UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT
OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file
number 811-00537
Franklin Custodian Funds
(Exact name of registrant as
specified in charter)
One Franklin Parkway, San
Mateo, CA 94403-1906
(Address of principal executive offices) (Zip code)
Alison Baur, One Franklin Parkway,
San Mateo, CA 94403-1906
(Name and address of agent for service)
Registrant's
telephone number, including area code: 650 312-2000
Date
of fiscal year end: 9/30
Date
of reporting period: 3/31/23
Item
1. Reports to Stockholders.
a.)
The
following is a copy of the report transmitted to shareholders pursuant to
Rule30e-1 under the Investment Company Act of 1940, as amended (the “1940 Act”)
(17 CFR 270.30e-1.)
b.)
A copy
of the notice transmitted to shareholders in reliance on Rule 30e-3 under the
1940 Act that contains disclosures specified by paragraph (c)(3) of that rule
is included in the Annual Report.
Not Applicable
.
Semiannual
Report
and
Shareholder
Letter
Franklin
Custodian
Funds
March
31,
2023
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up
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Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Not
FDIC
Insured
May
Lose
Value
No
Bank
Guarantee
franklintempleton.com
Semiannual
Report
1
Shareholder
Letter
Dear
Shareholder:
During
the
six
months
ended
March
31,
2023,
the
U.S.
economy
continued
to
recover
from
the
COVID-19
pandemic
amid
declining
unemployment,
rising
wages
and
higher
personal
consumption.
U.S.
gross
domestic
product
grew
in
2022’s
fourth
quarter
as
increased
consumer
and
government
spending,
higher
inventories
and
strong
nonresidential
fixed
investment
boosted
the
economy.
Although
consumer
spending
continued
to
rise,
deteriorating
financial
conditions
kept
consumer
sentiment
at
historically
low
levels.
Meanwhile,
inflation
showed
signs
of
easing
but
remained
heightened
relative
to
recent
decades,
and
its
path
remains
uncertain.
The
annual
inflation
rate,
as
measured
by
the
consumer
price
index,
declined
to
6%
in
February
2023,
the
lowest
rate
since
September
2021,
as
energy
costs
declined
sharply.
In
an
effort
to
control
inflation,
the
U.S.
Federal
Reserve
(Fed)
raised
the
federal
funds
target
rate
at
all
four
meetings
during
the
six-month
period,
increasing
it
by
a
total
of
1.75%
(from
a
range
of
3.00%–3.25%
to
4.75%–5.00%
by
period-
end).
As
high
inflation
began
to
ease,
the
Fed
stepped
down
the
pace
of
its
interest-rate
hikes
from
75
basis
points
(bps)
at
its
November
2022
meeting
to
50
bps
in
December,
followed
by
25
bps
increases
in
February
and
March
2023.
At
its
March
2023
meeting,
the
Fed
said
it
would
continue
to
reduce
bond
holdings
but
departed
from
previous
statements
by
softening
its
firm
outlook
on
future
rate
hikes.
Additionally,
Fed
Chair
Jerome
Powell
said
the
central
bank
most
likely
would
not
cut
rates
in
2023.
Despite
continued
challenges
from
elevated
inflation,
higher
interest
rates
and
several
well-publicized
failures
in
the
banking
sector
near
period-end,
U.S.
stocks,
as
measured
by
the
Standard
&
Poor’s
®
500
Index
(S&P
500
®
),
posted
a
+15.62%
total
return
amid
signs
of
resilience
in
the
U.S.
economy.
1
The
10-year
U.S.
Treasury
(UST)
yield
(which
moves
inversely
to
price)
declined
despite
higher
interest
rates,
as
inflation
continued
to
slow.
The
yield
curve
for
all
UST
maturities
inverted
further
during
the
period,
at
one
point
reaching
the
largest
inversion
in
more
than
four
decades,
as
investors
became
increasingly
concerned
about
the
economic
outlook.
In
this
environment,
investment-grade
bonds,
as
measured
by
the
Bloomberg
U.S.
Aggregate
Bond
Index,
posted
a
+4.89%
total
return.
1
While
uneven
economic
conditions
are
a
concern
for
many
investors,
we
remain
committed
to
our
long-term
perspective
and
disciplined
investment
approach
as
we
conduct
a
rigorous,
fundamental
analysis
of
securities,
which
balances
long-term
opportunities
and
risk
management.
We
believe
active,
professional
investment
management
serves
investors
well.
We
also
recognize
the
important
role
of
financial
professionals
in
today’s
markets
and
encourage
investors
to
continue
to
seek
their
advice.
Amid
changing
markets
and
economic
conditions,
we
are
confident
investors
with
a
well-diversified
portfolio
and
a
patient,
long-term
outlook
should
be
well
positioned
for
the
years
ahead.
Franklin
Custodian
Funds’
semiannual
report,
covering
Franklin
DynaTech
Fund,
Franklin
Focused
Growth
Fund,
Franklin
Growth
Fund,
Franklin
Income
Fund,
Franklin
U.S.
Government
Securities
Fund
and
Franklin
Utilities
Fund,
includes
more
detail
about
investment
decisions
during
the
period.
Please
remember
all
securities
markets
fluctuate,
as
do
mutual
fund
share
prices.
We
thank
you
for
investing
with
Franklin
Templeton,
welcome
your
questions
and
comments,
and
look
forward
to
serving
your
future
investment
needs.
Sincerely,
Gregory
E.
Johnson
Chairman
Franklin
Custodian
Funds
This
letter
reflects
our
analysis
and
opinions
as
of
March
31,
2023,
unless
otherwise
indicated.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
fund.
Statements
of
fact
are
from
sources
considered
reliable.
1.
Source:
Morningstar.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
franklintempleton.com
Semiannual
Report
2
Contents
Semiannual
Report
Economic
and
Market
Overview
3
Franklin
DynaTech
Fund
4
Franklin
Focused
Growth
Fund
11
Franklin
Growth
Fund
18
Franklin
Income
Fund
23
Franklin
U.S.
Government
Securities
Fund
29
Franklin
Utilities
Fund
34
Financial
Highlights
and
Schedules
of
Investments
39
Financial
Statements
109
Notes
to
Financial
Statements
119
Shareholder
Information
146
Visit
franklintempleton.com
for
fund
updates,
to
access
your
account,
or
to
find
helpful
financial
planning
tools.
3
franklintempleton.com
Semiannual
Report
SEMIANNUAL
REPORT
Economic
and
Market
Overview
U.S.
equities,
as
measured
by
the
Standard
&
Poor’s
®
500
Index
(S&P
500
®
),
posted
a
+15.62%
total
return
for
the
six
months
ended
March
31,
2023.
1
Despite
continued
challenges
from
elevated
inflation,
higher
interest
rates
and
the
failure
of
three
U.S.
banks
in
March
2023,
stocks,
led
by
the
information
technology
sector,
gained
amid
signs
of
resilience
in
the
U.S.
economy.
U.S.
gross
domestic
product
grew
in
2022’s
fourth
quarter
as
increased
consumer
and
government
spending,
higher
inventories
and
strong
nonresidential
fixed
investment
boosted
the
economy.
Although
consumer
spending
continued
to
rise,
deteriorating
financial
conditions
kept
consumer
sentiment
at
historically
low
levels.
Meanwhile,
inflation,
which
remained
heightened
relative
to
recent
decades,
showed
signs
of
easing.
The
annual
inflation
rate,
as
measured
by
the
consumer
price
index,
declined
to
6%
in
February
2023,
the
lowest
rate
since
September
2021,
as
energy
costs
declined
sharply.
The
U.S.
unemployment
rate
remained
at
historic
low
levels
during
the
period,
briefly
hitting
a
54-year
low
of
3.4%
in
January
2023
and
ended
the
period
at
3.5%.
Wage
growth
eased
toward
the
end
of
the
period,
raising
market
expectations
that
the
U.S.
Federal
Reserve
(Fed)
would
slow
its
rate
of
increasing
interest
rates.
Rising
interest
rates
translated
to
higher
borrowing
costs
for
individuals
and
businesses,
which
discouraged
some
economic
activity.
Despite
interest-rate
increases,
bank
failures
contributed
to
lower
mortgage
rates
toward
the
end
of
the
period.
In
an
effort
to
control
inflation,
the
Fed
raised
the
federal
funds
target
rate
four
times
during
the
period
to
end
at
a
range
of
4.75%–5.00%.
The
Fed
stepped
down
the
pace
of
its
interest-rate
hikes
from
75
basis
points
(bps)
at
its
November
2022
meeting
to
50
bps
in
December,
followed
by
25
bps
increases
in
February
and
March
2023.
At
its
March
2023
meeting,
the
Fed
said
it
would
continue
to
reduce
bond
holdings,
but
it
departed
from
previous
statements
by
softening
its
firm
outlook
on
future
rate
hikes.
Additionally,
Fed
Chair
Jerome
Powell
said
the
central
bank
most
likely
would
not
cut
rates
in
2023.
The
foregoing
information
reflects
our
analysis
and
opinions
as
of
March
31,
2023.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
fund.
Statements
of
fact
are
from
sources
considered
reliable.
1.
Source:
Morningstar.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
4
franklintempleton.com
Semiannual
Report
Franklin
DynaTech
Fund
This
semiannual
report
for
Franklin
DynaTech
Fund
covers
the
period
ended
March
31,
2023.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
capital
appreciation
by
investing
primarily
in
equity
securities
of
companies
that
emphasize
innovation
and
new
technologies,
have
superior
management
and
that
benefit
from
new
industry
conditions
in
the
dynamically
changing
global
economy.
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
+17.37%
cumulative
total
return
for
the
six
months
under
review.
In
comparison,
the
Russell
1000
®
Growth
Index,
which
is
market
capitalization
weighted
and
measures
performance
of
those
Russell
1000
®
Index
companies
with
relatively
higher
price-
to-book
ratios
and
higher
forecasted
growth
rates,
posted
a
cumulative
total
return
of
+16.88%.
1
Also
for
comparison,
the
broad
U.S.
stock
market,
as
measured
by
the
Standard
&
Poor’s
500
Index
(S&P
500),
posted
a
+15.62%
cumulative
total
return.
1
You
can
find
the
Fund’s
long-term
performance
data
in
the
Performance
Summary
beginning
on
page
8
.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236.
Investment
Strategy
We
use
fundamental,
bottom-up
research
to
seek
companies
meeting
our
criteria
of
growth
potential,
quality
and
valuation.
In
seeking
sustainable
growth
characteristics,
we
look
for
companies
we
believe
can
produce
sustainable
earnings
and
cash
flow
growth,
evaluating
the
long-term
market
opportunity
and
competitive
structure
of
an
industry
to
target
leaders
and
emerging
leaders.
We
define
quality
companies
as
those
with
strong
and
improving
competitive
positions
in
attractive
markets.
We
also
believe
important
attributes
of
quality
are
experienced
and
talented
management
teams
as
well
as
financial
strength
reflected
in
the
capital
structure,
gross
and
operating
margins,
free
cash
flow
generation
and
returns
on
capital
employed.
Our
valuation
analysis
includes
a
range
of
potential
outcomes
based
on
an
assessment
of
multiple
scenarios.
In
assessing
value,
we
consider
whether
security
prices
fully
reflect
the
balance
of
the
sustainable
growth
opportunities
relative
to
business
and
financial
risks.
Manager’s
Discussion
During
the
six
months
under
review,
the
Fund
generally
took
a
volatile
path
to
robust
overall
gains.
In
the
first
half
of
the
period,
our
positive
absolute
returns
in
October
and
November
2022
were
essentially
eliminated
in
December’s
selloff.
Returns
then
rebounded
solidly
in
January
2023—the
strongest
month
of
the
period—before
backtracking
slightly
in
February,
ahead
of
another
rally
towards
period-end
in
March.
The
bulk
of
the
Fund’s
overall
gains
occurred
in
the
information
technology
(IT)
sector,
which
represented
just
over
half
of
the
overall
portfolio
at
period-end.
IT
sector
sentiment
and
valuation
improved
in
early
2023,
which
we
think
happened
for
a
few
reasons.
First,
U.S.
Treasury
yields
have
trended
down
from
their
highs
in
2022’s
fourth
quarter
as
inflation
cooled—and
from
their
2023
year-to-date
Portfolio
Composition
3/31/23
%
of
Total
Net
Assets
Software
28.3%
Semiconductors
&
Semiconductor
Equipment
17.2%
Life
Sciences
Tools
&
Services
7.4%
Broadline
Retail
7.1%
Financial
Services
6.2%
Health
Care
Equipment
&
Supplies
5.5%
Interactive
Media
&
Services
3.3%
Automobiles
2.8%
Capital
Markets
2.6%
IT
Services
2.3%
Technology
Hardware,
Storage
&
Peripherals
2.2%
Electric
Utilities
1.6%
Pharmaceuticals
1.6%
Electronic
Equipment,
Instruments
&
Components
1.3%
Other
9.4%
Short-Term
Investments
&
Other
Net
Assets
1.2%
1.
Source:
Morningstar.
Frank
Russell
Company
is
the
source
and
owner
of
the
trademarks,
service
marks
and
copyrights
related
to
the
Russell
Indexes.
Russell
®
is
a
trademark
of
Frank
Russell
Company.
The
indexes
are
unmanaged
and
include
reinvestment
of
any
income
or
distributions.
They
do
not
reflect
any
fees,
expenses
or
sales
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Schedule
of
Investments
(SOI).
The
SOI
begins
on
page
44
.
Franklin
DynaTech
Fund
5
franklintempleton.com
Semiannual
Report
highs
at
the
beginning
of
the
U.S.-focused
banking
turmoil
(in
March)
as
the
banking
industry
had
largely
stabilized
by
period-end.
Second,
while
we
remained
aware
of
signs
that
the
broader
economy
was
under
stress,
in
our
view,
it
looked
like
we
were
getting
closer
to
the
end
of
the
negative
earnings
estimate
revision
cycle
amongst
more
cyclically
sensitive
technology
industries
(e.g.,
semiconductors)
and
advertising-driven
internet
companies
as
well
(though
this
assertion
remains
dependent
on
how
hard
of
an
economic
landing
the
U.S.
and
global
economies
might
be
in
for).
Third,
we
believe
many
IT
companies
have
realized
the
need
for
efficiency
in
a
higher
cost-of-capital
environment,
and
profitability
has
been,
for
the
most
part,
surprising
to
the
upside
even
when
revenue
is
not,
according
to
our
analysis.
Fourth,
both
earnings
estimate
revisions
and
cost
cutting
appear
to
be
occurring
in
the
IT
sector
before
other
sectors
due
to
COVID-19
driven
overconsumption
in
2020–2021,
which
we
believe
bodes
well
for
the
sector
on
a
relative
basis
if
or
when
the
economy
heads
into
a
recession.
Finally,
we
believe
that
generative
artificial
intelligence
(AI)
and
its
impact
on
growth
in
the
IT
sector
may
be
starting
to
shift
from
theoretical
to
tangible
as
we
see
early
examples
of
productization
and
monetization
from
across
an
array
of
IT
and
technology-driven
non-IT
companies.
Although
all
five
of
the
Fund’s
IT-related
industry
allocations
rallied
to
varying
degrees,
semiconductor
and
semiconductor
equipment
makers
collectively
posted
an
outsized
return
that
was
led
higher
by
NVIDIA,
ASML
Holding
and
Analog
Devices,
though
most
others
also
advanced.
Semiconductor
sales
tend
to
be
quite
cyclical;
before
their
rally
commenced
in
early
2023,
they
were
down
substantially
from
record-
high
levels
seen
in
May
2022.
They
benefited
in
part
from
evidence
that
a
broadening
range
of
companies
were
expected
to
begin
spending
more
on
microchip-intensive,
productivity-enhancing
technologies.
Corporate
earnings
were
a
factor,
but
not-as-bad-as-feared
forward
guidance,
inventory
digestion,
and
nascent
optimism
about
a
potential
bottom
in
the
near
term
helped
drive
their
gains.
Among
the
standout
contributors,
ASML,
a
Dutch
developer
of
advanced
semiconductor
equipment
systems
(including
lithography,
metrology
and
inspection
systems
for
complex
integrated
circuits),
upgraded
its
long-term
outlook
despite
a
soft
market
in
2022,
while
its
fiscal
fourth-quarter
financial
earnings
report
showed
surprising
strength.
It
raised
its
outlook
for
2025
by
about
30%
above
the
figures
it
had
projected
one
year
ago—reassuring
given
the
industry’s
current
downcycle.
ASML
also
guided
for
continued
growth
to
2030,
citing
a
brighter
outlook
for
artificial
intelligence
(AI)
and
edge
computing
data
centers,
as
well
as
the
metaverse,
which
emerged
as
a
big
concept
more
than
a
year
ago.
From
a
wider
perspective,
a
wave
of
investor
interest
and
heightened
trading
around
machine
learning
(ML)
technology—a
branch
of
AI
that
enables
computers
to
emulate
how
humans
learn
and
adapt
by
using
data
and
experience—ignited
rallies
in
several
notable
Fund
contributors
pursuing
both
themes.
Although
it
included
semiconductor
industry
players
situated
at
the
core
of
ML/
AI
computing
power,
it
extends
to
software,
IT
services,
electronic
equipment
and
instruments,
and
non-IT
industries
such
as
internet
retail,
automobiles,
aerospace
and
defense,
biotechnology
and
life
sciences
tools.
NVIDIA—by
far
the
Fund’s
largest
overall
contributor
over
the
October
2022–March
2023
span—was
widely
seen
as
being
a
key
recipient
of
future
investment
in
this
arena.
NVIDIA’s
hardware
originally
made
a
name
for
itself
powering
high-end
video
game
graphics,
but
in
recent
years
the
company’s
bet
on
AI
and
ML
has
begun
to
pay
off.
Machines
require
massive
amounts
of
information
and
computer
power
to
learn,
and
we
believe
NVIDIA’s
GPUs
(graphics
processing
units)
are
well-suited
for
the
task.
The
company
has
emerged
as
a
technological
leader
in
the
space
as
it
continued
to
research
next-generation
chip
circuitry.
NVIDIA
consistently
generates
operating
profit
margins
well
into
double-digit
percentages,
all
the
while
spending
heavily
every
year
on
new
research
and
development.
Software—the
Fund’s
largest
industry-level
exposure—also
enjoyed
impressive
and
widespread
gains
that
were
aided
foremost
by
Microsoft,
Cadence
Design
Systems
(software,
hardware
and
intellectual
properties
used
to
design
microchips,
related
systems
and
printed
circuit
boards)
and
Top
10
Holdings
3/31/23
Company
Industry
,
Country
%
of
Total
Net
Assets
a
a
Microsoft
Corp.
6.4%
Software,
United
States
NVIDIA
Corp.
5.9%
Semiconductors
&
Semiconductor
Equipment,
United
States
Amazon.com,
Inc.
5.5%
Broadline
Retail,
United
States
Alphabet,
Inc.
3.3%
Interactive
Media
&
Services,
United
States
Mastercard,
Inc.
3.3%
Financial
Services,
United
States
Thermo
Fisher
Scientific,
Inc.
3.1%
Life
Sciences
Tools
&
Services,
United
States
ServiceNow,
Inc.
2.8%
Software,
United
States
ASML
Holding
NV
2.8%
Semiconductors
&
Semiconductor
Equipment,
Netherlands
Tesla,
Inc.
2.8%
Automobiles,
United
States
Danaher
Corp.
2.7%
Life
Sciences
Tools
&
Services,
United
States
Franklin
DynaTech
Fund
6
franklintempleton.com
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Report
Synopsys
(electronic
design
automation
and
testing
focused
on
semiconductor
fabrication).
In
particular,
enterprise
and
personal
software
titan
Microsoft
rallied
solidly
as
it
showed
strong
potential
to
stoke
future
growth
in
cloud
computing
and
infrastructure
(Azure),
as
well
as
rapid
adoption
in
its
quest
for
AI
integration
(led
currently
by
ChatGPT-enabled
Bing
search,
while
undergoing
testing
and
roll-out
in
other
aspects
of
the
business).
And,
while
the
weak
PC
(personal
computer)
market
has
pressured
Microsoft’s
sales
recently,
many
investors
perceived
a
bottom
may
be
nearing.
The
rally
came
on
the
heels
of
the
company’s
stronger-than-
expected
financial
results
(released
in
January
2023)
and
a
huge
surge
in
interest
in
ChatGPT
and
its
developer
OpenAI
(not
a
Fund
holding),
which
is
in
partnership
with
Microsoft
as
it
continues
to
integrate
AI
capabilities
into
its
search
engine,
Office
software
suite
and
other
applications
where
AI
will
serve
as
“copilot.”
Microsoft’s
resilience
in
the
face
of
macroeconomic
headwinds—aided
by
its
increasing
business
diversity—boosted
investor
confidence
that
the
company
can
capitalize
on
these
and
other
growing
opportunities
(including
gaming)
in
the
coming
months.
Numerous
other
software
industry
holdings
advanced
with
double-digit
percentage
returns
including
HubSpot,
ServiceNow
and
ANSYS.
Elsewhere
in
the
portfolio,
six
out
of
nine
other
sector
allocations
were
net
contributors
to
the
Fund’s
absolute
performance,
led
by
financials
and
health
care.
Most
of
our
positions
in
financial
services
providers—with
a
focus
on
electronic
payment
processing
specialists
such
as
Mastercard
and
Adyen—traded
higher,
as
did
all
four
holdings
in
the
capital
markets
industry,
including
key
contributor
Tradeweb
Markets,
which
operates
a
leading
fixed
income,
derivatives
and
ETF
electronic
trading
platform.
Our
health
care
investments
remained
focused
on
innovative
life
sciences
tools
and
services
companies
such
as
standout
contributor
Thermo
Fisher
Scientific
and
high-tech
health
care
equipment
and
supplies
industry
names
such
as
IDEXX
Laboratories,
Intuitive
Surgical
and
Inspire
Medical
Systems,
which
were
the
best
of
several
related
contributors
that
posted
double-digit
percentage
gains
during
the
period
under
review.
To
a
lesser
extent,
additional
gains
surfaced
in
the
industrials,
materials,
energy
and
communication
services
sectors,
while
overall
losses
in
the
consumer
discretionary
sector
were
partially
offset
by
a
robust
rally
in
MercadoLibre,
an
e-commerce
platform
serving
as
Latin
America’s
largest
online
marketplace.
Mixed
results
in
the
industrials
sector
were
buoyed
by
notable
strength
in
aerospace
and
defense
industry
companies
including
key
contributor
Axon
Enterprise,
which
develops
technology
and
weapons
products
for
military,
law
enforcement,
and
civilians,
and
is
well
known
for
its
Taser
line
of
electroshock
devices.
Materials
sector
gains
were
concentrated
on
chemical
manufacturers,
while
our
small
exposure
to
energy
firms
was
focused
on
oilfield
services
and
equipment
providers.
Within
communication
services,
the
standout
contributor
was
Alphabet,
a
significant
investment
that
supported
results
in
the
interactive
media
and
services
industry.
Alphabet
staged
a
comeback
late
in
the
period,
having
previously
sold
off
after
it
reported
that
search-advertising
growth
for
its
Google
subsidiary
was
crimped
by
inflation
and
tighter
spending
discipline
by
advertisers.
In
contrast,
most
of
the
Fund’s
major
detractors
were
mild
to
modest
when
compared
to
the
net
contributors
described
above.
Two
of
our
largest
holdings—Tesla
and
Amazon.com—were
out
of
favor
throughout
much
of
the
reporting
period
and
dragged
on
returns
in
the
consumer
discretionary
sector.
In
particular,
the
Fund’s
position
in
electric
vehicle
(EV)
manufacturer
Tesla
initially
traded
lower
following
slightly
weaker-than-expected
third-quarter
2022
vehicle
deliveries
and
overall
earnings
results.
Earnings
and
profit
margins
were
negatively
impacted
by
escalating
raw
materials
costs,
logistics
snags,
new
plant
start-up
inefficiencies
and
currency
headwinds.
In
December
2022,
the
selloff
accelerated
after
Tesla
announced
a
plan
to
temporarily
halt
production
at
its
China
factory.
News
of
reduced
output
in
Shanghai
came
on
the
heels
of
a
report
that
Tesla
was
offering
U.S.
consumers
a
US$7,500
discount
to
take
delivery
of
its
two
highest-volume
models
before
the
end
of
2022.
Although
bearish
investors
argued
that
company
management’s
explanation
around
logistic
constraints
were
just
an
excuse
for
eroding
demand,
we
believed
the
market
was
being
short-sighted
in
thinking
that
Tesla
had
a
demand
problem;
by
mid-March,
Tesla
was
reporting
a
solid
pickup
in
early
2023
sales
versus
the
low
point
in
2022.
While
cracks
in
demand
for
automobiles
were
starting
to
form
given
affordability
challenges
on
an
increasingly
strained
consumer,
demand
for
EVs
remains
robust,
and
Tesla
is
one
of
the
few
players
currently
producing
at
scale.
Additionally,
Tesla
sees
solid
growth
in
2023,
as
new
plants
in
Germany
and
Texas
continue
ramping
up
and
credits
from
the
Inflation
Reduction
Act
come
to
bear.
Aside
from
consumer
discretionary,
our
much
smaller
exposures
to
the
real
estate
and
utilities
sectors
failed
to
advance,
but
their
net
impact
on
absolute
returns
was
negligible.
The
rest
of
the
Fund’s
key
detractors
served
to
reduce
the
overall
gains
achieved
in
other
sector
allocations,
including
ZoomInfo
Technologies
(not
held
at
period
end)
(sold
by
Franklin
DynaTech
Fund
7
franklintempleton.com
Semiannual
Report
period-end)
in
communication
services;
Chart
Industries
(sold
by
period-end)
in
the
industrials
sector;
and
Catalent
(sold
by
period-end),
Repligen
and
UnitedHealth
Group
in
the
health
care
sector.
In
particular,
Chart
Industries,
our
sole
position
in
the
machinery
industry,
which
is
a
leading
global
manufacturer
of
specialty
equipment
servicing
applications
in
the
energy
(including
hydrogen/carbon
capture)
and
industrial
gas
markets,
surprised
investors
with
the
announcement
that
it
had
signed
a
definitive
agreement
to
acquire
Howden
(not
held
at
period
end)
(not
a
Fund
holding),
an
industrial
compressor
manufacturer
that
is
larger
in
sales
and
earnings
than
Chart,
for
US$4.4
billion.
We
liquidated
the
Fund’s
position
as
our
view
on
this
transformational
deal
was
negative
given:
(1)
the
business
lines
exist
completely
outside
of
Chart’s
core
competencies;
(2)
company
management
seemed
unreasonably
optimistic
in
its
cost
and
revenue
synergy
forecasts;
and
(3)
the
balance
sheet
is
jeopardized
with
trailing
12-month
net
leverage
jumping
ninefold.
Although
it
was
still
feasible
for
Chart
to
walk
away
from
the
deal
without
a
breakup
fee,
during
our
subsequent
discussion,
management
sounded
firm
in
its
commitment
to
complete
the
transaction
and
undaunted
by
the
value
destruction.
All
of
the
other
notable
individual
detractors
weakened
our
results
in
the
IT
sector,
none
more
so
than
Atlassian,
CrowdStrike
Holdings
(sold
by
period-end)
and
Enphase
Energy
(semiconductors).
Atlassian
and
CrowdStrike
were
joined
by
several
other,
lesser
detractors
in
the
software
industry,
including
Datadog
and
GitLab.
In
particular,
project
management
software
specialist
Atlassian’s
equity
value
fell
back
to
levels
not
seen
in
three
years
as
its
latest
quarterly
results
were
mediocre
at
best,
while
guidance
into
early
2023
fell
far
below
consensus
analyst
projections
as
the
company
was
seeing
free-to-paid
subscription
conversions
slowing
in
a
more
uncertain
macro
environment.
Atlassian
had
also
begun
to
see
a
slowdown
in
existing
customers
expanding
deployments
as
layoffs
(and
hiring
freezes)
accelerated
and
IT
budgets
faced
greater
scrutiny,
which
we
viewed
as
the
bigger
challenge.
Despite
the
muted
results
and
guidance,
the
company’s
trailing
sales
have
surged
111%
higher
since
the
end
of
2019,
it
keeps
generating
healthy
cash
flow,
and
we
still
believe
there
is
strength
in
Atlassian’s
business
model
and
competitive
position.
Thank
you
for
your
continued
participation
in
Franklin
DynaTech
Fund.
We
look
forward
to
serving
your
future
investment
needs.
Matthew
J.
Moberg,
CPA
Rupert
H.
Johnson,
Jr.
Portfolio
Management
Team
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
March
31,
2023,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Performance
Summary
as
of
March
31,
2023
Franklin
DynaTech
Fund
8
franklintempleton.com
Semiannual
Report
The
performance
table
does
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
3/31/23
1
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
5.50%
and
the
minimum
is
0%.
Class
A:
5.50%
maximum
initial
sales
charge;
Advisor
Class:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236.
Share
Class
Cumulative
Total
Return
2
Average
Annual
Total
Return
3
–
A
4
6-Month
+17.37%
+10.92%
1-Year
-15.56%
-20.21%
5-Year
+63.42%
+9.08%
10-Year
+268.49%
+13.29%
Advisor
6-Month
+17.52%
+17.52%
1-Year
-15.35%
-15.35%
5-Year
+65.47%
+10.60%
10-Year
+277.85%
+14.22%
See
page
9
for
Performance
Summary
footnotes.
Franklin
DynaTech
Fund
Performance
Summary
9
franklintempleton.com
Semiannual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
possible
loss
of
principal.
Stocks
historically
have
outperformed
other
asset
classes
over
the
long
term,
but
tend
to
fluctuate
more
dramatically
over
the
short
term.
Investments
in
fast-growing
industries,
like
the
technology
and
health
care
sectors
(which
have
historically
been
volatile)
could
result
in
increased
price
fluctuation,
especially
over
the
short
term,
due
to
the
rapid
pace
of
product
change
and
development
and
changes
in
government
regulation
of
companies
emphasizing
scientific
or
technological
advancement
or
regulatory
approval
for
new
drugs
and
medical
instruments.
The
Fund
may
also
invest
in
small-
and
mid-capitalization
companies,
which
can
be
particularly
sensitive
to
changing
economic
conditions,
and
their
prospects
for
growth
are
less
certain
than
those
of
larger,
more
established
companies.
Events
such
as
the
spread
of
deadly
diseases,
disasters,
and
financial,
political
or
social
disruptions,
may
heighten
risks
and
adversely
affect
performance.
The
Fund’s
prospectus
also
includes
a
description
of
the
main
investment
risks.
1.
The
total
annual
operating
expenses
are
as
of
the
Fund's
prospectus
available
at
the
time
of
publication.
Actual
expenses
may
be
higher
and
may
impact
portfolio
returns.
2.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
3.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
periods
indicated.
Return
for
less
than
one
year,
if
any,
has
not
been
annualized.
4.
Prior
to
9/10/18,
these
shares
were
offered
at
a
higher
initial
sales
charge
of
5.75%,
thus
actual
returns
(with
sales
charges)
would
have
differed.
Average
annual
total
returns
(with
sales
charges)
have
been
restated
to
reflect
the
current
maximum
initial
sales
charge
of
5.50%.
5.
Figures
are
as
stated
in
the
Fund’s
current
prospectus
and
may
differ
from
the
expense
ratios
disclosed
in
the
Your
Fund’s
Expenses
and
Financial
Highlights
sections
in
this
report.
In
periods
of
market
volatility,
assets
may
decline
significantly,
causing
total
annual
Fund
operating
expenses
to
become
higher
than
the
figures
shown.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
Total
Annual
Operating
Expenses
5
Share
Class
A
0.82%
Advisor
0.57%
Your
Fund’s
Expenses
Franklin
DynaTech
Fund
10
franklintempleton.com
Semiannual
Report
As
a
Fund
shareholder,
you
can
incur
two
types
of
costs:
(1)
transaction
costs,
including
sales
charges
(loads)
on
Fund
purchases
and
redemptions;
and
(2)
ongoing
Fund
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
Fund
expenses.
All
mutual
funds
have
ongoing
costs,
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
“Actual.”
In
these
columns
the
Fund’s
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
“Ending
Account
Value”
for
each
class
of
shares.
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
for
your
class
of
shares
under
the
headings
“Actual”
and
“Expenses
Paid
During
Period”
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
“Hypothetical”
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund’s
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund’s
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
for
the
class
of
shares
you
hold
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
“Hypothetical”
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above—in
the
far
right
column—multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/365
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Does
not
include
acquired
fund
fees
and
expenses.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Share
Class
Beginning
Account
Value
10/1/22
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
a
Net
Annualized
Expense
Ratio
2
A
$1,000
$1,173.70
$4.64
$1,020.66
$4.31
0.86%
C
$1,000
$1,169.40
$8.68
$1,016.93
$8.07
1.61%
R
$1,000
$1,172.30
$5.99
$1,019.42
$5.57
1.11%
R6
$1,000
$1,176.00
$2.59
$1,022.55
$2.41
0.48%
Advisor
$1,000
$1,175.20
$3.28
$1,021.91
$3.05
0.61%
11
franklintempleton.com
Semiannual
Report
Franklin
Focused
Growth
Fund
This
semiannual
report
for
Franklin
Focused
Growth
Fund
covers
the
period
ended
March
31,
2023.
At
a
meeting
held
on
December
14-15,
2022,
the
Board
of
Trustees
of
the
Franklin
Custodian
Funds
approved
the
reorganization
of
the
Franklin
Focused
Growth
Fund
(the
“Mutual
Fund”)
into
the
Franklin
Focused
Growth
ETF
(the
“ETF”),
a
newly-organized
series
of
the
Franklin
Templeton
ETF
Trust,
pursuant
to
an
Agreement
and
Plan
of
Reorganization.
If
the
Agreement
and
Plan
of
Reorganization
is
approved
by
the
shareholders
of
the
Mutual
Fund,
the
reorganization
of
the
Mutual
Fund
would
consist
of
(1)
the
transfer
of
substantially
all
of
the
Mutual
Fund’s
assets,
subject
to
its
liabilities,
to
the
ETF
for
shares
of
the
ETF;
and
(2)
the
distribution
of
the
ETF
shares
to
the
Mutual
Fund
shareholders
in
complete
liquidation
of
the
Mutual
Fund.
The
ETF
will
be
managed
in
a
substantially
similar
manner
as
the
Mutual
Fund,
and
the
ETF’s
investment
objective,
principal
investment
strategies,
investment
adviser
and
portfolio
management
team
will
be
the
same
as
that
of
the
Mutual
Fund,
except
that
the
ETF,
unlike
the
Mutual
Fund,
will
be
a
non-diversified
fund
(within
the
meaning
of
the
Investment
Company
Act
of
1940),
which
means
that
it
will
generally
invest
a
greater
proportion
of
its
assets
in
the
securities
of
one
or
more
issuers
and
will
invest
overall
in
a
smaller
number
of
issuers
than
a
diversified
fund.
For
more
information,
please
see
the
Mutual
Fund’s
current
prospectus.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
capital
appreciation
by
investing
in
an
equity
securities
portfolio
of
approximately
20–50
companies
that
we
believe
offers
a
compelling
trade-off
between
growth
opportunity,
business
and
financial
risk
and
valuation.
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
+18.24%
cumulative
total
return
for
the
six
months
under
review.
In
comparison,
the
Russell
1000
®
Growth
Index,
which
is
market
capitalization
weighted
and
measures
performance
of
those
Russell
1000
®
Index
companies
with
relatively
higher
price-
to-book
ratios
and
higher
forecasted
growth
rates,
posted
a
cumulative
total
return
of
+16.88%.
1
You
can
find
the
Fund’s
long-term
performance
data
in
the
Performance
Summary
beginning
on
page
15
.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236.
Investment
Strategy
We
use
fundamental,
bottom-up
research
to
seek
companies
meeting
our
criteria
of
growth
potential,
quality
and
valuation.
In
seeking
sustainable
growth
characteristics,
we
look
for
companies
we
believe
can
produce
sustainable
earnings
and
cash
flow
growth,
evaluating
the
long-term
market
opportunity
and
competitive
structure
of
an
industry
to
target
leaders
and
emerging
leaders.
We
define
quality
companies
as
those
with
strong
and
improving
competitive
positions
in
attractive
markets.
We
also
believe
important
attributes
of
quality
are
experienced
and
talented
management
teams
as
well
as
financial
strength
reflected
in
the
capital
structure,
gross
and
operating
margins,
free
cash
flow
generation
and
returns
on
capital
employed.
Our
valuation
analysis
includes
a
range
of
potential
outcomes
based
on
an
assessment
of
multiple
scenarios.
In
assessing
value,
we
consider
whether
security
prices
fully
reflect
the
balance
of
the
sustainable
growth
opportunities
relative
to
business
and
financial
risks.
Manager’s
Discussion
During
the
six
months
under
review,
the
Fund
followed
a
somewhat
volatile
path
to
robust
overall
gains.
In
the
first
half
of
the
period,
our
positive
absolute
returns
in
October
and
November
2022
were
essentially
eliminated
in
December’s
selloff.
Returns
then
rebounded
solidly
in
January
2023—the
strongest
month
of
the
period—before
backtracking
modestly
in
February,
ahead
of
another
rally
in
March.
The
bulk
of
the
Fund’s
overall
gains
occurred
in
the
information
technology
(IT)
sector,
which
represented
more
than
two-fifths
of
the
portfolio
at
period-end.
IT
sector
sentiment
and
valuation
improved
in
early
2023,
which
we
think
happened
for
a
few
reasons.
1.
Source:
Morningstar.
Frank
Russell
Company
is
the
source
and
owner
of
the
trademarks,
service
marks
and
copyrights
related
to
the
Russell
Indexes.
Russell
®
is
a
trademark
of
Frank
Russell
Company.
The
index
is
unmanaged
and
includes
reinvestment
of
any
income
or
distributions.
It
does
not
reflect
any
fees,
expenses
or
sales
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Schedule
of
Investments
(SOI).
The
SOI
begins
on
page
53
.
Franklin
Focused
Growth
Fund
12
franklintempleton.com
Semiannual
Report
First,
U.S.
Treasury
yields
have
trended
down
from
their
highs
in
2022’s
fourth
quarter
as
inflation
cooled—and
from
their
2023
year-to-date
highs
at
the
beginning
of
the
U.S.-focused
banking
turmoil
(in
March)
as
the
banking
industry
had
largely
stabilized
by
period-end.
Second,
while
we
remained
aware
of
signs
that
the
broader
economy
was
under
stress,
in
our
view,
it
looked
like
we
were
getting
closer
to
the
end
of
the
negative
earnings
estimate
revision
cycle
amongst
more
cyclically
sensitive
technology
industries
(e.g.,
semiconductors)
and
advertising-driven
internet
companies
as
well
(though
this
assertion
remains
dependent
on
how
hard
of
an
economic
landing
the
U.S.
and
global
economies
might
be
in
for).
Third,
we
believe
many
IT
companies
have
realized
the
need
for
efficiency
in
a
higher
cost-of-capital
environment,
and
profitability
has
been,
for
the
most
part,
surprising
to
the
upside
even
when
revenue
is
not,
according
to
our
analysis.
Fourth,
both
earnings
estimate
revisions
and
cost
cutting
appear
to
be
occurring
in
the
IT
sector
before
other
sectors
due
to
COVID-19
driven
overconsumption
in
2020–2021,
which
we
believe
bodes
well
for
the
sector
on
a
relative
basis
if
or
when
the
economy
heads
into
a
recession.
Finally,
we
believe
that
generative
artificial
intelligence
(AI)
and
its
impact
on
growth
in
the
IT
sector
may
be
starting
to
shift
from
theoretical
to
tangible
as
we
see
early
examples
of
“productization”
and
monetization
from
across
an
array
of
IT
and
technology-driven
non-IT
companies.
Although
all
three
of
the
Fund’s
IT-related
industry
allocations
rallied
to
varying
degrees,
semiconductor
and
semiconductor
equipment
makers
collectively
posted
an
outsized
return
that
was
led
higher
by
NVIDIA,
ASML
Holding
and
Analog
Devices.
Semiconductor
sales
tend
to
be
quite
cyclical;
before
their
rally
commenced
in
early
2023,
they
were
down
substantially
from
record-high
levels
seen
in
May
2022.
They
benefited
in
part
from
evidence
that
a
broadening
range
of
companies
were
expected
to
begin
spending
more
on
microchip-intensive,
productivity-enhancing
technologies.
Corporate
earnings
were
a
factor,
but
not-as-bad-as-feared
forward
guidance,
inventory
digestion,
and
nascent
optimism
about
a
potential
bottom
in
the
near
term
helped
drive
their
gains.
Among
the
standout
contributors,
ASML,
a
Dutch
developer
of
advanced
semiconductor
equipment
systems
(including
lithography,
metrology
and
inspection
systems
for
complex
integrated
circuits),
upgraded
its
long-term
outlook
despite
a
soft
market
in
2022,
while
its
fiscal
fourth-quarter
financial
earnings
report
showed
surprising
strength.
It
raised
its
outlook
for
2025
by
about
30%
above
the
figures
it
had
projected
one
year
ago—reassuring
given
the
industry’s
current
downcycle.
ASML
also
guided
for
continued
growth
to
2030,
citing
a
brighter
outlook
for
artificial
intelligence
(AI)
and
edge
computing
data
centers,
as
well
as
the
metaverse,
which
emerged
as
a
big
concept
more
than
a
year
ago.
