STATEMENT OF INVESTMENTS As at December 31, 2012 Franklin U.S. Rising Dividends Fund Average Cost Fair Value Shares (000s) (000s) LONG-TERM INVESTMENTS: 96.17% COMMON STOCKS: 96.17% Health Care Equipment & Supplies: 13.86% Abbott Laboratories ..................... 237,040 $ 11,899 $ 15,424 Becton, Dickinson and Co. ................ 217,295 16,254 16,878 Hill–Rom Holdings Inc. .................. 53,672 1,605 1,519 Medtronic Inc. ........................ 509,500 19,035 20,758 Stryker Corp. . ........................ 337,590 17,173 18,378 Teleflex Inc. . . ........................ 84,180 4,868 5,960 West Pharmaceutical Services Inc. . . ........ 110,223 4,043 5,991 74,877 84,908 Chemicals: 10.63% Air Products and Chemicals Inc. . . . ........ 283,000 21,882 23,620 Albemarle Corp. . ...................... 339,455 17,998 20,945 Ecolab Inc. . . ........................ 86,100 4,042 6,148 Praxair Inc. . . ........................ 132,621 10,713 14,409 54,635 65,122 Oil, Gas & Consumable Fuels: 9.60% Chevron Corp. ........................ 267,200 26,620 28,721 Exxon Mobil Corp. ...................... 207,500 16,512 17,848 Occidental Petroleum Corp. ............... 161,285 13,110 12,273 56,242 58,842 Machinery: 8.30% Donaldson Co. Inc. .................... 72,568 1,479 2,367 Dover Corp. . . ........................ 336,836 16,983 22,001 Pentair Ltd. . . ........................ 542,280 20,459 26,473 38,921 50,841 Food & Staples Retailing: 5.34% Walgreen Co. . ........................ 324,200 11,237 11,924 Wal–Mart Stores Inc. ................... 307,100 16,754 20,821 27,991 32,745 Pharmaceuticals: 5.19% Johnson & Johnson ..................... 374,640 23,423 26,085 Pfizer Inc. . . . ........................ 229,850 6,117 5,728 29,540 31,813 IT Services: 4.52% International Business Machines Corp. . ...... 145,600 21,083 27,704 Aerospace & Defense: 4.40% General Dynamics Corp. ................. 84,500 5,439 5,814 United Technologies Corp. ................ 259,496 17,958 21,138 23,397 26,952 Household Products: 4.26% Colgate–Palmolive Co. ................... 62,981 5,036 6,541 The Procter & Gamble Co. ................ 289,760 18,575 19,545 23,611 26,086 The accompanying notes are an integral part of these financial statements. Average Cost Fair Value Shares (000s) (000s) Electrical Equipment: 4.19% Brady Corp., A ........................ 197,728 $ 6,562 $ 6,554 Roper Industries Inc. .................... 172,790 9,942 19,122 16,504 25,676 Insurance: 4.04% Aflac Inc. . . ......................... 72,739 3,279 3,837 Arthur J. Gallagher & Co. ................. 79,190 2,268 2,724 Erie Indemnity Co., A .................... 132,658 7,540 9,119 Mercury General Corp. .................. 23,590 1,269 930 Old Republic International Corp. ............ 348,729 7,996 3,689 RLI Corp. . . . ......................... 29,790 1,686 1,911 The Chubb Corp. ...................... 34,200 2,008 2,558 26,046 24,768 Food Products: 4.01% Archer–Daniels–Midland Co. .............. 559,410 15,782 15,213 McCormick & Co. Inc. .................. 148,387 5,854 9,359 21,636 24,572 Auto Components: 2.99% Johnson Controls Inc. ................... 600,432 17,574 18,291 Multiline Retail: 2.93% Family Dollar Stores Inc. ................. 284,610 11,974 17,925 Hotels, Restaurants & Leisure: 2.79% McDonald’s Corp. ...................... 195,200 16,152 17,108 Beverages: 2.71% PepsiCo Inc. ......................... 244,467 15,972 16,618 Textiles, Apparel & Luxury Goods: 1.36% NIKE Inc., B .......................... 163,200 6,443 8,364 Media: 1.00% John Wiley & Sons Inc., A ................ 157,710 6,991 6,108 Commercial Services & Supplies: 0.89% ABM Industries Inc. .................... 101,147 2,292 2,004 Cintas Corp. .......................... 84,598 2,704 3,435 4,996 5,439 Diversified Consumer Services: 0.76% Hillenbrand Inc. ....................... 127,914 3,266 2,871 Matthews International Corp., A ............ 56,700 1,819 1,807 5,085 4,678 Containers & Packaging: 0.57% Bemis Co. Inc. ........................ 104,660 3,355 3,479 Metals & Mining: 0.52% Nucor Corp. .......................... 74,167 3,742 3,180 Household Durables: 0.37% Leggett & Platt Inc. .................... 83,444 2,155 2,257 Specialty Retail: 0.35% Ross Stores Inc. ....................... 40,000 2,134 2,151 Franklin <strong>Templeton</strong> Investments Funds 103
Franklin U.S. Rising Dividends Fund STATEMENT OF INVESTMENTS As at December 31, 2012 (Continued) Average Cost Fair Value Shares (000s) (000s) Industrial Conglomerates: 0.28% Carlisle Companies Inc. .................. 29,404 $ 1,228 $ 1,716 Capital Markets: 0.26% State Street Corp. ....................... 34,041 2,307 1,590 Trading Companies & Distributors: 0.05% W.W. Grainger Inc. ...................... 1,500 281 302 Total Common Stocks: .................... 514,872 589,235 Total Long-Term Investments: ............... 514,872 589,235 Transaction costs (Note 2) ................... (171) — TOTAL INVESTMENTS: 96.17% .............. $514,701 589,235 OTHER ASSETS, less liabilities: 3.83% ........ 23,496 TOTAL NET ASSETS: 100.00% .............. $612,731 The accompanying notes are an integral part of these financial statements. 104 Franklin <strong>Templeton</strong> Investments Funds
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