地說明，包括富蘭克林最新的Form 10-K與10-Q申報文件中的「風險因素」及「管理層討論與分析（MD&A）」章節。

Good morning. My name is Elmer, and I will be your call operator today. (Operator Instructions) As a reminder, this conference is being recorded. At this time, I would like to turn the call over to Franklin Resources' Chairman and CEO, Mr. Greg Johnson. Mr. Johnson, you may begin.

早安。我叫Elmer，今天將擔任本次電話會議的接線員。（接線員指示）提醒各位，本次會議將被錄音。現在，我想將電話交給富蘭克林資源董事長兼執行長Greg Johnson先生。Johnson先生，您可以開始。

Well, hello, and welcome to our third quarter conference call. I'm joined today by Ken Lewis, our CFO. While some clear challenges persisted in the quarter, investment performance within our growth strategies was very strong, and net flows into our U.S. equity and hybrid products improved. U.S. equity sales reached the highest level in 3 years, driven by demand for a number of our growth funds within the category. Additionally, we continue to make progress with several strategic initiatives to offer lower-cost options to investors, notably in the DCIO space. Importantly, operating results remain strong, with over $503 million of operating income generated on $1.6 billion of revenue in the quarter. We continue to prioritize capital return with elevated share repurchase activity in the quarter and a $0.23 per share regular quarterly dividend.

各位好，歡迎參加我們第三季電話會議。今天與我一同出席的還有我們的財務長Ken Lewis。雖然本季仍持續面臨一些明顯挑戰，但我們成長策略中的投資績效非常強勁，且美國股票與混合型產品的淨流入有所改善。在該類別中多檔成長型基金需求帶動下，美國股票銷售額達到近3年最高水準。此外，我們持續推進多項策略性計畫，為投資人提供更低成本的選擇，尤其是在DCIO領域。重要的是，營運成果依然強勁，本季在16億美元營收上創造超過5.03億美元的營業利益。我們持續將資本回饋列為優先事項，本季提高了庫藏股回購活動，並發放每股0.23美元的例行季度股利。

We'd now like to open the line to your questions.

現在我們想開放線路，回答各位的提問。

Our first question comes from Craig Siegenthaler, Crédit Suisse.

我們的第一個問題來自瑞士信貸（Crédit Suisse）的Craig Siegenthaler。

On Page 4 of the prepared remarks, I see you adjusted fee structures in your A shares. So I'm just wondering, how large is this A share from an AUM base standpoint? And also, what's the estimated economic impact in terms of EPS or revenues or earnings?

在事先準備的講稿第4頁，我看到你們調整了A股的費率結構。所以我想請問，從資產管理規模（AUM）的角度來看，A股的規模有多大？另外，就每股盈餘（EPS）或營收或獲利而言，預估的經濟影響為何？

Yes, I mean, I don't we have a number. I think it -- I would say it would be nominal any impact. It's really just adjusting the payout schedule to be more competitive on the breakpoint schedules. And we think the real impact would be in the lower duration kind of products, where we've seen a lot of over $1 million sales being competitive on the brokerage side of those still selling A share assets. So I just don't think it is a number that would adjust anything at this stage. Hopefully, it will, if we get strong sales.

是的，我的意思是，我不認為我們手上有一個數字。我想——我會說其影響應該很小。這主要只是調整支付（分潤）時程，使其在級距（breakpoint）費率表上更具競爭力。我們認為真正的影響會出現在存續期間較短的那類產品上；在經紀通路仍在銷售A股資產的情況下，我們看到許多超過100萬美元的銷售需要在競爭力上做出回應。所以我不認為在這個階段它會是一個足以調整任何數字的因素。希望若我們能取得強勁銷售，它就會產生效果。

Right. We think it will increase sales. And if it does increase sales, then you would see the sales distribution, revenue and expense line increase, which is a good thing.

沒錯。我們認為這會提高銷售。如果確實提高了銷售，那麼你會看到銷售與通路分銷相關的收入與費用項目同步增加，而這是一件好事。

And then just as my follow-up. I don't know if you guys did this intentionally, but it looks like you pulled the text and commentary around the pipeline in the prepared remarks. I'm just wondering, how did the institutional, 'won but not yet funded' pipeline trend from last quarter?

接著作為追問。我不確定你們是否刻意如此，但看起來你們在事先準備的講稿中拿掉了關於案源（pipeline）的文字與評論。我想請問，機構端「已得標但尚未入金（won but not yet funded）」的案源，相較上一季的趨勢如何？

Well, I think that the --- was the question how the pipeline related back to last quarter?

嗯，我想——你的問題是案源相較上一季的變化嗎？

Yes, so how did the institutional pipeline of 'won yet not yet funded' mandates trend, the current -- I mean, right now versus 3 months ago?

是的，也就是機構端「已得標但尚未入金」的委任案源趨勢——目前相較於3個月前如何？

Yes, I think, for example, the big win for our local asset management in the U.K., I don't think we noted that last quarter, so that was an upside surprise. But I would say for -- the pipeline came in pretty much -- yes, for the rest of the pipeline, it came in pretty much as we expected.

是的，我想例如我們在英國的在地資產管理業務拿下的一筆大型案子，我不認為我們在上一季有提到，所以那算是一個正向的意外驚喜。但我會說——至於其餘案源，結果大致——是的，其餘案源的落點大致符合我們的預期。

Our next question comes from Bill Katz, Citi.

我們的下一個問題來自花旗（Citi）的Bill Katz。

So first question is just on expenses. I appreciate that you -- hold on a second, guys, sorry, some background noise -- so just appreciate the guidance as it relates to the fourth quarter on the G&A side. So I guess, first of all, the question is, where is the spend? It sounded like there's a little lumpiness to it. And then now that you're so close to the end of the year, how are you thinking about the growth next year relative to the growth rate you articulated for this year?

第一個問題是關於費用。我很感謝你們——等一下各位，抱歉，有些背景噪音——我很感謝你們就第四季一般及行政（G&A）費用所提供的指引。所以我想先問，支出主要發生在哪裡？聽起來似乎有些不均勻（lumpiness）。另外，既然你們已經非常接近年底，對於明年費用成長的看法，與你們今年所表述的成長率相比，會如何思考？

Right. You know there were a few one-time charges in the G&A, but there's also -- there was a bit of kind of expense trends going on in there as well. So that's why we gave the guidance. Some of it relates to sub-advisory expense. So you're seeing an offset to that in revenue as well. But that -- I think that's probably the biggest driver there. And so that's why we're -- giving that guidance for the fourth quarter. I mean, it's early in the budget process for us looking forward to next year, but our target is to try to keep the expenses under 3% growth rate next year, year-over-year, '19 versus '18.

對。你知道，G&A裡有幾筆一次性費用，但同時——其中也有一些費用趨勢的變化。所以我們才提供這個指引。其中一部分與次投顧（sub-advisory）費用有關。因此你也會在營收端看到相應的抵銷。但我想那大概是最大的驅動因素。所以我們才——針對第四季提供那樣的指引。至於展望明年，我們目前仍在預算流程的早期階段，但我們的目標是努力將明年的費用年增率控制在3%以下，也就是2019年相較2018年。

Okay, that's helpful. And then just stepping back, you mentioned, I think, your priority is capital return. Where are you in terms of the buyback versus sort of the stepped up repurchasing you announced more recently? And I guess, so I think going forward from here, is buyback still the priority use for that within sort of the overall capital plan?