From
a
wider
perspective,
a
wave
of
investor
interest
and
heightened
trading
around
machine
learning
(ML)
technology—a
branch
of
AI
that
enables
computers
to
Portfolio
Composition
3/31/23
%
of
Total
Net
Assets
Software
21.5%
Semiconductors
&
Semiconductor
Equipment
19.2%
Broadline
Retail
8.6%
Financial
Services
5.8%
Life
Sciences
Tools
&
Services
5.3%
Consumer
Staples
Distribution
&
Retail
4.8%
Health
Care
Equipment
&
Supplies
4.8%
Electric
Utilities
4.3%
Automobiles
4.3%
Interactive
Media
&
Services
3.6%
IT
Services
3.2%
Capital
Markets
2.4%
Specialized
REITs
1.9%
Aerospace
&
Defense
1.4%
Other
7.2%
Short-Term
Investments
&
Other
Net
Assets
1.7%
Top
10
Holdings
3/31/23
Company
Industry
,
Country
%
of
Total
Net
Assets
a
a
Microsoft
Corp.
11.4%
Software,
United
States
NVIDIA
Corp.
9.6%
Semiconductors
&
Semiconductor
Equipment,
United
States
Amazon.com,
Inc.
7.4%
Broadline
Retail,
United
States
Costco
Wholesale
Corp.
4.8%
Consumer
Staples
Distribution
&
Retail,
United
States
ASML
Holding
NV
4.7%
Semiconductors
&
Semiconductor
Equipment,
Netherlands
NextEra
Energy,
Inc.
4.3%
Electric
Utilities,
United
States
Tesla,
Inc.
4.3%
Automobiles,
United
States
Danaher
Corp.
4.1%
Life
Sciences
Tools
&
Services,
United
States
ServiceNow,
Inc.
4.0%
Software,
United
States
Mastercard,
Inc.
3.9%
Financial
Services,
United
States
Franklin
Focused
Growth
Fund
13
franklintempleton.com
Semiannual
Report
emulate
how
humans
learn
and
adapt
by
using
data
and
experience—ignited
rallies
in
several
notable
Fund
contributors
pursuing
both
themes.
Although
it
included
semiconductor
industry
players
situated
at
the
core
of
ML/AI
computing
power,
it
extends
to
software
and
IT
services
(both
of
which
have
industry
representation
in
the
portfolio),
as
well
as
non-IT
industries
such
as
internet
retail,
automobiles,
aerospace
and
defense,
biotechnology
and
life
sciences
tools.
NVIDIA—by
far
the
Fund’s
largest
overall
contributor
over
the
October
2022–March
2023
span—was
widely
seen
as
being
a
key
recipient
of
future
investment
in
this
arena.
NVIDIA’s
hardware
originally
made
a
name
for
itself
powering
high-end
video
game
graphics,
but
in
recent
years
the
company’s
bet
on
AI
and
ML
has
begun
to
pay
off.
Machines
require
massive
amounts
of
information
and
computer
power
to
learn,
and
NVIDIA’s
GPUs
(graphics
processing
units)
are
well-suited
for
the
task.
The
company
has
emerged
as
a
technological
leader
in
the
space
as
it
continued
to
research
next-generation
chip
circuitry.
NVIDIA
consistently
generates
operating
profit
margins
well
into
double-digit
percentages,
all
the
while
spending
heavily
every
year
on
new
research
and
development.
Software—the
Fund’s
largest
industry-level
exposure—
also
enjoyed
impressive
and
widespread
gains
that
were
aided
foremost
by
Microsoft,
ServiceNow
(cloud
computing
platform
geared
toward
enterprise
operations
and
digital
workflow
management)
and
Cadence
Design
Systems
(software,
hardware
and
intellectual
properties
used
to
design
microchips,
related
systems
and
printed
circuit
boards;
purchased
during
the
period).
In
particular,
enterprise
and
personal
software
titan
Microsoft
rallied
solidly
as
it
showed
strong
potential
to
stoke
future
growth
in
cloud
computing
and
infrastructure
(Azure),
as
well
as
rapid
adoption
in
its
quest
for
AI
integration
(led
currently
by
ChatGPT-enabled
Bing
search
while
undergoing
testing
and
roll-out
in
other
aspects
of
the
business).
And
while
the
weak
PC
(personal
computer)
market
has
pressured
Microsoft’s
sales
recently,
many
investors
perceived
a
bottom
may
be
nearing.
The
rally
came
on
the
heels
of
the
company’s
stronger-than-expected
financial
results
(released
in
January
2023)
and
a
huge
surge
in
interest
in
ChatGPT
and
its
developer
OpenAI
(not
a
Fund
holding),
which
is
in
partnership
with
Microsoft
as
it
continues
to
integrate
AI
capabilities
into
its
search
engine,
Office
software
suite
and
other
applications
where
AI
will
serve
as
“copilot.”
Microsoft’s
resilience
in
the
face
of
macroeconomic
headwinds—aided
by
its
increasing
business
diversity—boosted
investor
confidence
that
the
company
can
capitalize
on
these
and
other
growing
opportunities
(including
gaming)
in
the
coming
months.
Numerous
other
software
industry
holdings
advanced
with
double-digit
percentage
returns
including
HubSpot
(not
held
at
period
end),
ServiceNow
and
Ansys
(not
held
at
period
end).
Elsewhere
in
the
portfolio,
seven
out
of
10
other
sector
allocations
were
net
contributors
to
the
Fund’s
absolute
performance,
led
by
financials
and
health
care.
Our
positions
in
financial
services
providers
were
concentrated
on
electronic
payment
processing
specialists
Mastercard
and
Adyen,
both
of
which
traded
higher,
as
did
MSCI
(a
global
provider
of
equity,
fixed
income
and
real
estate
indexes
plus
multi-asset
portfolio
analysis
tools)
in
the
capital
markets
industry.
Our
health
care
investments
remained
focused
on
innovative
life
sciences
tools
and
services
companies,
as
well
as
high-
tech
health
care
equipment
and
supplies
industry
names
including
standout
contributors
IDEXX
Laboratories
and
Intuitive
Surgical,
both
of
which
posted
robust
double-digit
percentage
gains
during
the
period
under
review.
To
a
lesser
extent,
additional
gains
surfaced
in
the
industrials,
consumer
staples,
materials,
communication
services
and
utilities
sectors.
Meanwhile,
our
overall
losses
in
the
consumer
discretionary
sector
were
partially
offset
by
a
solid
rally
in
MercadoLibre,
an
e-commerce
platform
serving
as
Latin
America’s
largest
online
marketplace,
and
which
had
previously
dipped
to
multi-year
lows
when
interest
rates
began
to
rise
sharply
and
recessionary
concerns
around
consumer
spending
began
to
intensify.
All
industrials
sector
holdings
were
supportive,
led
by
notable
strength
in
key
contributor
Axon
Enterprise,
which
develops
technology
and
weapons
products
for
military,
law
enforcement,
and
civilians,
and
is
well
known
for
its
Taser
line
of
electroshock
devices.
In
consumer
staples,
Costco
Wholesale
was
the
top
contributor
based
in
part
on
its
considerable
presence
within
the
overall
portfolio,
though
our
smaller
position
in
Estee
Lauder
Companies
had
a
much
higher
six-month
return.
Materials
sector
gains
were
concentrated
in
a
solitary
position
in
diversified
metals
and
mining
conglomerate
Freeport-McMoRan,
which
benefited
in
part
from
strong
rebounds
in
copper
and
steel
prices
in
the
latter
half
of
the
period.
Within
communication
services,
the
standout
contributor
was
Alphabet,
a
significant
investment
that
supported
results
in
the
interactive
media
and
services
industry.
Alphabet
staged
a
comeback
late
in
the
period,
having
previously
sold
off
after
it
reported
that
search-
advertising
growth
for
its
Google
subsidiary
was
crimped
by
inflation
and
tighter
spending
discipline
by
advertisers.
In
contrast,
most
of
the
Fund’s
major
detractors
were
mild
to
modest
when
compared
to
the
net
contributors
described
above.
Two
of
our
largest
holdings—Tesla
and
Amazon.com—were
out
of
favor
throughout
much
of
the
Franklin
Focused
Growth
Fund
14
franklintempleton.com
Semiannual
Report
reporting
period
and
dragged
on
returns
in
the
consumer
discretionary
sector.
In
particular,
the
Fund’s
position
in
electric
vehicle
(EV)
manufacturer
Tesla
initially
traded
lower
following
slightly
weaker-than-expected
third-quarter
2022
vehicle
deliveries
and
overall
earnings
results.
Earnings
and
profit
margins
were
negatively
impacted
by
escalating
raw
materials
costs,
logistics
snags,
new
plant
start-up
inefficiencies
and
currency
headwinds.
In
December
2022,
the
selloff
accelerated
after
Tesla
announced
a
plan
to
temporarily
halt
production
at
its
China
factory.
News
of
reduced
output
in
Shanghai
came
on
the
heels
of
a
report
that
Tesla
was
offering
U.S.
consumers
a
US$7,500
discount
to
take
delivery
of
its
two
highest-volume
models
before
the
end
of
2022.
Although
bearish
investors
argued
that
company
management’s
explanation
around
logistic
constraints
were
just
an
excuse
for
eroding
demand,
we
believed
the
market
was
being
short-sighted
in
thinking
that
Tesla
had
a
demand
problem;
by
mid-March,
Tesla
was
reporting
a
solid
pickup
in
early
2023
sales
versus
the
low
point
in
2022.
While
cracks
in
demand
for
automobiles
was
starting
to
form
given
affordability
challenges
on
an
increasingly
strained
consumer,
demand
for
EVs
remains
robust,
and
Tesla
is
one
of
the
few
players
currently
producing
at
scale.
Additionally,
Tesla
sees
solid
growth
in
2023,
as
new
plants
in
Germany
and
Texas
continue
ramping
up
and
credits
from
the
Inflation
Reduction
Act
come
to
bear.
Aside
from
consumer
discretionary,
our
much
smaller
exposures
to
the
real
estate
and
utilities
sectors
failed
to
advance,
but
their
net
impact
on
absolute
returns
was
negligible.
Separately,
within
the
commodity-linked
energy
sector,
steadily
falling
crude
oil
and
natural
gas
prices
translated
into
reduced
profitability
and
ebbing
equity
values
for
Schlumberger
and
Hess,
both
of
which
were
purchased
during
the
period.
In
the
real
estate
sector,
a
solitary
position
in
SBA
Communications,
a
specialized
real
estate
investment
trust
focused
on
developing
and
leasing
a
range
of
wireless
telecommunications
infrastructure,
underwent
a
modest
selloff.
The
rest
of
the
Fund’s
key
detractors
served
to
reduce
the
overall
gains
achieved
in
other
sector
allocations,
including
Repligen
and
Danaher
in
the
health
care
sector.
All
of
the
other
notable
individual
detractors
weakened
our
results
in
the
IT
sector,
none
more
so
than
Atlassian
(sold
by
period-
end),
cloud-based
data
warehousing
and
analytics
provider
Snowflake
and
Enphase
Energy
(a
semiconductor
industry
firm
focused
on
solar
micro-inverters,
battery
energy
storage,
and
EV
charging
stations).
In
particular,
project
management
software
specialist
Atlassian’s
equity
value
fell
back
to
levels
not
seen
in
three
years
as
its
latest
quarterly
results
were
mediocre
at
best,
while
guidance
into
early
2023
fell
far
below
consensus
analyst
projections
as
the
company
was
seeing
free-to-paid
subscription
conversions
slowing
in
a
more
uncertain
macro
environment.
Atlassian
(not
held
at
period
end)
had
also
begun
to
see
a
slowdown
in
existing
customers
expanding
deployments
as
layoffs
(and
hiring
freezes)
accelerated
and
IT
budgets
faced
greater
scrutiny,
which
we
viewed
as
the
bigger
challenge.
Thank
you
for
your
participation
in
Franklin
Focused
Growth
Fund.
We
look
forward
to
serving
your
future
investment
needs.
Matthew
J.
Moberg,
CPA
Portfolio
Manager
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
March
31,
2023,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Performance
Summary
as
of
March
31,
2023
Franklin
Focused
Growth
Fund
15
franklintempleton.com
Semiannual
Report
The
performance
table
does
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
3/31/23
1
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
5.50%
and
the
minimum
is
0%.
Class
A:
5.50%
maximum
initial
sales
charge;
Advisor
Class:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236.
Share
Class
Cumulative
Total
Return
2
Average
Annual
Total
Return
3
–
A
4
6-Month
+18.24%
+11.74%
1-Year
-16.07%
-20.69%
5-Year
+64.71%
+9.25%
Since
Inception
(4/13/16)
5
+145.42%
+2.61%
Advisor
6-Month
+18.42%
+18.42%
1-Year
-15.83%
-15.83%
5-Year
+66.90%
+10.79%
Since
Inception
(4/13/16)
5
+149.90%
+14.06%
See
page
16
for
Performance
Summary
footnotes.
Franklin
Focused
Growth
Fund
Performance
Summary
16
franklintempleton.com
Semiannual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
possible
loss
of
principal.
To
the
extent
the
Fund
focuses
on
particular
countries,
regions,
industries,
sectors
or
types
of
investment
from
time
to
time,
it
may
be
subject
to
greater
risks
of
adverse
developments
in
such
areas
of
focus
than
a
fund
that
invests
in
a
wider
variety
of
countries,
regions,
industries,
sectors
or
investments.
Growth
stock
prices
reflect
projections
of
future
earnings
or
revenues,
and
can,
therefore,
fall
dramati-
cally
if
the
company
fails
to
meet
those
projections.
The
Fund
may
also
invest
in
small-
and
mid-capitalization
companies,
which
can
be
particularly
sensitive
to
changing
economic
conditions,
and
their
prospects
for
growth
are
less
certain
than
those
of
larger,
more
established
companies.
Foreign
investing
carries
additional
risks
such
as
currency
and
market
volatility,
and
political
or
social
instability;
risks
which
are
heightened
in
developing
countries.
Events
such
as
the
spread
of
deadly
diseases,
disasters,
and
financial,
political
or
social
disruptions,
may
heighten
risks
and
adversely
affect
performance.
The
Fund’s
prospectus
also
includes
a
description
of
the
main
investment
risks.
1.
Gross
expenses
are
the
Fund’s
total
annual
operating
expenses
as
of
the
Fund's
prospectus
available
at
the
time
of
publication.
Actual
expenses
may
be
higher
and
may
impact
portfolio
returns.
Net
expenses
reflect
contractual
fee
waivers,
expense
caps
and/or
reimbursements,
which
cannot
be
terminated
prior
to
01/31/2024
without
Board
consent.
Additional
amounts
may
be
voluntarily
waived
and/or
reimbursed
and
may
be
modified
or
discontinued
at
any
time
without
notice.
2.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
3.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
periods
indicated.
Return
for
less
than
one
year,
if
any,
has
not
been
annualized.
4.
Effective
2/14/20,
the
Fund
began
offering
Class
A
shares.
Class
A
performance
shown
has
been
calculated
as
follows:
(a)
for
periods
prior
to
2/14/20,
a
restated
figure
is
used
based
on
the
Fund’s
Advisor
Class
performance
that
includes
any
Rule
12b-1
rate
differential
that
exists
between
Class
A
and
Advisor
Class;
and
(b)
for
periods
after
2/14/20,
actual
Class
A
performance
is
used,
reflecting
all
charges
and
fees
applicable
to
that
class.
5.
Since
Inception
returns
are
based
on
the
performance
inception
date
of
4/13/16.
6.
Figures
are
as
stated
in
the
Fund’s
current
prospectus
and
may
differ
from
the
expense
ratios
disclosed
in
the
Your
Fund’s
Expenses
and
Financial
Highlights
sections
in
this
report.
In
periods
of
market
volatility,
assets
may
decline
significantly,
causing
total
annual
Fund
operating
expenses
to
become
higher
than
the
figures
shown.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
Total
Annual
Operating
Expenses
6
Share
Class
With
Fee
Waiver
Without
Fee
Waiver
A
1.10%
1.37%
Advisor
0.85%
1.12%
Your
Fund’s
Expenses
Franklin
Focused
Growth
Fund
17
franklintempleton.com
Semiannual
Report
As
a
Fund
shareholder,
you
can
incur
two
types
of
costs:
(1)
transaction
costs,
including
sales
charges
(loads)
on
Fund
purchases
and
redemptions;
and
(2)
ongoing
Fund
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
Fund
expenses.
All
mutual
funds
have
ongoing
costs,
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
“Actual.”
In
these
columns
the
Fund’s
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
“Ending
Account
Value”
for
each
class
of
shares.
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
for
your
class
of
shares
under
the
headings
“Actual”
and
“Expenses
Paid
During
Period”
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
“Hypothetical”
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund’s
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund’s
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
for
the
class
of
shares
you
hold
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
“Hypothetical”
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above—in
the
far
right
column—multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/365
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Does
not
include
acquired
fund
fees
and
expenses.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Share
Class
Beginning
Account
Value
10/1/22
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
a
Net
Annualized
Expense
Ratio
2
A
$1,000
$1,182.40
$5.95
$1,019.48
$5.51
1.09%
C
$1,000
$1,178.10
$10.05
$1,015.71
$9.30
1.85%
R
$1,000
$1,181.20
$7.35
$1,018.19
$6.80
1.35%
R6
$1,000
$1,184.60
$4.48
$1,020.83
$4.15
0.82%
Advisor
$1,000
$1,184.20
$4.65
$1,020.68
$4.30
0.85%
18
franklintempleton.com
Semiannual
Report
Franklin
Growth
Fund
This
semiannual
report
for
Franklin
Growth
Fund
covers
the
period
ended
March
31,
2023.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
capital
appreciation
by
investing
substantially
in
equity
securities
of
companies
that
are
leaders
in
their
industries.
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
+16.74%
cumulative
total
return
for
the
six
months
under
review.
In
comparison,
the
Standard
&
Poor’s
500
Index
(S&P
500),
which
is
a
broad
measure
of
U.S.
stock
performance,
posted
a
+15.62%
cumulative
total
return.
1
The
Fund’s
new
secondary
benchmark,
the
Russell
1000
®
Growth
Index,
which
is
market
capitalization
weighted
and
measures
performance
of
those
Russell
1000
®
Index
companies
with
relatively
higher
price-to-book
ratios
and
higher
forecasted
growth
rates,
posted
a
cumulative
total
return
of
+16.88%.
1
You
can
find
the
Fund’s
long-term
performance
data
in
the
Performance
Summary
beginning
on
page
20
.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236.
Investment
Strategy
We
use
fundamental,
bottom-up
research
to
seek
companies
meeting
our
criteria
of
growth
potential,
quality
and
valuation.
In
seeking
sustainable
growth
characteristics,
we
look
for
companies
we
believe
can
produce
sustainable
earnings
and
cash
flow
growth,
evaluating
the
long-term
market
opportunity
and
competitive
structure
of
an
industry
to
target
leaders
and
emerging
leaders.
We
define
quality
companies
as
those
with
strong
and
improving
competitive
positions
in
attractive
markets.
We
also
believe
important
attributes
of
quality
are
experienced
and
talented
management
teams
as
well
as
financial
strength
reflected
in
the
capital
structure,
gross
and
operating
margins,
free
cash
flow
generation
and
returns
on
capital
employed.
Our
valuation
analysis
includes
a
range
of
potential
outcomes
based
on
an
assessment
of
multiple
scenarios.
In
assessing
value,
we
consider
whether
security
prices
fully
reflect
the
balance
of
the
sustainable
growth
opportunities
relative
to
business
and
financial
risks.
The
investment
manager’s
process
generally
includes
an
assessment
of
the
potential
impacts
of
any
material
environmental,
social
and
governance
(“ESG”)
factors
on
the
long-term
risk
and
return
profile
of
a
company.
*Categories
within
the
Other
category
are
listed
in
full
in
the
Fund’s
Schedule
of
Investments
(SOI),
which
can
be
found
later
in
the
report.
Manager’s
Discussion
For
the
six
months
under
review,
the
Fund
outperformed
its
benchmark.
Strength
during
the
period
was
primarily
due
to
our
positioning
in
the
health
care,
financials
and
consumer
discretionary
sectors.
Stock
selection
and
overweighting
benefited
relative
performance
in
the
health
care
sector,
led
by
our
investment
in
medical
device
manufacturer
Mettler-
Toledo
International.
The
company
has
seen
increased
demand
in
most
of
its
end-markets
for
innovative
solutions
that
support
automation
and
digitalization.
In
contrast,
Danaher
was
a
leading
detractor
in
the
health
care
sector.
Uncertainty
about
COVID-19-related
revenue
in
2023
was
a
drag
on
the
shares
of
the
life
sciences
and
diagnostics
company.
However,
Danaher
continues
to
see
solid
signs
of
strength
from
its
bioprocessing
business,
which
is
expected
Portfolio
Composition
3/31/23
%
of
Total
Net
Assets
Software
17.0%
Semiconductors
&
Semiconductor
Equipment
8.9%
Life
Sciences
Tools
&
Services
7.2%
Aerospace
&
Defense
4.9%
Financial
Services
4.8%
Technology
Hardware,
Storage
&
Peripherals
4.8%
Machinery
4.2%
Health
Care
Equipment
&
Supplies
4.2%
Capital
Markets
3.9%
Pharmaceuticals
3.8%
Beverages
3.6%
Ground
Transportation
3.3%
Electronic
Equipment,
Instruments
&
Components
3.1%
Chemicals
3.0%
Other*
23.0%
Short-Term
Investments
&
Other
Net
Assets
0.3%
1.
Source:
Morningstar.
The
index
is
unmanaged
and
includes
reinvestment
of
any
income
or
distributions.
It
does
not
reflect
any
fees,
expenses
or
sales
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Schedule
of
Investments
(SOI).
The
SOI
begins
on
page
60
.
Franklin
Growth
Fund
19
franklintempleton.com
Semiannual
Report
to
contribute
more
than
20%
growth
to
non-COVID-19
revenues.
A
lack
of
exposure
to
the
banks
industry
helped
relative
performance
in
the
financials
sector.
However,
contagion
fears
resulting
from
the
bank
fallout
in
March
2023
spread
to
other
financial
services
companies
including
Charles
Schwab,
which
weighed
on
the
shares
of
the
brokerage
giant.
In
the
consumer
discretionary
sector,
economic
uncertainty
and
concerns
about
consumer
demand
pressured
Tesla’s
stock
over
the
period.
The
Fund
benefited
from
a
relative
underweighting
in
the
electric
vehicle
manufacturer.
The
information
technology
(IT)
sector
recovered
lost
ground
over
the
six-month
period,
helped
by
the
prospect
of
slower
rate
hikes.
Standout
contributors
included
chipmakers
NVIDIA
and
ASML
Holding,
which
followed
financial
markets
higher.
Semiconductors
are
at
the
heart
of
digital
transformation
and
end-market
demand
remains
robust,
in
our
view.
In
contrast,
the
communication
services
and
industrials
sectors
delivered
negative
relative
performance
over
the
period.
In
the
industrials
sector,
elevated
inflation,
supply-
chain
delays
and
labor
shortages
were
challenges
for
defense
contractor
Northrop
Grumman,
which
was
a
leading
detractor.
Thank
you
for
your
continued
participation
in
Franklin
Growth
Fund.
We
look
forward
to
serving
your
future
investment
needs.
Serena
Perin
Vinton,
CFA
Robert
Rendler,
CFA
Joyce
Lin,
CFA
Portfolio
Management
Team
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
March
31,
2023,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Top
10
Holdings
3/31/23
Company
Industry
,
Country
%
of
Total
Net
Assets
a
a
Microsoft
Corp.
5.4%
Software,
United
States
Apple,
Inc.
4.8%
Technology
Hardware,
Storage
&
Peripherals,
United
States
NVIDIA
Corp.
3.1%
Semiconductors
&
Semiconductor
Equipment,
United
States
Amazon.com,
Inc.
3.0%
Broadline
Retail,
United
States
Alphabet,
Inc.
3.0%
Interactive
Media
&
Services,
United
States
Mastercard,
Inc.
2.2%
Financial
Services,
United
States
Mettler-Toledo
International,
Inc.
2.1%
Life
Sciences
Tools
&
Services,
United
States
Intuit,
Inc.
2.1%
Software,
United
States
Eli
Lilly
&
Co.
2.0%
Pharmaceuticals,
United
States
ServiceNow,
Inc.
1.9%
Software,
United
States
CFA
®
is
a
trademark
owned
by
CFA
Institute.
Performance
Summary
as
of
March
31,
2023
Franklin
Growth
Fund
20
franklintempleton.com
Semiannual
Report
The
performance
table
does
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
3/31/23
1
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
5.50%
and
the
minimum
is
0%.
Class
A:
5.50%
maximum
initial
sales
charge;
Advisor
Class:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236.
Share
Class
Cumulative
Total
Return
2
Average
Annual
Total
Return
3
–
A
4
6-Month
+16.74%
+10.32%
1-Year
-9.14%
-14.14%
5-Year
+63.09%
+9.04%
10-Year
+220.63%
+11.72%
Advisor
6-Month
+16.89%
+16.89%
1-Year
-8.90%
-8.90%
5-Year
+65.17%
+10.56%
10-Year
+228.77%
+12.64%
See
page
21
for
Performance
Summary
footnotes.
Franklin
Growth
Fund
Performance
Summary
21
franklintempleton.com
Semiannual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
possible
loss
of
principal.
The
market
values
of
securities
or
other
investments
owned
by
the
Fund
will
go
up
or
down,
sometimes
rapidly
or
unpredictably.
The
Fund
may
focus
on
particular
sectors
of
the
market
from
time
to
time,
which
can
carry
greater
risks
of
adverse
developments
in
such
sectors.
While
the
Fund
historically
has
focused
on
larger
companies,
it
may
invest
up
to
25%
of
its
assets
in
small,
relatively
new
and/
or
unseasoned
companies,
which
involves
additional
risks,
as
these
companies
may
have
less
certain
growth
prospects
and
limited
or
less
developed
product
lines
or
markets,
and
less
secure
financing.
Growth
stock
prices
can
be
volatile,
particularly
over
the
short
term.
The
Fund
may
invest
up
to
40%
of
its
net
assets
in
stocks
of
foreign
companies,
which
involve
special
risks,
including
currency
fluctuations
and
economic
as
well
as
political
uncertainty.
Events
such
as
the
spread
of
deadly
diseases,
disasters,
and
financial,
political
or
social
disruptions,
may
heighten
risks
and
adversely
affect
performance.
The
Fund’s
prospectus
also
includes
a
description
of
the
main
investment
risks.
1.
The
total
annual
operating
expenses
are
as
of
the
Fund's
prospectus
available
at
the
time
of
publication.
Actual
expenses
may
be
higher
and
may
impact
portfolio
returns.
2.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
3.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
periods
indicated.
Return
for
less
than
one
year,
if
any,
has
not
been
annualized.
4.
Prior
to
9/10/18,
these
shares
were
offered
at
a
higher
initial
sales
charge
of
5.75%,
thus
actual
returns
(with
sales
charges)
would
have
differed.
Average
annual
total
returns
(with
sales
charges)
have
been
restated
to
reflect
the
current
maximum
initial
sales
charge
of
5.50%.
5.
Figures
are
as
stated
in
the
Fund’s
current
prospectus
and
may
differ
from
the
expense
ratios
disclosed
in
the
Your
Fund’s
Expenses
and
Financial
Highlights
sections
in
this
report.
In
periods
of
market
volatility,
assets
may
decline
significantly,
causing
total
annual
Fund
operating
expenses
to
become
higher
than
the
figures
shown.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
Distributions
(10/1/22–3/31/23)
Share
Class
Net
Investment
Income
Long-Term
Capital
Gain
Total
A
–
$10.7138
$10.7138
C
–
$10.7138
$10.7138
R
–
$10.7138
$10.7138
R6
$0.2521
$10.7138
$10.9659
Advisor
$0.1571
$10.7138
$10.8709
Total
Annual
Operating
Expenses
5
Share
Class
A
0.80%
Advisor
0.55%
Your
Fund’s
Expenses
Franklin
Growth
Fund
22
franklintempleton.com
Semiannual
Report
As
a
Fund
shareholder,
you
can
incur
two
types
of
costs:
(1)
transaction
costs,
including
sales
charges
(loads)
on
Fund
purchases
and
redemptions;
and
(2)
ongoing
Fund
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
Fund
expenses.
All
mutual
funds
have
ongoing
costs,
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
“Actual.”
In
these
columns
the
Fund’s
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
“Ending
Account
Value”
for
each
class
of
shares.
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
for
your
class
of
shares
under
the
headings
“Actual”
and
“Expenses
Paid
During
Period”
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
“Hypothetical”
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund’s
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund’s
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
for
the
class
of
shares
you
hold
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
“Hypothetical”
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above—in
the
far
right
column—multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/365
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Does
not
include
acquired
fund
fees
and
expenses.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Share
Class
Beginning
Account
Value
10/1/22
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
a
Net
Annualized
Expense
Ratio
2
A
$1,000
$1,167.40
$4.43
$1,020.84
$4.13
0.82%
C
$1,000
$1,162.90
$8.47
$1,017.10
$7.90
1.57%
R
$1,000
$1,165.90
$5.78
$1,019.60
$5.39
1.07%
R6
$1,000
$1,169.30
$2.56
$1,022.57
$2.39
0.47%
Advisor
$1,000
$1,168.90
$3.08
$1,022.09
$2.87
0.57%
23
franklintempleton.com
Semiannual
Report
Franklin
Income
Fund
This
semiannual
report
for
Franklin
Income
Fund
covers
the
period
ended
March
31,
2023.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
to
maximize
income,
while
maintaining
prospects
for
capital
appreciation
by
investing,
under
normal
market
conditions,
in
a
diversified
portfolio
of
debt
and
equity
securities.
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
cumulative
total
return
of
+10.67%
for
the
six
months
under
review.
In
comparison,
the
Fund’s
equity
benchmark,
the
Standard
&
Poor’s
500
Index
(S&P
500),
which
is
a
broad
measure
of
U.S.
stock
performance,
posted
a
+15.62%
cumulative
total
return.
1
The
Fund’s
secondary
benchmark,
the
blended
50%
MSCI
USA
High
Dividend
Yield
Index
+
25%
Bloomberg
High
Yield
Very
Liquid
Index
+
25%
Bloomberg
U.S.
Aggregate
Bond
Index
(Blended
Benchmark),
which
is
a
combination
of
leading
stock
and
bond
indexes,
posted
a
+10.07%
cumulative
total
return.
2
You
can
find
the
Fund’s
long-term
performance
data
in
the
Performance
Summary
beginning
on
page
26
.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Investment
Strategy
In
analyzing
debt
and
equity
securities,
we
consider
such
factors
as
a
company’s
experience
and
managerial
strength;
responsiveness
to
changes
in
interest
rates
and
business
conditions;
debt
maturity
schedules
and
borrowing
requirements;
changing
financial
condition
and
market
recognition
of
the
change;
and
a
security’s
relative
value
based
on
such
factors
as
anticipated
cash
flow,
interest
or
dividend
coverage,
asset
coverage
and
earnings.
When
choosing
investments
for
the
Fund,
we
apply
a
bottom-up,
value
oriented,
long-term
approach,
focusing
on
the
market
price
of
a
company’s
securities
relative
to
the
investment
manager’s
evaluation
of
the
company’s
long-term
earning,
asset
value
and
cash
flow
potential.
Manager’s
Discussion
During
the
six-month
period
under
review,
our
equity
weighting
decreased
from
42.9%
to
37.2%,
and
our
fixed
income
weighting
increased
from
55.8%
to
60.0%.
The
Fund’s
cash
position
increased
from
1.7%
to
3.6%
of
total
net
assets.
The
Fund
generated
positive
returns
during
the
period
with
strong
performance
from
both
equity
and
fixed
income
holdings.
The
Fund
was
positioned
with
an
overweight
allocation
to
fixed
income
during
the
period.
Relative
to
the
Fund’s
blended
benchmark,
an
overweight
allocation
to
corporate
credit
broadly
led
to
strong
performance
relative
to
the
Fund’s
blended
benchmark.
The
Fund
entered
the
period
with
a
decreased
equity
weighting
and
an
increased
fixed
income
weighting,
while
also
holding
a
portion
in
cash
equivalents.
The
Fund,
having
already
reduced
equities
meaningfully
prior
to
the
start
of
the
period
under
review,
continued
the
transition
to
a
less
equity-tilted
portfolio
over
the
period.
The
Fund
ended
the
period
with
a
decreased
equity
weighting
and
an
increased
fixed
income
exposure,
while
continuing
to
hold
a
portion
in
cash
equivalents.
Dividend
stocks,
particularly
value-oriented
sectors,
underperformed
growth-oriented
sectors
during
the
period
under
review.
The
equity
component
of
the
Fund’s
blended
benchmark
advanced
with
the
MSCI
USA
High
Dividend
Yield
Index
posting
positive
returns
for
the
6-month
period.
The
Fund’s
equity
positions
underperformed
the
Fund’s
blended
benchmark.
Corporate
credit
spreads
tightened
during
the
period
under
review
as
inflationary
pressures
started
to
abate
and
the
central
bank
tightening
expectations
decreased
during
the
period.
In
addition
to
tightening
credit
spreads,
interest
rates
broadly
decreased
during
the
period,
which
benefited
the
more
duration
sensitive
positions
in
the
Fund.
Fixed
income
returns
for
the
Fund
outperformed
the
Fund’s
blended
benchmark.
The
Bloomberg
U.S.
Aggregate
Bond
Index
posted
positive
returns,
while
the
Bloomberg
Barclays
U.S.
High
Yield
Very
Liquid
Index
also
posted
positive
returns
during
the
period.
1.
Source:
Morningstar.
2.
Source:
FactSet.
The
Fund’s
Blended
Benchmark
was
calculated
internally.
The
indexes
are
unmanaged
and
include
reinvestment
of
any
income
or
distributions.
They
do
not
reflect
any
fees,
expenses
or
sales
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Schedule
of
Investments
(SOI).
The
SOI
begins
on
page
71
.
Franklin
Income
Fund
24
franklintempleton.com
Semiannual
Report
*Categories
within
the
Other
category
are
listed
in
full
in
the
Fund’s
Schedule
of
Investments
(SOI),
which
can
be
found
later
in
the
report.
Fixed
Income
holdings
posted
positive
returns
during
the
period
with
outperformance
relative
to
the
Fund’s
blended
fixed
income
benchmark.
As
an
asset
class,
fixed
income
underperformed
the
equity
asset
class.
The
Fund’s
duration
positioning
was
relatively
in-line
with
the
Fund’s
benchmark
during
the
period.
Corporate
credit
spreads
within
both
investment-grade
and
sub-investment-grade
tightened
during
the
period;
the
Fund
had
an
overweight
posture
to
corporate
credit
during
the
period
which
contributed
to
the
outperformance
relative
to
the
Fund’s
benchmark.
Every
corporate
credit
sector
generated
positive
absolute
returns
during
the
period
under
review.
Relative
to
the
Fund’s
blended
benchmark,
the
leading
contributors
were
health
care,
information
technology
(IT),
materials
and
communication
services.
Our
holdings
in
U.S.
Treasuries
were
positive
contributors
during
the
period
but
these
positions
were
large
positive
contributors
relative
to
the
Fund’s
blended
benchmark
given
overweight
allocation
relative
to
the
Fund’s
benchmark.
The
largest
contributors
to
performance
were
found
in
the
health
care
sector
with
bonds
of
hospital
peers
CHS/
Community
Health
Systems
and
Tenet
Healthcare
producing
strong
returns.
Outside
of
health
care,
Ford
Motor
within
the
consumer
discretionary
sector
and
Boeing
within
the
industrial
sector
generated
strong
returns.
U.S.
Treasuries
were
also
a
key
contributor
during
the
period,
as
previously
noted.
In
terms
of
fixed
income
detractors,
high-yield
health
care
players
Multiplan
and
Medical
Properties
Trust
(not
held
at
period
end)
generated
negative
returns.
Consumer
discretionary
player
Carvana
(not
held
at
period
end)
also
generated
negative
returns
(not
held
at
period
end).
Equity
holdings
decreased
over
the
period.
As
an
asset-
class,
equities
outperformed
fixed
income
during
the
period.
The
Fund
actively
trimmed
its
equity
overweighting
during
the
period
under
review.
*Includes
convertible
bonds.
All
sectors
saw
positive
contributions
during
the
period
with
the
top
absolute
contributors
coming
from
IT,
energy,
industrials
and
materials.
The
largest
sector
contributors
relative
to
the
Fund’s
benchmark
were
energy,
financials
and
materials,
with
the
largest
sector
detractors
relative
to
the
Fund’s
benchmark
being
consumer
staples,
health
care
and
consumer
discretionary.
IT
returns
were
led
by
semiconductor
peers
Texas
Instruments,
Broadcom
and
Analog
Devices,
as
well
as
equipment
provider
Cisco
Systems.
Strong
energy
returns
were
led
by
Chevron
and
Exxon
Mobil
during
the
period.
Rio
Tinto,
Barrick
Gold
and
Freeport-McMoRan
generated
strong
results
in
the
materials
sector.
Portfolio
Composition
3/31/23
%
of
Total
Net
Assets
Financial
Services
12.7%
Banks
8.0%
Health
Care
Providers
&
Services
7.2%
Oil,
Gas
&
Consumable
Fuels
6.2%
Pharmaceuticals
5.6%
Semiconductors
&
Semiconductor
Equipment
5.2%
Electric
Utilities
5.0%
Aerospace
&
Defense
3.7%
Capital
Markets
2.8%
Hotels,
Restaurants
&
Leisure
2.8%
Consumer
Finance
2.5%
Media
2.5%
Communications
Equipment
2.3%
Metals
&
Mining
2.3%
Other*
27.3%
Short-Term
Investments
&
Other
Net
Assets
3.9%
Top
Five
Fixed
Income
Holdings
3/31/23
Company
Industry
,
Country
%
of
Total
Net
Assets
a
a
U.S.
Treasury
Notes
11.1%
Financial
Services
,
United
States
CHS/Community
Health
Systems,
Inc.
3.4%
Health
Care
Providers
&
Services
,
United
States
Tenet
Healthcare
Corp.
1.5%
Health
Care
Providers
&
Services
,
United
States
Bausch
Health
Cos.,
Inc.
1.4%
Pharmaceuticals
,
United
States
Boeing
Co.
(The)
1.1%
Aerospace
&
Defense
,
United
States
Top
Five
Equity
Holdings*
3/31/23
Company
Industry
,
Country
%
of
Total
Net
Assets
a
a
Chevron
Corp.
1.5%
Oil,
Gas
&
Consumable
Fuels
,
United
States
Texas
Instruments,
Inc.
1.0%
Semiconductors
&
Semiconductor
Equipment
,
United
States
Southern
Co.
(The)
0.9%
Electric
Utilities
,
United
States
Morgan
Stanley
0.9%
Capital
Markets
,
United
States
Bank
of
America
Corp.
0.8%
Banks
,
United
States
Franklin
Income
Fund
25
franklintempleton.com
Semiannual
Report
Top
performers
in
the
Fund
outside
of
these
sectors
included
Siemens
and
Lockheed
Martin
in
the
industrials
sector,
AbbVie
within
health
care
and
Comcast
within
the
communications
services
sector.
At
the
individual
security
level,
the
largest
detractors
from
performance
during
the
period
came
from
financial
peers
Truist
Financial,
Charles
Schwab
and
US
Bancorp.
Outside
of
these,
utility
Dominion
Energy
weighed
on
results.
During
the
period,
the
Fund
used
derivatives
such
as
equity
call
and
put
options
to
sell
and
reduce
positions
(call
options)
and/or
to
initiate
and
add
to
positions,
which
generated
gains
during
the
period
under
review.
Thank
you
for
your
continued
participation
in
Franklin
Income
Fund.
We
look
forward
to
serving
your
future
investment
needs.
Edward
D.
Perks,
CFA
Lead
Portfolio
Manager
Brendan
Circle,
CFA
Todd
Brighton,
CFA
Portfolio
Management
Team
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
March
31,
2023,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Performance
Summary
as
of
March
31,
2023
Franklin
Income
Fund
26
franklintempleton.com
Semiannual
Report
The
performance
tables
do
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
3/31/23
1
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
3.75%
and
the
minimum
is
0%.
Class
A:
3.75%
maximum
initial
sales
charge;
Advisor
Class:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236.
Share
Class
Cumulative
Total
Return
2
Average
Annual
Total
Return
3
–
A
4,5
6-Month
+10.67%
+6.52%
1-Year
-3.69%
-7.30%
5-Year
+32.52%
+4.99%
10-Year
+69.03%
+4.99%
Advisor
6-Month
+10.91%
+10.91%
1-Year
-3.44%
-3.44%
5-Year
+34.36%
+6.09%
10-Year
+72.99%
+5.63%
Share
Class
Distribution
Rate
6
30-Day
Standardized
Yield
7
A
5.27%
4.19%
Advisor
5.74%
4.61%
See
page
27
for
Performance
Summary
footnotes.
Franklin
Income
Fund
Performance
Summary
27
franklintempleton.com
Semiannual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
possible
loss
of
principal.
The
Fund’s
portfolio
includes
a
substantial
portion
of
higher-yielding,
lower-rated
corporate
bonds
and
some
floating
rate
loans,
which
are
also
higher-yielding
and
lower-rated.
These
investments
have
more
credit
risk
than
investment-grade
securities
and
are
subject
to
increased
risk
of
default
and
potential
loss
of
principal.
The
Fund’s
share
price
and
yield
will
be
affected
by
interest
rate
movements.
Bond
prices
generally
move
in
the
opposite
direction
of
interest
rates.
Thus,
as
prices
of
bonds
in
the
Fund
adjust
to
a
rise
in
interest
rates,
the
Fund’s
share
price
may
decline.
