Now I would like to turn the call over to Mr. Greg Johnson. Mr. Johnson, you may begin.Gregory Johnson Well, thank you, and good afternoon, everyone. Thank you for taking time out to join us on this call. I'm Greg Johnson, CEO; and I'm joined by Ken Lewis, our CFO. Hopefully everyone had a chance to listen to the commentary we made available this morning, but just to quickly recap, it was another strong quarter driven by strong equity markets, as well as the depth and breadth of our global presence. AUM reached an all-time high of $671 billion, and we saw the benefits of diversification as flow trends to equity and Hybrid products improved, while fixed income flow remains strong. We were able to recapture almost half of the muni [municipal] fund outflows that we experienced during the quarter, the exchanges into other Franklin Templeton funds. Operating income was $659 million, began the year on a high note, but while part of the increase was due to some non-recurring items in seasonality, it that was largely driven by the growth of assets. I'd like to now open it up for your questions. Question-and-Answer Session Operator [Operator Instructions] The first question comes from Bill Katz from Citigroup. William Katz - Citigroup Inc First question is just around capital management. You mentioned on your pre-recorded call that this quarter might be a bit more indicative relative to the last rolling five quarters, if you will, if you look at the payout ratio and I get that with the special dividend about a year ago. I guess, the strategic question I have is I know we keep asking on these conference calls, but given your very robust balance sheet and the fact that you can continue to sort of build cash and was trying to understand strategically given where rates are and given where you are with the franchise as diverse as it is and as recurring as it is, why you continue to husband so much capital? And just sort of what your thoughts are here. Is there something that you're worried about strategically in the business or looking at May from December [ph] transaction maybe why not be a little more, maybe stepped up, if you will, in terms of either dividend payout or buyback?
Kenneth LewisThis is Ken. I'll take a stab at that. I think there's a couple of ways to look at this question. First, if you look at our balance sheet, keep in mind that a significant part of the balance sheet we have to reinvest in the business. And by reinvesting in the business, we're talking about seeding new products and co-investing and also keeping money on reserve for restricted purposes. So I would say that almost 2/3 of the balance sheet is for reinvesting of the business and earmarked for those purposes. And the remainder, as you know, part of it is offshore and part of it is in the United States. So that's kind of give you the perspective from how we use the balance sheet regarding the philosophy and strategy. I think that remains unchanged, if you look at our history this quarter's payout ratio is kind of indicative of our long-term history, and I think that's proved to be very beneficial to shareholders over the last four years. I made this comment last quarter, but I'll just reiterate it. Over the last four years, we generated over $1 billion of cash, kept debt stable, and we've reduced the shareholder accounts significantly by about 12%, I think over the last four years. So we continued to be cognizant of returning and providing value to shareholders. And the other two comments I'd make is the markets do turn, so it's good to have a strong balance sheet. We saw that through the financial crisis and not only from a financial point of view but also from a client point of view. We found that to be -- the fact that we have a strong balance sheet to be one of the factors that we were able to retain and attract clients during that period. Read the rest of this transcript for free on seekingalpha.com