好的，這很有幫助。再退一步看，你提到我想你們的優先事項是資本回饋。就庫藏股回購而言，你們目前的進度相對於你們近期宣布提高回購力道的計畫，處於什麼位置？我想問的是，從現在往後，在整體資本規劃中，回購是否仍是優先的資金用途？

Yes, I would broaden the answer, and just say that returning capital to shareholders is, continues to be a priority. And part of that is share repurchases. I would point out, this quarter, there were -- you know we like to be opportunistic with our share repurchases. This quarter, there was a couple of factors that kind of elevated the share repurchases compared to the previous quarter. One of them was a pretty big spike-up in volume during the quarter. And also, we repurchased shares to cover any -- some share issuances that we had related to M&A. So a little elevated this quarter, but it continues to be a priority.

是的，我會把回答範圍放大一點，也就是說，將資本回饋給股東仍然、並且持續是優先事項。其中一部分就是股票回購。我也要指出，本季——你知道，我們喜歡在股票回購上採取機會主義的作法。本季有幾個因素使得回購規模相較上一季有所提高。其中之一是本季成交量出現相當大的激增。另外，我們也回購股票，以因應——覆蓋我們與併購（M&A）相關的一些股票發行。所以本季略為提高，但它仍然是優先事項。

Our next question comes from Ken Worthington, JPMorgan.

我們的下一個問題來自摩根大通（JPMorgan）的Ken Worthington。

And to follow up on the capital return conversation, you're clearly returning a bunch to investors, but at the same time, the business is under tremendous pressure. And you've got a tremendous amount of cash, gives you the opportunity to kind of redirect the business or buy your way into better growth. And you've done acquisitions, but nothing that I would consider transformational. So how serious are conversations in the boardroom about leveraging the cash for more than just buybacks and dividends, and if the opportunity arose to do something truly transformational for what has been a struggling business?

延續資本回饋的討論，你們顯然回饋了相當多給投資人，但同時，這項業務正承受巨大的壓力。而你們手上有非常大量的現金，這讓你們有機會某種程度上重新導向業務，或透過收購買進更好的成長動能。你們確實做過收購，但沒有任何一筆是我會認為具有轉型意義的。所以董事會對於運用現金、而不僅僅是用於回購與股利的討論有多認真？以及如果出現真正具有轉型意義的機會、能為這個一直在掙扎的業務帶來改變，你們會如何看待？

No, I mean, I think you're dead on. And I think I was going to add that to the last -- to Bill's -- to Ken's response to Bill's question, that when you look at capital, M&A is still the priority for the use of that capital on the balance sheet. And I think the challenges that you mentioned, and we all know, whether it's fee pressure, passive or just the move to advisory from brokerage, will continue to put pressure on organic growth rates. So we are, as we said on past calls, very active in looking. And that still would be the #1 priority, to invest the capital into growth channels, and not make the priority just buybacks and dividends. And I think, obviously, and those board discussions are ongoing, looking at all aspects and all channels of growth, and are much more interested in that discussion than the level of buybacks.

不，我的意思是，我覺得你說得非常到位。而且我本來想把這點補充到上一個——對 Bill 的——對 Ken 回答 Bill 問題的回應裡：當你看資本配置時，併購（M&A）仍然是資產負債表上運用該資本的首要優先事項。我認為你提到的挑戰，以及我們都知道的，無論是費率壓力、被動化，或只是從經紀轉向顧問服務的趨勢，都將持續對內生成長率造成壓力。所以我們如同在過去的電話會議中所說，我們非常積極地在尋找機會。而那仍會是第一優先：把資本投入到成長通路，而不是把重點僅放在庫藏股回購與股利。我想很明顯地，董事會的相關討論仍在進行中，會從各個面向與各種成長通路來看，且對這類討論的興趣遠高於回購規模的高低。

And evidenced by what you guys have been doing, you guys have done a number of smaller deals, but they've been smaller deals and not sort of big, transformational deals. If the right opportunity arose, is transformational something that would be under serious consideration? Or really, is the better approach, do you think, continue to kind of nudge the battleship and maybe transform the business longer term using smaller transactions? Like, I guess, it's been so long since -- like Franklin has done big, big transformational deals in the past, but it's been a long, long, long time since you guys have taken that approach.

而且從你們一直在做的事情也看得出來，你們做了不少較小的交易，但都是小型交易，而不是那種大型、具變革性的交易。如果出現合適的機會，所謂「變革性」的交易會是你們認真考慮的選項嗎？或者你認為更好的做法其實是，繼續像推動一艘戰艦那樣慢慢調整，並透過較小的交易在較長期內改造業務？我的意思是，已經很久了——像 Franklin 過去做過非常、非常大型的變革性交易，但你們採取那種做法已經是很久很久以前的事了。

Well, and also very different organizations from when Franklin brought Templeton to where we are today as far as the breadth of what we offer in as many places. So I think the answer is that we continue in doing bolt-on, developing products, whether it's alternatives. I mean, we're building out businesses like private equity. We want to continue to scale up the high net worth business. We've said that in the past. The transformation -- I mean, define transformational, but I think they're harder to do. And of course, we are open to that. But I think combining with a company of this size is very challenging to maintain who we are as an organization. But I think those discussions, again, are ones that we are open to. But more probably, you'll see continued investment in those other categories that can't be duplicated by passive strategies as a priority, and then just, again, scaling up the businesses that we're in. We'll continue to do that. But I think as far as a transformational, whether it's 2 huge organizations combining, I think that, that's more difficult. But we could certainly still do something in between that, that would absolutely change the organization in a significant way. So those are all things we're looking at.

嗯，而且 Franklin 當年併入 Templeton 時的組織，和我們今天在產品廣度以及覆蓋地區的多樣性上，已經是非常不同的組織了。所以我想答案是，我們會持續進行補強型（bolt-on）併購、持續開發產品，不論是另類投資。我的意思是，我們正在建立像私募股權這樣的業務。我們也希望持續擴大高淨值客群業務的規模。我們過去也說過這點。至於「變革性」——我的意思是，要先定義什麼叫變革性，但我認為那類交易更難做。當然，我們對此持開放態度。但我認為，與一家同等規模的公司合併，要維持我們作為一個組織的本質是非常具挑戰的。不過我想這些討論，我再說一次，我們是開放的。但更可能的是，你會看到我們優先持續投資於那些無法被被動策略複製的其他類別，然後就是再次擴大我們既有業務的規模。我們會繼續這麼做。但我認為，就變革性交易而言，若是兩個龐大組織的合併，我覺得那更困難。不過我們當然也可能做介於兩者之間的事情，而且那確實會在相當程度上改變組織。所以這些都是我們正在評估的方向。

Our next question comes from Michael Carrier, Bank of America Merrill Lynch.

下一個問題來自美國銀行美林（Bank of America Merrill Lynch）的 Michael Carrier。

Maybe first one, just on the fee rate, it seems like there is a little bit of -- a little bit more pressure here this quarter. Just wanted to get some sense, were there any other changes that were made in the quarter on pricing? Or was it more -- whether it's product vehicle shift that was just playing into that?

第一個問題可能是關於費率，看起來本季的壓力稍微——稍微更大一些。想請教一下，本季在定價上是否還有做任何其他調整？或者更多是——例如產品或載體（vehicle）結構的轉移，導致了這樣的結果？

I think one of the factors was just simply that there were some one-offs last quarter, and that weren't -- that didn't happen this quarter. But we're not really seeing any major shifts in -- fee reductions in any of the major retail products. I think some of the institutional accounts coming in, there's some fee pressure on that we're seeing for new accounts, but nothing significant.