Changes
in
the
financial
strength
of
a
bond
issuer
or
in
a
bond’s
credit
rating
may
affect
its
value.
Stock
prices
fluctuate,
sometimes
rapidly
and
dra-
matically,
due
to
factors
affecting
individual
companies,
particular
industries
or
sectors,
or
general
market
conditions.
Foreign
investing
involves
additional
risks
such
as
currency
and
market
volatility,
as
well
as
political
and
social
instability.
Events
such
as
the
spread
of
deadly
diseases,
disasters,
and
financial,
political
or
social
disruptions,
may
heighten
risks
and
adversely
affect
performance.
The
Fund’s
prospectus
also
includes
a
description
of
the
main
investment
risks.
1.
Gross
expenses
are
the
Fund’s
total
annual
operating
expenses
as
of
the
Fund's
prospectus
available
at
the
time
of
publication.
Actual
expenses
may
be
higher
and
may
impact
portfolio
returns.
Net
expenses
reflect
contractual
fee
waivers,
expense
caps
and/or
reimbursements,
which
cannot
be
terminated
prior
to
01/31/2024
without
Board
consent.
Additional
amounts
may
be
voluntarily
waived
and/or
reimbursed
and
may
be
modified
or
discontinued
at
any
time
without
notice.
2.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
3.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
periods
indicated.
Return
for
less
than
one
year,
if
any,
has
not
been
annualized.
4.
Effective
9/10/18,
Class
A
shares
closed
to
new
investors,
were
renamed
Class
A1
shares,
and
a
new
Class
A
share
with
a
different
expense
structure
became
available.
Class
A
performance
shown
has
been
calculated
as
follows:
(a)
for
periods
prior
to
9/10/18,
a
restated
figure
is
used
based
on
the
Fund’s
Class
A1
performance
that
includes
any
Rule
12b-1
rate
differential
that
exists
between
Class
A1
and
Class
A;
and
(b)
for
periods
after
9/10/18,
actual
Class
A
performance
is
used,
reflecting
all
charges
and
fees
applicable
to
that
class.
5.
Prior
to
3/1/19,
these
shares
were
offered
at
a
higher
initial
sales
charge
of
4.25%,
thus
actual
returns
(with
sales
charges)
would
have
differed.
Average
annual
total
returns
(with
sales
charges)
have
been
restated
to
reflect
the
current
maximum
initial
sales
charge
of
3.75%.
6.
Distribution
rate
is
based
on
an
annualization
of
the
respective
class’s
March
dividend
and
the
maximum
offering
price
(NAV
for
Advisor
Class)
per
share
on
3/31/23.
7.
The
Fund’s
30-day
standardized
yield
is
calculated
over
a
trailing
30-day
period
using
the
yield
to
maturity
on
bonds
and/or
the
dividends
accrued
on
stocks.
It
may
not
equal
the
Fund’s
actual
income
distribution
rate,
which
reflects
the
Fund’s
past
dividends
paid
to
shareholders.
8.
Figures
are
as
stated
in
the
Fund’s
current
prospectus
and
may
differ
from
the
expense
ratios
disclosed
in
the
Your
Fund’s
Expenses
and
Financial
Highlights
sections
in
this
report.
In
periods
of
market
volatility,
assets
may
decline
significantly,
causing
total
annual
Fund
operating
expenses
to
become
higher
than
the
figures
shown.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
Net
Asset
Value
Share
Class
(Symbol)
3/31/23
9/30/22
Change
A
(FKIQX)
$2.30
$2.14
+$0.16
A1
(FKINX)
$2.30
$2.15
+$0.15
C
(FCISX)
$2.35
$2.18
+$0.17
R
(FISRX)
$2.25
$2.10
+$0.15
R6
(FNCFX)
$2.29
$2.13
+$0.16
Advisor
(FRIAX)
$2.28
$2.12
+$0.16
Distributions
(10/1/22–3/31/23)
Share
Class
Net
Investment
Income
A
$0.0666
A1
$0.0681
C
$0.0618
R
$0.0636
R6
$0.0702
Advisor
$0.0696
Total
Annual
Operating
Expenses
8
Share
Class
With
Fee
Waiver
Without
Fee
Waiver
A
0.72%
0.73%
Advisor
0.47%
0.48%
Your
Fund’s
Expenses
Franklin
Income
Fund
28
franklintempleton.com
Semiannual
Report
As
a
Fund
shareholder,
you
can
incur
two
types
of
costs:
(1)
transaction
costs,
including
sales
charges
(loads)
on
Fund
purchases
and
redemptions;
and
(2)
ongoing
Fund
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
Fund
expenses.
All
mutual
funds
have
ongoing
costs,
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
“Actual.”
In
these
columns
the
Fund’s
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
“Ending
Account
Value”
for
each
class
of
shares.
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
for
your
class
of
shares
under
the
headings
“Actual”
and
“Expenses
Paid
During
Period”
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
“Hypothetical”
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund’s
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund’s
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
for
the
class
of
shares
you
hold
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
“Hypothetical”
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above—in
the
far
right
column—multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/365
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Does
not
include
acquired
fund
fees
and
expenses.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Share
Class
Beginning
Account
Value
10/1/22
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
a
Net
Annualized
Expense
Ratio
2
A
$1,000
$1,106.70
$3.74
$1,021.38
$3.59
0.71%
A1
$1,000
$1,102.20
$3.21
$1,021.88
$3.09
0.61%
C
$1,000
$1,107.00
$5.84
$1,019.39
$5.60
1.11%
R
$1,000
$1,102.50
$5.04
$1,020.13
$4.85
0.96%
R6
$1,000
$1,108.90
$2.16
$1,022.89
$2.07
0.41%
Advisor
$1,000
$1,109.10
$2.43
$1,022.63
$2.33
0.46%
29
franklintempleton.com
Semiannual
Report
Franklin
U.S.
Government
Securities
Fund
This
semiannual
report
for
Franklin
U.S.
Government
Securities
Fund
covers
the
period
ended
March
31,
2023.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
income
by
investing
at
least
80%
of
its
net
assets
in
U.S.
government
securities.
The
Fund
presently
invests
substantially
all
of
its
assets
in
Government
National
Mortgage
Association
obligations
(Ginnie
Maes).
Since
1983,
the
Fund
has
invested
substantially
in
Ginnie
Mae
securities,
which
carry
a
guarantee
backed
by
the
full
faith
and
credit
of
the
U.S.
government
as
to
the
timely
payment
of
interest
and
principal.
1
Issued
by
the
Government
National
Mortgage
Association
(GNMA),
Ginnie
Maes
have
been
among
the
highest
yielding
U.S.
government
obligations
available.
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
+4.05%
cumulative
total
return
for
the
six
months
under
review.
In
comparison,
the
Bloomberg
U.S.
Government
-
Intermediate
Index,
the
intermediate
component
of
the
Bloomberg
U.S.
Government
Index,
posted
a
+3.29%
cumulative
total
return.
2
You
can
find
the
Fund’s
long-term
performance
data
in
the
Performance
Summary
beginning
on
page
31
.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236.
Investment
Strategy
We
currently
invest
the
Fund’s
assets
substantially
in
GNMA
obligations.
We
analyze
securities
using
proprietary
models
to
help
us
identify
attractive
investment
opportunities.
Manager’s
Discussion
During
the
six-months
under
review,
after
raising
the
fed
funds
rate
by
75
basis
points
(bps)
in
November
2022,
the
fourth
consecutive
raise,
the
U.S.
Federal
Reserve
(Fed)
slowed
their
tightening
path,
raising
rates
by
50
bps
at
its
December
meeting.
The
Fed
then
followed
up
with
two
consecutive
25
bp
rate
hikes
in
February
and
March
2023.
From
the
recent
March
Federal
Open
Market
Committee
(FOMC)
meeting,
Chair
Jerome
Powell
noted
that
inflation
is
still
too
high
and
the
labor
market
still
too
hot.
He
also
emphasized
that
the
recent
turmoil
in
the
banking
sector
was
limited
and
not
a
sign
of
systemic
risk
in
the
sector,
but
it
seems
likely
to
result
in
some
contraction
in
credit
conditions,
which
would
have
the
same
impact
as
more
rate
hikes
and
therefore
would
leave
less
need
for
additional
policy
tightening.
Against
this
backdrop,
U.S.
Treasury
(UST)
yields
ended
the
6-month
period
lower
across
the
curve,
while
remaining
inverted.
Mortgage-backed
securities
(MBS)
spreads
fluctuated
throughout
the
performance
period
but
ended
March
2023
at
a
similar
point
compared
to
the
beginning
of
October
2022.
The
Primary
Mortgage
Market
Survey
(PMMS)
rate
ended
March
2023
at
6.32%,
which
is
over
1%
lower
than
the
highs
reached
in
October
2022.
With
just
a
very
small
amount
of
the
universe
with
the
economic
incentive
to
refinance,
in
our
view,
we
expect
prepayment
risk
to
remain
contained.
The
Fund
maintains
a
conservative,
disciplined
investment
strategy
and
seeks
higher-yielding
income
generation
than
USTs
by
investing
primarily
in
GNMA
mortgage
pass-
throughs,
which
remain
the
only
MBS
that
are
backed
by
the
full
faith
and
credit
of
the
U.S.
government—the
same
guarantee
applicable
to
U.S.
Treasuries.
1
We
believe
our
collateral-intensive
research
approach
can
allow
us
to
uncover
dislocations
across
the
GNMA
markets
and
associated
mispricing
of
prepayment
risk.
We
continue
to
focus
on
specified
pools
where
we
believe
our
experience
and
continual
investment
in
new
technologies
help
us
uncover
these
discrepancies.
Portfolio
Composition
3/31/23
%
of
Total
Net
Assets
Mortgage-Backed
Securities
97.6%
Other
0.6%
Short-Term
Investments
&
Other
Net
Assets
1.8%
1.
Securities
owned
by
the
Fund,
but
not
shares
of
the
Fund,
are
guaranteed
by
the
U.S.
government,
its
agencies
or
instrumentalities
as
to
the
timely
payment
of
principal
and
interest.
The
Fund’s
yield
and
share
price
are
not
guaranteed
and
will
vary
with
market
conditions.
2.
Source:
Morningstar.
The
index
is
unmanaged
and
includes
reinvestment
of
any
income
or
distributions.
It
does
not
reflect
any
fees,
expenses
or
sales
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Schedule
of
Investments
(SOI).
The
SOI
begins
on
page
99
.
Franklin
U.S.
Government
Securities
Fund
30
franklintempleton.com
Semiannual
Report
Total
return
performance
was
positive
across
agency
MBS
sectors
during
the
reporting
period.
Freddie
Mac
MBS
was
the
best
performer
on
a
relative
basis,
followed
by
Fannie
Mae
MBS
and
Ginnie
Mae
MBS.
Across
the
GNMA
coupon
stack,
GNMA
I
and
II
3.5%
coupons
were
the
best
performers,
while
GNMA
II
1.5%
and
6.0%
coupons
lagged
with
negative
excess
returns.
At
period-end,
we
remained
heavily
weighted
to
GNMA
II
securities
(comprised
of
multiple-issuer
pools),
with
over
85%
of
allocation
in
the
sector,
versus
GNMA
I
securities
(comprised
of
single-issuer
pools).
The
portfolio’s
largest
absolute
allocations
were
in
GNMA
II
2.5%
through
3.5%
at
period-end
and
relative
to
the
Bloomberg
GNMA
Index
the
portfolio
was
significantly
underweight
the
2.0%
coupons
and
overweight
the
3.0%
coupon
through
4.5%
coupons.
The
Fund’s
overweight
allocation
to
GNMA
II
3.0%
through
4.0%
and
underweight
in
5.5%
coupon
securities
contributed
to
relative
performance.
Overweight
allocation
to
GNMA
I
4.0%
through
5.0%,
and
7.0%
coupon
securities
benefited
results,
as
did
security
selection
in
GNMA
I
5.0%
coupons.
Conversely,
underweight
allocation
to
GNMA
II
2.0%,
2.5%,
4.5%
and
5.0%
coupon
securities
detracted
from
performance
(especially
the
2.0%
coupons).
Security
selection
in
GNMA
II
2.5%,
and
3.5%
through
5.5%
coupons
securities
hindered
results,
as
did
security
selection
in
GNMA
I
4.0%
coupon
securities.
Underweight
allocation
to
GNMA
I
3.0%
coupon
securities
hindered
results.
Thank
you
for
your
continued
participation
in
Franklin
U.S.
Government
Securities
Fund.
We
welcome
your
comments
and
questions
and
look
forward
to
serving
your
investment
needs
in
the
years
ahead.
Paul
Varunok
Neil
Dhruv
Portfolio
Management
Team
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
March
31,
2023,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Performance
Summary
as
of
March
31,
2023
Franklin
U.S.
Government
Securities
Fund
31
franklintempleton.com
Semiannual
Report
The
performance
tables
do
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
3/31/23
1
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
3.75%
and
the
minimum
is
0%.
Class
A:
3.75%
maximum
initial
sales
charge;
Advisor
Class:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236.
Share
Class
Cumulative
Total
Return
2
Average
Annual
Total
Return
3
–
A
4,5
6-Month
+4.05%
+0.15%
1-Year
-4.47%
-8.05%
5-Year
-1.04%
-0.97%
10-Year
+2.97%
-0.09%
Advisor
6-Month
+4.16%
+4.16%
1-Year
-4.22%
-4.22%
5-Year
+0.08%
+0.02%
10-Year
+4.92%
+0.48%
30-Day
Standardized
Yield
7
Share
Class
Distribution
Rate
6
(with
fee
waiver)
(without
fee
waiver)
A
2.64%
2.19%
2.18%
Advisor
2.97%
2.52%
2.52%
See
page
32
for
Performance
Summary
footnotes.
Franklin
U.S.
Government
Securities
Fund
Performance
Summary
32
franklintempleton.com
Semiannual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
loss
of
principal.
The
Fund’s
share
price
and
yield
will
be
affected
by
interest
rate
movements
and
mortgage
prepayments.
Bond
prices
generally
move
in
the
opposite
direction
of
interest
rates.
Thus,
as
the
prices
of
bonds
in
the
Fund
adjust
to
a
rise
in
interest
rates,
the
Fund’s
share
price
may
decline.
Changes
in
the
financial
strength
of
a
bond
issuer
or
in
a
bond’s
credit
rating
may
affect
its
value.
Events
such
as
the
spread
of
deadly
diseases,
disasters,
and
financial,
political
or
social
disruptions,
may
heighten
risks
and
adversely
affect
performance.
The
Fund’s
prospectus
also
includes
a
description
of
the
main
investment
risks.
1.
Gross
expenses
are
the
Fund’s
total
annual
operating
expenses
as
of
the
Fund's
prospectus
available
at
the
time
of
publication.
Net
expenses
are
capped
under
a
contrac-
tual
agreement,
which
cannot
be
terminated
prior
to
01/31/2024
without
Board
consent.
Actual
expenses
may
be
higher
and
may
impact
portfolio
returns.
2.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
3.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
periods
indicated.
Return
for
less
than
one
year,
if
any,
has
not
been
annualized.
4.
Effective
9/10/18,
Class
A
shares
closed
to
new
investors,
were
renamed
Class
A1
shares,
and
a
new
Class
A
share
with
a
different
expense
structure
became
available.
Class
A
performance
shown
has
been
calculated
as
follows:
(a)
for
periods
prior
to
9/10/18,
a
restated
figure
is
used
based
on
the
Fund’s
Class
A1
performance
that
includes
any
Rule
12b-1
rate
differential
that
exists
between
Class
A1
and
Class
A;
and
(b)
for
periods
after
9/10/18,
actual
Class
A
performance
is
used,
reflecting
all
charges
and
fees
applicable
to
that
class.
5.
Prior
to
3/1/19,
these
shares
were
offered
at
a
higher
initial
sales
charge
of
4.25%,
thus
actual
returns
(with
sales
charges)
would
have
differed.
Average
annual
total
returns
(with
sales
charges)
have
been
restated
to
reflect
the
current
maximum
initial
sales
charge
of
3.75%.
6.
Distribution
rate
is
based
on
an
annualization
of
the
respective
class’s
March
dividend
and
the
maximum
offering
price
(NAV
for
Advisor
Class)
per
share
on
3/31/23.
7.
The
Fund’s
30-day
standardized
yield
is
calculated
over
a
trailing
30-day
period
using
the
yield
to
maturity
on
bonds
and/or
the
dividends
accrued
on
stocks.
It
may
not
equal
the
Fund’s
actual
income
distribution
rate,
which
reflects
the
Fund’s
past
dividends
paid
to
shareholders.
8.
Figures
are
as
stated
in
the
Fund’s
current
prospectus
and
may
differ
from
the
expense
ratios
disclosed
in
the
Your
Fund’s
Expenses
and
Financial
Highlights
sections
in
this
report.
In
periods
of
market
volatility,
assets
may
decline
significantly,
causing
total
annual
Fund
operating
expenses
to
become
higher
than
the
figures
shown.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
Distributions
(10/1/22–3/31/23)
Share
Class
Net
Investment
Income
A
$0.0723
A1
$0.0750
C
$0.0622
R
$0.0661
R6
$0.0817
Advisor
$0.0787
Total
Annual
Operating
Expenses
8
Share
Class
A
0.87%
Advisor
0.62%
Your
Fund’s
Expenses
Franklin
U.S.
Government
Securities
Fund
33
franklintempleton.com
Semiannual
Report
As
a
Fund
shareholder,
you
can
incur
two
types
of
costs:
(1)
transaction
costs,
including
sales
charges
(loads)
on
Fund
purchases
and
redemptions;
and
(2)
ongoing
Fund
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
Fund
expenses.
All
mutual
funds
have
ongoing
costs,
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
“Actual.”
In
these
columns
the
Fund’s
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
“Ending
Account
Value”
for
each
class
of
shares.
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration):
Divide
your
account
value
by
$1,000
(if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6).
Then
multiply
the
result
by
the
number
in
the
row
for
your
class
of
shares
under
the
headings
“Actual”
and
“Expenses
Paid
During
Period”
(if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
“Hypothetical”
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund’s
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund’s
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
for
the
class
of
shares
you
hold
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
“Hypothetical”
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above—in
the
far
right
column—multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/365
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Does
not
include
acquired
fund
fees
and
expenses.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Share
Class
Beginning
Account
Value
10/1/22
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
a
Net
Annualized
Expense
Ratio
2
A
$1,000
$1,040.50
$4.56
$1,020.47
$4.51
0.90%
A1
$1,000
$1,041.00
$4.02
$1,020.99
$3.98
0.79%
C
$1,000
$1,036.60
$6.58
$1,018.47
$6.52
1.30%
R
$1,000
$1,039.20
$5.83
$1,019.21
$5.78
1.15%
R6
$1,000
$1,042.10
$2.68
$1,022.30
$2.66
0.53%
Advisor
$1,000
$1,041.60
$3.29
$1,021.71
$3.26
0.65%
34
franklintempleton.com
Semiannual
Report
Portfolio
Composition
3/31/23
%
of
Total
Net
Assets
Electric
Utilities
58.5%
Multi-Utilities
30.0%
Oil,
Gas
&
Consumable
Fuels
3.4%
Independent
Power
and
Renewable
Electricity
Producers
2.6%
Construction
&
Engineering
1.9%
Water
Utilities
1.4%
Other
1.8%
Short-Term
Investments
&
Other
Net
Assets
0.4%
Franklin
Utilities
Fund
This
semiannual
report
for
Franklin
Utilities
Fund
covers
the
period
ended
March
31,
2023.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
both
capital
appreciation
and
current
income
by
investing
at
least
80%
of
its
net
assets
in
the
securities
of
public
utility
companies.
These
are
companies
that
provide
electricity,
natural
gas,
water,
and
communications
services
to
the
public
and
companies
that
provide
services
to
public
utilities
companies.
The
Fund
concentrates
(invests
more
than
25%
of
its
total
assets)
in
companies
operating
in
the
utilities
industry.
The
Fund
invests
primarily
in
equity
securities,
which
consist
mainly
of
common
stocks.
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
+6.74%
cumulative
total
return
for
the
six
months
under
review.
In
comparison,
the
S&P
500
Utilities
Index,
which
measures
the
performance
of
all
utilities
stocks
in
the
Standard
&
Poor’s
500
Index
(S&P
500),
posted
a
+5.11%
cumulative
total
return,
and
the
S&P
500
Index,
which
is
a
broad
measure
of
U.S.
stock
performance,
posted
a
+15.62%
cumulative
total
return.
1
You
can
find
the
Fund’s
long-term
performance
data
in
the
Performance
Summary
beginning
on
page
36
.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Investment
Strategy
We
search
for
the
best
return
opportunities
available
in
the
global
utilities
arena
with
a
specific
focus
on
the
U.S.
electricity
and
gas
sector.
Generally,
we
seek
to
invest
in
companies
producing
a
high
percentage
of
earnings
from
their
regulated
operations.
Manager’s
Discussion
Over
the
six-month
period
under
review,
the
electric
utilities
and
multi-utilities
industries
were
the
key
drivers
of
absolute
performance,
with
additional
contributions
from
both
the
industrials
sector
and
independent
power
and
renewable
electricity
producers.
Only
the
energy
sector
detracted,
just
slightly,
from
performance.
Among
the
individual
contributors,
California-based
Edison
International
led
the
way.
We
have
watched
Edison
International’s
share
price
melt
up
amid
a
broad
short
squeeze
(i.e.,
traders
who
had
sold
short
the
company’s
stocks
then
bought
them
to
avoid
further
losses
as
the
stock
price
rose,
driving
the
stocks
even
higher).
While
we
remain
constructive
on
the
company
over
the
longer
term,
we
are
aware
of
the
short-term
risks
associated
with
the
upcoming
fire
season.
We
also
note
that
Southern
California
Edison’s
(SCE’s)
efforts
to
improve
fire
resilience
have
drawn
praise,
and
that
property
destruction
from
SCE-linked
fires
dropped
significantly
from
2019-2022.
E.ON,
the
Germany-based
energy
giant
in
the
multi-utilities
industry,
also
contributed.
Shares
advanced
during
the
period,
despite
disruptions
in
European
energy
markets
driven
by
the
Russia-Ukraine
war,
as
E.ON’s
focus
on
crisis
management
execution
led
the
company
to
surpass
earnings
expectations
in
2022.
E.ON’s
strong
guidance
for
2023
likely
supported
investor
sentiment,
as
did
its
plans
to
accelerate
decarbonization
and
energy
transition
initiatives
and
infrastructure
expansion
plans
though
2027.
The
company
affirmed
its
2022
dividend
and
its
target
of
increasing
the
payout
by
as
much
as
5%
annually
through
2027.
1.
Source:
Morningstar.
The
indexes
are
unmanaged
and
include
reinvestment
of
any
income
or
distributions.
They
do
not
reflect
any
fees,
expenses
or
sales
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Schedule
of
Investments
(SOI).
The
SOI
begins
on
page
107
.
Franklin
Utilities
Fund
35
franklintempleton.com
Semiannual
Report
Shares
of
California-based
electric
utility
PG&E,
which
emerged
from
bankruptcy
in
2020,
advanced
as
the
company
beat
earnings
estimates
twice
during
the
period.
The
company
revised
guidance
upward
and
increased
its
spending
forecast
through
2027.
Like
Edison
International,
PG&E
shares
likely
benefited
from
fire
resilience
efforts
and
reduced
liabilities
since
2018.
In
December
2022,
California
regulators
approved
a
10%
return
on
equity
limit
for
2023,
which
we
believe
is
one
of
the
highest
in
the
country
and
will
likely
help
support
PG&E’s
growth.
In
February
2023,
PG&E
reaffirmed
earning
guidance
through
2026,
which
would
approach
10%
annual
growth,
and
in
our
view,
will
likely
position
the
company
to
meet
the
post-bankruptcy
threshold
to
resume
dividend
payments.
In
contrast,
a
position
in
Virginia-based
energy
company
Dominion
Energy,
in
the
multi-utilities
industry,
detracted
from
absolute
performance.
Early
in
the
period,
shares
declined
broadly
due
to
investor
concerns
about
its
long-
term
strategic
and
costly
merger
and
acquisition
(M&A)
activity.
Earnings
announced
in
early-November
2022
came
mostly
below
expectations.
Investors
were
further
spooked
when
management
announced
it
would
undergo
a
“strategic
review”
upon
release
of
the
earnings
results.
In
February
2023,
Dominion
reported
a
fourth-quarter
loss,
though
it
beat
analysts’
expectations
for
both
earnings
and
revenues.
Michigan-based
DTE
Energy
also
weighed
on
returns.
In
November
2022,
following
a
long,
contested
case
in
which
environmental
groups,
a
major
supermarket
chain
and
others
opposed
DTE’s
8.8%
rate
increase
request,
Michigan
regulators
approved
an
increase
of
less
than
0.8%.
In
February
2023,
regulators
denied
DTE’s
appeal
of
the
rate
ruling.
The
company
came
under
criticism
for
widespread,
multi-day
power
outages
in
the
wake
of
a
February
ice
storm,
and
for
budget
cuts.
We
appreciate
the
company’s
dividend
growth
and
its
electric
and
gas
utilities’
investment
plan
to
upgrade
Michigan’s
aging
infrastructure,
as
well
as
gas
power
generation
and
renewable
energy,
which
we
believe
will
likely
support
growth.
Shares
of
energy
sector
stock
Cheniere
Energy,
a
liquefied
natural
gas
(LNG)
company,
declined
from
all-time
highs
in
November
2022,
despite
reporting
robust
financial
results
for
the
fourth
quarter
that
exceeded
consensus
expectations.
The
company,
which
is
a
major
LNG
exporter,
benefited
from
high
LNG
prices
in
2022,
as
countries
in
Europe
and
elsewhere
worked
to
replace
Russian
energy
amid
the
war
in
Ukraine.
Shares
declined
along
with
natural
gas
prices
in
early
2023,
amid
unusually
warm
weather
and
weaker
than
expected
demand
for
LNG.
In
our
view,
Cheniere
is
well-
positioned
for
the
long-term
growth
of
global
LNG
markets,
given
its
ongoing
capacity
expansion
and
strong
competitive
position.
Thank
you
for
your
continued
participation
in
Franklin
Utilities
Fund.
We
look
forward
to
serving
your
future
investment
needs.
John
Kohli,
CFA
Blair
Schmicker,
CFA
Portfolio
Management
Team
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
March
31,
2023,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Top
10
Holdings
3/31/23
Company
Industry
,
Country
%
of
Total
Net
Assets
a
a
NextEra
Energy,
Inc.
11.5%
Electric
Utilities,
United
States
Southern
Co.
(The)
4.6%
Electric
Utilities,
United
States
Edison
International
4.6%
Electric
Utilities,
United
States
Sempra
Energy
4.1%
Multi-Utilities,
United
States
Exelon
Corp.
4.0%
Electric
Utilities,
United
States
Duke
Energy
Corp.
4.0%
Electric
Utilities,
United
States
Evergy,
Inc.
3.9%
Electric
Utilities,
United
States
American
Electric
Power
Co.,
Inc.
3.7%
Electric
Utilities,
United
States
Entergy
Corp.
3.6%
Electric
Utilities,
United
States
CMS
Energy
Corp.
3.5%
Multi-Utilities,
United
States
Performance
Summary
as
of
March
31,
2023
Franklin
Utilities
Fund
36
franklintempleton.com
Semiannual
Report
The
performance
tables
do
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
3/31/23
1
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
3.75%
and
the
minimum
is
0%.
Class
A:
3.75%
maximum
initial
sales
charge;
Advisor
Class
:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Share
Class
Cumulative
Total
Return
2
Average
Annual
Total
Return
3
–
A
4,5
6-Month
+6.74%
+2.74%
1-Year
-5.30%
-8.86%
5-Year
+55.92%
+8.46%
10-Year
+129.86%
+8.26%
Advisor
6-Month
+6.85%
+6.85%
1-Year
-5.10%
-5.10%
5-Year
+57.89%
+9.57%
10-Year
+134.68%
+8.90%
Share
Class
Distribution
Rate
6
30-Day
Standardized
Yield
7
A
2.09%
2.41%
Advisor
2.40%
2.75%
See
page
37
for
Performance
Summary
footnotes.
Franklin
Utilities
Fund
Performance
Summary
37
franklintempleton.com
Semiannual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
loss
of
principal.
Investing
in
a
Fund
concentrating
in
the
utilities
sector
involves
special
risks,
including
increased
sus-
ceptibility
to
adverse
economic
and
regulatory
developments
affecting
the
sector.
Stocks
historically
have
outperformed
other
asset
classes
over
the
long
term,
but
tend
to
fluctuate
more
dramatically
over
the
short
term.
Securities
issued
by
utility
companies
have
been
historically
sensitive
to
interest
rate
changes.
When
interest
rates
fall,
utility
securities
prices,
and
thus
a
utilities
Fund’s
share
price,
tend
to
rise;
when
interest
rates
rise,
their
prices
generally
fall.
The
manager’s
portfolio
selection
strategy
is
not
solely
based
on
ESG
considerations,
and
therefore
the
issuers
in
which
the
fund
invests
may
not
be
considered
ESG-focused
companies.
Integrating
ESG
considerations
into
the
investment
process
is
not
a
guarantee
that
better
performance
will
be
achieved.
Events
such
as
the
spread
of
deadly
diseases,
disasters,
and
financial,
political
or
social
disruptions,
may
heighten
risks
and
adversely
affect
performance.
The
Fund’s
prospectus
also
includes
a
description
of
the
main
investment
risks.
1.
The
total
annual
operating
expenses
are
as
of
the
Fund's
prospectus
available
at
the
time
of
publication.
Actual
expenses
may
be
higher
and
may
impact
portfolio
returns.
2.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
3.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
periods
indicated.
Return
for
less
than
one
year,
if
any,
has
not
been
annualized.
4.
Effective
9/10/18,
Class
A
shares
closed
to
new
investors,
were
renamed
Class
A1
shares,
and
a
new
Class
A
share
with
a
different
expense
structure
became
available.
Class
A
performance
shown
has
been
calculated
as
follows:
(a)
for
periods
prior
to
9/10/18,
a
restated
figure
is
used
based
on
the
Fund’s
Class
A1
performance
that
includes
any
Rule
12b-1
rate
differential
that
exists
between
Class
A1
and
Class
A;
and
(b)
for
periods
after
9/10/18,
actual
Class
A
performance
is
used,
reflecting
all
charges
and
fees
applicable
to
that
class.
5.
Prior
to
3/1/19,
these
shares
were
offered
at
a
higher
initial
sales
charge
of
4.25%,
thus
actual
returns
(with
sales
charges)
would
have
differed.
Average
annual
total
returns
(with
sales
charges)
have
been
restated
to
reflect
the
current
maximum
initial
sales
charge
of
3.75%.
6.
Distribution
rate
is
based
on
an
annualization
of
the
respective
class’s
current
quarterly
dividend
and
the
maximum
offering
price
(NAV
for
Advisor
Class)
per
share
on
3/31/23.
7.
The
Fund’s
30-day
standardized
yield
is
calculated
over
a
trailing
30-day
period
using
the
yield
to
maturity
on
bonds
and/or
the
dividends
accrued
on
stocks.
It
may
not
equal
the
Fund’s
actual
income
distribution
rate,
which
reflects
the
Fund’s
past
dividends
paid
to
shareholders.
8.
Figures
are
as
stated
in
the
Fund’s
current
prospectus
and
may
differ
from
the
expense
ratios
disclosed
in
the
Your
Fund’s
Expenses
and
Financial
Highlights
sections
in
this
report.
In
periods
of
market
volatility,
assets
may
decline
significantly,
causing
total
annual
Fund
operating
expenses
to
become
higher
than
the
figures
shown.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
Net
Asset
Value
Share
Class
(Symbol)
3/31/23
9/30/22
Change
A
(FKUQX)
$21.08
$20.26
+$0.82
A1
(FKUTX)
$21.08
$20.27
+$0.81
C
(FRUSX)
$20.95
$20.14
+$0.81
R
(FRURX)
$20.98
$20.17
+$0.81
R6
(FUFRX)
$21.30
$20.47
+$0.83
Advisor
(FRUAX)
$21.30
$20.47
+$0.83
Distributions
(10/1/22–3/31/23)
Share
Class
Net
Investment
Income
Long-Term
Capital
Gain
Total
A
$0.2447
$0.3087
$0.5534
A1
$0.2553
$0.3087
$0.5640
C
$0.2030
$0.3087
$0.5117
R
$0.2186
$0.3087
$0.5273
R6
$0.2777
$0.3087
$0.5864
Advisor
$0.2710
$0.3087
$0.5797
Total
Annual
Operating
Expenses
8
Share
Class
A
0.82%
Advisor
0.57%
Your
Fund’s
Expenses
Franklin
Utilities
Fund
38
franklintempleton.com
Semiannual
Report
As
a
Fund
shareholder,
you
can
incur
two
types
of
costs:
(1)
transaction
costs,
including
sales
charges
(loads)
on
Fund
purchases
and
redemptions;
and
(2)
ongoing
Fund
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
Fund
expenses.
All
mutual
funds
have
ongoing
costs,
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
“Actual.”
In
these
columns
the
Fund’s
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
“Ending
Account
Value”
for
each
class
of
shares.
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
for
your
class
of
shares
under
the
headings
“Actual”
and
“Expenses
Paid
During
Period”
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
“Hypothetical”
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund’s
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund’s
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
for
the
class
of
shares
you
hold
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
“Hypothetical”
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above—in
the
far
right
column—multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/365
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Does
not
include
acquired
fund
fees
and
expenses.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Share
Class
Beginning
Account
Value
10/1/22
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
Ending
Account
Value
3/31/23
Expenses
Paid
During
Period
10/1/22–3/31/23
1,2
a
Net
Annualized
Expense
Ratio
2
A
$1,000
$1,067.40
$4.13
$1,020.94
$4.03
0.80%
A1
$1,000
$1,067.40
$3.61
$1,021.44
$3.53
0.70%
C
$1,000
$1,065.20
$6.18
$1,018.95
$6.04
1.20%
R
$1,000
$1,065.90
$5.41
$1,019.69
$5.29
1.05%
R6
$1,000
$1,068.90
$2.53
$1,022.49
$2.47
0.49%
Advisor
$1,000
$1,068.50
$2.84
$1,022.19
$2.77
0.55%
Franklin
Custodian
Funds
Financial
Highlights
Franklin
DynaTech
Fund
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
39
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
A
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$92.78
$157.23
$121.24
$82.84
$81.16
$63.10
Income
from
investment
operations
a
:
Net
investment
(loss)
b
..............
(0.17)
(0.64)
(0.82)
(0.38)
(0.20)
(0.23)
Net
realized
and
unrealized
gains
(losses)
16.29
(61.59)
36.81
39.44
3.79
19.45
Total
from
investment
operations
........
16.12
(62.23)
35.99
39.06
3.59
19.22
Less
distributions
from:
Net
realized
gains
.................
—
(2.22)
—
(0.66)
(1.91)
(1.16)
Net
asset
value,
end
of
period
..........
$108.90
$92.78
$157.23
$121.24
$82.84
$81.16
Total
return
c
.......................
17.37%
(40.15)%
29.68%
47.47%
4.77%
30.88%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.86%
0.82%
0.79%
0.85%
0.86%
0.86%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.86%
f
0.82%
f
0.79%
f
0.84%
0.85%
0.86%
f
Net
investment
(loss)
................
(0.35)%
(0.50)%
(0.56)%
(0.39)%
(0.26)%
(0.32)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$8,213,117
$7,214,315
$12,129,483
$8,378,574
$4,504,434
$3,741,562
Portfolio
turnover
rate
................
8.10%
40.72%
18.77%
13.82%
20.01%
17.22%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
DynaTech
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
40
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
C
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$74.75
$128.06
$99.49
$68.60
$68.07
$53.49
Income
from
investment
operations
a
:
Net
investment
(loss)
b
..............
(0.43)
(1.29)
(1.55)
(0.91)
(0.66)
(0.65)
Net
realized
and
unrealized
gains
(losses)
13.09
(49.80)
30.12
32.46
3.10
16.39
Total
from
investment
operations
........
12.66
(51.09)
28.57
31.55
2.44
15.74
Less
distributions
from:
Net
realized
gains
.................
—
(2.22)
—
(0.66)
(1.91)
(1.16)
Net
asset
value,
end
of
period
..........
$87.41
$74.75
$128.06
$99.49
$68.60
$68.07
Total
return
c
.......................
16.94%
(40.60)%
28.72%
46.37%
3.97%
29.93%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
1.61%
1.57%
1.54%
1.60%
1.61%
1.61%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
1.61%
f
1.57%
f
1.54%
f
1.59%
1.60%
1.61%
f
Net
investment
(loss)
................
(1.10)%
(1.26)%
(1.31)%
(1.14)%
(1.01)%
(1.07)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$772,011
$715,976
$1,339,016
$1,095,702
$597,927
$611,221
Portfolio
turnover
rate
................
8.10%
40.72%
18.77%
13.82%
20.01%
17.22%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
DynaTech
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
41
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$89.14
$151.52
$117.13
$80.26
$78.88
$61.51
Income
from
investment
operations
a
:
Net
investment
(loss)
b
..............
(0.28)
(0.91)
(1.14)
(0.60)
(0.39)
(0.40)
Net
realized
and
unrealized
gains
(losses)
15.64
(59.25)
35.53
38.13
3.68
18.93
Total
from
investment
operations
........
15.36
(60.16)
34.39
37.53
3.29
18.53
Less
distributions
from:
Net
realized
gains
.................
—
(2.22)
—
(0.66)
(1.91)
(1.16)
Net
asset
value,
end
of
period
..........
$104.50
$89.14
$151.52
$117.13
$80.26
$78.88
Total
return
c
.......................
17.23%
(40.29)%
29.36%
47.09%
4.52%
30.57%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
1.11%
1.07%
1.04%
1.10%
1.11%
1.11%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
1.11%
f
1.07%
f
1.04%
f
1.09%
1.10%
1.11%
f
Net
investment
(loss)
................
(0.60)%
(0.75)%
(0.81)%
(0.63)%
(0.51)%
(0.57)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$210,747
$188,831
$311,646
$221,041
$123,721
$95,925
Portfolio
turnover
rate
................
8.10%
40.72%
18.77%
13.82%
20.01%
17.22%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
DynaTech
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
42
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R6
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$97.95
$165.26
$127.01
$86.46
$84.31
$65.28
Income
from
investment
operations
a
:
Net
investment
income
(loss)
b
........
0.02
(0.18)
(0.36)
(0.05)
0.07
0.04
Net
realized
and
unrealized
gains
(losses)
17.22
(64.91)
38.61
41.26
3.99
20.15
Total
from
investment
operations
........
17.24
(65.09)
38.25
41.21
4.06
20.19
Less
distributions
from:
Net
realized
gains
.................
—
(2.22)
—
(0.66)
(1.91)
(1.16)
Net
asset
value,
end
of
period
..........
$115.19
$97.95
$165.26
$127.01
$86.46
$84.31
Total
return
c
.......................
17.60%
(39.92)%
30.12%
47.97%
5.15%
31.38%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.48%
0.46%
0.46%
0.50%
0.51%
0.50%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.48%
f
0.45%
0.46%
f
0.50%
f
0.50%
0.50%
f
Net
investment
income
(loss)
..........
0.03%
(0.13)%
(0.23)%
(0.05)%
0.09%
0.04%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$7,227,423
$6,322,021
$9,820,184
$5,817,028
$2,473,942
$1,688,595
Portfolio
turnover
rate
................
8.10%
40.72%
18.77%
13.82%
20.01%
17.22%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
DynaTech
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
43
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Advisor
Class
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$96.64
$163.27
$125.58
$85.58
$83.56
$64.78
Income
from
investment
operations
a
:
Net
investment
(loss)
b
..............
(0.05)
(0.34)
(0.48)
(0.15)
(0.01)
(0.06)
Net
realized
and
unrealized
gains
(losses)
16.98
(64.07)
38.17
40.81
3.94
20.00
Total
from
investment
operations
........
16.93
(64.41)
37.69
40.66
3.93
19.94
Less
distributions
from:
Net
realized
gains
.................
—
(2.22)
—
(0.66)
(1.91)
(1.16)
Net
asset
value,
end
of
period
..........
$113.57
$96.64
$163.27
$125.58
$85.58
$83.56
Total
return
c
.......................
17.52%
(39.99)%
30.01%
47.83%
5.04%
31.21%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.61%
0.57%
0.54%
0.60%
0.61%
0.61%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.61%
f
0.57%
f
0.54%
f
0.59%
0.60%
0.61%
f
Net
investment
(loss)
................
(0.10)%
(0.26)%
(0.32)%
(0.15)%
(0.01)%
(0.07)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$2,387,446
$2,280,138
$4,352,531
$2,884,489
$1,154,604
$680,066
Portfolio
turnover
rate
................
8.10
%
40.72%
18.77%
13.82%
20.01%
17.22%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited),
March
31,
2023
Franklin
DynaTech
Fund
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
44
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
98.6%
Aerospace
&
Defense
1.3%
a
Axon
Enterprise,
Inc.
...................................
United
States
700,000
$
157,395,000
HEICO
Corp.
........................................
United
States
500,000
85,520,000
242,915,000
Automobile
Components
0.1%
a,b
Mobileye
Global,
Inc.,
A
.................................
Israel
300,000
12,981,000
Automobiles
2.8%
a
Tesla,
Inc.
...........................................
United
States
2,500,000
518,650,000
Biotechnology
1.1%
a
Argenx
SE
..........................................
Netherlands
300,000
111,411,779
a
Ascendis
Pharma
A/S,
ADR
.............................
Denmark
250,000
26,805,000
a
Genmab
A/S,
ADR
....................................
Denmark
500,000
18,880,000
a
Halozyme
Therapeutics,
In
c.
.............................
United
States
500,000
19,095,000
a
Moderna,
Inc.
........................................
United
States
250,000
38,395,000
214,586,779
Broadline
Retail
7.1%
a
Amazon.com,
Inc.
.....................................
United
States
10,000,000
1,032,900,000
a
Etsy,
Inc.
............................................
United
States
300,000
33,399,000
a
MercadoLibre,
Inc.
....................................
Brazil
200,000
263,612,000
1,329,911,000
Capital
Markets
2.6%
FactSet
Research
Systems,
Inc.
..........................
United
States
100,000
41,509,000
Moody's
Corp.
........................................
United
States
100,000
30,602,000
MSCI,
Inc.
...........................................
United
States
400,000
223,876,000
Tradeweb
Markets,
Inc.,
A
...............................
United
States
2,500,000
197,550,000
493,537,000
Chemicals
1.0%
Corteva,
Inc.
.........................................
United
States
2,750,000
165,852,500
FMC
Corp.
..........................................
United
States
100,000
12,213,000
178,065,500
Construction
&
Engineering
1.0%
Quanta
Services,
Inc.
..................................
United
States
1,100,000
183,304,000
Electric
Utilities
1.6%
NextEra
Energy,
Inc.
...................................
United
States
4,000,000
308,320,000
Electrical
Equipment
0.2%
a
Array
Technologies,
Inc.
................................
United
States
600,000
13,128,000
a
LG
Energy
Solution
Ltd.
................................
South
Korea
10,000
4,489,461
a
NEXTracker,
Inc.,
A
....................................
United
States
200,000
7,252,000
a
Shoals
Technologies
Group,
Inc.,
A
........................
United
States
600,000
13,674,000
38,543,461
Electronic
Equipment,
Instruments
&
Components
1.3%
Amphenol
Corp.,
A
....................................
United
States
500,000
40,860,000
Keyence
Corp.
.......................................
Japan
200,000
98,036,521
a
Keysight
Technologies,
Inc.
..............................
United
States
350,000
56,518,000
Samsung
SDI
Co.
Ltd.
.................................
South
Korea
100,000
56,601,284
252,015,805
Energy
Equipment
&
Services
1.2%
Baker
Hughes
Co.
.....................................
United
States
1,450,000
41,847,000
a
Oceaneering
International,
Inc.
...........................
United
States
1,100,000
19,393,000
Schlumberger
NV
.....................................
United
States
3,000,000
147,300,000
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
DynaTech
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
45
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Energy
Equipment
&
Services
(continued)
a
TechnipFMC
plc
......................................
United
Kingdom
700,000
$
9,555,000
218,095,000
Entertainment
0.0%
†
a
Sea
Ltd.,
ADR
........................................
Singapore
50,000
4,327,500
Financial
Services
6.2%
a,c
Adyen
NV,
144A,
Reg
S
................................
Netherlands
200,000
318,700,450
Mastercard,
Inc.,
A
....................................
United
States
1,700,000
617,797,000
a
Toast,
Inc.,
A
.........................................
United
States
550,000
9,762,500
Visa,
Inc.,
A
..........................................
United
States
1,000,000
225,460,000
1,171,719,950
Ground
Transportation
0.2%
a
Uber
Technologies,
Inc.
.................................
United
States
1,250,000
39,625,000
Health
Care
Equipment
&
Supplies
5.5%
a
Dexcom,
Inc.
.........................................
United
States
300,000
34,854,000
a
Edwards
Lifesciences
Corp.
.............................
United
States
500,000
41,365,000
a
GE
HealthCare
Technologies,
Inc.
.........................
United
States
50,000
4,101,500
a
Haemonetics
Corp.
....................................
United
States
100,000
8,275,000
a
IDEXX
Laboratories,
Inc.
................................
United
States
725,000
362,558,000
a
Inmode
Ltd.
.........................................
United
States
100,000
3,196,000
a
Inspire
Medical
Systems,
Inc.
............................
United
States
800,000
187,256,000
a
Insulet
Corp.
.........................................
United
States
350,000
111,636,000
a
Intuitive
Surgical,
Inc.
..................................
United
States
1,000,000
255,470,000
Stryker
Corp.
........................................
United
States
100,000
28,547,000
1,037,258,500
Health
Care
Providers
&
Services
1.3%
UnitedHealth
Group,
Inc.
................................
United
States
500,000
236,295,000
Health
Care
Technology
0.4%
a
Veeva
Systems,
Inc.,
A
.................................
United
States
450,000
82,705,500
Hotels,
Restaurants
&
Leisure
0.7%
a
Airbnb,
Inc.,
A
........................................
United
States
500,000
62,200,000
a
Booking
Holdings,
Inc.
.................................
United
States
25,000
66,310,250
128,510,250
Interactive
Media
&
Services
3.3%
a
Alphabet,
Inc.,
A
......................................
United
States
6,000,000
622,380,000
IT
Services
2.3%
a
Cloudflare,
Inc.,
A
.....................................
United
States
400,000
24,664,000
a
MongoDB,
Inc.
.......................................
United
States
750,000
174,840,000
a
Shopify,
Inc.,
A
.......................................
Canada
3,250,000
155,815,330
a
Snowflake,
Inc.,
A
.....................................
United
States
450,000
69,430,500
424,749,830
Life
Sciences
Tools
&
Services
7.2%
Danaher
Corp.
.......................................
United
States
2,000,000
504,080,000
Lonza
Group
AG
......................................
Switzerland
200,000
120,406,520
a
Repligen
Corp.
.......................................
United
States
950,000
159,942,000
Thermo
Fisher
Scientific,
Inc.
............................
United
States
1,000,000
576,370,000
1,360,798,520
Pharmaceuticals
1.6%
AstraZeneca
plc,
ADR
..................................
United
Kingdom
2,350,000
163,113,500
Eli
Lilly
&
Co.
........................................
United
States
325,000
111,611,500
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
DynaTech
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
46
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Pharmaceuticals
(continued)
a
Jazz
Pharmaceuticals
plc
...............................
United
States
225,000
$
32,924,250
307,649,250
Professional
Services
0.3%
a
CoStar
Group,
Inc.
....................................
United
States
800,000
55,080,000
Semiconductors
&
Semiconductor
Equipment
17.2%
a
Advanced
Micro
Devices,
Inc.
............................
United
States
50,000
4,900,500
Analog
Devices,
Inc.
...................................
United
States
2,000,000
394,440,000
ASM
International
NV
..................................
Netherlands
225,000
91,331,905
ASML
Holding
NV,
ADR
................................
Netherlands
775,000
527,550,250
a
Enphase
Energy,
Inc.
..................................
United
States
500,000
105,140,000
Entegris,
Inc.
.........................................
United
States
1,000,000
82,010,000
a
First
Solar,
Inc.
.......................................
United
States
25,000
5,437,500
Intel
Corp.
...........................................
United
States
500,000
16,335,000
KLA
Corp.
...........................................
United
States
550,000
219,543,500
Lam
Research
Corp.
...................................
United
States
535,000
283,614,200
a
Lattice
Semiconductor
Corp.
.............................
United
States
800,000
76,400,000
Monolithic
Power
Systems,
Inc.
...........................
United
States
525,000
262,783,500
NVIDIA
Corp.
........................................
United
States
4,000,000
1,111,080,000
a
SolarEdge
Technologies,
Inc.
............................
United
States
150,000
45,592,500
Taiwan
Semiconductor
Manufacturing
Co.
Ltd.,
ADR
...........
Taiwan
75,000
6,976,500
3,233,135,355
Software
28.3%
a
Adobe,
Inc.
..........................................
United
States
100,000
38,537,000
a
ANSYS,
Inc.
.........................................
United
States
600,000
199,680,000
a
Aspen
Technology,
Inc.
.................................
United
States
500,000
114,435,000
a
Atlassian
Corp.,
A
.....................................
United
States
650,000
111,260,500
a
Cadence
Design
Systems,
Inc.
...........................
United
States
2,300,000
483,207,000
Constellation
Software,
Inc.
..............................
Canada
30,000
56,397,825
a
Datadog,
Inc.,
A
......................................
United
States
1,350,000
98,091,000
a
Descartes
Systems
Group,
Inc.
(The)
......................
Canada
500,000
40,305,000
a
Gitlab,
Inc.,
A
........................................
United
States
1,100,000
37,719,000
a
HubSpot,
Inc.
........................................
United
States
600,000
257,250,000
a
Intapp,
Inc.
..........................................
United
States
25,000
1,121,000
Intuit,
Inc.
...........................................
United
States
1,000,000
445,830,000
a,c
Lumine
Group,
Inc.,
Reg
S
..............................
Canada
90,011
979,625
Microsoft
Corp.
.......................................
United
States
4,200,000
1,210,860,000
a
Monday.com
Ltd.
......................................
United
States
750,000
107,062,500
a
Palo
Alto
Networks,
Inc.
................................
United
States
1,000,000
199,740,000
a
Paycom
Software,
Inc.
.................................
United
States
250,000
76,002,500
a
Paylocity
Holding
Corp.
.................................
United
States
250,000
49,695,000
a
Procore
Technologies,
Inc.
..............................
United
States
1,000,000
62,630,000
Roper
Technologies,
Inc.
................................
United
States
500,000
220,345,000
a
Salesforce,
Inc.
.......................................
United
States
1,000,000
199,780,000
a
ServiceNow,
Inc.
......................................
United
States
1,150,000
534,428,000
a
SPS
Commerce,
Inc.
...................................
United
States
25,000
3,807,500
a
Synopsys,
Inc.
.......................................
United
States
1,250,000
482,812,500
a
Tyler
Technologies,
Inc.
.................................
United
States
250,000
88,660,000
a
Workday,
Inc.,
A
......................................
United
States
1,000,000
206,540,000
a
Xero
Ltd.
............................................
New
Zealand
50,000
3,032,799
5,330,208,749
Specialized
REITs
0.5%
Crown
Castle,
Inc.
.....................................
United
States
100,000
13,384,000
SBA
Communications
Corp.
.............................
United
States
300,000
78,321,000
91,705,000
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
DynaTech
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
47
See
Abbreviations
on
page
145
.
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Technology
Hardware,
Storage
&
Peripherals
2.2%
Apple,
Inc.
..........................................
United
States
2,500,000
$
412,250,000
Trading
Companies
&
Distributors
0.1%
Fastenal
Co.
.........................................
United
States
300,000
16,182,000
Total
Common
Stocks
(Cost
$11,409,018,293)
...................................
18,545,504,949
Preferred
Stocks
0.2%
Life
Sciences
Tools
&
Services
0.2%
d
Sartorius
AG,
0.37%
...................................
Germany
100,000
42,147,570
Total
Preferred
Stocks
(Cost
$40,747,986)
......................................
42,147,570
Total
Long
Term
Investments
(Cost
$11,449,766,279)
............................
18,587,652,519
a
Short
Term
Investments
1.3%
a
a
Country
Shares
a
Value
a
a
a
Money
Market
Funds
1.3%
e,f
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
....
United
States
239,555,443
239,555,443
Total
Money
Market
Funds
(Cost
$239,555,443)
.................................
239,555,443
a
a
a
g
Investments
from
Cash
Collateral
Received
for
Loaned
Securities
0.0%
Money
Market
Funds
0.0%
†
e,f
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
....
United
States
11,474,000
11,474,000
Total
Investments
from
Cash
Collateral
Received
for
Loaned
Securities
(Cost
$11,474,000)
...........................................................
11,474,000
Total
Short
Term
Investments
(Cost
$251,029,443
)
...............................
251,029,443
a
Total
Investments
(Cost
$11,700,795,722)
100.1%
................................
$18,838,681,962
Other
Assets,
less
Liabilities
(0.1)%
...........................................
(27,937,859)
Net
Assets
100.0%
...........................................................
$18,810,744,103
†
Rounds
to
less
than
0.1%
of
net
assets.
a
Non-income
producing.
b
A
portion
or
all
of
the
security
is
on
loan
at
March
31,
2023.
See
Note
1(f).
c
Security
was
purchased
pursuant
to
Rule
144A
or
Regulation
S
under
the
Securities
Act
of
1933.
144A
securities
may
be
sold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers
or
in
a
public
offering
registered
under
the
Securities
Act
of
1933.
Regulation
S
securities
cannot
be
sold
in
the
United
States
without
either
an
effective
registration
statement
filed
pursuant
to
the
Securities
Act
of
1933,
or
pursuant
to
an
exemption
from
registration.
At
March
31,
2023,
the
aggregate
value
of
these
securities
was
$319,680,075,
representing
1.7%
of
net
assets.
d
Variable
rate
security.
The
rate
shown
represents
the
yield
at
period
end.
e
See
Note
3(f)
regarding
investments
in
affiliated
management
investment
companies.
f
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
g
See
Note
1(f)
regarding
securities
on
loan.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Focused
Growth
Fund
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Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
48
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
Year
Ended
September
30,
2020
a
2022
2021
Class
A
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
..............................
$19.30
$31.61
$25.05
$20.16
Income
from
investment
operations
b
:
Net
investment
(loss)
c
.......................................
(0.04)
(0.18)
(0.23)
(0.10)
Net
realized
and
unrealized
gains
(losses)
........................
3.56
(11.95)
7.00
4.99
Total
from
investment
operations
.................................
3.52
(12.13)
6.77
4.89
Less
distributions
from:
Net
realized
gains
..........................................
—
(0.18)
(0.21)
—
Net
asset
value,
end
of
period
...................................
$22.82
$19.30
$31.61
$25.05
Total
return
d
................................................
18.24%
(38.61)%
27.17%
24.26%
Ratios
to
average
net
assets
e
Expenses
before
waiver
and
payments
by
affiliates
...................
1.45%
1.37%
1.36%
1.81%
Expenses
net
of
waiver
and
payments
by
affiliates
....................
1.09%
1.10%
f
1.10%
f
1.10%
Net
investment
(loss)
.........................................
(0.40)%
(0.69)%
(0.78)%
(0.72)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
.................................
$62,157
$53,027
$80,509
$26,793
Portfolio
turnover
rate
.........................................
7.24%
39.93%
22.77%
33.93%
a
For
the
period
February
14,
2020
(effective
date)
to
September
30,
2020.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year,
except
for
non-recurring
expenses,
if
any.
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Focused
Growth
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
49
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
Year
Ended
September
30,
2020
a
2022
2021
Class
C
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
..............................
$18.92
$31.23
$24.94
$20.16
Income
from
investment
operations
b
:
Net
investment
(loss)
c
.......................................
(0.11)
(0.37)
(0.44)
(0.21)
Net
realized
and
unrealized
gains
(losses)
........................
3.48
(11.76)
6.94
4.99
Total
from
investment
operations
.................................
3.37
(12.13)
6.50
4.78
Less
distributions
from:
Net
realized
gains
..........................................
—
(0.18)
(0.21)
—
Net
asset
value,
end
of
period
...................................
$22.29
$18.92
$31.23
$24.94
Total
return
d
................................................
17.81%
(39.08)%
26.20%
23.71%
Ratios
to
average
net
assets
e
Expenses
before
waiver
and
payments
by
affiliates
...................
2.21%
2.12%
2.12%
2.56%
Expenses
net
of
waiver
and
payments
by
affiliates
....................
1.85%
1.85%
f
1.85%
f
1.85%
Net
investment
(loss)
.........................................
(1.15)%
(1.44)%
(1.53)%
(1.47)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
.................................
$4,542
$3,954
$6,028
$3,931
Portfolio
turnover
rate
.........................................
7.24%
39.93%
22.77%
33.93%
a
For
the
period
February
14,
2020
(effective
date)
to
September
30,
2020.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year,
except
for
non-recurring
expenses,
if
any.
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Focused
Growth
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
50
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
Year
Ended
September
30,
2020
a
2022
2021
Class
R
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
..............................
$19.20
$31.53
$25.06
$20.16
Income
from
investment
operations
b
:
Net
investment
(loss)
c
.......................................
(0.07)
(0.24)
(0.31)
(0.11)
Net
realized
and
unrealized
gains
(losses)
........................
3.55
(11.91)
6.99
5.01
Total
from
investment
operations
.................................
3.48
(12.15)
6.68
4.90
Less
distributions
from:
Net
realized
gains
..........................................
—
(0.18)
(0.21)
—
Net
asset
value,
end
of
period
...................................
$22.68
$19.20
$31.53
$25.06
Total
return
d
................................................
18.12%
(38.77)%
26.79%
24.31%
Ratios
to
average
net
assets
e
Expenses
before
waiver
and
payments
by
affiliates
...................
1.71%
1.61%
1.66%
1.65%
Expenses
net
of
waiver
and
payments
by
affiliates
....................
1.35%
1.35%
f
1.38%
f
1.04%
Net
investment
(loss)
.........................................
(0.65)%
(0.94)%
(1.05)%
(0.77)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
.................................
$969
$723
$984
$643
Portfolio
turnover
rate
.........................................
7.24%
39.93%
22.77%
33.93%
a
For
the
period
February
14,
2020
(effective
date)
to
September
30,
2020.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Total
return
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year,
except
for
non-recurring
expenses,
if
any.
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Focused
Growth
Fund
(continued)
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accompanying
notes
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an
integral
part
of
these
financial
statements.
Semiannual
Report
51
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
Year
Ended
September
30,
2020
a
2022
2021
Class
R6
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
..............................
$19.45
$31.78
$25.10
$20.16
Income
from
investment
operations
b
:
Net
investment
(loss)
c
.......................................
(0.01)
(0.11)
(0.13)
(0.07)
Net
realized
and
unrealized
gains
(losses)
........................
3.60
(12.04)
7.02
5.01
Total
from
investment
operations
.................................
3.59
(12.15)
6.89
4.94
Less
distributions
from:
Net
realized
gains
..........................................
—
(0.18)
(0.21)
—
Net
asset
value,
end
of
period
...................................
$23.04
$19.45
$31.78
$25.10
Total
return
d
................................................
18.46%
(38.46)%
27.59%
24.50%
Ratios
to
average
net
assets
e
Expenses
before
waiver
and
payments
by
affiliates
...................
1.03%
0.98%
1.05%
2.08%
Expenses
net
of
waiver
and
payments
by
affiliates
....................
0.82%
0.82%
f
0.77%
f
0.85%
Net
investment
(loss)
.........................................
(0.13)%
(0.42)%
(0.44)%
(0.52)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
.................................
$63
$46
$75
$65
Portfolio
turnover
rate
.........................................
7.24%
39.93%
22.77%
33.93%
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
a
For
the
period
February
14,
2020
(effective
date)
to
September
30,
2020.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Total
return
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year,
except
for
non-recurring
expenses,
if
any.
Franklin
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Focused
Growth
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(continued)
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The
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these
financial
statements.
52
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Advisor
Class
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$19.43
$31.75
$25.10
$17.62
$17.24
$13.36
Income
from
investment
operations
a
:
Net
investment
(loss)
b
..............
(0.01)
(0.13)
(0.16)
(0.09)
(0.06)
(0.05)
Net
realized
and
unrealized
gains
(losses)
3.60
(12.01)
7.02
8.66
0.52
3.93
Total
from
investment
operations
........
3.59
(12.14)
6.86
8.57
0.46
3.88
Less
distributions
from:
Net
investment
income
..............
—
—
—
—
(0.01)
—
Net
realized
gains
.................
—
(0.18)
(0.21)
(1.09)
(0.07)
—
Total
distributions
...................
—
(0.18)
(0.21)
(1.09)
(0.08)
—
Net
asset
value,
end
of
period
..........
$23.02
$19.43
$31.75
$25.10
$17.62
$17.24
Total
return
c
.......................
18.42%
(38.44)%
27.47%
51.20%
2.80%
29.04%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
1.22%
1.12%
1.12%
2.04%
2.41%
2.23%
Expenses
net
of
waiver
and
payments
by
affiliates
..........................
0.85%
0.85%
e
0.85%
e
0.88%
1.00%
1.00%
e
Net
investment
(loss)
................
(0.14
)%
(0.47)%
(0.53)%
(0.41)%
(0.36)%
(0.34)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$14,615
$9,519
$25,041
$16,747
$4,404
$4,310
Portfolio
turnover
rate
................
7.24%
39.93%
22.77%
33.93%
28.65%
14.47%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year,
except
for
non-recurring
expenses,
if
any.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited),
March
31,
2023
Franklin
Focused
Growth
Fund
franklintempleton.com
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accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
53
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
98.3%
Aerospace
&
Defense
1.4%
a
Axon
Enterprise,
Inc.
...................................
United
States
5,000
$
1,124,250
Automobiles
4.3%
a
Tesla,
Inc.
...........................................
United
States
17,000
3,526,820
Broadline
Retail
8.6%
a
Amazon.com,
Inc.
.....................................
United
States
58,958
6,089,772
a
MercadoLibre,
Inc.
....................................
Brazil
740
975,364
7,065,136
Capital
Markets
2.4%
MSCI,
Inc.
...........................................
United
States
3,500
1,958,915
Consumer
Staples
Distribution
&
Retail
4.8%
Costco
Wholesale
Corp.
................................
United
States
8,000
3,974,960
Electric
Utilities
4.3%
NextEra
Energy,
Inc.
...................................
United
States
46,000
3,545,680
Energy
Equipment
&
Services
0.8%
Schlumberger
NV
.....................................
United
States
14,000
687,400
Financial
Services
5.8%
a,b
Adyen
NV,
144A,
Reg
S
................................
Netherlands
1,000
1,593,502
Mastercard,
Inc.,
A
....................................
United
States
8,850
3,216,179
4,809,681
Ground
Transportation
0.9%
Canadian
Pacific
Railway
Ltd.
............................
Canada
10,000
769,400
Health
Care
Equipment
&
Supplies
4.8%
a
IDEXX
Laboratories,
Inc.
................................
United
States
4,530
2,265,362
a
Intuitive
Surgical,
Inc.
..................................
United
States
6,500
1,660,555
3,925,917
Health
Care
Technology
1.1%
a
Veeva
Systems,
Inc.,
A
.................................
United
States
4,920
904,247
Interactive
Media
&
Services
3.6%
a
Alphabet,
Inc.,
A
......................................
United
States
28,900
2,997,797
IT
Services
3.2%
a
MongoDB,
Inc.
.......................................
United
States
3,000
699,360
a
Shopify,
Inc.,
A
.......................................
Canada
25,000
1,198,580
a
Snowflake,
Inc.,
A
.....................................
United
States
5,000
771,450
2,669,390
Life
Sciences
Tools
&
Services
5.3%
Danaher
Corp.
.......................................
United
States
13,300
3,352,132
a
Repligen
Corp.
.......................................
United
States
5,895
992,482
4,344,614
Metals
&
Mining
1.0%
Freeport-McMoRan,
Inc.
................................
United
States
20,000
818,200
Oil,
Gas
&
Consumable
Fuels
0.8%
Hess
Corp.
..........................................
United
States
5,000
661,700
Personal
Care
Products
1.3%
Estee
Lauder
Cos.,
Inc.
(The),
A
..........................
United
States
4,500
1,109,070
Pharmaceuticals
1.3%
Eli
Lilly
&
Co.
........................................
United
States
3,000
1,030,260
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Focused
Growth
Fund
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accompanying
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statements.
54
s
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Semiconductors
&
Semiconductor
Equipment
19.2%
Analog
Devices,
Inc.
...................................
United
States
15,000
$
2,958,300
ASML
Holding
NV,
ADR
................................
Netherlands
5,700
3,880,047
a
Enphase
Energy,
Inc.
..................................
United
States
1,500
315,420
NVIDIA
Corp.
........................................
United
States
28,496
7,915,334
Taiwan
Semiconductor
Manufacturing
Co.
Ltd.,
ADR
...........
Taiwan
8,000
744,160
15,813,261
Software
21.5%
a
Cadence
Design
Systems,
Inc.
...........................
United
States
10,000
2,100,900
Intuit,
Inc.
...........................................
United
States
3,500
1,560,405
Microsoft
Corp.
.......................................
United
States
32,427
9,348,704
a
Salesforce,
Inc.
.......................................
United
States
7,000
1,398,460
a
ServiceNow,
Inc.
......................................
United
States
7,000
3,253,040
17,661,509
Specialized
REITs
1.9%
SBA
Communications
Corp.
.............................
United
States
6,000
1,566,420
Total
Common
Stocks
(Cost
$73,871,384)
......................................
80,964,627
Short
Term
Investments
1.5%
a
a
Country
Shares
a
Value
a
a
a
Money
Market
Funds
1.5%
c,d
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
....
United
States
1,201,709
1,201,709
Total
Money
Market
Funds
(Cost
$1,201,709)
...................................
1,201,709
Total
Short
Term
Investments
(Cost
$1,201,709
)
.................................
1,201,709
a
Total
Investments
(Cost
$75,073,093)
99.8%
....................................
$82,166,336
Other
Assets,
less
Liabilities
0.2%
.............................................
180,489
Net
Assets
100.0%
...........................................................
$82,346,825
See
Abbreviations
on
page
145
.
a
Non-income
producing.
b
Security
was
purchased
pursuant
to
Rule
144A
or
Regulation
S
under
the
Securities
Act
of
1933.
144A
securities
may
be
sold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers
or
in
a
public
offering
registered
under
the
Securities
Act
of
1933.
Regulation
S
securities
cannot
be
sold
in
the
United
States
without
either
an
effective
registration
statement
filed
pursuant
to
the
Securities
Act
of
1933,
or
pursuant
to
an
exemption
from
registration.
At
March
31,
2023,
the
value
of
this
security
was
$1,593,502,
representing
1.9%
of
net
assets.
c
See
Note
3(f)
regarding
investments
in
affiliated
management
investment
companies.
d
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
Franklin
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Funds
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Growth
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notes
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an
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part
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financial
statements.
Semiannual
Report
55
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
A
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$105.41
$151.73
$129.91
$110.04
$107.59
$91.61
Income
from
investment
operations
a
:
Net
investment
income
(loss)
b
........
0.10
0.01
(0.06)
0.33
0.46
0.41
Net
realized
and
unrealized
gains
(losses)
16.75
(32.51)
32.67
25.99
3.47
18.18
Total
from
investment
operations
........
16.85
(32.50)
32.61
26.32
3.93
18.59
Less
distributions
from:
Net
investment
income
..............
—
—
(0.18)
(0.46)
(0.44)
(0.36)
Net
realized
gains
.................
(10.71)
(13.82)
(10.61)
(5.99)
(1.04)
(2.25)
Total
distributions
...................
(10.71)
(13.82)
(10.79)
(6.45)
(1.48)
(2.61)
Net
asset
value,
end
of
period
..........
$111.55
$105.41
$151.73
$129.91
$110.04
$107.59
Total
return
c
.......................
16.74%
(23.83)%
26.44%
25.09%
3.79%
20.72%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.82%
0.80%
0.79%
0.82%
0.83%
0.83%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.82%
f
0.80%
f
0.79%
f
0.81%
0.83%
f
0.83%
f
Net
investment
income
(loss)
..........
0.18%
0.01%
(0.04)%
0.29%
0.45%
0.41%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$10,173,626
$9,118,403
$12,927,577
$10,990,297
$9,157,154
$9,044,834
Portfolio
turnover
rate
................
1.60%
4.95%
g
6.04%
g
9.01%
4.91%
g
6.05%
g
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
g
Excludes
the
value
of
portfolio
activity
as
a
result
of
in-kind
transactions.
See
Note
3(h)
and
13.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Growth
Fund
(continued)
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The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
56
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
C
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$91.92
$134.93
$117.27
$100.21
$98.38
$84.25
Income
from
investment
operations
a
:
Net
investment
(loss)
b
..............
(0.27)
(0.87)
(1.01)
(0.47)
(0.29)
(0.30)
Net
realized
and
unrealized
gains
(losses)
14.48
(28.32)
29.28
23.52
3.16
16.68
Total
from
investment
operations
........
14.21
(29.19)
28.27
23.05
2.87
16.38
Less
distributions
from:
Net
realized
gains
.................
(10.71)
(13.82)
(10.61)
(5.99)
(1.04)
(2.25)
Net
asset
value,
end
of
period
..........
$95.42
$91.92
$134.93
$117.27
$100.21
$98.38
Total
return
c
.......................
16.29%
(24.40)%
25.51%
24.16%
3.02%
19.82%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
1.57%
1.55%
1.54%
1.57%
1.58%
1.58%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
1.57%
f
1.55%
f
1.54%
f
1.56%
1.58%
f
1.58%
f
Net
investment
(loss)
................
(0.57)%
(0.75)%
(0.79)%
(0.46)%
(0.30)%
(0.34)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$415,735
$407,722
$666,348
$727,093
$704,217
$1,060,258
Portfolio
turnover
rate
................
1.60%
4.95%
g
6.04%
g
9.01%
4.91%
g
6.05%
g
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
g
Excludes
the
value
of
portfolio
activity
as
a
result
of
in-kind
transactions.
See
Note
3(h)
and
13.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Growth
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
57
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$104.43
$150.77
$129.28
$109.49
$107.00
$91.13
Income
from
investment
operations
a
:
Net
investment
income
(loss)
b
........
(0.04)
(0.32)
(0.41)
0.05
0.21
0.16
Net
realized
and
unrealized
gains
(losses)
16.58
(32.20)
32.51
25.86
3.46
18.09
Total
from
investment
operations
........
16.54
(32.52)
32.10
25.91
3.67
18.25
Less
distributions
from:
Net
investment
income
..............
—
—
—
(0.13)
(0.14)
(0.13)
Net
realized
gains
.................
(10.71)
(13.82)
(10.61)
(5.99)
(1.04)
(2.25)
Total
distributions
...................
(10.71)
(13.82)
(10.61)
(6.12)
(1.18)
(2.38)
Net
asset
value,
end
of
period
..........
$110.26
$104.43
$150.77
$129.28
$109.49
$107.00
Total
return
c
.......................
16.59%
(24.01)%
26.13%
24.78%
3.54%
20.42%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
1.07%
1.05%
1.04%
1.07%
1.08%
1.08%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
1.07%
f
1.05%
f
1.04%
f
1.06%
1.08%
f
1.08%
f
Net
investment
income
(loss)
..........
(0.07)%
(0.25)%
(0.29)%
0.04%
0.20%
0.16%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$270,303
$249,874
$395,301
$420,082
$435,331
$524,960
Portfolio
turnover
rate
................
1.60%
4.95%
g
6.04%
g
9.01%
4.91%
g
6.05%
g
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
g
Excludes
the
value
of
portfolio
activity
as
a
result
of
in-kind
transactions.
See
Note
3(h)
and
13.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Growth
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
58
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R6
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$106.22
$152.40
$130.31
$110.37
$107.90
$91.90
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.29
0.46
0.41
0.71
0.83
0.77
Net
realized
and
unrealized
gains
(losses)
16.87
(32.72)
32.76
26.06
3.47
18.22
Total
from
investment
operations
........
17.16
(32.26)
33.17
26.77
4.30
18.99
Less
distributions
from:
Net
investment
income
..............
(0.25)
(0.10)
(0.47)
(0.84)
(0.79)
(0.74)
Net
realized
gains
.................
(10.71)
(13.82)
(10.61)
(5.99)
(1.04)
(2.25)
Total
distributions
...................
(10.96)
(13.92)
(11.08)
(6.83)
(1.83)
(2.99)
Net
asset
value,
end
of
period
..........
$112.42
$106.22
$152.40
$130.31
$110.37
$107.90
Total
return
c
.......................
16.93%
(23.57)%
26.86%
25.51%
4.16%
21.17%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.48%
0.46%
0.47%
0.48%
0.48%
0.47%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.47%
0.46%
f
0.47%
f
0.48%
f
0.48%
f
0.46%
Net
investment
income
...............
0.53%
0.34%
0.29%
0.63%
0.80%
0.78%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$2,140,859
$2,000,923
$3,113,946
$2,999,370
$2,545,800
$2,634,455
Portfolio
turnover
rate
................
1.60%
4.95%
g
6.04%
g
9.01%
4.91%
g
6.05%
g
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
g
Excludes
the
value
of
portfolio
activity
as
a
result
of
in-kind
transactions.
See
Note
3(h)
and
13.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Growth
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
59
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Advisor
Class
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$106.25
$152.47
$130.38
$110.41
$107.95
$91.90
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.24
0.34
0.30
0.62
0.72
0.66
Net
realized
and
unrealized
gains
(losses)
16.89
(32.74)
32.79
26.07
3.47
18.23
Total
from
investment
operations
........
17.13
(32.40)
33.09
26.69
4.19
18.89
Less
distributions
from:
Net
investment
income
..............
(0.16)
—
(0.39)
(0.73)
(0.69)
(0.59)
Net
realized
gains
.................
(10.71)
(13.82)
(10.61)
(5.99)
(1.04)
(2.25)
Total
distributions
...................
(10.87)
(13.82)
(11.00)
(6.72)
(1.73)
(2.84)
Net
asset
value,
end
of
period
..........
$112.51
$106.25
$152.47
$130.38
$110.41
$107.95
Total
return
c
.......................
16.89%
(23.64)%
26.76%
25.41%
4.05%
21.02%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.57%
0.55%
0.54%
0.57%
0.58%
0.58%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.57%
f
0.55%
f
0.54%
f
0.56%
0.58%
f
0.58%
f
Net
investment
income
...............
0.43%
0.25%
0.21%
0.54%
0.70%
0.66%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$2,889,366
$2,652,765
$4,229,679
$3,549,412
$3,154,342
$3,139,208
Portfolio
turnover
rate
................
1.60%
4.95%
g
6.04%
g
9.01%
4.91%
g
6.05%
g
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
g
Excludes
the
value
of
portfolio
activity
as
a
result
of
in-kind
transactions.
See
Note
3(h)
and
13
.
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited),
March
31,
2023
Franklin
Growth
Fund
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
60
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
98.8%
Aerospace
&
Defense
4.9%
BWX
Technologies,
Inc.
................................
United
States
1,361,711
$
85,842,262
Lockheed
Martin
Corp.
.................................
United
States
350,955
165,906,957
Northrop
Grumman
Corp.
...............................
United
States
635,597
293,467,847
Raytheon
Technologies
Corp.
............................
United
States
2,319,110
227,110,442
772,327,508
Automobiles
0.6%
a
Tesla,
Inc.
...........................................
United
States
485,583
100,739,049
Beverages
3.6%
Brown-Forman
Corp.,
B
................................
United
States
1,560,182
100,272,897
Constellation
Brands,
Inc.,
A
.............................
United
States
535,378
120,936,536
a
Monster
Beverage
Corp.
................................
United
States
4,283,526
231,353,239
PepsiCo,
Inc.
........................................
United
States
624,045
113,763,404
566,326,076
Biotechnology
1.7%
AbbVie,
Inc.
.........................................
United
States
441,587
70,375,720
Amgen,
Inc.
.........................................
United
States
516,636
124,896,753
a
Argenx
SE,
ADR
......................................
Netherlands
30,811
11,479,562
a
Regeneron
Pharmaceuticals,
Inc.
.........................
United
States
73,146
60,101,874
266,853,909
Broadline
Retail
3.0%
a
Amazon.com,
Inc.
.....................................
United
States
4,686,824
484,102,051
Building
Products
1.5%
Allegion
plc
..........................................
United
States
476,985
50,908,609
Trane
Technologies
plc
.................................
United
States
1,002,969
184,526,237
235,434,846
Capital
Markets
3.9%
BlackRock,
Inc.
.......................................
United
States
125,420
83,921,031
Blackstone,
Inc.
......................................
United
States
356,607
31,324,359
Charles
Schwab
Corp.
(The)
.............................
United
States
2,857,882
149,695,859
Intercontinental
Exchange,
Inc.
...........................
United
States
1,368,390
142,709,393
S&P
Global,
Inc.
......................................
United
States
355,225
122,470,923
Tradeweb
Markets,
Inc.,
A
...............................
United
States
1,144,120
90,408,362
620,529,927
Chemicals
3.0%
Air
Products
and
Chemicals,
Inc.
..........................
United
States
480,067
137,880,043
Ecolab,
Inc.
..........................................
United
States
598,778
99,115,722
Linde
plc
............................................
United
States
697,627
247,964,541
484,960,306
Commercial
Services
&
Supplies
0.5%
Republic
Services,
Inc.
.................................
United
States
624,999
84,512,365
Construction
Materials
0.7%
Martin
Marietta
Materials,
Inc.
............................
United
States
304,897
108,256,729
Consumer
Staples
Distribution
&
Retail
0.2%
Costco
Wholesale
Corp.
................................
United
States
53,949
26,805,640
Electric
Utilities
1.0%
NextEra
Energy,
Inc.
...................................
United
States
1,971,046
151,928,226
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Growth
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
61
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Electrical
Equipment
1.1%
AMETEK,
Inc.
........................................
United
States
672,067
$
97,671,497
Eaton
Corp.
plc
.......................................
United
States
443,764
76,034,524
173,706,021
Electronic
Equipment,
Instruments
&
Components
3.1%
Amphenol
Corp.,
A
....................................
United
States
2,780,815
227,248,202
a
Keysight
Technologies,
Inc.
..............................
United
States
147,391
23,800,699
TE
Connectivity
Ltd.
...................................
United
States
1,794,257
235,316,805
486,365,706
Entertainment
0.3%
a
ROBLOX
Corp.,
A
.....................................
United
States
1,192,286
53,629,024
Financial
Services
4.8%
a,b
Adyen
NV,
144A,
Reg
S
................................
Netherlands
73,341
116,869,048
Mastercard
,
Inc.,
A
....................................
United
States
976,926
355,024,678
a
Paymentus
Holdings,
Inc.,
A
.............................
United
States
906,285
8,029,685
Visa,
Inc.,
A
..........................................
United
States
1,226,618
276,553,294
756,476,705
Food
Products
0.3%
Lamb
Weston
Holdings,
Inc.
.............................
United
States
526,459
55,025,495
Ground
Transportation
3.3%
Canadian
Pacific
Railway
Ltd.
............................
Canada
1,364,749
105,003,788
JB
Hunt
Transport
Services,
Inc.
..........................
United
States
480,067
84,232,556
a
Uber
Technologies,
Inc.
.................................
United
States
978,339
31,013,346
Union
Pacific
Corp.
....................................
United
States
1,500,110
301,912,139
522,161,829
Health
Care
Equipment
&
Supplies
4.2%
Abbott
Laboratories
....................................
United
States
751,302
76,076,840
a
Edwards
Lifesciences
Corp.
.............................
United
States
1,048,724
86,760,936
a
Haemonetics
Corp.
....................................
United
States
747,064
61,819,546
a
Intuitive
Surgical,
Inc.
..................................
United
States
996,140
254,483,886
Stryker
Corp.
........................................
United
States
394,047
112,488,597
Teleflex,
Inc.
.........................................
United
States
321,702
81,490,334
673,120,139
Health
Care
Providers
&
Services
0.9%
Laboratory
Corp.
of
America
Holdings
......................
United
States
323,216
74,152,214
UnitedHealth
Group,
Inc.
................................
United
States
150,015
70,895,589
145,047,803
Health
Care
Technology
0.3%
a
Veeva
Systems,
Inc.,
A
.................................
United
States
265,213
48,743,497
Hotels,
Restaurants
&
Leisure
1.4%
a
Airbnb,
Inc.,
A
........................................
United
States
350,090
43,551,196
a
Booking
Holdings,
Inc.
.................................
United
States
28,473
75,522,070
a
Las
Vegas
Sands
Corp.
.................................
United
States
1,745,783
100,295,233
219,368,499
Industrial
REITs
0.1%
Prologis,
Inc.
.........................................
United
States
134,800
16,818,996
Interactive
Media
&
Services
3.0%
a
Alphabet,
Inc.,
A
......................................
United
States
2,083,620
216,133,902
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Growth
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
62
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Interactive
Media
&
Services
(continued)
a
Alphabet,
Inc.,
C
......................................
United
States
2,519,700
$
262,048,800
478,182,702
IT
Services
0.8%
a,c,d
Canva
,
Inc.
..........................................
Australia
25,413
20,112,109
a
Shopify,
Inc.,
A
.......................................
Canada
417,200
20,000,568
a
Snowflake,
Inc.,
A
.....................................
United
States
537,179
82,881,348
122,994,025
Life
Sciences
Tools
&
Services
6.8%
Agilent
Technologies,
Inc.
...............................
United
States
1,248,068
172,657,727
Danaher
Corp.
.......................................
United
States
1,106,072
278,774,387
a
Illumina,
Inc.
.........................................
United
States
577,514
134,300,881
a
Mettler
-Toledo
International,
Inc.
..........................
United
States
221,809
339,414,350
Thermo
Fisher
Scientific,
Inc.
............................
United
States
272,834
157,253,332
1,082,400,677
Machinery
4.2%
Deere
&
Co.
.........................................
United
States
451,451
186,395,089
Dover
Corp.
.........................................
United
States
380,644
57,835,049
Illinois
Tool
Works,
Inc.
.................................
United
States
960,119
233,740,971
Ingersoll
Rand,
Inc.
....................................
United
States
1,884,276
109,627,178
a
Proterra
,
Inc.
.........................................
United
States
3,038,197
4,618,059
Xylem,
Inc.
..........................................
United
States
802,201
83,990,445
676,206,791
Media
0.3%
Cable
One,
Inc.
.......................................
United
States
37,275
26,167,050
Comcast
Corp.,
A
.....................................
United
States
771,078
29,231,567
55,398,617
Personal
Care
Products
0.3%
Estee
Lauder
Cos.,
Inc.