我想其中一個因素只是單純因為上季有一些一次性因素，而本季沒有發生。但我們並沒有看到任何主要零售產品出現重大的——費率下調的重大變化。我認為在一些新進來的機構帳戶上，我們確實看到新帳戶有一些費率壓力，但並不顯著。

And I would just add to the mix. And if you look at the emerging markets, they were down 8% for the quarter. That probably counts as 2 or 3x per dollar of assets. So that kind of move can have an impact on that line as well.

我也想補充一點。如果你看新興市場，本季下跌了 8%。以每一美元資產來看，那大概相當於 2 到 3 倍的影響。所以這種走勢也可能對那一項目產生影響。

Right. Okay, makes sense. And then just on the investments on the M&A front. I think you guys have said in the past that yes, you look at a lot of opportunities, but it's also from a timing of the cycle, like pricing or valuations are a bit tougher. Just wanted to get your sense, when you guys go through that math and the calculation, how much do you focus on sort of like the price being paid versus maybe the longer-term consequence of not pursuing those with the outflows continuing, the cash flow deteriorating? Just wanted to get your perspective on how much does the current maybe decay factor into potentially doing something.

了解。好，合理。接著是關於併購（M&A）方面的投資。我記得你們過去說過，確實會看很多機會，但從週期時點來看，像價格或估值會比較棘手。想請教你們的看法：當你們做那些數學推算與計算時，你們會在多大程度上著重於支付的價格，相對於另一種可能的長期後果——也就是如果不去做，資金外流持續、現金流惡化？想聽聽你們的觀點：目前這種可能的「衰退/侵蝕」因素，在你們考慮是否採取行動時，會占多大比重？

Well, I think every target, if you will, every potential acquisition is bespoke. So I don't think we look at it and say, "Oh, it can improve aggregate net flows." But we look at the opportunity set that a potential M&A target presents. We -- I mean, of course, that would include where we think it will be improved flows in a certain sector and all that or a product or improve our investment capabilities, et cetera. So I think -- I don't know if that answers your question. But basically, it's a case-by-case analysis.

嗯，我認為每一個標的——如果你願意這麼稱呼——每一個潛在收購案都是量身訂做的（bespoke）。所以我不認為我們會用「喔，它可以改善整體淨流量」這種方式來看。但我們會看一個潛在併購標的所帶來的機會集合（opportunity set）。我們——我的意思是，當然也會包含我們認為它能在哪個領域改善資金流、或某個產品、或提升我們的投資能力等等。所以我想——我不確定這是否回答了你的問題。

And I would just say that, first and foremost, we would -- we think our stock is probably still the best buy out there. So we'll continue to do that. And I think the -- we don't think the pressure that we're undergoing. I think in a rising rate environment, a different kind of market, the value growth cycle, the 30-year spread of where we are of value versus growth, the strength of the dollar, all of these things can mitigate some of the pressures that we're seeing on the current flows. So I think that, that's -- we don't think that's forever. So let's start there, that we have to change the business. But I think, and to your question on how we look at acquisitions and pricing, obviously, a smaller one, you can pay a higher multiple to get exposure to an area that you can grow quickly. I think it gets more difficult when you're looking at larger deals at very high multiples. And then the market becomes such a factor in how that works out in the next few years. So we're willing to pay up for talent and people. And we recognize it's expensive. But also at times, when things are expensive, that's when you have opportunities to purchase quality organizations. So I think we're certainly open if we think that it's a business that can scale to pay above-market multiples.

我也想說，首先也是最重要的，我們——我們認為我們的股票可能仍然是市場上最值得買的標的。所以我們會繼續做（回購）。而且我認為——我們不認為我們正在承受的壓力會一直持續。我認為在升息環境、不同型態的市場、價值與成長的輪動週期、價值相對成長在 30 年區間中的位置、美元走強，這些因素都可能緩解我們目前在資金流上看到的一些壓力。所以我認為，那就是——我們不認為那會永遠如此。所以先從這裡開始：我們不一定必須改變業務。但我認為，回到你關於我們如何看待收購與定價的問題，顯然，較小的交易，你可以支付較高的倍數，以取得你能快速成長領域的曝險。我認為當你在看較大型交易且倍數非常高時，就會更困難。而且市場在接下來幾年如何演變，會成為影響結果的一個重要因素。所以我們願意為人才與團隊付出溢價。我們也認知到這很昂貴。但同時，有時候在昂貴的時候，反而是你有機會買到高品質組織的時候。所以我認為，如果我們認為那是一個能夠擴張規模（scale）的業務，我們當然願意以高於市場的倍數來出價。

Our next question comes from Dan Fannon, Jefferies.

下一個問題來自 Jefferies 的 Dan Fannon。

I guess, a little bit more on kind of the areas you're spending in and kind of opportunities for growth. Headcount, if I just look at some of the numbers, went up 3.5% sequentially. I assume part of that's the deal. But I guess, could you talk about, as you look into next year with, whatever, 3% growth, and we know what's happening in the fourth quarter pickup, like where those dollars are going, what areas you're investing in the most in terms of, I assume, for kind of future growth?

我想再多問一點關於你們投入資源的領域，以及成長機會。如果我看一些數字，員工人數（headcount）較前一季增加了 3.5%。我猜其中一部分是因為那筆交易。但我想問的是，當你們展望明年、假設有 3% 的成長，而且我們也知道第四季會有回升，例如那些資金會流向哪裡、你們最主要投資在哪些領域，以我理解應該是為了未來成長？

Well, I think the key areas that are new channels for us and new products would be -- first would be the ETFs. And that has been a build organically and grow. And if we find the right acquisition to bolt on that, that's something we would certainly do. But the significant headcount in the ETF business as well as separate distribution there has increased the headcount line overall. Solutions, another area that we've talked about, having tactical asset allocation, having multi-asset products and having better retirement target date glide path funds is a priority for us. And we've added quite a bit of talent there. We've -- the institutional side's been a priority to grow that part of the business, and we've added headcount in the institutional side. And just the changing distribution landscape in the U.S., switching from your brokerage selling product to more of the consultative planning side. We've really revamped and reconfigured our entire -- what was our retail distribution and have a New York Stock Exchange channelization focusing on the traditional wirehouses with more of a planning approach. That has required all additional resources. So I think there's been a lot of areas where we've spent and invested incremental dollars. Hopefully, we can find savings in other areas, but that's really the probably 3 or 4 areas where we've added headcount at more of the higher-cost type of headcount.

嗯，我認為對我們而言屬於新通路與新產品的關鍵領域是——首先是 ETF。這部分是我們以有機方式建立並成長起來的。如果我們找到合適的併購標的來加掛在這上面，那也是我們肯定會做的事。但 ETF 業務的大幅增員，以及那邊獨立的通路配置，已使整體人力成本線上升。解決方案（Solutions）也是我們談過的另一個領域，包含戰術性資產配置、多元資產產品，以及更好的退休目標日期（Target Date）滑行路徑基金，都是我們的優先事項。我們在那裡也增加了不少人才。我們——機構端一直是我們優先要成長的業務部分，我們也在機構端增加了人力。另外，美國通路版圖正在改變，從券商銷售產品轉向更偏顧問式的規劃服務。我們確實已全面改造並重新配置我們整個——原本的零售通路，並建立紐約證券交易所（NYSE）通路分層，聚焦傳統大型券商（wirehouses），以更偏規劃導向的方式運作。這需要額外的資源投入。所以我認為我們在很多領域都增加了支出並投入了增量資金。希望我們能在其他領域找到節省空間，但這大概就是我們增加人力的 3 到 4 個領域，而且多屬於成本較高的人力配置。

This is Ken. I would add, across the enterprise, we've also been -- as we forecasted years ago, we've been increasing our investment in technology, and you're seeing that come through the numbers.