(The),
A
..........................
United
States
180,608
44,512,648
Pharmaceuticals
3.8%
AstraZeneca
plc,
ADR
..................................
United
Kingdom
2,138,016
148,399,691
a
Catalent
,
Inc.
........................................
United
States
2,119,187
139,251,778
Eli
Lilly
&
Co.
........................................
United
States
903,784
310,377,501
598,028,970
Professional
Services
1.5%
Automatic
Data
Processing,
Inc.
..........................
United
States
106,629
23,738,814
a
CoStar
Group,
Inc.
....................................
United
States
1,248,423
85,953,924
Equifax,
Inc.
.........................................
United
States
470,856
95,508,431
Verisk
Analytics,
Inc.
...................................
United
States
180,621
34,653,945
239,855,114
Semiconductors
&
Semiconductor
Equipment
8.9%
ASML
Holding
NV,
ADR
................................
Netherlands
393,994
268,195,656
a
Enphase
Energy,
Inc.
..................................
United
States
106,000
22,289,680
Lam
Research
Corp.
...................................
United
States
28,850
15,293,962
a
Lattice
Semiconductor
Corp.
.............................
United
States
253,000
24,161,500
Monolithic
Power
Systems,
Inc.
...........................
United
States
432,145
216,305,858
NVIDIA
Corp.
........................................
United
States
1,797,267
499,226,854
NXP
Semiconductors
NV
...............................
China
674,130
125,708,392
Texas
Instruments,
Inc.
.................................
United
States
1,344,118
250,019,389
1,421,201,291
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Growth
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
63
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Software
16.5%
a
Adobe,
Inc.
..........................................
United
States
145,393
$
56,030,100
a
ANSYS,
Inc.
.........................................
United
States
126,932
42,242,970
a
Atlassian
Corp.,
A
.....................................
United
States
269,462
46,123,811
a
Autodesk,
Inc.
........................................
United
States
751,213
156,372,498
a
BILL
Holdings,
Inc.
....................................
United
States
1,040,382
84,416,596
a,c,d
Checkout
Payments
Group
Ltd.,
B
.........................
United
Kingdom
96,603
8,763,882
a
Crowdstrike
Holdings,
Inc.,
A
.............................
United
States
134,553
18,468,745
a
Gitlab
,
Inc.,
A
........................................
United
States
99,936
3,426,805
Intuit,
Inc.
...........................................
United
States
738,631
329,303,859
Microsoft
Corp.
.......................................
United
States
2,988,268
861,517,664
a
Paycom
Software,
Inc.
.................................
United
States
181,566
55,197,880
a
Procore
Technologies,
Inc.
..............................
United
States
67,551
4,230,719
a
PTC,
Inc.
...........................................
United
States
1,156,115
148,248,627
a
Salesforce,
Inc.
.......................................
United
States
541,262
108,133,322
a
ServiceNow
,
Inc.
......................................
United
States
656,895
305,272,244
a,c,d
Stripe,
Inc.,
B
........................................
United
States
540,043
10,873,301
a
Synopsys,
Inc.
.......................................
United
States
509,920
196,956,600
a
Tyler
Technologies,
Inc.
.................................
United
States
115,752
41,050,289
a
Workday,
Inc.,
A
......................................
United
States
670,401
138,464,623
2,615,094,535
Specialized
REITs
0.6%
Crown
Castle,
Inc.
.....................................
United
States
758,119
101,466,647
Technology
Hardware,
Storage
&
Peripherals
4.8%
Apple,
Inc.
..........................................
United
States
4,586,193
756,263,226
Textiles,
Apparel
&
Luxury
Goods
1.4%
NIKE,
Inc.,
B
.........................................
United
States
1,780,736
218,389,463
Trading
Companies
&
Distributors
0.9%
Fastenal
Co.
.........................................
United
States
2,639,613
142,380,725
Water
Utilities
0.6%
American
Water
Works
Co.,
Inc.
..........................
United
States
672,067
98,451,095
Total
Common
Stocks
(Cost
$4,999,379,053)
....................................
15,704,066,872
Convertible
Preferred
Stocks
0.5%
IT
Services
0.0%
†
a,c,d
Canva
,
Inc.,
A
........................................
Australia
2,353
1,862,188
a,c,d
Canva
,
Inc.,
A-3
......................................
Australia
94
74,393
a,c,d
Canva
,
Inc.,
A-4
......................................
Australia
8
6,331
a,c,d
Canva
,
Inc.,
A-5
......................................
Australia
5
3,957
1,946,869
Software
0.5%
a,c,d
Gusto,
Inc.,
E
........................................
United
States
822,494
28,668,904
a,c,d
OneTrust
LLC,
C
......................................
United
States
849,894
9,348,834
a,c,d
Stripe,
Inc.,
H
........................................
United
States
756,137
15,224,168
a,c,d
Stripe,
Inc.,
I
.........................................
United
States
1,230,266
24,770,348
78,012,254
Total
Convertible
Preferred
Stocks
(Cost
$100,970,705)
..........................
79,959,123
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Growth
Fund
(continued)
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The
accompanying
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are
an
integral
part
of
these
financial
statements.
64
†
Rounds
to
less
than
0.1%
of
net
assets.
a
Non-income
producing.
b
Security
was
purchased
pursuant
to
Rule
144A
or
Regulation
S
under
the
Securities
Act
of
1933.
144A
securities
may
be
sold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers
or
in
a
public
offering
registered
under
the
Securities
Act
of
1933.
Regulation
S
securities
cannot
be
sold
in
the
United
States
without
either
an
effective
registration
statement
filed
pursuant
to
the
Securities
Act
of
1933,
or
pursuant
to
an
exemption
from
registration.
At
March
31,
2023,
the
value
of
this
security
was
$116,869,048,
representing
0.7%
of
net
assets.
c
Fair
valued
using
significant
unobservable
inputs.
See
Note
14
regarding
fair
value
measurements.
d
See
Note
8
regarding
restricted
securities.
e
Variable
rate
security.
The
rate
shown
represents
the
yield
at
period
end.
f
See
Note
3(f)
regarding
investments
in
affiliated
management
investment
companies.
g
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
See
Abbreviations
on
page
145
.
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Preferred
Stocks
0.4%
Life
Sciences
Tools
&
Services
0.4%
e
Sartorius
AG,
0.37%
...................................
Germany
138,200
$
58,247,942
Total
Preferred
Stocks
(Cost
$55,133,304)
......................................
58,247,942
Total
Long
Term
Investments
(Cost
$5,155,483,062)
.............................
15,842,273,937
a
Short
Term
Investments
0.6%
a
a
Country
Shares
a
Value
a
a
a
Money
Market
Funds
0.6%
f,g
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
....
United
States
94,647,361
94,647,361
Total
Money
Market
Funds
(Cost
$94,647,361)
..................................
94,647,361
Total
Short
Term
Investments
(Cost
$94,647,361
)
................................
94,647,361
a
Total
Investments
(Cost
$5,250,130,423)
100.3%
................................
$15,936,921,298
Other
Assets,
less
Liabilities
(0.3)%
...........................................
(47,032,451)
Net
Assets
100.0%
...........................................................
$15,889,888,847
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Income
Fund
franklintempleton.com
The
accompanying
notes
are
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integral
part
of
these
financial
statements.
Semiannual
Report
65
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
Year
Ended
September
30,
2018
a
2022
2021
2020
2019
Class
A
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$2.14
$2.47
$2.08
$2.30
$2.32
$2.31
Income
from
investment
operations
b
:
Net
investment
income
(loss)
c
........
0.04
0.07
0.08
0.08
0.08
(0.04)
Net
realized
and
unrealized
gains
(losses)
0.19
(0.24)
0.42
(0.18)
0.02
0.05
Total
from
investment
operations
........
0.23
(0.17)
0.50
(0.10)
0.10
0.01
Less
distributions
from:
Net
investment
income
..............
(0.07)
(0.11)
(0.11)
(0.12)
(0.12)
—
Net
realized
gains
.................
—
(0.05)
—
—
—
—
Total
distributions
...................
(0.07)
(0.16)
(0.11)
(0.12)
(0.12)
—
Net
asset
value,
end
of
period
..........
$2.30
$2.14
$2.47
$2.08
$2.30
$2.32
Total
return
d
.......................
10.67%
(7.28)%
24.55%
(4.48)%
4.40%
0.43%
Ratios
to
average
net
assets
e
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.72%
0.72%
0.72%
0.71%
0.72%
0.71%
Expenses
net
of
waiver
and
payments
by
affiliates
f
..........................
0.71%
0.71%
0.72%
g
0.70%
0.72%
g
0.71%
g
Net
investment
income
...............
3.85%
3.08%
3.19%
3.64%
3.92%
3.89%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$19,503,026
$16,829,899
$16,044,379
$10,072,437
$7,427,468
$107,057
Portfolio
turnover
rate
................
30.95%
77.65%
68.93%
69.13%
43.63%
49.95%
a
For
the
period
September
10,
2018
(effective
date)
to
September
30,
2018.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year.
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
g
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Income
Fund
(continued)
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The
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an
integral
part
of
these
financial
statements.
66
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
A1
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$2.15
$2.48
$2.08
$2.30
$2.32
$2.39
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.04
0.08
0.08
0.08
0.09
0.09
Net
realized
and
unrealized
gains
(losses)
0.18
(0.24)
0.43
(0.18)
0.01
(0.04)
Total
from
investment
operations
........
0.22
(0.16)
0.51
(0.10)
0.10
0.05
Less
distributions
from:
Net
investment
income
..............
(0.07)
(0.12)
(0.11)
(0.12)
(0.12)
(0.12)
Net
realized
gains
.................
—
(0.05)
—
—
—
—
Total
distributions
...................
(0.07)
(0.17)
(0.11)
(0.12)
(0.12)
(0.12)
Net
asset
value,
end
of
period
..........
$2.30
$2.15
$2.48
$2.08
$2.30
$2.32
Total
return
c
.......................
10.22%
(7.10)%
25.19%
(4.39)%
4.50%
2.18%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.62%
0.62%
0.62%
0.61%
0.62%
0.61%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.61%
0.61%
0.62%
f
0.60%
0.62%
f
0.61%
f
Net
investment
income
...............
3.95%
3.15%
3.32%
3.74%
4.02%
3.99%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$31,801,876
$30,236,582
$35,704,730
$32,693,224
$39,625,649
$42,929,573
Portfolio
turnover
rate
................
30.95%
77.65%
68.93%
69.13%
43.63%
49.95%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Income
Fund
(continued)
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accompanying
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an
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part
of
these
financial
statements.
Semiannual
Report
67
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
C
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$2.19
$2.52
$2.12
$2.34
$2.35
$2.42
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.04
0.07
0.07
0.07
0.08
0.08
Net
realized
and
unrealized
gains
(losses)
0.18
(0.25)
0.43
(0.18)
0.02
(0.04)
Total
from
investment
operations
........
0.22
(0.18)
0.50
(0.11)
0.10
0.04
Less
distributions
from:
Net
investment
income
..............
(0.06)
(0.10)
(0.10)
(0.11)
(0.11)
(0.11)
Net
realized
gains
.................
—
(0.05)
—
—
—
—
Total
distributions
...................
(0.06)
(0.15)
(0.10)
(0.11)
(0.11)
(0.11)
Net
asset
value,
end
of
period
..........
$2.35
$2.19
$2.52
$2.12
$2.34
$2.35
Total
return
c
.......................
10.70%
(7.89)%
24.09%
(4.80)%
4.35%
1.61%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
1.12%
1.12%
1.13%
1.11%
1.12%
1.11%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
1.11%
1.11%
1.12%
1.10%
1.12%
f
1.11%
f
Net
investment
income
...............
3.44%
2.63%
2.84%
3.24%
3.52%
3.49%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$5,594,774
$5,654,802
$7,507,658
$9,339,238
$13,488,627
$19,895,441
Portfolio
turnover
rate
................
30.95%
77.65%
68.93%
69.13%
43.63%
49.95%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
68
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$2.10
$2.43
$2.04
$2.26
$2.28
$2.35
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.04
0.07
0.07
0.07
0.08
0.08
Net
realized
and
unrealized
gains
(losses)
0.17
(0.24)
0.43
(0.18)
0.01
(0.04)
Total
from
investment
operations
........
0.21
(0.17)
0.50
(0.11)
0.09
0.04
Less
distributions
from:
Net
investment
income
..............
(0.06)
(0.11)
(0.11)
(0.11)
(0.11)
(0.11)
Net
realized
gains
.................
—
(0.05)
—
—
—
—
Total
distributions
...................
(0.06)
(0.16)
(0.11)
(0.11)
(0.11)
(0.11)
Net
asset
value,
end
of
period
..........
$2.25
$2.10
$2.43
$2.04
$2.26
$2.28
Total
return
c
.......................
10.25%
(7.61)%
24.75%
(4.82)%
4.20%
1.86%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.97%
0.97%
0.97%
0.96%
0.97%
0.96%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.96%
0.96%
0.97%
f
0.95%
0.97%
f
0.96%
f
Net
investment
income
...............
3.60%
2.84%
2.97%
3.40%
3.67%
3.64%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$302,991
$270,060
$257,109
$221,584
$265,531
$296,098
Portfolio
turnover
rate
................
30.95%
77.65%
68.93%
69.13%
43.63%
49.95%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
69
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R6
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$2.14
$2.47
$2.07
$2.29
$2.30
$2.37
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.05
0.08
0.08
0.09
0.10
0.10
Net
realized
and
unrealized
gains
(losses)
0.17
(0.24)
0.44
(0.19)
0.01
(0.05)
Total
from
investment
operations
........
0.22
(0.16)
0.52
(0.10)
0.11
0.05
Less
distributions
from:
Net
investment
income
..............
(0.07)
(0.12)
(0.12)
(0.12)
(0.12)
(0.12)
Net
realized
gains
.................
—
(0.05)
—
—
—
—
Total
distributions
...................
(0.07)
(0.17)
(0.12)
(0.12)
(0.12)
(0.12)
Net
asset
value,
end
of
period
..........
$2.29
$2.14
$2.47
$2.07
$2.29
$2.30
Total
return
c
.......................
10.89%
(7.38)%
25.53%
(4.23)%
5.17%
2.40%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.42%
0.42%
0.43%
0.40%
0.41%
0.39%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.41%
0.40%
0.41%
0.39%
0.40%
0.39%
f
Net
investment
income
...............
4.16%
3.43%
3.50%
3.96%
4.24%
4.21%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$1,686,761
$1,158,685
$748,355
$1,626,735
$1,902,027
$2,062,334
Portfolio
turnover
rate
................
30.95%
77.65%
68.93%
69.13%
43.63%
49.95%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
70
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Advisor
Class
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$2.13
$2.46
$2.07
$2.28
$2.30
$2.37
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.05
0.08
0.08
0.08
0.09
0.10
Net
realized
and
unrealized
gains
(losses)
0.17
(0.24)
0.43
(0.17)
0.01
(0.05)
Total
from
investment
operations
........
0.22
(0.16)
0.51
(0.09)
0.10
0.05
Less
distributions
from:
Net
investment
income
..............
(0.07)
(0.12)
(0.12)
(0.12)
(0.12)
(0.12)
Net
realized
gains
.................
—
(0.05)
—
—
—
—
Total
distributions
...................
(0.07)
(0.17)
(0.12)
(0.12)
(0.12)
(0.12)
Net
asset
value,
end
of
period
..........
$2.28
$2.13
$2.46
$2.07
$2.28
$2.30
Total
return
c
.......................
10.91%
(7.44)%
24.98%
(3.86)%
4.65%
2.34%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.47%
0.47%
0.47%
0.46%
0.47%
0.46%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.46%
0.46%
0.47%
f
0.45%
0.47%
f
0.46%
f
Net
investment
income
...............
4.10%
3.32%
3.46%
3.89%
4.17%
4.14%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$13,138,278
$11,638,757
$11,969,691
$9,712,076
$11,816,599
$11,328,761
Portfolio
turnover
rate
................
30.95
%
77.65%
68.93%
69.13%
43.63%
49.95%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited),
March
31,
2023
Franklin
Income
Fund
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
71
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
21.0%
Aerospace
&
Defense
1.4%
Lockheed
Martin
Corp.
.................................
United
States
1,100,000
$
520,003,000
Northrop
Grumman
Corp.
...............................
United
States
400,000
184,688,000
Raytheon
Technologies
Corp.
............................
United
States
2,959,550
289,828,732
994,519,732
Air
Freight
&
Logistics
0.4%
United
Parcel
Service,
Inc.,
B
............................
United
States
1,500,000
290,985,000
Automobiles
0.2%
General
Motors
Co.
....................................
United
States
4,839,024
177,495,400
Banks
3.0%
a
Bank
of
America
Corp.
.................................
United
States
19,000,000
543,400,000
a
Citigroup,
Inc.
........................................
United
States
10,086,303
472,946,748
Fifth
Third
Bancorp
....................................
United
States
8,000,000
213,120,000
a
JPMorgan
Chase
&
Co.
.................................
United
States
2,000,000
260,620,000
PNC
Financial
Services
Group,
Inc.
(The)
...................
United
States
750,000
95,325,000
Truist
Financial
Corp.
..................................
United
States
6,000,000
204,600,000
US
Bancorp
.........................................
United
States
6,500,000
234,325,000
a
Wells
Fargo
&
Co.
.....................................
United
States
4,000,000
149,520,000
2,173,856,748
Biotechnology
0.3%
a
AbbVie,
Inc.
.........................................
United
States
600,000
95,622,000
a
Amgen,
Inc.
.........................................
United
States
500,000
120,875,000
216,497,000
Broadline
Retail
0.2%
a,b
Amazon.com,
Inc.
.....................................
United
States
1,500,000
154,935,000
Capital
Markets
1.3%
a
Charles
Schwab
Corp.
(The)
.............................
United
States
2,000,000
104,760,000
a
Goldman
Sachs
Group,
Inc.
(The)
.........................
United
States
746,574
244,211,821
a
Morgan
Stanley
.......................................
United
States
7,100,000
623,380,000
972,351,821
Communications
Equipment
0.7%
a
Cisco
Systems,
Inc.
...................................
United
States
9,700,000
507,067,500
Consumer
Staples
Distribution
&
Retail
0.2%
Target
Corp.
.........................................
United
States
1,000,000
165,630,000
Diversified
Telecommunication
Services
0.3%
Verizon
Communications,
Inc.
............................
United
States
5,000,000
194,450,000
Electric
Utilities
2.2%
American
Electric
Power
Co.,
Inc.
.........................
United
States
1,500,000
136,485,000
Duke
Energy
Corp.
....................................
United
States
3,000,000
289,410,000
Edison
International
...................................
United
States
5,000,000
352,950,000
NextEra
Energy,
Inc.
...................................
United
States
1,695,594
130,696,386
b
PG&E
Corp.
.........................................
United
States
5,000,000
80,850,000
Southern
Co.
(The)
....................................
United
States
9,000,000
626,220,000
1,616,611,386
Ground
Transportation
0.2%
a
Union
Pacific
Corp.
....................................
United
States
750,000
150,945,000
Household
Products
0.6%
Procter
&
Gamble
Co.
(The)
.............................
United
States
2,750,000
408,897,500
Industrial
Conglomerates
0.7%
Siemens
AG
.........................................
Germany
3,000,000
486,034,137
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
72
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Insurance
0.8%
Allianz
SE
...........................................
Germany
500,000
$
115,423,365
AXA
SA
.............................................
France
2,000,000
61,037,980
Zurich
Insurance
Group
AG
..............................
Switzerland
800,000
383,379,923
559,841,268
Metals
&
Mining
0.8%
a
Freeport-McMoRan,
Inc.
................................
United
States
5,000,000
204,550,000
a
Rio
Tinto
plc,
ADR
.....................................
Australia
5,000,000
343,000,000
547,550,000
Multi-Utilities
1.0%
a
Dominion
Energy,
Inc.
..................................
United
States
8,995,000
502,910,450
Sempra
Energy
.......................................
United
States
1,250,000
188,950,000
691,860,450
Oil,
Gas
&
Consumable
Fuels
2.8%
a
BP
plc,
ADR
.........................................
United
Kingdom
3,500,000
132,790,000
a
Chevron
Corp.
.......................................
United
States
6,500,000
1,060,540,000
Exxon
Mobil
Corp.
.....................................
United
States
4,059,000
445,109,940
a
Shell
plc,
ADR
........................................
Netherlands
4,000,000
230,160,000
a
TotalEnergies
SE,
ADR
.................................
France
2,000,000
118,100,000
1,986,699,940
Pharmaceuticals
1.9%
b
Bausch
Health
Cos.,
Inc.
................................
United
States
15,000,000
121,500,000
Johnson
&
Johnson
...................................
United
States
3,500,000
542,500,000
a
Pfizer,
Inc.
...........................................
United
States
10,698,956
436,517,405
Roche
Holding
AG
....................................
United
States
1,000,000
285,758,219
1,386,275,624
Semiconductors
&
Semiconductor
Equipment
1.4%
a
Intel
Corp.
...........................................
United
States
4,000,000
130,680,000
a
QUALCOMM,
Inc.
.....................................
United
States
1,000,000
127,580,000
a
Texas
Instruments,
Inc.
.................................
United
States
4,000,000
744,040,000
1,002,300,000
Specialty
Retail
0.3%
Home
Depot,
Inc.
(The)
.................................
United
States
762,000
224,881,440
Tobacco
0.3%
Philip
Morris
International,
Inc.
...........................
United
States
2,000,000
194,500,000
Total
Common
Stocks
(Cost
$13,366,821,434)
...................................
15,104,184,946
Management
Investment
Companies
0.1%
Capital
Markets
0.1%
c
Clarion
Partners
Real
Estate
Income
Fund,
Inc.,
Class
I
........
United
States
7,867,833
96,774,343
Total
Management
Investment
Companies
(Cost
$100,000,000)
...................
96,774,343
d
Equity-Linked
Securities
15.4%
Aerospace
&
Defense
0.3%
e
Mizuho
Markets
Cayman
LP
into
Lockheed
Martin
Corp.,
144A,
9%,
11/07/23
..........................................
United
States
459,000
215,724,016
Automobiles
0.1%
e
Barclays
Bank
plc
into
Ford
Motor
Co.,
144A,
12%,
2/09/24
......
United
States
7,600,000
97,231,463
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
73
a
a
Country
Shares
a
Value
a
a
a
a
a
a
d
Equity-Linked
Securities
(continued)
Banks
2.0%
e
BNP
Paribas
Issuance
BV
into
Bank
of
America
Corp.,
144A,
8.5%,
7/13/23
...........................................
United
States
8,500,000
$
252,292,504
e
J.P.
Morgan
Structured
Products
BV
into
Bank
of
America
Corp.,
144A,
9.5%,
5/12/23
.................................
United
States
7,100,000
208,881,235
e
JPMorgan
Chase
Bank
NA
into
Bank
of
America
Corp.,
144A,
9%,
2/02/24
...........................................
United
States
8,450,000
256,727,100
e
National
Bank
of
Canada
into
JPMorgan
Chase
&
Co.,
144A,
8%,
8/16/23
...........................................
United
States
2,643,000
330,613,273
e
National
Bank
of
Canada
into
Truist
Financial
Corp.,
144A,
9%,
10/10/23
..........................................
United
States
5,000,000
179,726,506
e
UBS
AG
into
Citigroup,
Inc.,
144A,
8.5%,
7/19/23
.............
United
States
5,007,000
240,001,482
1,468,242,100
Biotechnology
0.2%
e
Goldman
Sachs
International
Bank
into
AbbVie,
Inc.,
144A,
8.5%,
2/06/24
...........................................
United
States
1,150,000
180,851,055
Broadline
Retail
0.4%
e
Royal
Bank
of
Canada
into
Amazon.com,
Inc.,
144A,
10%,
4/05/24
United
States
2,800,000
280,422,814
Capital
Markets
0.6%
e
BNP
Paribas
Issuance
BV
into
Morgan
Stanley,
144A,
8%,
5/22/23
United
States
3,050,000
270,079,178
e
UBS
AG
into
Charles
Schwab
Corp.
(The),
144A,
10%,
6/16/23
...
United
States
3,567,000
190,836,117
460,915,295
Chemicals
0.4%
e
JPMorgan
Chase
Bank
NA
into
LyondellBasell
Industries
NV,
144A,
11%,
1/22/24
.......................................
United
States
2,700,000
256,512,092
Communications
Equipment
0.4%
e
Royal
Bank
of
Canada
into
Cisco
Systems,
Inc.,
144A,
8%,
9/11/23
United
States
5,850,000
298,266,211
Containers
&
Packaging
0.4%
e
Mizuho
Markets
Cayman
LP
into
International
Paper
Co.,
144A,
10.5%,
12/15/23
.....................................
United
States
7,400,000
271,102,546
Electric
Utilities
0.9%
e
Mizuho
Markets
Cayman
LP
into
NextEra
Energy,
Inc.,
144A,
8%,
3/19/24
...........................................
United
States
3,500,000
258,902,073
e
Morgan
Stanley
Finance
II
Ltd.
into
PG&E
Corp.,
144A,
10%,
11/14/23
..........................................
United
States
10,800,000
154,034,756
e
National
Bank
of
Canada
into
NextEra
Energy,
Inc.,
144A,
8.5%,
12/05/23
..........................................
United
States
3,300,000
253,858,400
666,795,229
Financial
Services
0.3%
e
UBS
AG
into
Fidelity
National
Information
Services,
Inc.,
144A,
10%,
10/19/23
..........................................
United
States
3,200,000
187,850,814
Ground
Transportation
0.7%
e
Merrill
Lynch
International
&
Co.
CV
into
Union
Pacific
Corp.,
144A,
Reg
S,
9%,
11/01/23
.................................
United
States
1,240,000
254,355,910
e
UBS
AG
into
Union
Pacific
Corp.,
144A,
8%,
3/13/24
...........
United
States
1,190,000
236,790,823
491,146,733
Hotels,
Restaurants
&
Leisure
0.2%
e
Societe
Generale
SA
into
Las
Vegas
Sands
Corp.,
144A,
10.137%,
9/12/23
...........................................
United
States
2,843,000
131,234,740
Industrial
Conglomerates
0.4%
e
Goldman
Sachs
International
Bank
into
Honeywell
International,
Inc.,
144A,
8.5%,
4/04/23
.................................
United
States
1,335,000
257,049,459
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
74
a
a
Country
Shares
a
Value
a
a
a
a
a
a
d
Equity-Linked
Securities
(continued)
Insurance
0.6%
e
Royal
Bank
of
Canada
into
MetLife,
Inc.,
144A,
9%,
9/22/23
.....
United
States
3,200,000
$
189,726,367
e
Royal
Bank
of
Canada
into
MetLife,
Inc.,
144A,
10%,
5/19/23
....
United
States
3,581,000
211,281,029
401,007,396
Interactive
Media
&
Services
0.3%
e
Citigroup
Global
Markets
Holdings,
Inc.
into
Alphabet,
Inc.,
144A,
9%,
6/22/23
........................................
United
States
115,000
240,377,683
Machinery
0.3%
e
National
Bank
of
Canada
into
Cummins,
Inc.,
144A,
8.5%,
2/13/24
United
States
1,000,000
245,405,684
Media
0.8%
e
Citigroup
Global
Markets
Holdings,
Inc.
into
Comcast
Corp.,
144A,
8.5%,
6/23/23
......................................
United
States
5,667,000
217,748,101
e
Societe
Generale
SA
into
Comcast
Corp.,
144A,
8%,
4/17/23
....
United
States
5,300,000
204,183,369
e
UBS
AG
into
Comcast
Corp.,
144A,
8.5%,
7/20/23
.............
United
States
3,765,000
145,651,415
567,582,885
Metals
&
Mining
0.4%
e
Goldman
Sachs
International
Bank
into
Newmont
Corp.,
144A,
10%,
7/05/23
...........................................
United
States
3,850,000
197,517,341
e
Royal
Bank
of
Canada
into
Barrick
Gold
Corp.,
144A,
11%,
3/07/24
Canada
5,600,000
106,349,689
303,867,030
Oil,
Gas
&
Consumable
Fuels
1.5%
e
Citigroup
Global
Markets
Holdings,
Inc.
into
Exxon
Mobil
Corp.,
144A,
9.5%,
2/22/24
.................................
United
States
2,000,000
225,051,848
e,f
J.P.
Morgan
Structured
Products
BV
into
Exxon
Mobil
Corp.,
144A,
9%,
9/24/24
........................................
United
States
2,435,000
263,144,623
e
Merrill
Lynch
International
&
Co.
CV
into
Chevron
Corp.,
144A,
10%,
12/04/23
..........................................
United
States
1,650,000
270,481,222
e
UBS
AG
into
BP
plc,
144A,
10%,
6/14/23
....................
United
Kingdom
8,460,000
301,778,471
1,060,456,164
Passenger
Airlines
0.3%
e
BNP
Paribas
Issuance
BV
into
Delta
Air
Lines,
Inc.,
144A,
10%,
7/12/23
...........................................
United
States
5,500,000
201,817,176
Pharmaceuticals
0.8%
e
BNP
Paribas
Issuance
BV
into
Bristol-Myers
Squibb
Co.,
144A,
7.5%,
4/18/23
......................................
United
States
3,300,000
231,296,512
e
Mizuho
Markets
Cayman
LP
into
Bristol-Myers
Squibb
Co.,
144A,
8.5%,
12/04/23
.....................................
United
States
2,600,000
187,542,742
e
Societe
Generale
SA
into
Pfizer,
Inc.,
144A,
8.5%,
6/09/23
......
United
States
4,200,000
174,080,410
592,919,664
Semiconductors
&
Semiconductor
Equipment
2.8%
e
Barclays
Bank
plc
into
Texas
Instruments,
Inc.,
144A,
9%,
10/10/23
United
States
1,600,000
287,725,260
e
BNP
Paribas
Issuance
BV
into
Broadcom,
Inc.,
144A,
9%,
8/14/23
United
States
530,000
313,789,689
e
Citigroup
Global
Markets
Holdings,
Inc.
into
Intel
Corp.,
144A,
10%,
9/14/23
...........................................
United
States
8,050,000
265,176,859
e
Goldman
Sachs
International
Bank
into
Intel
Corp.,
144A,
10%,
4/04/23
...........................................
United
States
3,315,000
106,322,679
e
Merrill
Lynch
International
&
Co.
CV
into
Analog
Devices,
Inc.,
144A,
9%,
4/04/23
........................................
United
States
1,551,000
281,973,436
e
Merrill
Lynch
International
&
Co.
CV
into
Broadcom,
Inc.,
144A,
10%,
12/05/23
..........................................
United
States
500,000
275,069,132
e
Mizuho
Markets
Cayman
LP
into
Microchip
Technology,
Inc.,
144A,
10%,
11/03/23
......................................
United
States
4,200,000
310,975,841
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
75
a
a
Country
Shares
a
Value
a
a
a
a
a
a
d
Equity-Linked
Securities
(continued)
Semiconductors
&
Semiconductor
Equipment
(continued)
e
Morgan
Stanley
Finance
II
Ltd.
into
Microchip
Technology,
Inc.,
144A,
10%,
9/12/23
..................................
United
States
2,045,000
$
158,674,137
1,999,707,033
Specialty
Retail
0.3%
e
Citigroup
Global
Markets
Holdings,
Inc.
into
Home
Depot,
Inc.
(The),
144A,
8.5%,
6/12/24
.................................
United
States
811,000
248,370,086
Total
Equity-Linked
Securities
(Cost
$11,362,682,226)
...........................
11,124,855,368
Convertible
Preferred
Stocks
0.8%
Electric
Utilities
0.7%
American
Electric
Power
Co.,
Inc.,
6.125%
..................
United
States
1,500,000
75,525,000
NextEra
Energy,
Inc.,
6.219%
............................
United
States
7,500,000
366,300,000
PG&E
Corp.,
5.5%
....................................
United
States
500,000
71,165,000
512,990,000
Financial
Services
0.1%
b
FNMA,
5.375%
.......................................
United
States
4,240
27,027,880
b
Total
Convertible
Preferred
Stocks
(Cost
$819,342,988)
..........................
540,017,880
Preferred
Stocks
0.0%
†
Financial
Services
0.0%
†
b
FNMA,
8.25%,
S
......................................
United
States
4,000,000
6,880,000
b
Total
Preferred
Stocks
(Cost
$93,801,501)
......................................
6,880,000
Principal
Amount
*
Convertible
Bonds
0.1%
Media
0.1%
DISH
Network
Corp.
,
Senior
Note
,
2.375
%
,
3/15/24
............
United
States
50,000,000
44,437,500
Total
Convertible
Bonds
(Cost
$48,768,196)
....................................
44,437,500
Corporate
Bonds
46.3%
Aerospace
&
Defense
2.0%
Boeing
Co.
(The)
,
Senior
Bond,
3.2%,
3/01/29
............................
United
States
74,000,000
67,665,343
Senior
Bond,
3.625%,
2/01/31
..........................
United
States
79,000,000
72,439,688
Senior
Note,
2.196%,
2/04/26
..........................
United
States
45,000,000
41,771,545
Senior
Note,
5.04%,
5/01/27
...........................
United
States
180,000,000
181,425,228
Senior
Note,
3.25%,
2/01/28
...........................
United
States
60,000,000
55,937,293
Senior
Note,
5.15%,
5/01/30
...........................
United
States
370,000,000
372,505,381
e
Bombardier,
Inc.
,
Senior
Bond
,
144A,
7.5
%
,
3/15/25
...........
Canada
28,076,000
28,102,089
Raytheon
Technologies
Corp.
,
Senior
Note
,
3.125
%
,
5/04/27
.....
United
States
40,000,000
37,972,255
Textron,
Inc.
,
Senior
Bond,
3%,
6/01/30
.............................
United
States
59,049,000
52,789,618
Senior
Bond,
2.45%,
3/15/31
...........................
United
States
40,000,000
33,754,499
TransDigm,
Inc.
,
Senior
Note,
6.375%,
6/15/26
..........................
United
States
102,500,000
100,301,887
e
Senior
Secured
Note,
144A,
8%,
12/15/25
.................
United
States
65,176,000
66,438,785
e
Senior
Secured
Note,
144A,
6.25%,
3/15/26
...............
United
States
208,000,000
208,400,400
e
Senior
Secured
Note,
144A,
6.75%,
8/15/28
...............
United
States
85,000,000
85,956,250
1,405,460,261
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
76
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Air
Freight
&
Logistics
0.0%
†
FedEx
Corp.
,
Senior
Bond
,
2.4
%
,
5/15/31
...................
United
States
29,000,000
$
24,690,531
Automobile
Components
0.6%
American
Axle
&
Manufacturing,
Inc.
,
Senior
Note
,
5
%
,
10/01/29
..
United
States
45,000,000
38,056,973
e
Dornoch
Debt
Merger
Sub,
Inc.
,
Senior
Note
,
144A,
6.625
%
,
10/15/29
..........................................
United
States
95,000,000
64,208,724
Goodyear
Tire
&
Rubber
Co.
(The)
,
g
Senior
Bond,
5%,
5/31/26
.............................
United
States
77,000,000
74,536,770
g
Senior
Bond,
5.25%,
4/30/31
...........................
United
States
52,500,000
46,215,750
g
Senior
Note,
4.875%,
3/15/27
..........................
United
States
34,757,000
32,855,792
Senior
Note,
5%,
7/15/29
.............................
United
States
130,000,000
116,308,400
Senior
Note,
5.25%,
7/15/31
...........................
United
States
40,500,000
35,026,830
407,209,239
Automobiles
0.8%
Ford
Motor
Co.
,
Senior
Bond,
3.25%,
2/12/32
...........................
United
States
107,500,000
84,641,910
Senior
Bond,
6.1%,
8/19/32
............................
United
States
139,000,000
134,894,087
g
Senior
Note,
4.346%,
12/08/26
.........................
United
States
145,000,000
141,041,848
General
Motors
Co.
,
Senior
Bond,
5%,
10/01/28
............................
United
States
25,000,000
24,653,523
Senior
Bond,
5.6%,
10/15/32
...........................
United
States
35,000,000
34,303,838
Senior
Bond,
5.15%,
4/01/38
...........................
United
States
105,000,000
94,808,410
e
Volkswagen
Group
of
America
Finance
LLC
,
Senior
Note
,
144A,
1.25
%
,
11/24/25
.....................................
Germany
97,000,000
88,295,991
602,639,607
Banks
3.0%
Bank
of
America
Corp.
,
h
AA,
Junior
Sub.
Bond,
6.1%
to
3/16/25,
FRN
thereafter,
Perpetual
United
States
70,000,000
68,798,100
h
X,
Junior
Sub.
Bond,
6.25%
to
9/04/24,
FRN
thereafter,
Perpetual
United
States
55,000,000
53,831,250
Senior
Bond,
3.419%
to
12/19/27,
FRN
thereafter,
12/20/28
...
United
States
135,000,000
125,537,376
Senior
Bond,
4.571%
to
4/26/32,
FRN
thereafter,
4/27/33
.....
United
States
65,000,000
61,921,977
Barclays
plc
,
Senior
Bond,
4.337%,
1/10/28
..........................
United
Kingdom
31,000,000
29,547,743
Senior
Bond,
2.645%
to
6/23/30,
FRN
thereafter,
6/24/31
.....
United
Kingdom
31,000,000
24,939,051
Senior
Bond,
5.746%
to
8/08/32,
FRN
thereafter,
8/09/33
.....
United
Kingdom
100,000,000
98,068,679
Senior
Bond,
7.437%
to
11/01/32,
FRN
thereafter,
11/02/33
....
United
Kingdom
75,000,000
82,971,619
Senior
Note,
3.932%
to
5/06/24,
FRN
thereafter,
5/07/25
......
United
Kingdom
30,000,000
29,199,709
Senior
Note,
4.375%,
1/12/26
..........................
United
Kingdom
95,000,000
91,785,402
Senior
Note,
7.325%
to
11/01/25,
FRN
thereafter,
11/02/26
....
United
Kingdom
30,000,000
30,751,106
Senior
Note,
5.501%
to
8/08/27,
FRN
thereafter,
8/09/28
......
United
Kingdom
80,000,000
78,954,034
Citigroup,
Inc.
,
h,i
Junior
Sub.
Bond,
FRN,
8.87%,
(3-month
USD
LIBOR
+
4.068%),
Perpetual
.........................................
United
States
118,000,000
117,410,000
g,h
D,
Junior
Sub.
Bond,
5.35%
to
5/14/23,
FRN
thereafter,
Perpetual
United
States
75,000,000
72,510,000
h
M,
Junior
Sub.
Bond,
6.3%
to
5/14/24,
FRN
thereafter,
Perpetual
United
States
105,000,000
100,143,750
Senior
Bond,
3.52%
to
10/26/27,
FRN
thereafter,
10/27/28
....
United
States
35,000,000
32,743,417
Senior
Bond,
6.27%
to
11/16/32,
FRN
thereafter,
11/17/33
.....
United
States
60,000,000
64,941,552
Senior
Note,
1.462%
to
6/08/26,
FRN
thereafter,
6/09/27
......
United
States
20,000,000
17,773,437
Sub.
Bond,
4.125%,
7/25/28
...........................
United
States
95,000,000
89,781,431
Fifth
Third
Bancorp
,
Senior
Note
,
3.65
%
,
1/25/24
..............
United
States
62,689,000
61,187,296
Fifth
Third
Bank
NA
,
Senior
Note
,
5.852%
to
10/26/24,
FRN
thereafter
,
10/27/25
..................................
United
States
28,185,000
27,800,975
h
JPMorgan
Chase
&
Co.
,
g
Q,
Junior
Sub.
Bond,
5.15%
to
4/30/23,
FRN
thereafter,
Perpetual
United
States
60,700,000
59,562,447
g
R,
Junior
Sub.
Bond,
6%
to
7/31/23,
FRN
thereafter,
Perpetual
.
United
States
55,000,000
53,968,750
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
77
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Banks
(continued)
h
JPMorgan
Chase
&
Co.,
(continued)
S,
Junior
Sub.
Bond,
6.75%
to
1/31/24,
FRN
thereafter,
Perpetual
United
States
65,000,000
$
65,266,825
KeyBank
NA
,
Senior
Note,
5.85%,
11/15/27
..........................
United
States
50,000,000
49,208,291
Sub.
Bond,
4.9%,
8/08/32
.............................
United
States
35,000,000
30,759,820
PNC
Financial
Services
Group,
Inc.
(The)
,
Senior
Bond,
6.037%
to
10/27/32,
FRN
thereafter,
10/28/33
...
United
States
70,000,000
73,717,851
Senior
Bond,
5.068%
to
1/23/33,
FRN
thereafter,
1/24/34
.....
United
States
40,000,000
39,492,269
Royal
Bank
of
Canada
,
Senior
Bond
,
5
%
,
2/01/33
.............
Canada
50,000,000
50,640,174
Truist
Bank
,
Sub.
Bond
,
2.25
%
,
3/11/30
.....................
United
States
22,645,000
18,625,796
Truist
Financial
Corp.
,
Senior
Bond,
5.122%
to
1/25/33,
FRN
thereafter,
1/26/34
.....
United
States
55,000,000
53,683,599
Sub.
Bond,
4.916%
to
7/27/32,
FRN
thereafter,
7/28/33
.......
United
States
95,000,000
88,619,751
US
Bancorp
,
Senior
Bond
,
5.85%
to
10/20/32,
FRN
thereafter
,
10/21/33
..........................................
United
States
45,000,000
47,041,016
Wells
Fargo
&
Co.
,
h
S,
Junior
Sub.
Bond,
5.9%
to
6/14/24,
FRN
thereafter,
Perpetual
United
States
70,000,000
66,538,500
Senior
Bond,
4.478%
to
4/03/30,
FRN
thereafter,
4/04/31
.....
United
States
20,000,000
19,159,547
Senior
Bond,
4.897%
to
7/24/32,
FRN
thereafter,
7/25/33
.....
United
States
50,000,000
48,835,397
2,125,717,937
Beverages
0.1%
Anheuser-Busch
InBev
Worldwide,
Inc.
,
Senior
Bond
,
4
%
,
4/13/28
Belgium
25,000,000
24,732,473
Constellation
Brands,
Inc.
,
Senior
Bond
,
3.15
%
,
8/01/29
........
United
States
35,000,000
32,017,764
56,750,237
Biotechnology
0.3%
AbbVie,
Inc.
,
Senior
Note,
3.2%,
5/14/26
............................
United
States
25,000,000
24,152,661
Senior
Note,
3.2%,
11/21/29
...........................
United
States
115,000,000
106,766,729
Amgen,
Inc.
,
Senior
Bond,
2.45%,
2/21/30
...........................
United
States
25,000,000
21,805,932
Senior
Bond,
5.25%,
3/02/33
...........................
United
States
30,000,000
30,838,375
Senior
Note,
5.25%,
3/02/30
...........................
United
States
20,000,000
20,462,624
204,026,321
Broadline
Retail
0.1%
Amazon.com,
Inc.
,
Senior
Bond
,
3.6
%
,
4/13/32
...............
United
States
67,500,000
64,161,632
Building
Products
0.3%
e
Camelot
Return
Merger
Sub,
Inc.
,
Senior
Secured
Note
,
144A,
8.75
%
,
8/01/28
.....................................
United
States
50,000,000
46,350,000
Carrier
Global
Corp.
,
Senior
Bond,
2.7%,
2/15/31
............................
United
States
22,500,000
19,367,080
Senior
Note,
2.722%,
2/15/30
..........................
United
States
98,200,000
85,978,236
Johnson
Controls
International
plc
/
Tyco
Fire
&
Security
Finance
SCA
,
Senior
Bond,
2%,
9/16/31
.............................
United
States
10,000,000
8,156,570
Senior
Bond,
4.9%,
12/01/32
...........................
United
States
39,500,000
40,107,373
199,959,259
Capital
Markets
0.8%
Brookfield
Finance,
Inc.
,
Senior
Bond
,
4.85
%
,
3/29/29
..........
Canada
34,444,000
33,200,172
e,g
Coinbase
Global,
Inc.
,
Senior
Note
,
144A,
3.375
%
,
10/01/28
.....
United
States
57,500,000
35,565,762
Goldman
Sachs
Group,
Inc.
(The)
,
Senior
Bond,
3.814%
to
4/22/28,
FRN
thereafter,
4/23/29
.....
United
States
21,000,000
19,744,219
Senior
Bond,
4.223%
to
4/30/28,
FRN
thereafter,
5/01/29
.....
United
States
20,000,000
19,179,245
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
78
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Capital
Markets
(continued)
Goldman
Sachs
Group,
Inc.
(The),
(continued)
Senior
Bond,
2.6%,
2/07/30
............................
United
States
36,250,000
$
31,136,696
Senior
Bond,
2.65%
to
10/20/31,
FRN
thereafter,
10/21/32
....
United
States
58,600,000
48,458,897
Senior
Note,
3.5%,
4/01/25
............................
United
States
73,000,000
70,923,754
Senior
Note,
3.8%,
3/15/30
............................
United
States
25,000,000
23,307,856
Morgan
Stanley
,
Senior
Bond,
2.699%
to
1/21/30,
FRN
thereafter,
1/22/31
.....
United
States
50,000,000
43,097,124
Senior
Bond,
3.622%
to
3/31/30,
FRN
thereafter,
4/01/31
.....
United
States
23,600,000
21,597,559
Senior
Bond,
2.239%
to
7/20/31,
FRN
thereafter,
7/21/32
.....
United
States
30,482,000
24,479,669
Senior
Bond,
2.511%
to
10/19/31,
FRN
thereafter,
10/20/32
....
United
States
81,000,000
66,412,964
Senior
Bond,
6.342%
to
10/17/32,
FRN
thereafter,
10/18/33
...
United
States
35,000,000
38,257,341
Senior
Note,
1.512%
to
7/19/26,
FRN
thereafter,
7/20/27
......
United
States
25,000,000
22,237,885
Senior
Note,
5.123%
to
1/31/28,
FRN
thereafter,
2/01/29
......
United
States
30,000,000
30,261,712
Sub.
Bond,
5.948%
to
1/18/33,
FRN
thereafter,
1/19/38
.......
United
States
37,095,000
36,923,758
564,784,613
Chemicals
1.0%
Celanese
US
Holdings
LLC
,
g
Senior
Bond,
6.379%,
7/15/32
..........................
United
States
50,000,000
50,742,632
Senior
Note,
6.165%,
7/15/27
..........................
United
States
20,000,000
20,142,486
e
Consolidated
Energy
Finance
SA
,
Senior
Note
,
144A,
6.5
%
,
5/15/26
Switzerland
125,000,000
117,801,658
e
CVR
Partners
LP
/
CVR
Nitrogen
Finance
Corp.
,
Senior
Secured
Note
,
144A,
6.125
%
,
6/15/28
...........................
United
States
31,500,000
27,959,558
Dow
Chemical
Co.
(The)
,
Senior
Bond
,
6.3
%
,
3/15/33
..........
United
States
35,000,000
38,111,433
Huntsman
International
LLC
,
Senior
Bond
,
4.5
%
,
5/01/29
.......
United
States
25,000,000
23,499,860
e
International
Flavors
&
Fragrances,
Inc.
,
Senior
Bond,
144A,
2.3%,
11/01/30
......................
United
States
130,000,000
104,420,138
Senior
Note,
144A,
1.832%,
10/15/27
....................
United
States
20,000,000
16,991,268
e
Olin
Corp.
,
Senior
Note
,
144A,
9.5
%
,
6/01/25
................
United
States
40,000,000
42,220,440
e
Rain
CII
Carbon
LLC
/
CII
Carbon
Corp.
,
Secured
Note
,
144A,
7.25
%
,
4/01/25
.....................................
United
States
33,249,000
32,237,565
e
SCIH
Salt
Holdings,
Inc.
,
Senior
Note,
144A,
6.625%,
5/01/29
.....................
United
States
119,500,000
99,038,015
Senior
Secured
Note,
144A,
4.875%,
5/01/28
..............
United
States
155,000,000
138,371,600
711,536,653
Commercial
Services
&
Supplies
0.4%
e
ADT
Security
Corp.
(The)
,
Senior
Secured
Note
,
144A,
4.125
%
,
8/01/29
...........................................
United
States
30,000,000
26,790,750
e
APX
Group,
Inc.
,
Senior
Note,
144A,
5.75%,
7/15/29
......................
United
States
113,000,000
101,277,380
Senior
Secured
Note,
144A,
6.75%,
2/15/27
...............
United
States
111,000,000
110,567,655
e
Madison
IAQ
LLC
,
Senior
Secured
Note
,
144A,
4.125
%
,
6/30/28
..
United
States
41,000,000
35,510,715
274,146,500
Communications
Equipment
1.2%
e
CommScope
Technologies
LLC
,
Senior
Note,
144A,
6%,
6/15/25
........................
United
States
463,500,000
436,958,085
Senior
Note,
144A,
5%,
3/15/27
........................
United
States
50,000,000
36,620,000
e
CommScope,
Inc.
,
Senior
Note,
144A,
8.25%,
3/01/27
......................
United
States
120,000,000
98,400,000
Senior
Note,
144A,
7.125%,
7/01/28
.....................
United
States
125,000,000
92,346,250
Senior
Secured
Note,
144A,
6%,
3/01/26
..................
United
States
230,085,000
222,309,277
886,633,612
Construction
&
Engineering
0.1%
Quanta
Services,
Inc.
,
Senior
Bond
,
2.9
%
,
10/01/30
...........
United
States
110,000,000
94,952,339
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
79
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Consumer
Finance
2.5%
Capital
One
Financial
Corp.
,
Senior
Bond,
3.8%,
1/31/28
............................
United
States
47,300,000
$
43,428,733
Senior
Bond,
5.268%
to
5/09/32,
FRN
thereafter,
5/10/33
.....
United
States
50,000,000
47,116,116
Senior
Bond,
5.817%
to
1/31/33,
FRN
thereafter,
2/01/34
.....
United
States
40,000,000
38,689,489
Senior
Note,
4.985%
to
7/23/25,
FRN
thereafter,
7/24/26
......
United
States
40,000,000
38,590,812
Senior
Note,
4.927%
to
5/09/27,
FRN
thereafter,
5/10/28
......
United
States
144,532,733
138,990,456
Senior
Note,
5.247%
to
7/25/29,
FRN
thereafter,
7/26/30
......
United
States
50,000,000
47,248,700
Sub.
Note,
4.2%,
10/29/25
............................
United
States
123,500,000
115,246,441
Sub.
Note,
3.75%,
7/28/26
............................
United
States
117,800,000
107,231,823
Ford
Motor
Credit
Co.
LLC
,
Senior
Bond,
4.389%,
1/08/26
..........................
United
States
25,000,000
23,755,500
Senior
Note,
2.3%,
2/10/25
............................
United
States
35,000,000
32,487,700
Senior
Note,
5.125%,
6/16/25
..........................
United
States
146,375,000
143,483,391
Senior
Note,
4.134%,
8/04/25
..........................
United
States
154,650,000
147,336,057
Senior
Note,
3.375%,
11/13/25
.........................
United
States
32,000,000
30,035,680
Senior
Note,
2.7%,
8/10/26
............................
United
States
60,000,000
53,475,000
Senior
Note,
4.95%,
5/28/27
...........................
United
States
115,000,000
109,859,500
Senior
Note,
7.35%,
11/04/27
..........................
United
States
30,000,000
30,975,300
Senior
Note,
5.113%,
5/03/29
..........................
United
States
75,000,000
70,515,375
Senior
Note,
7.35%,
3/06/30
...........................
United
States
45,000,000
46,282,500
General
Motors
Financial
Co.,
Inc.
,
Senior
Bond,
4.35%,
1/17/27
...........................
United
States
40,000,000
38,792,981
Senior
Bond,
3.6%,
6/21/30
............................
United
States
37,720,000
33,078,345
Senior
Bond,
3.1%,
1/12/32
............................
United
States
80,000,000
65,251,847
g
Senior
Bond,
6.4%,
1/09/33
............................
United
States
50,000,000
51,605,385
Senior
Note,
4.15%,
6/19/23
...........................
United
States
75,000,000
74,770,419
Senior
Note,
5%,
4/09/27
.............................
United
States
50,000,000
49,443,453
Senior
Note,
2.4%,
4/10/28
............................
United
States
35,000,000
30,583,997
Senior
Note,
4.3%,
4/06/29
............................
United
States
69,000,000
64,197,493
John
Deere
Capital
Corp.
,
Senior
Bond
,
4.35
%
,
9/15/32
........
United
States
40,000,000
39,955,302
OneMain
Finance
Corp.
,
Senior
Bond,
5.375%,
11/15/29
.........................
United
States
42,100,000
35,460,830
Senior
Note,
6.875%,
3/15/25
..........................
United
States
25,000,000
24,250,000
Senior
Note,
6.625%,
1/15/28
..........................
United
States
26,000,000
23,862,800
Senior
Note,
4%,
9/15/30
.............................
United
States
42,375,000
31,819,387
1,827,820,812
Consumer
Staples
Distribution
&
Retail
0.2%
e
7-Eleven,
Inc.
,
Senior
Bond
,
144A,
1.8
%
,
2/10/31
.............
United
States
75,000,000
59,474,567
Target
Corp.
,
Senior
Bond
,
4.5
%
,
9/15/32
...................
United
States
90,000,000
90,241,352
149,715,919
Containers
&
Packaging
1.4%
e,j
ARD
Finance
SA
,
Senior
Secured
Note
,
144A,
PIK,
6.5
%
,
6/30/27
.
Luxembourg
25,144,215
19,265,497
e,g
Ardagh
Metal
Packaging
Finance
USA
LLC
/
Ardagh
Metal
Packaging
Finance
plc
,
Senior
Note
,
144A,
4
%
,
9/01/29
.......
United
States
37,000,000
28,987,835
e
Ardagh
Packaging
Finance
plc
/
Ardagh
Holdings
USA,
Inc.
,
Senior
Note,
144A,
5.25%,
8/15/27
......................
United
States
200,440,000
158,229,341
Senior
Secured
Note,
144A,
5.25%,
4/30/25
...............
United
States
25,669,000
25,308,222
Senior
Secured
Note,
144A,
4.125%,
8/15/26
..............
United
States
50,000,000
46,692,750
e
Mauser
Packaging
Solutions
Holding
Co.
,
Secured
Note,
144A,
9.25%,
4/15/27
.....................
United
States
400,000,000
370,000,000
Senior
Secured
Note,
144A,
7.875%,
8/15/26
..............
United
States
295,000,000
295,266,975
e
Pactiv
Evergreen
Group
Issuer,
Inc./Pactiv
Evergreen
Group
Issuer
LLC
,
Senior
Secured
Note
,
144A,
4
%
,
10/15/27
.............
United
States
70,000,000
62,945,050
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
80
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Containers
&
Packaging
(continued)
e,g
Sealed
Air
Corp.
,
Senior
Note
,
144A,
6.125
%
,
2/01/28
..........
United
States
25,000,000
$
25,305,000
1,032,000,670
Diversified
REITs
0.2%
VICI
Properties
LP
,
Senior
Bond,
5.125%,
5/15/32
..........................
United
States
60,000,000
56,582,400
Senior
Note,
4.95%,
2/15/30
...........................
United
States
43,357,000
40,728,564
e
VICI
Properties
LP
/
VICI
Note
Co.,
Inc.
,
Senior
Note
,
144A,
4.25
%
,
12/01/26
..........................................
United
States
82,000,000
76,584,409
173,895,373
Diversified
Telecommunication
Services
0.2%
e
CCO
Holdings
LLC
/
CCO
Holdings
Capital
Corp.
,
Senior
Bond,
144A,
5.125%,
5/01/27
.....................
United
States
95,000,000
89,892,800
Senior
Bond,
144A,
5%,
2/01/28
........................
United
States
25,000,000
23,092,875
Verizon
Communications,
Inc.
,
Senior
Bond
,
4.016
%
,
12/03/29
...
United
States
50,000,000
47,900,895
160,886,570
Electric
Utilities
1.2%
American
Electric
Power
Co.,
Inc.
,
Senior
Bond,
5.95%,
11/01/32
..........................
United
States
30,000,000
31,948,021
Senior
Bond,
5.625%,
3/01/33
..........................
United
States
30,000,000
31,057,494
NextEra
Energy
Capital
Holdings,
Inc.
,
Senior
Note
,
1.875
%
,
1/15/27
United
States
65,000,000
58,818,192
NRG
Energy,
Inc.
,
e
Senior
Bond,
144A,
3.625%,
2/15/31
.....................
United
States
72,000,000
57,813,060
Senior
Note,
5.75%,
1/15/28
...........................
United
States
18,075,000
17,753,265
e
Senior
Note,
144A,
3.375%,
2/15/29
.....................
United
States
38,300,000
31,755,578
e
Senior
Secured
Bond,
144A,
7%,
3/15/33
.................
United
States
30,000,000
31,107,450
e
Senior
Secured
Note,
144A,
2.45%,
12/02/27
..............
United
States
30,000,000
25,690,001
Pacific
Gas
and
Electric
Co.
,
Senior
Bond,
4.55%,
7/01/30
...........................
United
States
122,500,000
114,858,348
Senior
Bond,
6.15%,
1/15/33
...........................
United
States
30,000,000
30,826,574
Senior
Note,
3.15%,
1/01/26
...........................
United
States
78,000,000
72,848,716
PG&E
Corp.
,
Senior
Secured
Note
,
5
%
,
7/01/28
..............
United
States
50,264,000
47,514,559
g
Southern
Co.
(The)
,
Senior
Bond
,
5.7
%
,
10/15/32
.............
United
States
45,000,000
47,368,627
e
Vistra
Operations
Co.
LLC
,
Senior
Note,
144A,
5.5%,
9/01/26
.......................
United
States
45,000,000
43,753,680
Senior
Note,
144A,
5%,
7/31/27
........................
United
States
56,000,000
53,026,680
Senior
Note,
144A,
4.375%,
5/01/29
.....................
United
States
130,000,000
115,282,089
Senior
Secured
Bond,
144A,
4.3%,
7/15/29
................
United
States
35,000,000
31,369,012
Senior
Secured
Note,
144A,
3.55%,
7/15/24
...............
United
States
25,000,000
24,150,137
Senior
Secured
Note,
144A,
3.7%,
1/30/27
................
United
States
18,000,000
16,634,205
883,575,688
Electrical
Equipment
0.1%
e
Regal
Rexnord
Corp.
,
Senior
Bond,
144A,
6.4%,
4/15/33
.......................
United
States
25,000,000
25,045,224
Senior
Note,
144A,
6.05%,
4/15/28
......................
United
States
35,000,000
35,041,159
Senior
Note,
144A,
6.3%,
2/15/30
.......................
United
States
25,000,000
25,198,153
e
Vertiv
Group
Corp.
,
Senior
Secured
Note
,
144A,
4.125
%
,
11/15/28
United
States
20,668,000
18,259,867
103,544,403
Electronic
Equipment,
Instruments
&
Components
0.1%
Flex
Ltd.
,
Senior
Note
,
4.75
%
,
6/15/25
.....................
United
States
50,000,000
49,114,921
Energy
Equipment
&
Services
0.6%
e
Schlumberger
Holdings
Corp.
,
Senior
Note
,
144A,
3.9
%
,
5/17/28
..
United
States
42,500,000
40,896,169
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
81
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Energy
Equipment
&
Services
(continued)
e
Weatherford
International
Ltd.
,
Senior
Note,
144A,
11%,
12/01/24
.......................
United
States
24,651,000
$
25,318,122
Senior
Note,
144A,
8.625%,
4/30/30
.....................
United
States
250,000,000
255,990,000
Senior
Secured
Note,
144A,
6.5%,
9/15/28
................
United
States
80,000,000
80,212,400
402,416,691
Entertainment
0.5%
Netflix,
Inc.
,
Senior
Bond,
4.375%,
11/15/26
.........................
United
States
100,000,000
98,965,000
Senior
Bond,
4.875%,
4/15/28
..........................
United
States
89,300,000
88,933,870
Senior
Bond,
5.875%,
11/15/28
.........................
United
States
50,000,000
52,667,500
e
Warnermedia
Holdings,
Inc.
,
Senior
Bond
,
144A,
4.279
%
,
3/15/32
.
United
States
100,000,000
89,351,888
329,918,258
Financial
Services
0.4%
Fidelity
National
Information
Services,
Inc.
,
Senior
Bond,
2.25%,
3/01/31
...........................
United
States
53,000,000
42,433,470
Senior
Bond,
5.1%,
7/15/32
............................
United
States
20,000,000
19,492,279
Fiserv,
Inc.
,
Senior
Bond,
4.2%,
10/01/28
...........................
United
States
52,000,000
50,484,968
Senior
Bond,
3.5%,
7/01/29
............................
United
States
40,000,000
37,143,066
Senior
Bond,
2.65%,
6/01/30
...........................
United
States
38,000,000
32,825,512
Senior
Bond,
5.6%,
3/02/33
............................
United
States
30,000,000
31,130,345
e
Woodside
Finance
Ltd.
,
Senior
Bond
,
144A,
4.5
%
,
3/04/29
......
Australia
100,000,000
96,624,231
310,133,871
Food
Products
0.3%
e
Darling
Ingredients,
Inc.
,
Senior
Note
,
144A,
6
%
,
6/15/30
.......
United
States
35,000,000
34,912,500
e
JBS
USA
LUX
SA
/
JBS
USA
Food
Co.
/
JBS
USA
Finance,
Inc.
,
Senior
Bond,
144A,
5.75%,
4/01/33
......................
United
States
80,000,000
76,600,000
Senior
Note,
144A,
5.125%,
2/01/28
.....................
United
States
20,000,000
19,352,100
e
Post
Holdings,
Inc.
,
Senior
Bond,
144A,
5.625%,
1/15/28
.....................
United
States
59,800,000
58,659,614
Senior
Bond,
144A,
5.5%,
12/15/29
......................
United
States
10,000,000
9,434,690
Senior
Bond,
144A,
4.5%,
9/15/31
.......................
United
States
55,400,000
48,807,400
247,766,304
Ground
Transportation
0.2%
e
Ashtead
Capital,
Inc.
,
Senior
Bond,
144A,
5.55%,
5/30/33
......................
United
Kingdom
55,000,000
54,399,317
Senior
Note,
144A,
4.375%,
8/15/27
.....................
United
Kingdom
34,500,000
33,083,141
Union
Pacific
Corp.
,
Senior
Bond
,
4.5
%
,
1/20/33
..............
United
States
73,000,000
73,232,452
160,714,910
Health
Care
Equipment
&
Supplies
0.8%
Baxter
International,
Inc.
,
Senior
Bond
,
2.539
%
,
2/01/32
........
United
States
15,935,000
12,985,667
DENTSPLY
SIRONA,
Inc.
,
Senior
Bond
,
3.25
%
,
6/01/30
........
United
States
51,249,000
45,330,601
e
GE
HealthCare
Technologies,
Inc.
,
Senior
Bond
,
144A,
5.905
%
,
11/22/32
..........................................
United
States
90,000,000
95,916,233
e
Medline
Borrower
LP
,
Senior
Note,
144A,
5.25%,
10/01/29
.....................
United
States
135,000,000
117,256,612
Senior
Secured
Note,
144A,
3.875%,
4/01/29
..............
United
States
354,000,000
307,505,640
578,994,753
Health
Care
Providers
&
Services
7.2%
Centene
Corp.
,
Senior
Bond,
2.5%,
3/01/31
............................
United
States
19,380,000
15,711,366
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
82
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Health
Care
Providers
&
Services
(continued)
Centene
Corp.,
(continued)
Senior
Note,
4.25%,
12/15/27
..........................
United
States
37,645,000
$
36,307,097
Senior
Note,
4.625%,
12/15/29
.........................
United
States
162,000,000
152,464,680
e
CHS/Community
Health
Systems,
Inc.
,
Secured
Note,
144A,
6.875%,
4/15/29
....................
United
States
600,000,000
372,180,000
Secured
Note,
144A,
6.125%,
4/01/30
....................
United
States
585,000,000
353,065,050
Senior
Note,
144A,
6.875%,
4/01/28
.....................
United
States
565,000,000
350,961,050
Senior
Secured
Note,
144A,
8%,
3/15/26
..................
United
States
537,565,000
520,094,138
Senior
Secured
Note,
144A,
5.625%,
3/15/27
..............
United
States
310,000,000
272,471,400
Senior
Secured
Note,
144A,
8%,
12/15/27
.................
United
States
382,000,000
370,463,600
Senior
Secured
Note,
144A,
6%,
1/15/29
..................
United
States
269,000,000
227,813,410
CVS
Health
Corp.
,
Senior
Bond,
4.3%,
3/25/28
............................
United
States
125,000,000
122,828,419
Senior
Bond,
1.875%,
2/28/31
..........................
United
States
70,000,000
56,731,794
Senior
Bond,
5.25%,
2/21/33
...........................
United
States
45,000,000
45,945,080
Senior
Bond,
5.05%,
3/25/48
...........................
United
States
40,000,000
37,458,759
e
DaVita,
Inc.
,
Senior
Bond,
144A,
3.75%,
2/15/31
......................
United
States
148,855,000
117,553,771
Senior
Note,
144A,
4.625%,
6/01/30
.....................
United
States
300,000,000
256,350,000
e
Fresenius
Medical
Care
US
Finance
III,
Inc.
,
Senior
Bond,
144A,
2.375%,
2/16/31
.....................
Germany
20,000,000
15,053,472
Senior
Bond,
144A,
3%,
12/01/31
.......................
Germany
30,941,000
23,954,260
HCA,
Inc.
,
Senior
Bond,
5.625%,
9/01/28
..........................
United
States
80,000,000
80,992,999
Senior
Bond,
4.125%,
6/15/29
..........................
United
States
38,500,000
36,102,951
Senior
Bond,
2.375%,
7/15/31
..........................
United
States
28,716,000
23,197,159
e
Senior
Bond,
144A,
3.625%,
3/15/32
.....................
United
States
32,954,000
29,080,499
Senior
Note,
5%,
3/15/24
.............................
United
States
114,800,000
114,156,068
Humana,
Inc.
,
Senior
Bond
,
5.875
%
,
3/01/33
.................
United
States
35,000,000
37,694,667
e
MPH
Acquisition
Holdings
LLC
,
g
Senior
Note,
144A,
5.75%,
11/01/28
.....................
United
States
181,000,000
130,394,907
Senior
Secured
Note,
144A,
5.5%,
9/01/28
................
United
States
174,850,000
139,171,882
Quest
Diagnostics,
Inc.
,
Senior
Bond
,
2.95
%
,
6/30/30
..........
United
States
58,755,000
52,620,993
Tenet
Healthcare
Corp.
,
Secured
Note,
6.25%,
2/01/27
..........................
United
States
115,331,000
113,543,369
Senior
Bond,
6.875%,
11/15/31
.........................
United
States
55,258,000
52,829,135
Senior
Note,
6.125%,
10/01/28
.........................
United
States
386,400,000
370,690,908
Senior
Secured
Note,
4.25%,
6/01/29
....................
United
States
119,800,000
108,492,078
Senior
Secured
Note,
4.375%,
1/15/30
...................
United
States
42,000,000
37,732,800
e
Senior
Secured
Note,
144A,
6.125%,
6/15/30
..............
United
States
371,000,000
366,325,400
UnitedHealth
Group,
Inc.
,
Senior
Bond
,
5.35
%
,
2/15/33
.........
United
States
125,000,000
132,966,727
5,173,399,888
Health
Care
REITs
0.3%
MPT
Operating
Partnership
LP
/
MPT
Finance
Corp.
,
g
Senior
Bond,
5.25%,
8/01/26
...........................
United
States
47,000,000
42,300,000
Senior
Bond,
5%,
10/15/27
............................
United
States
145,000,000
119,422,725
Senior
Bond,
4.625%,
8/01/29
..........................
United
States
29,650,000
21,934,922
183,657,647
Health
Care
Technology
0.2%
e,j
Multiplan
Corp.
,
Senior
Note
,
144A,
PIK,
6
%
,
10/15/27
.........
United
States
185,000,000
118,030,000
Hotel
&
Resort
REITs
0.1%
Service
Properties
Trust
,
Senior
Note
,
4.35
%
,
10/01/24
.........
United
States
39,445,000
37,783,577
Hotels,
Restaurants
&
Leisure
2.6%
e
Brinker
International,
Inc.
,
Senior
Note
,
144A,
5
%
,
10/01/24
.....
United
States
30,000,000
29,462,700
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
83
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Hotels,
Restaurants
&
Leisure
(continued)
e
Caesars
Entertainment,
Inc.
,
Senior
Note,
144A,
8.125%,
7/01/27
.....................
United
States
99,750,000
$
101,834,775
Senior
Note,
144A,
4.625%,
10/15/29
....................
United
States
92,000,000
80,549,220
Senior
Secured
Note,
144A,
6.25%,
7/01/25
...............
United
States
189,759,000
189,945,298
Senior
Secured
Note,
144A,
7%,
2/15/30
..................
United
States
52,000,000
52,957,580
e
Carnival
Corp.
,
Secured
Note,
144A,
10.5%,
2/01/26
.....................
United
States
13,000,000
13,556,855
g
Senior
Note,
144A,
7.625%,
3/01/26
.....................
United
States
112,100,000
102,401,108
Senior
Note,
144A,
5.75%,
3/01/27
......................
United
States
100,000,000
82,141,500
g
Senior
Note,
144A,
10.5%,
6/01/30
......................
United
States
65,000,000
62,458,500
e
Everi
Holdings,
Inc.
,
Senior
Note
,
144A,
5
%
,
7/15/29
...........
United
States
20,000,000
17,823,319
Expedia
Group,
Inc.
,
Senior
Bond,
3.8%,
2/15/28
............................
United
States
57,000,000
54,044,340
Senior
Note,
5%,
2/15/26
.............................
United
States
30,000,000
29,888,161
Senior
Note,
3.25%,
2/15/30
...........................
United
States
60,000,000
52,065,918
Senior
Note,
2.95%,
3/15/31
...........................
United
States
10,000,000
8,353,452
e
Senior
Note,
144A,
6.25%,
5/01/25
......................
United
States
54,596,000
55,312,020
e
Fertitta
Entertainment
LLC
/
Fertitta
Entertainment
Finance
Co.,
Inc.
,
Senior
Note,
144A,
6.75%,
1/15/30
......................
United
States
85,000,000
70,008,550
Senior
Secured
Note,
144A,
4.625%,
1/15/29
..............
United
States
145,000,000
127,433,250
Marriott
International,
Inc.
,
Senior
Note,
5%,
10/15/27
............................
United
States
25,000,000
25,070,691
Senior
Note,
4.9%,
4/15/29
............................
United
States
20,000,000
19,834,618
McDonald's
Corp.
,
Senior
Bond
,
4.6
%
,
9/09/32
...............
United
States
50,000,000
50,633,176
e
Penn
Entertainment,
Inc.
,
Senior
Note,
144A,
5.625%,
1/15/27
.....................
United
States
20,000,000
18,802,700
Senior
Note,
144A,
4.125%,
7/01/29
.....................
United
States
65,000,000
54,265,575
e
Wynn
Las
Vegas
LLC
/
Wynn
Las
Vegas
Capital
Corp.
,
Senior
Bond,
144A,
5.5%,
3/01/25
.......................
United
States
425,000,000
417,532,750
g
Senior
Note,
144A,
5.25%,
5/15/27
......................
United
States
146,722,000
138,825,422
e
Wynn
Resorts
Finance
LLC
/
Wynn
Resorts
Capital
Corp.
,
Senior
Note
,
144A,
7.125
%
,
2/15/31
...........................
United
States
30,000,000
30,458,100
1,885,659,578
Household
Durables
0.2%
KB
Home
,
Senior
Note
,
7.25
%
,
7/15/30
.....................
United
States
23,800,000
24,168,597
Lennar
Corp.
,
Senior
Note
,
4.5
%
,
4/30/24
...................
United
States
44,675,000
44,153,338
Shea
Homes
LP
/
Shea
Homes
Funding
Corp.
,
Senior
Note,
4.75%,
2/15/28
...........................
United
States
34,630,000
30,994,369
Senior
Note,
4.75%,
4/01/29
...........................
United
States
49,895,000
43,607,731
142,924,035
Household
Products
0.1%
e
Energizer
Holdings,
Inc.
,
Senior
Note,
144A,
6.5%,
12/31/27
......................
United
States
20,000,000
19,442,454
Senior
Note,
144A,
4.75%,
6/15/28
......................
United
States
24,000,000
21,629,974
Senior
Note,
144A,
4.375%,
3/31/29
.....................
United
States
16,000,000
14,080,320
55,152,748
Independent
Power
and
Renewable
Electricity
Producers
0.4%
e
Calpine
Corp.
,
Senior
Note,
144A,
5.125%,
3/15/28
.....................
United
States
132,000,000
121,032,160
Senior
Secured
Note,
144A,
4.5%,
2/15/28
................
United
States
103,500,000
96,132,721
e,h
Vistra
Corp.
,
Junior
Sub.
Bond
,
144A,
7%
to
12/14/26,
FRN
thereafter
,
Perpetual
.................................
United
States
100,000,000
88,103,500
305,268,381
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
84
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Insurance
0.2%
e
Five
Corners
Funding
Trust
III
,
Senior
Note
,
144A,
5.791
%
,
2/15/33
United
States
30,000,000
$
30,818,184
Lincoln
National
Corp.
,
Senior
Bond,
3.4%,
1/15/31
............................
United
States
15,000,000
12,276,594
Senior
Bond,
3.4%,
3/01/32
............................
United
States
20,572,000
16,583,854
e
Northwestern
Mutual
Global
Funding
,
Secured
Note
,
144A,
4.35
%
,
9/15/27
...........................................
United
States
40,000,000
39,666,505
Prudential
Financial,
Inc.
,
Junior
Sub.
Bond
,
5.7%
to
9/14/28,
FRN
thereafter
,
9/15/48
...................................
United
States
65,000,000
60,727,875
160,073,012
Interactive
Media
&
Services
0.1%
Meta
Platforms,
Inc.
,
Senior
Note
,
3.85
%
,
8/15/32
.............
United
States
65,000,000
60,882,167
e
ZipRecruiter,
Inc.
,
Senior
Note
,
144A,
5
%
,
1/15/30
.............
United
States
40,000,000
34,249,800
95,131,967
IT
Services
0.1%
Twilio,
Inc.
,
Senior
Bond,
3.875%,
3/15/31
..........................
United
States
46,500,000
39,500,355
Senior
Note,
3.625%,
3/15/29
..........................
United
States
45,000,000
38,863,350
78,363,705
Machinery
0.2%
e
Chart
Industries,
Inc.
,
Senior
Secured
Note
,
144A,
7.5
%
,
1/01/30
.
United
States
30,000,000
31,034,100
Parker-Hannifin
Corp.
,
Senior
Bond
,
3.25
%
,
6/14/29
...........
United
States
43,000,000
39,642,897
e
Roller
Bearing
Co.
of
America,
Inc.
,
Senior
Note
,
144A,
4.375
%
,
10/15/29
..........................................
United
States
35,000,000
31,295,600
e
TK
Elevator
U.S.
Newco,
Inc.
,
Senior
Secured
Note
,
144A,
5.25
%
,
7/15/27
...........................................
Germany
43,000,000
40,652,415
142,625,012
Media
1.6%
e
Clear
Channel
Outdoor
Holdings,
Inc.
,
Senior
Note,
144A,
7.75%,
4/15/28
......................
United
States
129,000,000
96,866,100
Senior
Note,
144A,
7.5%,
6/01/29
.......................
United
States
115,000,000
81,834,000
Senior
Secured
Note,
144A,
5.125%,
8/15/27
..............
United
States
65,000,000
58,405,100
CSC
Holdings
LLC
,
Senior
Bond,
5.25%,
6/01/24
...........................
United
States
58,026,000
56,061,240
e
Senior
Bond,
144A,
5.5%,
4/15/27
.......................
United
States
149,000,000
125,626,370
DISH
DBS
Corp.
,
Senior
Note,
5.875%,
11/15/24
.........................
United
States
205,000,000
183,024,000
Senior
Note,
7.75%,
7/01/26
...........................
United
States
64,320,000
42,517,771
e
Senior
Secured
Note,
144A,
5.25%,
12/01/26
..............
United
States
75,000,000
59,982,750
e
Stagwell
Global
LLC
,
Senior
Note
,
144A,
5.625
%
,
8/15/29
.......
United
States
60,000,000
52,679,823
e
Univision
Communications,
Inc.
,
Senior
Secured
Note,
144A,
5.125%,
2/15/25
..............
United
States
330,000,000
324,510,450
Senior
Secured
Note,
144A,
6.625%,
6/01/27
..............
United
States
70,000,000
66,437,000
Senior
Secured
Note,
144A,
7.375%,
6/30/30
..............
United
States
20,000,000
18,926,800
1,166,871,404
Metals
&
Mining
1.1%
e
Alcoa
Nederland
Holding
BV
,
Senior
Note
,
144A,
4.125
%
,
3/31/29
.
United
States
75,122,000
66,946,459
ArcelorMittal
SA
,
Senior
Bond,
6.8%,
11/29/32
...........................
Luxembourg
40,000,000
41,993,125
Senior
Note,
6.55%,
11/29/27
..........................
Luxembourg
25,000,000
26,026,005
e
Cleveland-Cliffs,
Inc.
,
g
Senior
Bond,
144A,
4.875%,
3/01/31
.....................
United
States
30,000,000
27,306,247
Senior
Secured
Note,
144A,
6.75%,
3/15/26
...............
United
States
50,000,000
50,950,000
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
85
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Metals
&
Mining
(continued)
e
First
Quantum
Minerals
Ltd.
,
Senior
Note
,
144A,
7.5
%
,
4/01/25
...
Zambia
120,000,000
$
120,021,600
e
FMG
Resources
August
2006
Pty.
Ltd.
,
Senior
Bond,
144A,
4.375%,
4/01/31
.....................
Australia
130,000,000
114,206,950
Senior
Bond,
144A,
6.125%,
4/15/32
.....................
Australia
30,500,000
29,398,798
Senior
Note,
144A,
5.125%,
5/15/24
.....................
Australia
114,540,000
113,433,721
Senior
Note,
144A,
5.875%,
4/15/30
.....................
Australia
45,000,000
43,190,512
Freeport-McMoRan,
Inc.
,
Senior
Bond,
5.25%,
9/01/29
...........................
United
States
30,000,000
29,446,275
Senior
Bond,
4.625%,
8/01/30
..........................
United
States
36,000,000
34,046,214
e
Glencore
Funding
LLC
,
Senior
Bond
,
144A,
2.5
%
,
9/01/30
......
Australia
100,000,000
83,825,019
e
Mineral
Resources
Ltd.
,
Senior
Note,
144A,
8%,
11/01/27
........................
Australia
20,000,000
20,590,000
Senior
Note,
144A,
8.5%,
5/01/30
.......................
Australia
25,000,000
25,682,500
827,063,425
Multi-Utilities
0.2%
Dominion
Energy,
Inc.
,
A,
Senior
Note,
4.35%,
8/15/32
.........................
United
States
30,000,000
28,666,907
C,
Senior
Note,
3.375%,
4/01/30
........................
United
States
30,000,000
27,296,708
NiSource,
Inc.
,
Senior
Bond
,
3.6
%
,
5/01/30
..................
United
States
33,750,000
31,169,659
Southern
Co.
Gas
Capital
Corp.
,
Senior
Bond
,
5.15
%
,
9/15/32
...
United
States
40,000,000
40,368,853
127,502,127
Oil,
Gas
&
Consumable
Fuels
1.9%
BP
Capital
Markets
America,
Inc.
,
Senior
Bond,
4.234%,
11/06/28
.........................
United
States
28,705,000
28,471,822
Senior
Bond,
3.633%,
4/06/30
..........................
United
States
46,500,000
44,152,426
Senior
Bond,
2.721%,
1/12/32
..........................
United
States
15,000,000
13,086,144
e
Calumet
Specialty
Products
Partners
LP
/
Calumet
Finance
Corp.
,
Senior
Note,
144A,
11%,
4/15/25
........................
United
States
260,000,000
268,898,102
Senior
Note,
144A,
8.125%,
1/15/27
.....................
United
States
95,000,000
90,529,421
Senior
Secured
Note,
144A,
9.25%,
7/15/24
...............
United
States
111,402,000
112,062,057
Cheniere
Corpus
Christi
Holdings
LLC
,
Senior
Secured
Note,
5.125%,
6/30/27
...................
United
States
87,973,000
88,089,683
Senior
Secured
Note,
3.7%,
11/15/29
....................
United
States
107,245,000
98,864,922
e
Chesapeake
Energy
Corp.
,
Senior
Note
,
144A,
5.875
%
,
2/01/29
..
United
States
25,000,000
23,826,875
Chevron
Corp.
,
Senior
Bond
,
2.236
%
,
5/11/30
................
United
States
40,000,000
35,384,626
e
CITGO
Petroleum
Corp.
,
Senior
Secured
Note,
144A,
7%,
6/15/25
..................
United
States
33,224,000
32,811,192
Senior
Secured
Note,
144A,
6.375%,
6/15/26
..............
United
States
30,000,000
29,277,150
Energy
Transfer
LP
,
Senior
Bond
,
5.75
%
,
2/15/33
.............
United
States
30,000,000
30,757,500
e
Hilcorp
Energy
I
LP
/
Hilcorp
Finance
Co.
,
Senior
Note
,
144A,
6
%
,
4/15/30
...........................................
United
States
32,000,000
29,548,795
Kinder
Morgan,
Inc.
,
Senior
Bond
,
5.2
%
,
6/01/33
..............
United
States
50,000,000
49,712,806
e
Kinetik
Holdings
LP
,
Senior
Note
,
144A,
5.875
%
,
6/15/30
........
United
States
50,000,000
48,200,000
Occidental
Petroleum
Corp.
,
Senior
Note,
5.5%,
12/01/25
...........................
United
States
30,000,000
29,993,132
Senior
Note,
6.375%,
9/01/28
..........................
United
States
60,000,000
62,190,579
Senior
Note,
6.625%,
9/01/30
..........................
United
States
40,000,000
42,163,400
Senior
Note,
6.125%,
1/01/31
..........................
United
States
30,000,000
31,155,450
Williams
Cos.,
Inc.
(The)
,
Senior
Bond,
3.5%,
11/15/30
...........................
United
States
27,575,000
24,995,962
Senior
Bond,
2.6%,
3/15/31
............................
United
States
50,000,000
42,081,426
Senior
Bond,
4.65%,
8/15/32
...........................
United
States
70,000,000
67,514,223
Senior
Bond,
5.65%,
3/15/33
...........................
United
States
30,000,000
31,000,408
1,354,768,101
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
86
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Passenger
Airlines
1.0%
e
American
Airlines
Group,
Inc.
,
Senior
Note
,
144A,
3.75
%
,
3/01/25
.
United
States
43,000,000
$
39,498,919
e
American
Airlines
Inc/AAdvantage
Loyalty
IP
Ltd.