我是 Ken。我補充一下，在整個企業層面，我們也一直——正如我們多年前所預測的——持續增加對科技的投資，而你們現在在數字上也看得到這點。

Got it. And then just a follow-up from the prepared comments about the 28 recommended list placements across the broker/dealer channels this year in fiscal '18. I guess, can you give us some context, like what is that? Where was it a year ago? Or kind of what's the bogey that you're trying to get to? I guess, it's hard to get a sense of what that means. It's on a stand-alone basis.

了解。另外針對事先準備的講稿中提到，本財年 2018 在券商/交易商（broker/dealer）通路有 28 個「推薦名單」的上架（placements）。我想請你們提供一些背景，例如那代表什麼？一年前是多少？或你們想達到的基準（bogey）大概是什麼？我想，單看這個數字很難理解它的意義。如果只單獨看它的話。

Yes, no. I don't really have that -- those numbers to give you that context. I think it was really -- we tried to set specific goals and targets and that was one of our targets, is to get that product placement. I think the importance, it really speaks to, again, some of the investment that we made in that side, bringing in more consultants and building better relationships in the home office. And we all know that getting the product placed doesn't necessarily mean you suddenly get flows coming in your funds. But what it means is you'll have that pipeline when the market does turn, and when people are looking for whether it's value or other styles that could be out of favor right now, we want to be on that platform. And it also helps you retain assets when assets are moving from brokerage to the fee-based, you need to be on that plan or on that platform. But I don't really have a number to give you what -- in terms of how many platforms or -- it just -- it was a goal that we set, a metric that we set out there for that team. And for them, they hit it 3/4 of the way through the year.

是的，不會。我手邊其實沒有那些數字可以提供你作為背景。我認為那主要是——我們嘗試設定具體目標與指標，而那就是我們的目標之一：取得該產品的上架位置。我想其重要性在於，它再次反映了我們在那一端所做的一些投資：引進更多顧問，並在總部（home office）建立更好的關係。而我們都知道，產品被納入名單並不代表資金流就會突然湧入你的基金。但它的意義是：當市場轉向、當投資人開始尋找不論是價值型或其他目前可能不受青睞的風格時，你會有那條管道（pipeline），我們希望能在那個平台上。此外，當資產從券商通路移往以費用為基礎（fee-based）的模式時，若你要留住資產，你就必須在那個方案或平台上。但我沒有一個數字可以告訴你——就平台數量或——總之，那是我們為該團隊設定的一個目標、一個衡量指標。而他們在年度進行到四分之三時就達成了。

Our next question comes from Brian Bedell, Deutsche Bank.

下一個問題來自德意志銀行（Deutsche Bank）的 Brian Bedell。

Maybe, Greg, if you could talk a little bit about the broad strategy and global equity in the Templeton franchise with the acquisition of Edinburgh Partners. Does this change how you're thinking about either managing the Templeton Global Equity franchise or delivering the product?

Greg，也許你可以談談在收購 Edinburgh Partners 之後，Templeton 品牌旗下的廣泛策略與全球股票（global equity）方面的整體策略。這是否改變你對 Templeton 全球股票業務的管理方式或產品交付方式的思考？

No, it really doesn't. I think it -- one, it allows us a little bit more flexibility with pricing, where Edinburgh has done a good job building sub-advisory relationships that Templeton wouldn't be able to price to with the existing assets in 40 Act Fund. So that gives us a new channel to distribute the value side. I think having the resource of Sandy Nairn who is a highly respected person in the industry, one that we know well, we think can only be helpful on just the overall Templeton side. But there's no plans to do any combination. And we think the benefit of accessing a growing distribution channel on the sub-advisory side that we can leverage our distribution to do that, and I don't think there's any other plans other than having the stand-alone entities with the benefit of Sandy there with -- helping with the Templeton side.

不，並沒有。我認為——第一，它讓我們在定價上更有彈性；Edinburgh 在建立次投顧（sub-advisory）關係方面做得很好，而以 Templeton 既有的 40 Act 基金資產規模，可能無法用那樣的價格去承作。因此這為我們提供了一個新的通路來分銷價值型（value）產品。我認為擁有 Sandy Nairn 這樣在業界備受尊敬、我們也很熟悉的人才資源，對整體 Templeton 端只會有幫助。但我們沒有任何合併整合的計畫。我們認為好處在於：能切入次投顧端一個正在成長的分銷通路，而我們可以運用自身的通路能力去槓桿這一點；除此之外沒有其他計畫——仍維持各自獨立的實體，同時由 Sandy 在 Templeton 端提供協助。

Great. So more of a bolt-on and leveraging that -- those extra capabilities rather than any kind of transformational move?

很好。所以比較像是加掛式（bolt-on）並運用那些額外能力，而不是任何轉型性的動作？

Exactly.

沒錯。

Yes, okay. And then just, Ken, one on expenses. Just wanted to make sure I had this correct. I think the top of the expense growth guidance for this fiscal year, if I'm correct, is about 7.5%. And that was from the -- an expense base of $2.0 billion. Am I correct on that?

好的。接著 Ken，關於費用我有一題。我想確認我理解是否正確。我記得本財年的費用成長指引上緣大約是 7.5%。而那是以 20 億美元的費用基礎為起點。我這樣理解正確嗎？

You are.

正確。

You are.

正確。

Our next question comes from Chris Harris, Wells Fargo.

下一個問題來自富國銀行（Wells Fargo）的 Chris Harris。

Can you guys talk a little bit about the trends you're seeing in Asia? That's been the one region for you guys that's been growing the fastest, at least on an AUM basis. So maybe you can elaborate on what you're seeing. And then also, related to that, is China loosening up their restrictions an opportunity for Franklin down the road?

你們能否談談在亞洲看到的趨勢？至少以資產管理規模（AUM）來看，亞洲一直是你們成長最快的區域。所以也許你們可以更詳細說明你們看到的情況。另外相關地，中國放寬限制是否會成為 Franklin 未來的機會？

I mean, first of all, I think the -- if you look at our distribution around the world, Asia continues to be the areas that are still having net inflows in a tough environment for our traditional strengths. So I think that markets like Taiwan and India continue to grow, and are generating positive sales. I think the China question on -- they have announced the intention to allow the minority owner in your JV to become a majority owner. We don't have exact clarity on when that'll happen, but we are having discussions with our partners. And that's always been our intent, to do that. And I think once you have control of that, that, I think, enables you to put further resources in on building out distribution there. So I think everything probably is on a little bit of a holding pattern right now with some of the trade issues, on giving clarity around that. I don't expect to see that. But from everything we've heard, we expect that to be within 12 months that we'd be able to do that.