,
Senior
Secured
Note,
144A,
5.5%,
4/20/26
................
United
States
152,500,000
150,264,625
Senior
Secured
Note,
144A,
5.75%,
4/20/29
...............
United
States
104,850,000
100,687,549
e
Delta
Air
Lines,
Inc.
/
SkyMiles
IP
Ltd.
,
Senior
Secured
Note,
144A,
4.5%,
10/20/25
...............
United
States
37,181,211
36,580,302
Senior
Secured
Note,
144A,
4.75%,
10/20/28
..............
United
States
178,000,000
171,920,949
e
Mileage
Plus
Holdings
LLC
/
Mileage
Plus
Intellectual
Property
Assets
Ltd.
,
Senior
Secured
Note
,
144A,
6.5
%
,
6/20/27
.......
United
States
93,500,000
93,291,028
e
United
Airlines,
Inc.
,
Senior
Secured
Note,
144A,
4.375%,
4/15/26
..............
United
States
69,462,000
66,536,135
Senior
Secured
Note,
144A,
4.625%,
4/15/29
..............
United
States
98,259,000
89,005,105
747,784,612
Personal
Care
Products
0.2%
e
BellRing
Brands,
Inc.
,
Senior
Note
,
144A,
7
%
,
3/15/30
.........
United
States
35,000,000
35,485,450
Haleon
US
Capital
LLC
,
Senior
Note,
3.375%,
3/24/29
..........................
United
States
30,000,000
27,691,084
Senior
Note,
3.625%,
3/24/32
..........................
United
States
65,043,000
59,107,896
122,284,430
Pharmaceuticals
2.9%
e
1375209
BC
Ltd.
,
Senior
Secured
Note
,
144A,
9
%
,
1/30/28
......
Canada
467,060,000
463,557,050
e
Bausch
Health
Cos.,
Inc.
,
Secured
Note,
144A,
14%,
10/15/30
.....................
United
States
164,340,000
93,337,222
Senior
Secured
Note,
144A,
5.5%,
11/01/25
...............
United
States
219,000,000
180,304,443
Senior
Secured
Note,
144A,
6.125%,
2/01/27
..............
United
States
185,000,000
119,920,700
Senior
Secured
Note,
144A,
5.75%,
8/15/27
...............
United
States
53,850,000
33,593,784
Senior
Secured
Note,
144A,
11%,
9/30/28
.................
United
States
800,000,000
592,672,000
e
Bayer
US
Finance
II
LLC
,
Senior
Note
,
144A,
4.25
%
,
12/15/25
...
Germany
65,000,000
63,637,929
Bristol-Myers
Squibb
Co.
,
Senior
Note
,
3.9
%
,
2/20/28
..........
United
States
30,000,000
29,451,361
e,k
Endo
Dac
/
Endo
Finance
LLC
/
Endo
Finco,
Inc.
,
Senior
Secured
Note
,
144A,
5.875
%
,
10/15/24
..........................
United
States
47,500,000
35,485,147
e,k
Endo
Luxembourg
Finance
Co.
I
SARL
/
Endo
US,
Inc.
,
Senior
Secured
Note
,
144A,
6.125
%
,
4/01/29
....................
United
States
66,355,000
49,144,555
e,k
Par
Pharmaceutical,
Inc.
,
Senior
Secured
Note
,
144A,
7.5
%
,
4/01/27
United
States
193,401,000
144,055,526
Royalty
Pharma
plc
,
Senior
Bond,
2.15%,
9/02/31
...........................
United
States
45,800,000
36,224,033
Senior
Note,
2.2%,
9/02/30
............................
United
States
35,000,000
28,610,560
Teva
Pharmaceutical
Finance
Netherlands
III
BV
,
Senior
Note,
7.125%,
1/31/25
..........................
Israel
27,220,000
27,805,502
Senior
Note,
6.75%,
3/01/28
...........................
Israel
16,000,000
16,020,880
g
Senior
Note,
7.875%,
9/15/29
..........................
Israel
25,000,000
26,187,500
g
Senior
Note,
8.125%,
9/15/31
..........................
Israel
30,000,000
31,528,526
Utah
Acquisition
Sub,
Inc.
,
Senior
Note
,
3.95
%
,
6/15/26
.........
United
States
130,500,000
124,391,641
Viatris,
Inc.
,
Senior
Note
,
2.7
%
,
6/22/30
.....................
United
States
25,000,000
20,333,127
2,116,261,486
Semiconductors
&
Semiconductor
Equipment
1.0%
Broadcom,
Inc.
,
Senior
Bond,
4.15%,
11/15/30
..........................
United
States
20,000,000
18,555,984
Senior
Bond,
4.3%,
11/15/32
...........................
United
States
80,000,000
73,749,568
e
Senior
Bond,
144A,
2.45%,
2/15/31
......................
United
States
80,000,000
65,534,283
e
Senior
Bond,
144A,
4.15%,
4/15/32
......................
United
States
65,000,000
59,259,009
e
Senior
Bond,
144A,
3.469%,
4/15/34
.....................
United
States
66,000,000
54,255,586
e
Senior
Bond,
144A,
3.137%,
11/15/35
....................
United
States
20,000,000
15,396,751
e
Senior
Note,
144A,
4%,
4/15/29
........................
United
States
58,307,000
54,594,275
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
87
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Semiconductors
&
Semiconductor
Equipment
(continued)
Intel
Corp.
,
Senior
Bond,
5.2%,
2/10/33
............................
United
States
25,000,000
$
25,477,297
Senior
Note,
5.125%,
2/10/30
..........................
United
States
30,000,000
30,563,660
Microchip
Technology,
Inc.
,
Senior
Note
,
4.333
%
,
6/01/23
.......
United
States
69,000,000
68,751,102
Micron
Technology,
Inc.
,
Senior
Bond,
5.327%,
2/06/29
..........................
United
States
25,000,000
25,167,236
Senior
Bond,
4.663%,
2/15/30
..........................
United
States
34,000,000
32,661,121
Senior
Bond,
5.875%,
2/09/33
..........................
United
States
40,000,000
40,466,826
Senior
Note,
6.75%,
11/01/29
..........................
United
States
55,000,000
58,455,303
NXP
BV
/
NXP
Funding
LLC
,
Senior
Note
,
5.55
%
,
12/01/28
......
China
20,000,000
20,422,197
NXP
BV
/
NXP
Funding
LLC
/
NXP
USA,
Inc.
,
Senior
Note,
3.4%,
5/01/30
............................
China
31,200,000
28,075,309
Senior
Note,
2.5%,
5/11/31
............................
China
35,000,000
28,956,075
e
Qorvo,
Inc.
,
Senior
Bond
,
144A,
3.375
%
,
4/01/31
.............
United
States
30,800,000
25,510,716
725,852,298
Software
1.0%
Autodesk,
Inc.
,
Senior
Bond
,
2.85
%
,
1/15/30
.................
United
States
20,000,000
17,679,354
e
McAfee
Corp.
,
Senior
Note
,
144A,
7.375
%
,
2/15/30
............
United
States
72,875,000
61,170,860
Oracle
Corp.
,
Senior
Bond,
2.65%,
7/15/26
...........................
United
States
100,000,000
93,478,006
Senior
Bond,
3.25%,
11/15/27
..........................
United
States
40,000,000
37,612,471
Senior
Bond,
2.95%,
4/01/30
...........................
United
States
44,000,000
38,866,154
Senior
Bond,
3.25%,
5/15/30
...........................
United
States
21,960,000
19,690,058
Senior
Bond,
2.875%,
3/25/31
..........................
United
States
101,000,000
86,477,390
Senior
Bond,
6.25%,
11/09/32
..........................
United
States
45,000,000
48,424,467
Senior
Note,
2.3%,
3/25/28
............................
United
States
50,000,000
44,764,509
Senior
Note,
6.15%,
11/09/29
..........................
United
States
20,000,000
21,312,011
e
Rocket
Software,
Inc.
,
Senior
Note
,
144A,
6.5
%
,
2/15/29
........
United
States
12,500,000
9,856,647
Roper
Technologies,
Inc.
,
Senior
Bond,
2%,
6/30/30
.............................
United
States
30,303,000
24,980,104
Senior
Bond,
1.75%,
2/15/31
...........................
United
States
20,000,000
15,999,789
Workday,
Inc.
,
Senior
Bond
,
3.8
%
,
4/01/32
..................
United
States
200,000,000
183,546,376
703,858,196
Specialized
REITs
0.6%
American
Tower
Corp.
,
Senior
Bond,
3.375%,
10/15/26
.........................
United
States
30,000,000
28,443,667
Senior
Bond,
3.55%,
7/15/27
...........................
United
States
40,000,000
37,721,020
Senior
Bond,
3.95%,
3/15/29
...........................
United
States
20,000,000
18,747,328
Senior
Bond,
2.9%,
1/15/30
............................
United
States
15,000,000
13,054,117
Senior
Bond,
5.65%,
3/15/33
...........................
United
States
60,000,000
61,797,570
Senior
Note,
1.6%,
4/15/26
............................
United
States
45,318,000
41,007,153
Senior
Note,
4.05%,
3/15/32
...........................
United
States
50,000,000
45,795,983
Crown
Castle,
Inc.
,
Senior
Bond,
3.3%,
7/01/30
............................
United
States
74,583,000
67,299,012
Senior
Bond,
2.1%,
4/01/31
............................
United
States
33,500,000
27,391,822
Senior
Bond,
2.5%,
7/15/31
............................
United
States
25,000,000
21,025,237
e
Iron
Mountain,
Inc.
,
Senior
Note
,
144A,
4.875
%
,
9/15/27
........
United
States
73,500,000
69,568,117
Weyerhaeuser
Co.
,
Senior
Bond
,
3.375
%
,
3/09/33
............
United
States
42,300,000
37,213,946
469,064,972
Specialty
Retail
0.8%
AutoNation,
Inc.
,
Senior
Bond,
4.75%,
6/01/30
...........................
United
States
40,959,000
38,533,165
Senior
Bond,
2.4%,
8/01/31
............................
United
States
44,451,000
34,267,409
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
88
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Specialty
Retail
(continued)
AutoNation,
Inc.,
(continued)
Senior
Bond,
3.85%,
3/01/32
...........................
United
States
32,953,000
$
28,098,640
Senior
Note,
1.95%,
8/01/28
...........................
United
States
44,000,000
36,454,349
Bath
&
Body
Works,
Inc.
,
Senior
Bond
,
6.875
%
,
11/01/35
.......
United
States
50,000,000
45,119,327
e
Gap,
Inc.
(The)
,
Senior
Bond
,
144A,
3.875
%
,
10/01/31
.........
United
States
12,233,000
8,499,122
g
Home
Depot,
Inc.
(The)
,
Senior
Note
,
4.5
%
,
9/15/32
...........
United
States
100,000,000
100,784,634
Lowe's
Cos.,
Inc.
,
Senior
Bond,
3.65%,
4/05/29
...........................
United
States
20,000,000
18,944,360
Senior
Bond,
4.5%,
4/15/30
............................
United
States
35,000,000
34,603,500
g
Senior
Bond,
3.75%,
4/01/32
...........................
United
States
40,000,000
36,978,728
Senior
Bond,
5%,
4/15/33
.............................
United
States
115,000,000
115,101,704
Senior
Bond,
5.15%,
7/01/33
...........................
United
States
35,000,000
35,348,891
Senior
Note,
1.7%,
10/15/30
...........................
United
States
15,000,000
12,135,558
e
Michaels
Cos.,
Inc.
(The)
,
Senior
Secured
Note
,
144A,
5.25
%
,
5/01/28
...........................................
United
States
60,000,000
50,068,200
594,937,587
Technology
Hardware,
Storage
&
Peripherals
0.6%
g
Apple,
Inc.
,
Senior
Bond
,
3.35
%
,
8/08/32
....................
United
States
60,000,000
56,616,595
Dell
International
LLC
/
EMC
Corp.
,
g
Senior
Bond,
5.75%,
2/01/33
...........................
United
States
40,000,000
40,269,198
Senior
Note,
5.3%,
10/01/29
...........................
United
States
55,000,000
55,454,184
HP,
Inc.
,
Senior
Bond,
4.2%,
4/15/32
............................
United
States
48,960,000
44,159,407
Senior
Bond,
5.5%,
1/15/33
............................
United
States
50,000,000
49,578,899
Senior
Note,
4%,
4/15/29
.............................
United
States
150,309,000
142,735,519
Senior
Note,
2.65%,
6/17/31
...........................
United
States
30,000,000
24,489,434
413,303,236
Textiles,
Apparel
&
Luxury
Goods
0.0%
†
e,g
Hanesbrands,
Inc.
,
Senior
Note
,
144A,
9
%
,
2/15/31
............
United
States
25,000,000
25,617,625
Tobacco
0.7%
BAT
Capital
Corp.
,
Senior
Note,
3.222%,
8/15/24
..........................
United
Kingdom
78,500,000
76,163,933
Senior
Note,
3.557%,
8/15/27
..........................
United
Kingdom
323,000,000
300,481,002
Senior
Note,
2.259%,
3/25/28
..........................
United
Kingdom
37,812,000
32,445,782
Philip
Morris
International,
Inc.
,
Senior
Bond,
5.75%,
11/17/32
..........................
United
States
25,000,000
26,253,096
Senior
Bond,
5.375%,
2/15/33
..........................
United
States
45,000,000
46,004,202
481,348,015
Trading
Companies
&
Distributors
0.6%
United
Rentals
North
America,
Inc.
,
Secured
Note,
3.875%,
11/15/27
........................
United
States
19,000,000
17,836,250
Senior
Bond,
4.875%,
1/15/28
..........................
United
States
120,000,000
114,876,000
Senior
Bond,
4%,
7/15/30
.............................
United
States
61,623,000
55,442,213
Senior
Bond,
3.875%,
2/15/31
..........................
United
States
104,657,000
92,474,925
Senior
Bond,
3.75%,
1/15/32
...........................
United
States
31,000,000
26,731,765
e
Senior
Secured
Note,
144A,
6%,
12/15/29
.................
United
States
65,000,000
65,957,450
e
WESCO
Distribution,
Inc.
,
Senior
Note
,
144A,
7.125
%
,
6/15/25
...
United
States
30,000,000
30,522,600
403,841,203
Water
Utilities
0.1%
American
Water
Capital
Corp.
,
Senior
Bond
,
4.45
%
,
6/01/32
.....
United
States
40,336,000
39,749,076
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
89
a
a
Country
Principal
Amount
*
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Wireless
Telecommunication
Services
0.9%
Sprint
LLC
,
Senior
Note,
7.875%,
9/15/23
..........................
United
States
187,350,000
$
188,903,881
Senior
Note,
7.125%,
6/15/24
..........................
United
States
190,650,000
193,980,852
Senior
Note,
7.625%,
3/01/26
..........................
United
States
86,300,000
91,338,207
e
Sprint
Spectrum
Co.
LLC
/
Sprint
Spectrum
Co.
II
LLC
/
Sprint
Spectrum
Co.
III
LLC
,
Senior
Secured
Note
,
144A,
5.152
%
,
3/20/28
...........................................
United
States
90,000,000
89,470,650
T-Mobile
USA,
Inc.
,
Senior
Bond,
5.2%,
1/15/33
............................
United
States
45,000,000
45,925,041
Senior
Note,
3.375%,
4/15/29
..........................
United
States
30,000,000
27,377,622
636,996,253
Total
Corporate
Bonds
(Cost
$34,745,599,534)
..................................
33,368,341,480
l
Senior
Floating
Rate
Interests
0.3%
Software
0.3%
m
TIBCO
Software,
Inc.
,
First
Lien,
CME
Term
Loan,
A
,
9.18
%
,
(
3-month
SOFR
+
4.5
%
),
9/29/28
........................
United
States
250,000,000
226,651,250
Total
Senior
Floating
Rate
Interests
(Cost
$218,431,709)
.........................
226,651,250
U.S.
Government
and
Agency
Securities
11.9%
U.S.
Treasury
Bonds
,
3.375
%,
8/15/42
.....................
United
States
600,000,000
563,625,000
U.S.
Treasury
Notes
,
4.375%,
10/31/24
....................................
United
States
1,000,000,000
1,001,347,660
4.25%,
10/15/25
.....................................
United
States
1,000,000,000
1,007,929,690
4.125%,
10/31/27
....................................
United
States
1,250,000,000
1,274,218,750
3.875%,
11/30/27
....................................
United
States
500,000,000
505,283,205
2.375%,
3/31/29
.....................................
United
States
1,000,000,000
933,847,660
2.875%,
5/15/32
.....................................
United
States
1,250,000,000
1,189,843,750
2.75%,
8/15/32
.....................................
United
States
2,250,000,000
2,117,988,270
Total
U.S.
Government
and
Agency
Securities
(Cost
$8,652,741,081)
..............
8,594,083,985
Asset-Backed
Securities
0.1%
Passenger
Airlines
0.1%
United
Airlines
Pass-Through
Trust
,
2020-1
,
A
,
5.875
%
,
10/15/27
.
.
United
States
41,499,333
41,429,502
Total
Asset-Backed
Securities
(Cost
$41,499,333)
...............................
41,429,502
Mortgage-Backed
Securities
0.0%
†
Federal
National
Mortgage
Association
(FNMA)
Fixed
Rate
0.0%
†
FNMA,
30
Year,
4%,
8/01/49
.............................
United
States
27,081,202
26,348,111
Total
Mortgage-Backed
Securities
(Cost
$28,689,148)
............................
26,348,111
Shares
a
Escrows
and
Litigation
Trusts
0.1%
e
Entegris
Escrow
Corp.,
Escrow
Account,
144A
...............
United
States
60,000,000
56,778,757
Total
Escrows
and
Litigation
Trusts
(Cost
$57,993,678)
..........................
56,778,757
Total
Long
Term
Investments
(Cost
$69,536,370,828)
............................
69,230,783,122
a
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
90
Short
Term
Investments
3.2%
a
a
Country
Shares
a
Value
a
a
a
Money
Market
Funds
3.0%
c,n
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
....
United
States
2,176,491,078
$
2,176,491,078
Total
Money
Market
Funds
(Cost
$2,176,491,078)
................................
2,176,491,078
a
a
a
o
Investments
from
Cash
Collateral
Received
for
Loaned
Securities
0.2%
Money
Market
Funds
0.2%
c,n
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
....
United
States
173,182,000
173,182,000
Total
Investments
from
Cash
Collateral
Received
for
Loaned
Securities
(Cost
$173,182,000)
..........................................................
173,182,000
Total
Short
Term
Investments
(Cost
$2,349,673,078
)
.............................
2,349,673,078
a
Total
Investments
(Cost
$71,886,043,906)
99.3%
................................
$71,580,456,200
Options
Written
(0.1)%
.......................................................
(50,464,750)
Other
Assets,
less
Liabilities
0.8%
.............................................
497,714,090
Net
Assets
100.0%
...........................................................
$72,027,705,540
Number
of
Contracts
Notional
Amount
#
p
Options
Written
(0.1)%
Calls
-
Exchange-Traded
Equity
Options
AbbVie,
Inc.,
April
Strike
Price
$160.00,
Expires
4/21/23
........
6,000
95,622,000
(1,194,000)
Amazon.com,
Inc.,
June
Strike
Price
$120.00,
Expires
6/16/23
...
5,000
51,645,000
(900,000)
Amazon.com,
Inc.,
June
Strike
Price
$125.00,
Expires
6/16/23
...
10,000
103,290,000
(1,100,000)
Amgen,
Inc.,
June
Strike
Price
$260.00,
Expires
6/16/23
........
5,000
120,875,000
(1,275,000)
Bank
of
America
Corp.,
April
Strike
Price
$30.00,
Expires
4/21/23
.
25,000
71,500,000
(1,025,000)
Bank
of
America
Corp.,
May
Strike
Price
$32.00,
Expires
5/19/23
.
25,000
71,500,000
(750,000)
BP
plc,
April
Strike
Price
$39.00,
Expires
4/21/23
..............
10,000
37,940,000
(490,000)
Charles
Schwab
Corp.
(The),
June
Strike
Price
$72.50,
Expires
6/16/23
...........................................
10,000
52,380,000
(280,000)
Charles
Schwab
Corp.
(The),
May
Strike
Price
$75.00,
Expires
5/19/23
...........................................
10,000
52,380,000
(90,000)
Chevron
Corp.,
June
Strike
Price
$180.00,
Expires
6/16/23
......
15,000
244,740,000
(2,865,000)
Cisco
Systems,
Inc.,
April
Strike
Price
$52.50,
Expires
4/21/23
...
20,000
104,550,000
(1,140,000)
Cisco
Systems,
Inc.,
May
Strike
Price
$55.00,
Expires
5/19/23
...
20,000
104,550,000
(1,420,000)
Citigroup,
Inc.,
June
Strike
Price
$50.00,
Expires
6/16/23
.......
20,000
93,780,000
(2,420,000)
Dominion
Energy,
Inc.,
April
Strike
Price
$67.50,
Expires
4/21/23
..
5,000
27,955,000
(25,000)
Freeport-McMoRan,
Inc.,
May
Strike
Price
$43.00,
Expires
5/19/23
10,000
40,910,000
(1,730,000)
Goldman
Sachs
Group,
Inc.
(The),
April
Strike
Price
$350.00,
Expires
4/21/23
.....................................
7,000
228,977,000
(1,162,000)
Intel
Corp.,
April
Strike
Price
$30.00,
Expires
4/21/23
...........
20,000
65,340,000
(5,840,000)
JPMorgan
Chase
&
Co.,
June
Strike
Price
$145.00,
Expires
6/16/23
10,000
130,310,000
(1,200,000)
JPMorgan
Chase
&
Co.,
June
Strike
Price
$160.00,
Expires
6/16/23
10,000
130,310,000
(180,000)
Morgan
Stanley,
May
Strike
Price
$90.00,
Expires
5/19/23
.......
10,000
87,800,000
(2,640,000)
Morgan
Stanley,
June
Strike
Price
$95.00,
Expires
6/16/23
......
10,000
87,800,000
(1,680,000)
Pfizer,
Inc.,
June
Strike
Price
$50.00,
Expires
6/16/23
..........
10,000
40,800,000
(60,000)
QUALCOMM,
Inc.,
June
Strike
Price
$145.00,
Expires
6/16/23
...
10,000
127,580,000
(2,240,000)
Rio
Tinto
plc,
May
Strike
Price
$72.50,
Expires
5/19/23
.........
20,000
137,200,000
(2,900,000)
Shell
plc,
April
Strike
Price
$62.50,
Expires
4/21/23
............
10,000
57,540,000
(150,000)
Shell
plc,
April
Strike
Price
$65.00,
Expires
4/21/23
............
20,000
115,080,000
(100,000)
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
91
a
a
a
Number
of
Contracts
Notional
Amount
#
a
Value
a
a
a
a
a
a
p
Options
Written
(continued)
Calls
-
Exchange-Traded
(continued)
Equity
Options
(continued)
Texas
Instruments,
Inc.,
April
Strike
Price
$190.00,
Expires
4/21/23
10,000
186,010,000
$
(2,510,000)
Texas
Instruments,
Inc.,
April
Strike
Price
$200.00,
Expires
4/21/23
20,000
372,020,000
(760,000)
Texas
Instruments,
Inc.,
June
Strike
Price
$200.00,
Expires
6/16/23
10,000
186,010,000
(3,510,000)
TotalEnergies
SE,
April
Strike
Price
$65.00,
Expires
4/21/23
.....
10,000
59,050,000
(150,000)
TotalEnergies
SE,
May
Strike
Price
$67.50,
Expires
5/19/23
.....
10,000
59,050,000
(175,000)
Union
Pacific
Corp.,
May
Strike
Price
$235.00,
Expires
5/19/23
...
7,500
150,945,000
(168,750)
Wells
Fargo
&
Co.,
June
Strike
Price
$42.50,
Expires
6/16/23
....
20,000
74,760,000
(1,100,000)
Wells
Fargo
&
Co.,
May
Strike
Price
$45.00,
Expires
5/19/23
.....
20,000
74,760,000
(220,000)
(43,449,750)
Puts
-
Exchange-Traded
Equity
Options
Amgen,
Inc.,
April
Strike
Price
$227.50,
Expires
4/21/23
........
5,000
120,875,000
(550,000)
BP
plc,
April
Strike
Price
$33.00,
Expires
4/21/23
..............
10,000
37,940,000
(80,000)
Home
Depot,
Inc.
(The),
April
Strike
Price
$270.00,
Expires
4/21/23
5,000
147,560,000
(345,000)
Honeywell
International,
Inc.,
April
Strike
Price
$180.00,
Expires
4/21/23
...........................................
10,000
191,120,000
(780,000)
Johnson
&
Johnson,
April
Strike
Price
$150.00,
Expires
4/21/23
..
15,000
232,500,000
(1,530,000)
Microsoft
Corp.,
April
Strike
Price
$225.00,
Expires
4/21/23
......
10,000
288,300,000
(90,000)
Pfizer,
Inc.,
June
Strike
Price
$37.50,
Expires
6/16/23
..........
10,000
40,800,000
(690,000)
QUALCOMM,
Inc.,
May
Strike
Price
$100.00,
Expires
5/19/23
....
10,000
127,580,000
(620,000)
Target
Corp.,
April
Strike
Price
$140.00,
Expires
4/21/23
........
10,000
165,630,000
(160,000)
Texas
Instruments,
Inc.,
April
Strike
Price
$160.00,
Expires
4/21/23
10,000
186,010,000
(160,000)
Union
Pacific
Corp.,
May
Strike
Price
$180.00,
Expires
5/19/23
...
10,000
201,260,000
(1,750,000)
Walmart,
Inc.,
April
Strike
Price
$135.00,
Expires
4/21/23
.......
10,000
147,450,000
(260,000)
(7,015,000)
Total
Options
Written
(Premiums
received
$71,548,702)
..........................
$
(50,464,750)
#
Notional
amount
is
the
number
of
contracts
multiplied
by
contract
size,
and
may
be
multiplied
by
the
underlying
price.
May
include
currency
units,
bushels,
shares,
pounds,
barrels
or
other
units.
Currency
units
are
stated
in
U.S.
dollars
unless
otherwise
indicated.
*
The
principal
amount
is
stated
in
U.S.
dollars
unless
otherwise
indicated.
†
Rounds
to
less
than
0.1%
of
net
assets.
a
A
portion
or
all
of
the
security
is
held
in
connection
with
written
option
contracts
open
at
period
end.
b
Non-income
producing.
c
See
Note
3(f)
regarding
investments
in
affiliated
management
investment
companies.
d
See
Note
1(e)
regarding
equity-linked
securities.
e
Security
was
purchased
pursuant
to
Rule
144A
or
Regulation
S
under
the
Securities
Act
of
1933.
144A
securities
may
be
sold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers
or
in
a
public
offering
registered
under
the
Securities
Act
of
1933.
Regulation
S
securities
cannot
be
sold
in
the
United
States
without
either
an
effective
registration
statement
filed
pursuant
to
the
Securities
Act
of
1933,
or
pursuant
to
an
exemption
from
registration.
At
March
31,
2023,
the
aggregate
value
of
these
securities
was
$28,141,368,047,
representing
39.1%
of
net
assets.
f
A
portion
or
all
of
the
security
purchased
on
a
delayed
delivery
basis.
See
Note
1(c).
g
A
portion
or
all
of
the
security
is
on
loan
at
March
31,
2023.
See
Note
1(f).
h
Perpetual
security
with
no
stated
maturity
date.
i
The
coupon
rate
shown
represents
the
rate
at
period
end.
j
Income
may
be
received
in
additional
securities
and/or
cash.
k
See
Note
7
regarding
credit
risk
and
defaulted
securities.
l
See
Note
1(g)
regarding
senior
floating
rate
interests.
m
The
coupon
rate
shown
represents
the
rate
inclusive
of
any
caps
or
floors,
if
applicable,
in
effect
at
period
end.
n
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
o
See
Note
1(f)
regarding
securities
on
loan.
p
See
Note
1(d)
regarding
written
options.
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Income
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
92
At
March
31,
2023,
the
Fund
had
the
following futures
contracts
outstanding.
See
Note
1(d).
See
Note
10
regarding
derivative
financial
instruments.
Futures
Contracts
Description
Type
Number
of
Contracts
Notional
Amount
*
Expiration
Date
Value/
Unrealized
Appreciation
(Depreciation)
Interest
rate
contracts
U.S.
Treasury
10
Year
Notes
....................
Long
54,000
$
6,205,781,250
6/21/23
$
170,829,378
U.S.
Treasury
Ultra
Bonds
......................
Long
3,000
423,375,000
6/21/23
21,691,593
Total
Futures
Contracts
......................................................................
$192,520,971
*
As
of
period
end.
See
Abbreviations
on
page
145
.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
U.S.
Government
Securities
Fund
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accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
93
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
Year
Ended
September
30,
2018
a
2022
2021
2020
2019
Class
A
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$5.03
$5.89
$6.09
$6.07
$5.86
$5.89
Income
from
investment
operations
b
:
Net
investment
income
c
.............
0.06
0.08
0.05
0.10
0.14
0.01
Net
realized
and
unrealized
gains
(losses)
0.14
(0.81)
(0.12)
0.08
0.25
(0.02)
Total
from
investment
operations
........
0.20
(0.73)
(0.07)
0.18
0.39
(0.01)
Less
distributions
from:
Net
investment
income
..............
(0.07)
(0.13)
(0.13)
(0.16)
(0.18)
(0.02)
Net
asset
value,
end
of
period
..........
$5.16
$5.03
$5.89
$6.09
$6.07
$5.86
Total
return
d
.......................
4.05%
(12.50)%
(1.15)%
3.01%
6.70%
(0.23)%
Ratios
to
average
net
assets
e
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.90%
0.87%
0.87%
0.89%
0.89%
0.86%
Expenses
net
of
waiver
and
payments
by
affiliates
f
..........................
0.90%
g
0.86%
0.87%
g
0.88%
0.88%
0.86%
g
Net
investment
income
...............
2.35%
1.44%
0.79%
1.58%
2.36%
2.40%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$655,487
$687,607
$1,020,574
$1,097,545
$336,646
$4,472
Portfolio
turnover
rate
................
—%
53.63%
89.16%
65.54%
41.34%
44.67%
a
For
the
period
September
10,
2018
(effective
date)
to
September
30,
2018.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year.
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
g
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
U.S.
Government
Securities
Fund
(continued)
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The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
94
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
A1
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$5.03
$5.90
$6.09
$6.07
$5.85
$6.13
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.06
0.09
0.05
0.10
0.15
0.15
Net
realized
and
unrealized
gains
(losses)
0.15
(0.82)
(0.10)
0.09
0.25
(0.25)
Total
from
investment
operations
........
0.21
(0.73)
(0.05)
0.19
0.40
(0.10)
Less
distributions
from:
Net
investment
income
..............
(0.08)
(0.14)
(0.14)
(0.17)
(0.18)
(0.18)
Net
asset
value,
end
of
period
..........
$5.16
$5.03
$5.90
$6.09
$6.07
$5.85
Total
return
c
.......................
4.10%
(12.55)%
(0.89)%
3.09%
6.94%
(1.60)%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.80%
0.76%
0.77%
0.78%
0.79%
0.76%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.79%
0.76%
f
0.76%
0.77%
0.78%
0.76%
f
Net
investment
income
...............
2.46%
1.56%
0.90%
1.69%
2.46%
2.50%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$1,526,353
$1,592,268
$2,104,978
$2,661,888
$2,885,194
$3,099,373
Portfolio
turnover
rate
................
—%
53.63%
89.16%
65.54%
41.34%
44.67%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
U.S.
Government
Securities
Fund
(continued)
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an
integral
part
of
these
financial
statements.
Semiannual
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95
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
C
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$5.00
$5.85
$6.04
$6.03
$5.81
$6.08
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.05
0.06
0.02
0.07
0.12
0.12
Net
realized
and
unrealized
gains
(losses)
0.13
(0.80)
(0.10)
0.08
0.25
(0.24)
Total
from
investment
operations
........
0.18
(0.74)
(0.08)
0.15
0.37
(0.12)
Less
distributions
from:
Net
investment
income
..............
(0.06)
(0.11)
(0.11)
(0.14)
(0.15)
(0.15)
Net
asset
value,
end
of
period
..........
$5.12
$5.00
$5.85
$6.04
$6.03
$5.81
Total
return
c
.......................
3.66%
(12.77)%
(1.41)%
2.43%
6.45%
(1.94)%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
1.30%
1.27%
1.27%
1.29%
1.29%
1.26%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
1.30%
f
1.26%
1.27%
f
1.28%
1.28%
1.26%
f
Net
investment
income
...............
1.95%
1.04%
0.39%
1.18%
1.96%
2.00%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$118,720
$116,145
$196,643
$354,483
$389,021
$571,525
Portfolio
turnover
rate
................
—%
53.63%
89.16%
65.54%
41.34%
44.67%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
U.S.
Government
Securities
Fund
(continued)
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The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
96
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$5.03
$5.89
$6.09
$6.07
$5.85
$6.12
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.05
0.07
0.03
0.08
0.13
0.13
Net
realized
and
unrealized
gains
(losses)
0.15
(0.81)
(0.11)
0.08
0.25
(0.24)
Total
from
investment
operations
........
0.20
(0.74)
(0.08)
0.16
0.38
(0.11)
Less
distributions
from:
Net
investment
income
..............
(0.07)
(0.12)
(0.12)
(0.14)
(0.16)
(0.16)
Net
asset
value,
end
of
period
..........
$5.16
$5.03
$5.89
$6.09
$6.07
$5.85
Total
return
c
.......................
3.92%
(12.72)%
(1.41)%
2.73%
6.58%
(1.78)%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
1.15%
1.12%
1.11%
1.13%
1.14%
1.11%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
1.15%
f
1.11%
1.11%
f
1.12%
1.13%
1.11%
f
Net
investment
income
...............
2.11%
1.20%
0.55%
1.34%
2.11%
2.15%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$16,037
$15,476
$19,513
$27,746
$32,906
$31,144
Portfolio
turnover
rate
................
—%
53.63%
89.16%
65.54%
41.34%
44.67%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
U.S.
Government
Securities
Fund
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
97
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R6
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$5.06
$5.92
$6.12
$6.10
$5.87
$6.15
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.07
0.10
0.07
0.12
0.16
0.17
Net
realized
and
unrealized
gains
(losses)
0.14
(0.81)
(0.12)
0.08
0.27
(0.25)
Total
from
investment
operations
........
0.21
(0.71)
(0.05)
0.20
0.43
(0.08)
Less
distributions
from:
Net
investment
income
..............
(0.08)
(0.15)
(0.15)
(0.18)
(0.20)
(0.20)
Net
asset
value,
end
of
period
..........
$5.19
$5.06
$5.92
$6.12
$6.10
$5.87
Total
return
c
.......................
4.21%
(12.11)%
(0.80)%
3.34%
7.39%
(1.33)%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.54%
0.50%
0.53%
0.54%
0.51%
0.49%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.53%
0.50%
f
0.51%
0.52%
0.50%
0.48%
Net
investment
income
...............
2.72%
1.81%
1.15%
1.96%
2.74%
2.78%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$201,207
$202,611
$304,650
$361,791
$573,957
$694,813
Portfolio
turnover
rate
................
—%
53.63%
89.16%
65.54%
41.34%
44.67%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Financial
Highlights
Franklin
U.S.
Government
Securities
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
98
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Advisor
Class
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$5.05
$5.92
$6.11
$6.10
$5.87
$6.15
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.07
0.09
0.06
0.11
0.16
0.16
Net
realized
and
unrealized
gains
(losses)
0.14
(0.81)
(0.10)
0.07
0.26
(0.25)
Total
from
investment
operations
........
0.21
(0.72)
(0.04)
0.18
0.42
(0.09)
Less
distributions
from:
Net
investment
income
..............
(0.08)
(0.15)
(0.15)
(0.17)
(0.19)
(0.19)
Net
asset
value,
end
of
period
..........
$5.18
$5.05
$5.92
$6.11
$6.10
$5.87
Total
return
c
.......................
4.16%
(12.39)%
(0.74)%
3.23%
7.08%
(1.45)%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.65%
0.62%
0.62%
0.64%
0.64%
0.61%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.65%
f
0.61%
0.62%
f
0.63%
0.63%
0.61%
f
Net
investment
income
...............
2.60%
1.67%
1.04%
1.84%
2.61%
2.65%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$287,392
$300,303
$692,010
$743,012
$946,318
$720,281
Portfolio
turnover
rate
................
—%
53.63%
89.16%
65.54%
41.34%
44.67%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited),
March
31,
2023
Franklin
U.S.
Government
Securities
Fund
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
99
a
a
Principal
Amount
a
Value
a
a
a
a
a
U.S.
Government
and
Agency
Securities
0.6%
U.S.
Treasury
Bonds,
4.75%,
2/15/37
....................................
$
14,500,000
$
16,551,240
Total
U.S.
Government
and
Agency
Securities
(Cost
$18,428,449)
.................
16,551,240
Mortgage-Backed
Securities
97.6%
Government
National
Mortgage
Association
(GNMA)
Fixed
Rate
97.6%
GNMA
I,
30
Year,
4.5%,
4/15/40
........................................
3,554,302
3,592,386
GNMA
I,
30
Year,
5%,
9/15/40
..........................................
126,403,556
129,645,928
GNMA
I,
30
Year,
5.5%,
2/15/40
........................................
56,430,114
59,074,633
GNMA
I,
30
Year,
6%,
12/15/39
.........................................
51,957,356
54,758,011
GNMA
I,
30
Year,
6.5%,
8/15/37
........................................
13,160,847
13,557,956
GNMA
I,
30
Year,
7%,
9/15/32
..........................................
8,197,482
8,707,918
GNMA
I,
30
Year,
7.5%,
7/15/26
-
8/15/33
.................................
772,081
806,008
GNMA
I,
30
Year,
8%,
10/15/29
.........................................
1,181
1,233
GNMA
I,
30
Year,
8.5%,
11/15/24
........................................
88
88
GNMA
I,
Single-family,
30
Year,
3.5%,
4/15/43
-
5/15/43
......................
11,813,121
11,491,344
GNMA
I,
Single-family,
30
Year,
4%,
10/15/40
-
8/15/46
.......................
34,471,959
33,306,105
GNMA
I,
Single-family,
30
Year,
4.5%,
2/15/39
-
6/15/41
......................
65,696,111
66,220,397
GNMA
I,
Single-family,
30
Year,
5%,
2/15/35
...............................
14,927
15,147
GNMA
I,
Single-family,
30
Year,
5.5%,
5/15/33
-
10/15/48
......................
560,516
577,065
GNMA
I,
Single-family,
30
Year,
7.25%,
12/15/25
............................
23,851
23,968
GNMA
I,
Single-family,
30
Year,
7.5%,
4/15/23
-
7/15/31
......................
889,308
898,752
GNMA
I,
Single-family,
30
Year,
8%,
6/15/23
-
9/15/30
........................
312,441
313,899
GNMA
I,
Single-family,
30
Year,
8.5%,
4/15/23
-
5/15/25
......................
5,113
5,103
GNMA
I,
Single-family,
30
Year,
10%,
2/15/25
..............................
2,240
2,237
GNMA
II,
30
Year,
4.5%,
5/20/34
-
6/20/41
.................................
2,967,263
3,006,542
GNMA
II,
30
Year,
6%,
3/20/34
-
9/20/34
..................................
935,355
937,938
GNMA
II,
30
Year,
6%,
7/20/39
.........................................
23,214,664
24,580,997
GNMA
II,
30
Year,
6.5%,
9/20/31
-
9/20/32
.................................
971,863
1,009,277
GNMA
II,
30
Year,
7%,
7/20/32
.........................................
279,654
297,139
GNMA
II,
30
Year,
7.5%,
10/20/24
.......................................
5,771
5,753
GNMA
II,
30
Year,
8%,
12/20/28
........................................
38,211
38,894
GNMA
II,
Single-family,
30
Year,
2%,
8/20/51
...............................
169,832,308
144,957,947
GNMA
II,
Single-family,
30
Year,
2.5%,
11/20/50
............................
15,120,164
12,872,625
GNMA
II,
Single-family,
30
Year,
2.5%,
7/20/51
.............................
74,417,122
65,582,385
GNMA
II,
Single-family,
30
Year,
2.5%,
8/20/51
.............................
220,771,313
194,582,265
GNMA
II,
Single-family,
30
Year,
2.5%,
9/20/51
.............................
89,260,661
78,654,235
GNMA
II,
Single-family,
30
Year,
2.5%,
10/20/51
............................
87,114,035
76,779,937
GNMA
II,
Single-family,
30
Year,
2.5%,
12/20/51
............................
88,936,012
78,363,248
GNMA
II,
Single-family,
30
Year,
2.5%,
1/20/52
.............................
133,451,989
117,610,216
GNMA
II,
Single-family,
30
Year,
3%,
10/20/44
..............................
19,367,032
18,091,340
GNMA
II,
Single-family,
30
Year,
3%,
12/20/44
..............................
9,701,813
9,073,708
GNMA
II,
Single-family,
30
Year,
3%,
5/20/45
...............................
14,256,759
13,300,755
GNMA
II,
Single-family,
30
Year,
3%,
4/20/46
...............................
19,035,226
17,663,676
GNMA
II,
Single-family,
30
Year,
3%,
9/20/47
...............................
15,276,051
14,103,094
GNMA
II,
Single-family,
30
Year,
3%,
10/20/47
..............................
24,638,973
22,753,872
GNMA
II,
Single-family,
30
Year,
3%,
6/20/50
...............................
11,672,763
10,874,247
GNMA
II,
Single-family,
30
Year,
3%,
9/20/50
...............................