我的意思是，首先，我認為——如果你看我們在全球的通路布局，在我們傳統強項面臨艱困環境之際，亞洲仍是持續出現淨流入的區域。因此我認為像台灣與印度等市場仍在成長，並帶來正向銷售。至於中國的問題——他們已宣布意向，允許合資企業（JV）中的少數股東成為多數股東。我們尚不清楚確切何時會發生，但我們正與合作夥伴進行討論。而這一直是我們的意圖：要做到那一步。我認為一旦你取得控制權，就能投入更多資源來擴建當地的通路。所以我想目前因為一些貿易議題，很多事情可能都處於觀望狀態，等待更明確的方向。我不預期會看到——但就我們聽到的所有訊息來看，我們預期在 12 個月內應該就能做到。

Our next question comes from Robert Lee, KBW.

下一個問題來自 KBW 的 Robert Lee。

Maybe following up a little bit on capital management and M&A deals. I mean, some of your competitors have made investments and acquired various types of digital -- have a digital strategy for distribution and otherwise. And you've talked in the past a little bit about some strategic investments, small but strategic investments you've made in different companies. Can you maybe update us on how you're thinking of, do you see a place for a digital strategy at Franklin? I mean, is that a possible path you could go down for future M&A?

我想延伸追問一下資本管理與併購（M&A）交易。我的意思是，你們的一些競爭對手已經投資並收購各類數位——在通路分銷等方面有數位策略。而你們過去也談過一些策略性投資，是規模不大但具策略性的投資，投向不同公司。你們能否更新一下你們目前的思考：你們是否認為 Franklin 需要一套數位策略？我的意思是，這是否可能成為你們未來併購的一條路徑？

Yes, I don't know if we need -- I think it's absolutely a path that we are continuing to develop a strategy on. We're doing direct in some of the markets around the world, and are doing it in a very efficient way in a market like India, where it's probably 1/4 of our business there, direct. So we've been building that out. I think the robo piece is fairly simple. I don't think we need M&A to do that on top of it. The digital tool capabilities and customizing service levels, those are all things we've got people working on actively. As we've said before, we have an investment in some different robos around the world, different companies like ADVIZOR, that do financial tools that our high net worth fiduciary trust is looking at leveraging there. So we are experimenting with it on various channels and developing. At this stage, we still have a lot of accounts that are direct, that some that came through Mutual Series. And it would be just a better way to service those accounts, where we could have $30 billion or so of no-adviser record accounts, and think that a robo, some type of service there makes sense. So I think like most firms, we think, first and foremost, that technology is going to help distribution, help partner with the adviser, provide better tools for them to more efficiently serve more clients. So that's the first goal. But then we're thinking longer term about how we can also service those direct accounts as well. And whether it's in the U.S. or other markets, we'll be thoughtful about how we roll that out.

是的，我不確定我們是否需要——我認為這絕對是一條我們正在持續制定策略的路徑。我們在全球部分市場採取直銷模式，而且執行得非常有效率，例如在印度市場，直銷可能約占我們當地業務的 1/4。因此我們一直在擴建這一塊。我認為機器人投顧（robo）這部分相當簡單。我不認為我們需要透過併購（M&A）來做這件事。數位工具能力以及客製化服務層級，這些都是我們已經有人在積極推進的事項。如同我們先前所說，我們在全球投資了幾家不同的機器人投顧公司，例如 ADVIZOR 這類提供金融工具的公司，我們的高淨值受託信託業務正在評估如何在那邊加以運用。因此我們正在不同通路上進行試驗並持續開發。在這個階段，我們仍有許多直銷帳戶，其中一些是透過 Mutual Series 進來的。若能以更好的方式服務這些帳戶會更理想；我們可能有約 300 億美元左右的「無顧問登記」帳戶，我們認為以機器人投顧或某種服務模式來提供服務是合理的。因此我想，和多數公司一樣，我們首先認為科技將有助於通路分銷、協助與理財顧問合作，並為他們提供更好的工具，使其能更有效率地服務更多客戶。這是第一個目標。但接著我們也在更長期地思考，如何同樣服務那些直銷帳戶。無論是在美國或其他市場，我們都會審慎思考如何推出並擴展。

And I would just add that, that is an area that we've been increasing expenses in and investing in. So that's been part of the expense growth.

我再補充一點，這也是我們一直在增加費用並投入資源的領域。因此這也構成了費用成長的一部分。

Okay, great. And then maybe as my follow-up. Can you update us on your ETF initiative? I mean, where does it stand now? And now that you've been at it for a while, I mean, do you feel like it's meeting your expectations, particularly with the low-cost kind of country-specific strategy that you started with? So just kind of a progress update.

好的，很棒。那接著作為追問。你們能更新一下 ETF 計畫的進展嗎？也就是說，目前進展到哪一步？而且你們推行一段時間後，是否覺得它符合你們的預期，特別是你們一開始推出的那種低成本、國別策略？所以想請你們做個進度更新。

Yes, I think it's moving along. It's probably in the range of $2.5 billion, I think, roughly today. And we are still early in rolling out many of these strategies in terms of distribution. Our goal has been to get on platforms. We continue to make progress there. And every -- it seems like every month or quarter, we're being approved on new platforms. Some just take -- may take 3 years to get on, but others we can get on a little bit faster. So I think the progress has been good to date, and one that we just recognize will take a little bit of time and actually sales support to grow. But we are seeing decent growth at this stage.

是的，我認為進展順利。我想目前大約在 25 億美元左右。而且就通路分銷而言，我們在推出許多這些策略上仍處於早期階段。我們的目標一直是上架到各大平台。我們在這方面持續取得進展。而且——看起來每個月或每一季，我們都會在新的平台上獲得核准。有些平台就是需要——可能要 3 年才能上架，但其他平台我們可以更快上架。因此我認為截至目前進展良好；我們也認知到這需要一些時間，並且需要實際的銷售支援才能成長。但在這個階段，我們確實看到不錯的成長。

And we -- in June, we kind of had a targeted campaign to grow awareness at the RA channel, institutional, so -- and also, we're marketing ETFs through print ads and digital and conference advertisement, et cetera. And we launched 3 active ETFs last quarter.

另外，我們在 6 月針對註冊投顧（RA）通路與機構端做了一個有目標的宣傳活動，以提升認知度；同時我們也透過平面廣告、數位行銷與會議廣告等方式推廣 ETF。而且我們在上一季推出了 3 檔主動式 ETF。

Our next question comes from Alex Blostein, Goldman Sachs.

下一個問題來自高盛（Goldman Sachs）的 Alex Blostein。

Question for you regarding non-U. S. retail distribution broadly and, I guess, specifically focusing on the U.K. market. I know it's been an area where you haven't had a lot of presence in the past. I don't know if that number changes materially, but given some of the more structural changes unfolding in the U.K. retail market, is it still a priority for you guys to try to expand there, or not as much?

我有個問題想請教，關於非美國零售通路分銷的整體情況，並且我想特別聚焦在英國市場。我知道過去你們在那裡的布局不算多。我不確定這個數字是否有明顯變化，但考量英國零售市場正在出現一些更結構性的變化，你們仍然把在那裡擴張視為優先事項嗎？還是沒那麼優先？

I would say it's a priority and one, again, that -- one that we have identified. It's a market that, I think, in the past, we felt that our core strengths around global equities, there were plenty of global equities in that market. So it's one that we really didn't put a lot of resources in. But I think now, I think what's changed is we look at the size of the market and the potential still for us. So it is a market that we've made a strong hire to run that effort there, and we're putting more resources into that market. So I think despite some of the changes that one could argue make the retail sales a little bit more difficult, it's just too big of a market for us to ignore. So we are building that. And we've been very successful with our local manager there and have very strong performance in U.K. equities. And just in the last quarter, as we mentioned, we got an institutional win over $1 billion, which, again, I think validates the strength of that local team.

我會說這是優先事項，而且同樣是——我們已經辨識出來的一個重點市場。我想過去我們認為自身在全球股票方面的核心優勢，在那個市場已經有很多全球股票產品。因此我們確實沒有投入太多資源。但我認為現在改變的是，我們看到市場規模以及對我們而言仍然存在的潛力。所以我們已經在那邊做了重要的人才招募來主導這項工作，並且正在投入更多資源到該市場。因此我認為，儘管有些變化可能會讓零售銷售變得更困難，但那個市場規模太大，我們無法忽視。所以我們正在建置並擴展。而且我們在當地的經理人團隊表現非常成功，在英國股票方面也有非常強勁的績效。就在上一季，如同我們提到的，我們拿下一筆超過 10 億美元的機構案，這也再次驗證了當地團隊的實力。

Got you. And just a follow-up question around expenses. So I heard your comments in the near term, and kind of just as you start to think about '19. But I guess, in an event of a downturn, can you help us think through what you would be able to scale back on, granted, you're obviously trying to pivot the business towards some of the more faster-growing areas, so where would be the flexibility in the expense base? And what are some things you would need to pull back from if we see more of a prolonged period of tougher markets?

了解。另外追問一個關於費用的問題。我聽到了你們對短期的評論，以及你們開始思考 2019 年的方向。但我想問的是，如果遇到景氣下行，你們能否協助我們理解哪些支出可以縮減？考量你們顯然正嘗試把業務轉向一些成長更快的領域，那麼費用基礎的彈性會在哪裡？如果我們看到市場更長時間處於較艱困的狀態，你們有哪些事情需要收縮或暫緩？

Yes, I'll address that 2 ways. One, you can kind of -- we've had these downturns in the past, and you can kind of see how we reacted. I think there's, there is that level of flexibility. If we needed to do it, we wouldn't -- we don't want to do it, but if we had to do it, we have that level of flexibility. But part of the process that we're talking about, and part of -- to incorporate it to my trying to keep the expense growth minimal next year, is to look at investments that we've made in the past that maybe aren't panning out, and cull operations that we don't find -- we don't see the benefit in performing a certain service and all that. So we're looking at all of the areas to see where can we create savings that we can reinvest. Because we do want the actual incremental growth into new things to be above the 3% guide, as I said, that I gave you, but we also want to fund that through some savings from outdated processes and services.

是的，我會從兩個角度來回答。第一，你可以——我們過去也經歷過這些下行週期，你可以大致看到我們當時如何應對。我認為我們確實有那種程度的彈性。如果我們需要這麼做，我們不——我們不希望這麼做，但如果不得不做，我們具備那樣的彈性。但我們正在談的流程之一，以及——也把它納入我明年試圖把費用成長控制在最低的做法中，就是檢視我們過去做過、但可能沒有產生預期成效的投資，並精簡我們認為沒有帶來效益的營運項目——例如我們不再認為有必要提供某些服務等。因此我們正在檢視所有領域，看看哪裡可以創造節省，並把節省下來的資源再投資。因為如我所說，我們確實希望投入新事物的實質增量成長能高於我給的 3% 指引，但同時也希望透過淘汰過時流程與服務所節省的成本來支應這些投入。

Our next question comes from Michael Cyprys, Morgan Stanley.

下一個問題來自摩根士丹利（Morgan Stanley）的 Michael Cyprys。

So just wanted to follow up on M&A. As you think about the opportunities out there, what's sort of a holdback or hesitation on some of the larger-size acquisitions at this point? Have you gotten close on anything? And if so, what's happened? And as you think about any sort of hesitation, is it price, a view on the cycle in terms of where we are? Does that kind of factor into consideration? And is there a view to maybe be a bit more patient on M&A, wait for a turn in the cycle, and then kind of get a better price? How do you sort of balance the near term versus more medium term of a better purchase price?

想再追問一下併購（M&A）。當你們思考外部的機會時，就目前而言，對於一些較大規模的收購，有哪些掣肘或猶豫？你們有沒有在任何案子上談得很接近？如果有，後來發生了什麼？另外，談到猶豫的原因，是價格因素，還是對景氣循環、也就是我們目前所處位置的看法？這些是否會納入考量？是否會傾向在併購上更有耐心一些，等景氣循環轉折後再出手，以取得更好的價格？你們如何在短期與中期（可能有更佳收購價格）之間取得平衡？

Well, I think, first of all, we did close 2 deals last quarter. So it's not like we're not doing anything. Although, obviously, not of the scale you're talking about. I think we have been as active as we can be in looking at multiple deals. Then we only have so much capacity for working on, even it's an -- a number of partners, that's going to take resources and tie up for a bit to close that. So I don't think it's -- price is always a consideration, of course. I mean, that's going to be one. It could just be what we think is not the right fit, not the right culture. We're concerned about where we are in the cycle in the business. All factors, all of the above, but not any one stands out. As I said in an earlier answer that, again, if it's an area that we think we need to be in, and we've got an opportunity to bring in a quality organization, we're going to pay up for that. So I don't -- we don't have any set number that says, "Gee, it can't be -- it has to be accretive in year 1 or it can be" -- those are the factors that we're going to think long term and try to just bring the best in at what hopefully isn't overpaying too much.

我想，首先，我們上季確實完成了2筆交易。所以並不是我們什麼都沒做。當然，規模沒有你所提到的那麼大。我認為我們在評估多個案子方面，已經盡可能保持活躍。但我們能投入的作業量也有限；即便有—有不少合夥人，完成交割仍會占用資源並在一段時間內被綁住。所以我不認為是—價格當然永遠是考量之一。我的意思是，那一定是其中一項。也可能只是我們認為不夠契合、文化不合。我們也會擔心目前所處的產業景氣循環位置。各種因素，以上皆是，但沒有任何單一因素特別突出。如同我先前回答提到的，再次強調，如果是我們認為必須布局的領域，而且有機會引進一家高品質的機構，我們願意為此付出更高的價格。所以我不—我們沒有設定任何硬性門檻，例如「天啊，第一年一定要增益（accretive）才行」或「可以不增益」—我們會以長期角度思考，並在希望不至於過度溢價的前提下，把最好的資產納入。

As Greg mentioned, price is always a factor, but that's the benefit of having a strong balance sheet, that if we see an opportunity that we think makes strategic sense, we can just get it.

如Greg所說，價格永遠是一個因素，但擁有強健的資產負債表的好處在於，如果我們看到一個在策略上合理的機會，我們就能把它拿下。

Okay, great. And just as a quick follow-up. I think I may have heard you, you said that you were building out a private equity business. If you could just talk a little bit more about that and some of the alternatives capability that you're building out organically, how that's progressing, what we can see next there.

好的，很棒。再快速追問一下。我想我可能聽到你提到，你們正在擴建私募股權業務。能否再多談一點，以及你們正在以內生成長方式打造的另類投資能力，進展如何、接下來我們可以期待看到什麼？

Yes, I think the -- for us, we've been in private equity and other areas with Templeton and for a while. It's really the U.S. side that we've developed. And part of it is the growth of the private markets, having analysts that built strong relationships here in Silicon Valley, and just seeing a lot of opportunities on the private side. That's one that we just said it made sense then to start a business. I think the -- and the fund's not a big first fund. But at $50 million, it has significant outside investors that recognize our access and strengths on the analysts side here in the Valley that, that made sense. We're doing and we're also looking at AI and Big Data and have some partners there that we're bringing in to do that. And I think just we're trying to take advantage of our location and the strength of our technology team here in San Mateo. It's very hard to go out, as you know, to go buy a private equity firm. I think that's -- we've seen that, that's extremely difficult. Again, if the right situation came up, we would entertain that. But I think building it organically, taking time there and just building strong records is what we want to do. The other alternative side, the K2, we didn't talk about that, but it had an extremely strong quarter. Whenever you see the kind of disruption in the market like we did earlier in the quarter, we tend to see a strong interest in the alternative category. And they've had very strong results on a relative basis and on a flow basis, and had a major win last quarter as well. So that's another business within the alternatives that continues to grow. And then other categories that we're looking at on the M&A side, we'd like to build a larger real estate group within that. So that's certainly something that we've been looking at deals, and recognize that, that's going to be an important category.

是的，我想—對我們而言，我們透過Templeton在私募股權及其他領域已經做了一段時間。真正是美國端這一塊是我們近年發展起來的。其中一部分原因是私募市場的成長；我們在矽谷這裡配置了分析師並建立了很強的人脈關係，也看到私募端有很多機會。因此我們認為成立一個業務是合理的。我想—而且這檔基金的首期規模不大。但以5,000萬美元的規模，仍吸引了相當多外部投資人，他們認可我們在矽谷這裡分析師端的觸及能力與優勢，因此覺得合理。我們也在做，並且也在關注AI與大數據，並引進一些合作夥伴一起推進。我想我們就是試著善用地利，以及我們位於San Mateo的科技團隊實力。如你所知，要出去收購一家私募股權公司非常困難。我想—我們也看到那確實極其困難。當然，如果出現合適的情況，我們也會考慮。但我認為以內生成長的方式、花時間建立並累積良好績效紀錄，是我們想做的。另類投資的其他面向，K2我們剛才沒談到，但它上季表現非常強勁。每當市場出現像我們在本季初看到的那種波動與擾動時，另類投資類別通常會出現強勁需求。他們在相對績效與資金流入方面都非常強，上季也拿下了一個重大案子。所以這也是另類投資內部持續成長的另一項業務。另外，在併購面向我們也在看其他類別；我們希望在其中建立一個更大的不動產團隊。因此這確實是我們一直在看案子的方向，也認知到這將會是一個重要的類別。

Our next question comes from Brian Bedell, Deutsche Bank.

下一個問題來自德意志銀行（Deutsche Bank）的Brian Bedell。

I wanted to come back to a couple of comments that -- a couple you guys made. Ken, one on the balance sheet, in terms of M&A, it sounds like it will be -- you'd be looking for doing any deals strictly in cash. So maybe just give us an update on what you view as excess cash on the balance sheet. And then you mentioned also building the ETF franchise potentially through acquisitions. So would you consider a large transformative ETF acquisition relative to your current footprint there?

我想回到你們剛才提到的幾點—其中幾點評論。Ken，關於資產負債表、就併購而言，聽起來你們會—傾向任何交易都完全以現金進行。所以能否更新一下，你們如何看待資產負債表上的超額現金規模？另外你也提到可能透過收購來打造ETF版圖。那麼，相對於你們目前在ETF的布局，你們是否會考慮一筆大型、具轉型意義的ETF收購？

I'll do the cash question first. So let's see, we have net cash, net of debt, is about $7 billion. And we think that, as we disclosed, we need about $3.5 billion for regulatory requirements, internal uses. So that leaves about $3.5 billion.

我先回答現金的問題。我們的淨現金（扣除負債後）大約是70億美元。而且我們認為，如同我們揭露的，我們需要大約35億美元用於監管要求與內部用途。所以剩下大約35億美元。

And the other question on...

至於另一個問題……

The other question was on, would we purchase a large transformative ETF?

另一個問題是，我們是否會收購一個大型、具轉型意義的ETF？

We would consider it. There's not many of them out there, but we certainly would be open to the idea.

我們會考慮。市場上這類標的不多，但我們當然願意對這個想法保持開放。

Okay, okay. And then, also, you mentioned in the deck a strategy sort of in the collective trust area, and that is, obviously, a growing area. Can you size sort of your AUM in the collective trust or at least characterize to what extent you are either transitioning mutual fund assets into collective trust structures or actually just getting new sales with collective trust and DCIO?

好的，好的。另外，你們在簡報中也提到在集合信託（collective trust）領域的一個策略，而那顯然是一個成長中的領域。你能否量化你們在集合信託的資產管理規模（AUM），或至少描述一下：你們是在把共同基金資產轉到集合信託架構中，還是其實主要是透過集合信託與DCIO拿到新的銷售？

Yes, I think, right now, we have $6 billion in the collective trust. And as -- I think, as you know, the flexibility of what we can do, pricing, it's like an R6 class. So it's a lower-cost alternative. And the pressure on fees within the retirement channel, we just find this to be a very strong vehicle well-suited to do that. And also, the flexibility of combining and building within your solutions group using trust, that's more flexible than a 40 Act Fund. So we have seen strong interest there on especially the DCIO channel, and have built strategic partnership with another firm that allows us to kind of plug-and-play those funds into existing -- already existing platforms. So I think our retirement group felt like there was $10 billion in the pipeline. I'm not sure what the probability of any of that, but $10 billion right now that they've identified and working on within the DCIO channel. But obviously, I think the market itself is like $2 trillion or something like that, the vehicles.

是的，我想，目前我們在集合信託（collective trust）裡有60億美元。而且就——我想，如你所知——我們能做的事情在彈性與定價方面，就像是一個R6級別。所以這是一個成本較低的替代方案。而在退休通路的費用壓力之下，我們發現這是一個非常強而有力、非常適合用來應對這種情況的載體。另外，在你們的解決方案團隊內，使用信託來做組合與建構的彈性，也比《1940年投資公司法》（40 Act）基金更高。因此我們在那裡，特別是在DCIO通路，看到很強的興趣，並且與另一家公司建立了策略合作夥伴關係，使我們能夠把這些基金以某種即插即用的方式，導入既有——已經存在的平台。所以我想我們的退休團隊覺得，管線裡大概有100億美元。我不確定其中任何一部分的機率有多大，但他們目前已辨識並正在DCIO通路推進的金額是100億美元。但顯然，我想市場本身大概是2兆美元左右，這類載體。

Yes, and then just in the formation of that $6 billion, was that -- is that mostly new money to Franklin Templeton? Or was a good portion of it switches from your own mutual funds (inaudible)?

是的，那麼在形成這60億美元的過程中，那——那主要是富蘭克林坦伯頓的新資金嗎？還是其中相當一部分是從你們自家的共同基金轉換過來的（聽不清）？

No, it's money, most of it's money that's been there for a while that we used that vehicle for the institutional side with Templeton. So those funds have existed. But where we're seeing the incremental growth now is really the -- what our group's excited about is just the opportunity within the DCIO channel to have a more competitive pricing structure. And we seem to be getting a lot of interest there.

不是，這些資金大多是已經在那裡一段時間的資金，我們在坦伯頓的機構端就用這個載體來承接。所以那些基金一直都存在。但我們現在看到的增量成長，真正讓我們團隊感到興奮的是：在DCIO通路裡，能夠提供更具競爭力的定價結構的機會。而且我們似乎在那裡獲得了很多關注。

Okay, great. And can I sneak in one more? Or would you -- or should I get back in the queue?

好的，很棒。我可以再偷偷問一個嗎？還是你——或我應該回到隊列裡？

You can go one more.

你可以再問一個。

One more? Okay. So just maybe if you can characterize the environment in July. I mean, obviously, we've seen the other companies talk about some net outflows. A lot of them have come from lumpy sources. But maybe with the uncertainty in the markets on trade and everything, if you could give us a flavor for what your sales teams are hearing from financial advisers in terms of retail appetite for funds, and maybe any kind of July flow, early July flow outlook, if that's possible.

再一個？好。那也許你能描述一下7月的環境。我的意思是，顯然我們看到其他公司談到一些淨流出。其中很多來自較為零星、波動較大的來源。但也許在貿易等因素造成市場不確定性的情況下，如果你能讓我們了解一下，你們的銷售團隊從理財顧問那裡聽到的情況——就零售端對基金的需求而言——以及如果可能的話，對7月資金流向、7月初資金流向的展望。

Yes, I don't have much color to offer there. I don't think we're seeing any significant shift at this stage, but probably consistent with some of the other remarks that have been made.

是的，我在這方面沒有太多可以補充的資訊。我不認為我們在這個階段看到任何顯著的變化，但大概與其他已提出的一些評論一致。

Our next question comes from John Dunn, Evercore ISI.

下一個問題來自Evercore ISI的John Dunn。

Just going back to the 28 recommended list placements. Is that a gross number? And on the flip side, can you talk about, like funds, what you're seeing as far as funds maybe getting consolidated off lists for you guys and for the industry in general?

回到那28個推薦名單的上架（placements）。那是毛數（gross number）嗎？反過來，你能談談，例如基金方面，你們看到的情況——就你們以及整個產業而言——是否有基金被整併、從名單上被移除之類的？

Yes, I think it's probably a gross number as far as new placements. And I'm not sure how you would net -- if you have a new advisory platform, that it's really getting on those. I don't -- I think the -- I'm not sure we even keep a statistic if you went off one and they're not -- it's really once you're on it -- and then most of these are new lists that have -- and you could argue if you go from the old open architecture to a new list, are you off that list or on? I don't know how you'd calculate that, because everybody was -- had access before it moved. It's just really when they set up their new advisory platform. And you're absolutely right. It's a funnel. It's a narrowing of what's available. And that's why it's so important and meaningful to get on that, because if you're on it, the opportunity to get greater share is there because you're not competing with thousands of funds. But we all know the downside. If you're not on it, the brokerage assets are more vulnerable to redemptions as they move to advisory.

是的，我想就新增上架而言，那應該是毛數。而且我不確定你要怎麼做淨額計算——如果你有一個新的投顧平台，那其實就是上到那些名單上。我不——我想——我甚至不確定我們是否會統計你從某個名單下架；因為其實一旦你上了——而且其中多數是新的名單——你也可以說，如果你從舊的開放式架構轉到新的名單，那你是從那個名單下來了還是上去了？我不知道要怎麼算，因為在它移轉之前，大家原本都——都有存取權。這其實就是他們建立新的投顧平台時發生的事。而你說得完全正確。這是一個漏斗。可選範圍在收窄。這也是為什麼能上到那個名單如此重要且有意義，因為如果你在名單上，就有機會取得更高的市占，因為你不需要和成千上萬檔基金競爭。但我們都知道缺點。如果你不在名單上，當券商資產轉向投顧時，券商端資產就更容易面臨贖回。

Our next question comes from Bill Katz, Citi.

下一個問題來自花旗的Bill Katz。

So a 3-part question. How much -- where do you stand right now in terms of remaining A, B and C share exposure in the U.S.? And then as you reprice now into the A-class share, where are you like within sort of your peers in terms of that pricing? And then if you are to be successful and sort of realign yourself so that you are better flowing relative to the brokerage to advisory shift, what's the economic impact on the business as you look ahead?

我有一個三段式問題。目前你們在美國剩餘的A、B與C股級（share class）曝險大概是多少——你們現在處於什麼位置？接著，當你們現在把A股級重新定價時，就定價水準而言，你們相對同業大概處於什麼位置？最後，如果你們成功並重新調整自己，使你們在券商轉向投顧的趨勢下能有更好的資金流入，那從長期來看，對這項業務的經濟影響是什麼？

Yes, so when we look at the -- well, first of all, the pricing was to make sure that the pricing was competitive with our competitors. And if we just -- it's effective -- it'll be effective next fiscal year, it'll go into effect. And in terms of the economic impact, it's hard to quantify. Certainly, there's a cost, but it's -- there's only a cost if it results in increased sales. So that's a good thing to have. So we'll have increased assets under management. And you'll see the sales distribution and expense line go up as a result.

是的，所以當我們看——嗯，首先，這次定價調整是為了確保我們的定價能與競爭對手相比具有競爭力。而如果我們——它是有效的——它會在下一個會計年度生效，會開始實施。至於經濟影響，很難量化。當然會有成本，但——只有在它帶來銷售增加時才會有成本。所以那其實是件好事。因此我們的管理資產規模會增加。而你會看到銷售通路與費用那一行因此上升。

And some of it was just being consistent as part -- as they've adopted even their brokerage model or adapted it to more of a -- trying to get a consistent pricing model, for example. We have a new class that would just make -- we were an outlier with a lower 12b-1 at 15 on some of our funds, and we've had to move them to 25 because that's the standard pricing for that asset class within certain advisers that had to have that. So repricing there doesn't really have -- and that won't have an impact financially, other than, hopefully, generating new sales. It's really just some of the tweaks within the payout structures and more flexibility around the $1 million pricing. And hopefully, that leads to larger tickets and better sales. But we don't have an exact impact number, because as I said earlier on the call, I just don't think it's going to be material for a while there. And I just don't think it's a material change in any way.

其中一部分也只是為了保持一致性，因為——隨著他們採用甚至是調整他們的券商模式，使其更——更像是——例如，試圖建立一致的定價模式。我們有一個新的級別，會讓——我們之前在某些基金上12b-1費用只有15個基點，算是異常值；我們必須把它們調到25個基點，因為在某些要求必須如此的顧問體系中，這是該資產類別的標準定價。所以那裡的重新定價其實不會——而且在財務上也不會有影響，除了希望能帶來新的銷售。這主要只是對支付結構做一些微調，並在100萬美元級距的定價上提供更大的彈性。希望這能帶來更大的單筆金額與更好的銷售。但我們沒有一個精確的影響數字，因為如我先前在電話會議中所說，我不認為在一段時間內它會是重大的。而且我也不認為這在任何方面是一個重大的改變。

Ladies and gentlemen, we have reached the end of the question-and-answer session, and I would like to turn the call back to Mr. Johnson for closing remarks.

各位女士、先生，我們已到達問答環節的結束，現在我想把電話交回給Johnson先生作結語。

Well, thank you again for everybody attending today's call, and we look forward to speaking next quarter. Thank you.

好的，再次感謝各位參加今天的電話會議，我們期待在下個季度再與各位交流。謝謝。

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

今天的會議到此結束。您現在可以掛斷電話線。感謝您的參與。