9,163,597
8,491,268
GNMA
II,
Single-family,
30
Year,
3%,
7/20/51
...............................
153,002,992
140,124,537
GNMA
II,
Single-family,
30
Year,
3%,
8/20/51
...............................
174,057,873
159,300,280
GNMA
II,
Single-family,
30
Year,
3%,
9/20/51
...............................
28,829,212
26,384,904
GNMA
II,
Single-family,
30
Year,
3%,
10/20/51
..............................
124,505,517
113,909,677
GNMA
II,
Single-family,
30
Year,
3%,
2/20/45
-
10/20/50
......................
62,433,637
57,990,422
GNMA
II,
Single-family,
30
Year,
3.5%,
7/20/42
.............................
30,515,265
29,193,990
GNMA
II,
Single-family,
30
Year,
3.5%,
9/20/42
.............................
38,340,498
36,707,619
GNMA
II,
Single-family,
30
Year,
3.5%,
5/20/43
.............................
11,365,580
10,892,418
GNMA
II,
Single-family,
30
Year,
3.5%,
6/20/43
.............................
13,165,309
12,608,792
GNMA
II,
Single-family,
30
Year,
3.5%,
9/20/47
.............................
137,184,487
130,929,873
GNMA
II,
Single-family,
30
Year,
3.5%,
11/20/47
............................
130,456,627
123,976,990
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
U.S.
Government
Securities
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
100
a
a
Principal
Amount
a
Value
a
a
a
a
a
Mortgage-Backed
Securities
(continued)
Government
National
Mortgage
Association
(GNMA)
Fixed
Rate
(continued)
GNMA
II,
Single-family,
30
Year,
3.5%,
10/20/40
-
1/20/49
.....................
$
49,589,098
$
47,411,476
GNMA
II,
Single-family,
30
Year,
3.5%,
11/20/51
............................
24,240,057
22,803,790
GNMA
II,
Single-family,
30
Year,
3.5%,
2/20/52
.............................
69,311,548
65,032,985
GNMA
II,
Single-family,
30
Year,
4%,
11/20/40
..............................
10,106,835
9,988,756
GNMA
II,
Single-family,
30
Year,
4%,
9/20/41
...............................
10,045,911
9,928,529
GNMA
II,
Single-family,
30
Year,
4%,
10/20/41
..............................
12,389,772
12,245,040
GNMA
II,
Single-family,
30
Year,
4%,
11/20/41
..............................
11,672,560
11,536,186
GNMA
II,
Single-family,
30
Year,
4%,
5/20/47
...............................
32,902,179
32,151,716
GNMA
II,
Single-family,
30
Year,
4%,
6/20/47
...............................
25,433,345
24,853,391
GNMA
II,
Single-family,
30
Year,
4%,
7/20/47
...............................
16,287,172
15,915,660
GNMA
II,
Single-family,
30
Year,
4%,
5/20/40
-
12/20/49
......................
48,100,589
47,357,603
GNMA
II,
Single-family,
30
Year,
4%,
6/20/52
...............................
127,392,236
122,826,877
GNMA
II,
Single-family,
30
Year,
4.5%,
5/20/41
.............................
9,140,719
9,265,024
GNMA
II,
Single-family,
30
Year,
4.5%,
6/20/41
.............................
11,288,308
11,441,781
GNMA
II,
Single-family,
30
Year,
4.5%,
7/20/41
.............................
12,539,061
12,709,555
GNMA
II,
Single-family,
30
Year,
4.5%,
9/20/41
.............................
18,055,076
18,300,435
GNMA
II,
Single-family,
30
Year,
4.5%,
10/20/41
............................
12,862,778
13,035,557
GNMA
II,
Single-family,
30
Year,
4.5%,
5/20/33
-
2/20/44
......................
28,637,147
29,009,397
GNMA
II,
Single-family,
30
Year,
5%,
9/20/33
...............................
7,993,387
8,246,587
GNMA
II,
Single-family,
30
Year,
5%,
7/20/33
-
9/20/41
.......................
25,975,170
26,739,040
GNMA
II,
Single-family,
30
Year,
5.5%,
6/20/34
-
2/20/50
......................
36,926,504
38,366,658
GNMA
II,
Single-family,
30
Year,
6%,
6/20/34
...............................
536,181
553,448
GNMA
II,
Single-family,
30
Year,
6.5%,
6/20/24
-
1/20/39
......................
7,422,234
7,835,028
GNMA
II,
Single-family,
30
Year,
7%,
2/20/28
-
7/20/33
.......................
1,947,091
2,031,706
GNMA
II,
Single-family,
30
Year,
7.5%,
5/20/23
-
4/20/32
......................
248,529
257,449
GNMA
II,
Single-family,
30
Year,
8%,
12/20/24
-
6/20/30
......................
124,018
128,099
GNMA
II,
Single-family,
30
Year,
8.5%,
1/20/25
-
6/20/25
......................
63
63
GNMA
II,
Single-family,
30
Year,
9.5%,
1/20/25
.............................
353
352
2,738,621,226
Total
Mortgage-Backed
Securities
(Cost
$3,029,273,043)
.........................
2,738,621,226
Total
Long
Term
Investments
(Cost
$3,047,701,492)
.............................
2,755,172,466
a
a
a
a
a
Short
Term
Investments
1.6%
Shares
a
Money
Market
Funds
1.6%
a,b
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
..................
45,008,101
45,008,101
Total
Money
Market
Funds
(Cost
$45,008,101)
..................................
45,008,101
Total
Short
Term
Investments
(Cost
$45,008,101
)
................................
45,008,101
a
Total
Investments
(Cost
$3,092,709,593)
99.8%
..................................
$2,800,180,567
Other
Assets,
less
Liabilities
0.2%
.............................................
5,015,989
Net
Assets
100.0%
...........................................................
$2,805,196,556
See
Abbreviations
on
page
145
.
a
See
Note
3(f)
regarding
investments
in
a
ffiliated
management
investment
companies.
b
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
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part
of
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statements.
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101
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
Year
Ended
September
30,
2018
a
2022
2021
2020
2019
Class
A
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$20.26
$20.20
$19.76
$22.53
$18.66
$19.16
Income
from
investment
operations
b
:
Net
investment
income
c
.............
0.26
0.46
0.43
0.51
0.53
0.02
Net
realized
and
unrealized
gains
(losses)
1.11
0.67
1.94
(2.43)
4.41
(0.52)
Total
from
investment
operations
........
1.37
1.13
2.37
(1.92)
4.94
(0.50)
Less
distributions
from:
Net
investment
income
..............
(0.24)
(0.47)
(0.52)
(0.50)
(0.49)
—
Net
realized
gains
.................
(0.31)
(0.60)
(1.41)
(0.35)
(0.58)
—
Total
distributions
...................
(0.55)
(1.07)
(1.93)
(0.85)
(1.07)
—
Net
asset
value,
end
of
period
..........
$21.08
$20.26
$20.20
$19.76
$22.53
$18.66
Total
return
d
.......................
6.74%
5.56%
12.29%
(8.68)%
27.43%
(2.61)%
Ratios
to
average
net
assets
e
Expenses
f
,g
........................
0.80%
0.82%
0.82%
0.83%
0.83%
0.84%
Net
investment
income
...............
2.49%
2.08%
2.10%
2.46%
2.51%
2.62%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$1,293,253
$1,200,671
$982,201
$742,188
$521,782
$3,536
Portfolio
turnover
rate
................
2.78%
5.66%
5.18%
12.19%
7.90%
4.58%
a
For
the
period
September
10,
2018
(effective
date)
to
September
30,
2018.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year.
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
g
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
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statements.
102
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
A1
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$20.27
$20.21
$19.77
$22.54
$18.66
$19.18
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.27
0.47
0.45
0.52
0.53
0.50
Net
realized
and
unrealized
gains
(losses)
1.12
0.68
1.94
(2.41)
4.44
(0.17)
Total
from
investment
operations
........
1.39
1.15
2.39
(1.89)
4.97
0.33
Less
distributions
from:
Net
investment
income
..............
(0.26)
(0.49)
(0.54)
(0.53)
(0.51)
(0.54)
Net
realized
gains
.................
(0.31)
(0.60)
(1.41)
(0.35)
(0.58)
(0.31)
Total
distributions
...................
(0.57)
(1.09)
(1.95)
(0.88)
(1.09)
(0.85)
Net
asset
value,
end
of
period
..........
$21.09
$20.27
$20.21
$19.77
$22.54
$18.66
Total
return
c
.......................
6.74%
5.67%
12.40%
(8.59)%
27.61%
1.68%
Ratios
to
average
net
assets
d
Expenses
e
,f
........................
0.70%
0.72%
0.72%
0.73%
0.73%
0.74%
Net
investment
income
...............
2.58%
2.16%
2.20%
2.50%
2.61%
2.72%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$3,268,501
$3,230,150
$3,321,370
$3,388,126
$4,176,487
$3,654,795
Portfolio
turnover
rate
................
2.78%
5.66%
5.18%
12.19%
7.90%
4.58%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
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part
of
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financial
statements.
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103
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
C
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$20.14
$20.09
$19.65
$22.42
$18.57
$19.09
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.21
0.36
0.34
0.41
0.42
0.41
Net
realized
and
unrealized
gains
(losses)
1.11
0.67
1.95
(2.41)
4.43
(0.18)
Total
from
investment
operations
........
1.32
1.03
2.29
(2.00)
4.85
0.23
Less
distributions
from:
Net
investment
income
..............
(0.20)
(0.38)
(0.44)
(0.42)
(0.42)
(0.44)
Net
realized
gains
.................
(0.31)
(0.60)
(1.41)
(0.35)
(0.58)
(0.31)
Total
distributions
...................
(0.51)
(0.98)
(1.85)
(0.77)
(1.00)
(0.75)
Net
asset
value,
end
of
period
..........
$20.95
$20.14
$20.09
$19.65
$22.42
$18.57
Total
return
c
.......................
6.52%
5.11%
11.91%
(9.10)%
26.96%
1.18%
Ratios
to
average
net
assets
d
Expenses
e
,f
........................
1.20%
1.22%
1.22%
1.23%
1.23%
1.24%
Net
investment
income
...............
2.06%
1.66%
1.69%
1.98%
2.11%
2.22%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$284,148
$302,959
$350,553
$537,808
$767,363
$834,070
Portfolio
turnover
rate
................
2.78%
5.66%
5.18%
12.19%
7.90%
4.58%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
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Utilities
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The
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of
these
financial
statements.
104
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$20.17
$20.12
$19.68
$22.45
$18.59
$19.11
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.23
0.40
0.38
0.44
0.45
0.44
Net
realized
and
unrealized
gains
(losses)
1.11
0.67
1.94
(2.41)
4.44
(0.18)
Total
from
investment
operations
........
1.34
1.07
2.32
(1.97)
4.89
0.26
Less
distributions
from:
Net
investment
income
..............
(0.22)
(0.42)
(0.47)
(0.45)
(0.45)
(0.47)
Net
realized
gains
.................
(0.31)
(0.60)
(1.41)
(0.35)
(0.58)
(0.31)
Total
distributions
...................
(0.53)
(1.02)
(1.88)
(0.80)
(1.03)
(0.78)
Net
asset
value,
end
of
period
..........
$20.98
$20.17
$20.12
$19.68
$22.45
$18.59
Total
return
c
.......................
6.59%
5.26%
12.06%
(8.95)%
27.17%
1.33%
Ratios
to
average
net
assets
d
Expenses
e
,f
........................
1.05%
1.07%
1.07%
1.08%
1.08%
1.09%
Net
investment
income
...............
2.24%
1.83%
1.85%
2.15%
2.26%
2.37%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$111,560
$103,579
$83,441
$84,488
$103,376
$72,927
Portfolio
turnover
rate
................
2.78%
5.66%
5.18%
12.19%
7.90%
4.58%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
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Utilities
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part
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105
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Class
R6
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$20.47
$20.40
$19.93
$22.73
$18.81
$19.32
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.29
0.54
0.50
0.58
0.56
0.55
Net
realized
and
unrealized
gains
(losses)
1.13
0.67
1.96
(2.46)
4.50
(0.17)
Total
from
investment
operations
........
1.42
1.21
2.46
(1.88)
5.06
0.38
Less
distributions
from:
Net
investment
income
..............
(0.28)
(0.54)
(0.58)
(0.57)
(0.56)
(0.58)
Net
realized
gains
.................
(0.31)
(0.60)
(1.41)
(0.35)
(0.58)
(0.31)
Total
distributions
...................
(0.59)
(1.14)
(1.99)
(0.92)
(1.14)
(0.89)
Net
asset
value,
end
of
period
..........
$21.30
$20.47
$20.40
$19.93
$22.73
$18.81
Total
return
c
.......................
6.89%
5.90%
12.71%
(8.44)%
27.89%
1.97%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.52%
0.54%
0.58%
0.56%
0.53%
0.52%
Expenses
net
of
waiver
and
payments
by
affiliates
e
..........................
0.49%
0.50%
0.50%
0.50%
0.50%
0.48%
Net
investment
income
...............
2.78%
2.41%
2.42%
2.75%
2.84%
2.98%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$233,477
$223,710
$153,969
$144,079
$150,244
$230,393
Portfolio
turnover
rate
................
2.78%
5.66%
5.18%
12.19%
7.90%
4.58%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
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Financial
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Franklin
Utilities
Fund
(continued)
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The
accompanying
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are
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integral
part
of
these
financial
statements.
106
a
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
2021
2020
2019
2018
Advisor
Class
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$20.47
$20.40
$19.93
$22.73
$18.81
$19.32
Income
from
investment
operations
a
:
Net
investment
income
b
.............
0.29
0.52
0.48
0.56
0.56
0.54
Net
realized
and
unrealized
gains
(losses)
1.12
0.68
1.97
(2.46)
4.48
(0.18)
Total
from
investment
operations
........
1.41
1.20
2.45
(1.90)
5.04
0.36
Less
distributions
from:
Net
investment
income
..............
(0.27)
(0.53)
(0.57)
(0.55)
(0.54)
(0.56)
Net
realized
gains
.................
(0.31)
(0.60)
(1.41)
(0.35)
(0.58)
(0.31)
Total
distributions
...................
(0.58)
(1.13)
(1.98)
(0.90)
(1.12)
(0.87)
Net
asset
value,
end
of
period
..........
$21.30
$20.47
$20.40
$19.93
$22.73
$18.81
Total
return
c
.......................
6.85%
5.82%
12.62%
(8.51)%
27.78%
1.82%
Ratios
to
average
net
assets
d
Expenses
e
,f
........................
0.55%
0.57%
0.57%
0.58%
0.58%
0.59%
Net
investment
income
...............
2.73%
2.32%
2.35%
2.66%
2.76%
2.87%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$1,395,835
$1,383,667
$1,200,859
$1,179,002
$1,262,883
$927,845
Portfolio
turnover
rate
................
2.78
%
5.66%
5.18%
12.19%
7.90%
4.58%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited),
March
31,
2023
Franklin
Utilities
Fund
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
107
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
99.6%
Construction
&
Engineering
1.9%
MDU
Resources
Group,
Inc.
.............................
United
States
4,200,000
$
128,016,000
Diversified
Telecommunication
Services
0.9%
TELUS
Corp.
........................................
Canada
3,000,000
59,551,643
Electric
Utilities
58.5%
Alliant
Energy
Corp.
...................................
United
States
3,700,000
197,580,000
American
Electric
Power
Co.,
Inc.
.........................
United
States
2,700,000
245,673,000
Constellation
Energy
Corp.
..............................
United
States
1,349,999
105,974,922
Duke
Energy
Corp.
....................................
United
States
2,700,000
260,469,000
Edison
International
...................................
United
States
4,300,000
303,537,000
Emera,
Inc.
..........................................
Canada
1,464,300
60,149,405
Entergy
Corp.
........................................
United
States
2,200,000
237,028,000
Evergy,
Inc.
..........................................
United
States
4,150,000
253,648,000
Eversource
Energy
....................................
United
States
1,900,000
148,694,000
Exelon
Corp.
.........................................
United
States
6,350,000
266,001,500
FirstEnergy
Corp.
.....................................
United
States
2,000,000
80,120,000
NextEra
Energy,
Inc.
...................................
United
States
9,800,000
755,383,999
OGE
Energy
Corp.
....................................
United
States
1,600,000
60,256,000
a
PG&E
Corp.
.........................................
United
States
11,000,000
177,870,000
Pinnacle
West
Capital
Corp.
.............................
United
States
1,050,000
83,202,000
PPL
Corp.
...........................................
United
States
6,000,000
166,740,000
Southern
Co.
(The)
....................................
United
States
4,400,000
306,152,000
Xcel
Energy,
Inc.
......................................
United
States
2,100,000
141,624,000
3,850,102,826
Gas
Utilities
0.9%
Spire,
Inc.
...........................................
United
States
800,000
56,112,000
Independent
Power
and
Renewable
Electricity
Producers
2.6%
Clearway
Energy,
Inc.,
C
................................
United
States
800,000
25,064,000
Drax
Group
plc
.......................................
United
Kingdom
7,000,000
52,583,483
Vistra
Corp.
..........................................
United
States
3,994,269
95,862,456
173,509,939
Multi-Utilities
30.0%
Ameren
Corp.
........................................
United
States
1,668,250
144,120,117
Black
Hills
Corp.
......................................
United
States
400,000
25,240,000
CenterPoint
Energy,
Inc.
................................
United
States
6,000,000
176,760,000
CMS
Energy
Corp.
....................................
United
States
3,800,000
233,244,000
Consolidated
Edison,
Inc.
...............................
United
States
900,000
86,103,000
Dominion
Energy,
Inc.
..................................
United
States
4,000,000
223,640,000
DTE
Energy
Co.
......................................
United
States
1,500,000
164,310,000
E.ON
SE
............................................
Germany
9,000,000
112,277,663
National
Grid
plc
......................................
United
Kingdom
5,000,000
67,640,516
NiSource,
Inc.
........................................
United
States
6,200,000
173,352,000
NorthWestern
Corp.
...................................
United
States
1,300,000
75,218,000
Public
Service
Enterprise
Group,
Inc.
......................
United
States
2,200,000
137,390,000
Sempra
Energy
.......................................
United
States
1,800,000
272,088,000
WEC
Energy
Group,
Inc.
................................
United
States
900,000
85,311,000
1,976,694,296
Oil,
Gas
&
Consumable
Fuels
3.4%
Cheniere
Energy,
Inc.
..................................
United
States
700,000
110,320,000
DT
Midstream,
Inc.
....................................
United
States
1,400,000
69,118,000
Equitrans
Midstream
Corp.
..............................
United
States
839,500
4,852,310
Williams
Cos.,
Inc.
(The)
................................
United
States
1,400,000
41,804,000
226,094,310
Franklin
Custodian
Funds
Schedule
of
Investments
(unaudited)
Franklin
Utilities
Fund
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
108
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Water
Utilities
1.4%
Essential
Utilities,
Inc.
..................................
United
States
1,500,000
$
65,475,000
United
Utilities
Group
plc
................................
United
Kingdom
2,000,000
26,177,050
91,652,050
Total
Common
Stocks
(Cost
$3,230,987,818)
....................................
6,561,733,064
Short
Term
Investments
0.3%
a
a
Country
Shares
a
Value
a
a
a
Money
Market
Funds
0.3%
b,c
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
....
United
States
18,744,661
18,744,661
Total
Money
Market
Funds
(Cost
$18,744,661)
..................................
18,744,661
Total
Short
Term
Investments
(Cost
$18,744,661
)
................................
18,744,661
a
Total
Investments
(Cost
$3,249,732,479)
99.9%
..................................
$6,580,477,725
Other
Assets,
less
Liabilities
0.1%
.............................................
6,296,057
Net
Assets
10
0.0
%
...........................................................
$6,586,773,782
See
Abbreviations
on
page
145
.
a
Non-income
producing.
b
See
Note
3(f)
regarding
investments
in
affiliated
management
investment
companies.
c
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Assets
and
Liabilities
March
31,
2023
(unaudited)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
109
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Assets:
Investments
in
securities:
Cost
-
Unaffiliated
issuers
.................................
$11,449,766,279
$73,871,384
$5,155,483,062
Cost
-
Non-controlled
affiliates
(Note
3
f
)
......................
251,029,443
1,201,709
94,647,361
Value
-
Unaffiliated
issuers
(Includes
securities
loaned
of
$11,682,900,
$—
and
$—,
respectively)
.................................
$18,587,652,519
$80,964,627
$15,842,273,937
Value
-
Non-controlled
affiliates
(Note
3
f
)
......................
251,029,443
1,201,709
94,647,361
Foreign
currency,
at
value
(cost
$349,
$86
and
$655,
respectively)
....
357
84
655
Receivables:
Capital
shares
sold
......................................
17,265,060
213,305
5,612,631
Dividends
.............................................
4,078,363
11,123
7,268,837
Affiliates
..............................................
—
53,380
—
Total
assets
........................................
18,860,025,742
82,444,228
15,949,803,421
Liabilities:
Payables:
Investment
securities
purchased
............................
14,902
—
—
Capital
shares
redeemed
.................................
23,661,967
27,367
46,271,479
Management
fees
.......................................
6,428,712
—
5,600,495
Distribution
fees
........................................
2,365,945
16,385
2,530,513
Transfer
agent
fees
......................................
4,678,672
27,993
4,673,499
Professional
fees
.......................................
40,766
20,793
49,763
Trustees'
fees
and
expenses
...............................
17,367
1,774
2,534
Payable
upon
return
of
securities
loaned
(Note
1
f
)
................
11,474,000
—
—
Accrued
expenses
and
other
liabilities
.........................
599,308
3,091
786,291
Total
liabilities
.......................................
49,281,639
97,403
59,914,574
Net
assets,
at
value
...............................
$18,810,744,103
$82,346,825
$15,889,888,847
Net
assets
consist
of:
Paid-in
capital
...........................................
$13,077,089,042
$90,067,722
$4,722,970,024
Total
distributable
earnings
(losses)
...........................
5,733,655,061
(7,720,897)
11,166,918,823
Net
assets,
at
value
...............................
$18,810,744,103
$82,346,825
$15,889,888,847
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Assets
and
Liabilities
(continued)
March
31,
2023
(unaudited)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
110
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Class
A:
Net
assets,
at
value
.....................................
$8,213,116,929
$62,157,252
$10,173,625,975
Shares
outstanding
......................................
75,417,580
2,723,734
91,201,192
Net
asset
value
per
share
a
................................
$108.90
$22.82
$111.55
Maximum
offering
price
per
share
(net
asset
value
per
share
÷
94.50%)
..............................................
$115.24
$24.15
$118.04
Class
C:
Net
assets,
at
value
.....................................
$772,010,928
$4,542,493
$415,735,309
Shares
outstanding
......................................
8,831,850
203,773
4,356,789
Net
asset
value
and
maximum
offering
price
per
share
a
...........
$87.41
$22.29
$95.42
Class
R:
Net
assets,
at
value
.....................................
$210,746,963
$968,870
$270,302,899
Shares
outstanding
......................................
2,016,760
42,727
2,451,540
Net
asset
value
and
maximum
offering
price
per
share
...........
$104.50
$22.68
$110.26
Class
R6:
Net
assets,
at
value
.....................................
$7,227,423,335
$63,149
$2,140,858,594
Shares
outstanding
......................................
62,740,775
2,742
19,042,580
Net
asset
value
and
maximum
offering
price
per
share
...........
$115.19
$23.04
$112.42
Advisor
Class:
Net
assets,
at
value
.....................................
$2,387,445,948
$14,615,061
$2,889,366,070
Shares
outstanding
......................................
21,021,148
634,979
25,681,757
Net
asset
value
and
maximum
offering
price
per
share
...........
$113.57
$23.02
$112.51
a
Redemption
price
is
equal
to
net
asset
value
less
contingent
deferred
sales
charges,
if
applicable.
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Assets
and
Liabilities
(continued)
March
31,
2023
(unaudited)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
111
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Assets:
Investments
in
securities:
Cost
-
Unaffiliated
issuers
.................................
$69,436,370,828
$3,047,701,492
$3,230,987,818
Cost
-
Non-controlled
affiliates
(Note
3
f
)
......................
2,449,673,078
45,008,101
18,744,661
Value
-
Unaffiliated
issuers
(Includes
securities
loaned
of
$170,347,549,
$—
and
$—,
respectively)
.....................
$69,134,008,779
$2,755,172,466
$6,561,733,064
Value
-
Non-controlled
affiliates
(Note
3
f
)
......................
2,446,447,421
45,008,101
18,744,661
Cash
..................................................
52,264,470
—
—
Foreign
currency,
at
value
(cost
$12,199,441,
$–
and
$–,
respectively)
.
12,199,441
—
—
Receivables:
Investment
securities
sold
.................................
223,650,935
—
11,919,987
Capital
shares
sold
......................................
34,554,924
3,183,664
1,728,772
Dividends
and
interest
...................................
687,483,260
8,404,372
13,065,703
European
Union
tax
reclaims
(Note
1
h
)
.......................
26,290,980
—
—
Deposits
with
brokers
for:
Futures
contracts
......................................
141,000,000
—
—
Variation
margin
on
futures
contracts
.........................
22,593,750
—
—
Total
assets
........................................
72,780,493,960
2,811,768,603
6,607,192,187
Liabilities:
Payables:
Investment
securities
purchased
............................
432,520,091
—
11,132,882
Capital
shares
redeemed
.................................
45,764,594
2,136,754
4,776,373
Management
fees
.......................................
21,761,668
1,053,778
2,418,513
Distribution
fees
........................................
11,271,549
396,638
871,254
Transfer
agent
fees
......................................
11,274,026
1,095,518
794,651
Trustees'
fees
and
expenses
...............................
246
2,584
173
Pricing
fees
...........................................
—
153,895
10,165
Options
written,
at
value
(premiums
received
$71,548,702,
$–
and
$–,
respectively)
............................................
50,464,750
—
—
Payable
upon
return
of
securities
loaned
(Note
1
f
)
................
173,182,000
—
—
Accrued
expenses
and
other
liabilities
.........................
6,549,496
1,732,880
414,394
Total
liabilities
.......................................
752,788,420
6,572,047
20,418,405
Net
assets,
at
value
...............................
$72,027,705,540
$2,805,196,556
$6,586,773,782
Net
assets
consist
of:
Paid-in
capital
...........................................
$73,195,746,658
$3,889,533,362
$3,225,095,848
Total
distributable
earnings
(losses)
...........................
(1,168,041,118)
(1,084,336,806)
3,361,677,934
Net
assets,
at
value
...............................
$72,027,705,540
$2,805,196,556
$6,586,773,782
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Assets
and
Liabilities
(continued)
March
31,
2023
(unaudited)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
112
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Class
A:
Net
assets,
at
value
.....................................
$19,503,026,159
$655,486,938
$1,293,253,101
Shares
outstanding
......................................
8,485,583,117
127,047,620
61,356,732
Net
asset
value
per
share
a
................................
$2.30
$5.16
$21.08
Maximum
offering
price
per
share
(net
asset
value
per
share
÷
96.25%)
..............................................
$2.39
$5.36
$21.90
Class
A1:
Net
assets,
at
value
.....................................
$31,801,875,940
$1,526,353,419
$3,268,500,722
Shares
outstanding
......................................
13,807,284,209
295,698,913
155,015,256
Net
asset
value
per
share
a
................................
$2.30
$5.16
$21.09
Maximum
offering
price
per
share
(net
asset
value
per
share
÷
96.25%)
..............................................
$2.39
$5.36
$21.91
Class
C:
Net
assets,
at
value
.....................................
$5,594,774,085
$118,720,444
$284,147,635
Shares
outstanding
......................................
2,385,093,351
23,184,510
13,564,508
Net
asset
value
and
maximum
offering
price
per
share
a
...........
$2.35
$5.12
$20.95
Class
R:
Net
assets,
at
value
.....................................
$302,990,796
$16,037,467
$111,560,465
Shares
outstanding
......................................
134,614,659
3,107,684
5,316,704
Net
asset
value
and
maximum
offering
price
per
share
...........
$2.25
$5.16
$20.98
Class
R6:
Net
assets,
at
value
.....................................
$1,686,760,597
$201,206,550
$233,477,052
Shares
outstanding
......................................
735,823,093
38,803,055
10,962,407
Net
asset
value
and
maximum
offering
price
per
share
...........
$2.29
$5.19
$21.30
Advisor
Class:
Net
assets,
at
value
.....................................
$13,138,277,963
$287,391,738
$1,395,834,807
Shares
outstanding
......................................
5,759,903,677
55,479,683
65,534,608
Net
asset
value
and
maximum
offering
price
per
share
...........
$2.28
$5.18
$21.30
a
Redemption
price
is
equal
to
net
asset
value
less
contingent
deferred
sales
charges,
if
applicable.
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Operations
for
the
six
months
ended
March
31,
2023
(unaudited)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
113
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Investment
income:
Dividends:
(net
of
foreign
taxes
of
$399,723,
$3,475
and
$446,683,
respectively)
Unaffiliated
issuers
......................................
$41,355,806
$214,895
$74,860,645
Non-controlled
affiliates
(Note
3
f
)
...........................
2,506,726
38,722
1,497,435
Income
from
securities
loaned:
Unaffiliated
entities
(net
of
fees
and
rebates)
...................
5,921
—
14,204
Non-controlled
affiliates
(Note
3
f
)
...........................
91,388
—
453
Total
investment
income
.................................
43,959,841
253,617
76,372,737
Expenses:
Management
fees
(Note
3
a
)
.................................
37,531,406
253,831
33,604,702
Distribution
fees:
(Note
3c
)
Class
A
..............................................
9,339,352
68,214
12,119,802
Class
C
..............................................
3,606,724
20,645
2,070,186
Class
R
..............................................
492,810
2,099
657,938
Transfer
agent
fees:
(Note
3e
)
Class
A
..............................................
5,541,450
64,274
5,759,586
Class
C
..............................................
535,056
4,721
246,002
Class
R
..............................................
146,199
959
156,340
Class
R6
.............................................
668,250
9
235,930
Advisor
Class
..........................................
1,674,998
12,914
1,669,119
Custodian
fees
(Note
4
)
....................................
242,982
827
70,112
Reports
to
shareholders
fees
................................
1,283,596
7,061
350,732
Registration
and
filing
fees
..................................
276,740
60,333
187,726
Professional
fees
.........................................
45,773
27,957
59,652
Trustees'
fees
and
expenses
................................
103,367
1,012
86,356
Interest
expense
.........................................
1,931
415
1,367
Other
..................................................
319,760
4,794
259,555
Total
expenses
.......................................
61,810,394
530,065
57,535,105
Expense
reductions
(Note
4
)
.............................
(6)
—
(1,876)
Expenses
waived/paid
by
affiliates
(Note
3
f
and
3
g
)
............
(297,445)
(130,475)
(168,085)
Net
expenses
.......................................
61,512,943
399,590
57,365,144
Net
investment
income
(loss)
..........................
(17,553,102)
(145,973)
19,007,593
Realized
and
unrealized
gains
(losses):
Net
realized
gain
(loss)
from:
Investments:
Unaffiliated
issuers
....................................
(453,269,555)
(2,290,222)
456,165,216
Foreign
currency
transactions
..............................
396,499
383
3,363
Net
realized
gain
(loss)
................................
(452,873,056)
(2,289,839)
456,168,579
Net
change
in
unrealized
appreciation
(depreciation)
on:
Investments:
Unaffiliated
issuers
....................................
3,302,642,401
15,067,671
1,890,388,182
Translation
of
other
assets
and
liabilities
denominated
in
foreign
currencies
...........................................
19,586
26
453
Net
change
in
unrealized
appreciation
(depreciation)
..........
3,302,661,987
15,067,697
1,890,388,635
Net
realized
and
unrealized
gain
(loss)
..........................
2,849,788,931
12,777,858
2,346,557,214
Net
increase
(decrease)
in
net
assets
resulting
from
operations
........
$2,832,235,829
$12,631,885
$2,365,564,807
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Operations
(continued)
for
the
six
months
ended
March
31,
2023
(unaudited)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
114
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Investment
income:
Dividends:
(net
of
foreign
taxes
of
$5,382,757,
$–
and
$491,738,
respectively)
Unaffiliated
issuers
......................................
$284,938,133
$—
$108,113,419
Non-controlled
affiliates
(Note
3
f
)
...........................
23,360,745
883,404
477,191
Interest:
Unaffiliated
issuers:
Paydown
gain
(loss)
...................................
(41,075)
(5,996,518)
—
Paid
in
cash
a
.........................................
1,289,040,998
51,411,411
—
Income
from
securities
loaned:
Unaffiliated
entities
(net
of
fees
and
rebates)
...................
(62,329)
—
—
Non-controlled
affiliates
(Note
3
f
)
...........................
2,915,543
—
—
Other
income
(Note
1
h
)
....................................
928,234
—
—
Total
investment
income
.................................
1,601,080,249
46,298,297
108,590,610
Expenses:
Management
fees
(Note
3
a
)
.................................
132,015,265
6,484,910
14,819,134
Distribution
fees:
(Note
3c
)
Class
A
..............................................
23,118,028
835,572
1,587,117
Class
A1
.............................................
23,736,574
1,122,024
2,470,908
Class
C
..............................................
18,606,789
388,269
971,906
Class
R
..............................................
726,921
39,270
276,785
Transfer
agent
fees:
(Note
3e
)
Class
A
..............................................
7,624,443
497,376
570,363
Class
A1
.............................................
13,049,924
1,159,475
1,480,191
Class
C
..............................................
2,361,011
88,853
134,378
Class
R
..............................................
119,880
11,682
49,734
Class
R6
.............................................
192,928
33,404
62,882
Advisor
Class
..........................................
5,247,068
216,328
637,757
Custodian
fees
(Note
4
)
....................................
262,337
10,880
25,358
Reports
to
shareholders
fees
................................
1,259,309
124,206
140,018
Registration
and
filing
fees
..................................
526,520
69,808
111,896
Professional
fees
.........................................
465,703
44,739
38,939
Trustees'
fees
and
expenses
................................
404,781
17,548
39,992
Other
..................................................
920,775
429,837
119,213
Total
expenses
.......................................
230,638,256
11,574,181
23,536,571
Expense
reductions
(Note
4
)
.............................
(4,464)
(67)
(235)
Expenses
waived/paid
by
affiliates
(Note
3
f
and
3
g
)
............
(2,526,901)
(95,888)
(83,798)
Net
expenses
.......................................
228,106,891
11,478,226
23,452,538
Net
investment
income
..............................
1,372,973,358
34,820,071
85,138,072
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Operations
(continued)
for
the
six
months
ended
March
31,
2023
(unaudited)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
115
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Realized
and
unrealized
gains
(losses):
Net
realized
gain
(loss)
from:
Investments:
Unaffiliated
issuers
....................................
343,450,982
(625,615)
34,261,287
Written
options
.........................................
181,110,682
—
—
Foreign
currency
transactions
..............................
(2,723,607)
—
(216,260)
Futures
contracts
.......................................
(29,340,528)
—
—
Net
realized
gain
(loss)
................................
492,497,529
(625,615)
34,045,027
Net
change
in
unrealized
appreciation
(depreciation)
on:
Investments:
Unaffiliated
issuers
....................................
4,781,670,169
78,543,551
312,439,138
Non-controlled
affiliates
(Note
3
f
)
..........................
(3,324,129)
—
—
Translation
of
other
assets
and
liabilities
denominated
in
foreign
currencies
...........................................
8,964,091
—
100,001
Written
options
.........................................
24,572,876
—
—
Futures
contracts
.......................................
177,716,721
—
—
Net
change
in
unrealized
appreciation
(depreciation)
..........
4,989,599,728
78,543,551
312,539,139
Net
realized
and
unrealized
gain
(loss)
..........................
5,482,097,257
77,917,936
346,584,166
Net
increase
(decrease)
in
net
assets
resulting
from
operations
........
$6,855,070,615
$112,738,007
$431,722,238
a
Includes
amortization
of
premium
and
accretion
of
discount.
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Changes
in
Net
Assets
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
116
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
Increase
(decrease)
in
net
assets:
Operations:
Net
investment
income
(loss)
.......
$(17,553,102)
$(84,996,268)
$(145,973)
$(671,705)
Net
realized
gain
(loss)
............
(452,873,056)
(812,697,850)
(2,289,839)
(11,577,019)
Net
change
in
unrealized
appreciation
(depreciation)
.................
3,302,661,987
(10,578,235,213)
15,067,697
(33,530,551)
Net
increase
(decrease)
in
net
assets
resulting
from
operations
.
2,832,235,829
(11,475,929,331)
12,631,885
(45,779,275)
Distributions
to
shareholders:
Class
A
........................
—
(172,943,583)
—
(493,434)
Class
C
........................
—
(23,184,109)
—
(38,188)
Class
R
........................
—
(4,586,975)
—
(5,897)
Class
R6
.......................
—
(134,824,197)
—
(415)
Advisor
Class
...................
—
(60,590,104)
—
(131,680)
Total
distributions
to
shareholders
.....
—
(396,128,968)
—
(669,614)
Capital
share
transactions:
(Note
2
)
Class
A
........................
(224,760,107)
192,477,080
(564,739)
8,401,386
Class
C
........................
(58,123,687)
(72,201,401)
(100,234)
711,737
Class
R
........................
(10,160,906)
10,119,125
94,290
196,571
Class
R6
.......................
(193,261,478)
788,549,445
8,013
415
Advisor
Class
...................
(256,467,029)
(278,464,615)
3,008,890
(8,229,494)
Total
capital
share
transactions
.......
(742,773,207)
640,479,634
2,446,220
1,080,615
Net
increase
(decrease)
in
net
assets
.....................
2,089,462,622
(11,231,578,665)
15,078,105
(45,368,274)
Net
assets:
Beginning
of
period
................
16,721,281,481
27,952,860,146
67,268,720
112,636,994
End
of
period
.....................
$18,810,744,103
$16,721,281,481
$82,346,825
$67,268,720
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Changes
in
Net
Assets
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
117
Franklin
Growth
Fund
Franklin
Income
Fund
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
Increase
(decrease)
in
net
assets:
Operations:
Net
investment
income
............
$19,007,593
$14,326,662
$1,372,973,358
$2,273,669,839
Net
realized
gain
(loss)
............
456,168,579
1,846,110,618
492,497,529
430,503,782
Net
change
in
unrealized
appreciation
(depreciation)
.................
1,890,388,635
(6,521,606,215)
4,989,599,728
(7,786,851,093)
Net
increase
(decrease)
in
net
assets
resulting
from
operations
.
2,365,564,807
(4,661,168,935)
6,855,070,615
(5,082,677,472)
Distributions
to
shareholders:
Class
A
........................
(909,635,091)
(1,168,961,036)
(540,753,912)
(1,152,988,107)
Class
A1
.......................
—
—
(950,605,344)
(2,410,250,572)
Class
C
........................
(44,719,553)
(66,622,776)
(153,972,573)
(440,734,378)
Class
R
........................
(24,964,554)
(34,890,151)
(8,296,672)
(18,070,687)
Class
R6
.......................
(198,355,706)
(278,038,777)
(40,121,112)
(71,339,359)
Advisor
Class
...................
(266,375,785)
(380,494,855)
(392,227,662)
(871,094,088)
Total
distributions
to
shareholders
.....
(1,444,050,689)
(1,929,007,595)
(2,085,977,275)
(4,964,477,191)
Capital
share
transactions:
(Note
2
)
Class
A
........................
468,806,538
278,407,375
1,436,831,776
3,309,460,327
Class
A1
.......................
—
—
(613,781,923)
(809,147,805)
Class
C
........................
(9,970,336)
(49,537,765)
(464,147,841)
(977,179,035)
Class
R
........................
4,994,065
(30,209,220)
13,369,468
53,857,218
Class
R6
.......................
11,237,803
(204,647,567)
436,099,809
581,612,935
Advisor
Class
...................
63,619,179
(306,999,175)
661,455,031
1,445,415,173
Total
capital
share
transactions
.......
538,687,249
(312,986,352)
1,469,826,320
3,604,018,813
Net
increase
(decrease)
in
net
assets
.....................
1,460,201,367
(6,903,162,882)
6,238,919,660
(6,443,135,850)
Net
assets:
Beginning
of
period
................
14,429,687,480
21,332,850,362
65,788,785,880
72,231,921,730
End
of
period
.....................
$15,889,888,847
$14,429,687,480
$72,027,705,540
$65,788,785,880
Franklin
Custodian
Funds
Financial
Statements
Statements
of
Changes
in
Net
Assets
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
118
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
Six
Months
Ended
March
31,
2023
(unaudited)
Year
Ended
September
30,
2022
Increase
(decrease)
in
net
assets:
Operations:
Net
investment
income
............
$34,820,071
$56,545,892
$85,138,072
$145,646,532
Net
realized
gain
(loss)
............
(625,615)
(58,392,142)
34,045,027
109,367,801
Net
change
in
unrealized
appreciation
(depreciation)
.................
78,543,551
(461,258,575)
312,539,139
64,616,747
Net
increase
(decrease)
in
net
assets
resulting
from
operations
.
112,738,007
(463,104,825)
431,722,238
319,631,080
Distributions
to
shareholders:
Class
A
........................
(9,445,389)
(20,267,585)
(33,465,379)
(55,029,799)
Class
A1
.......................
(22,819,556)
(46,598,044)
(88,076,012)
(176,291,048)
Class
C
........................
(1,462,039)
(3,045,344)
(7,279,027)
(16,186,173)
Class
R
........................
(204,269)
(367,976)
(2,778,331)
(4,384,032)
Class
R6
.......................
(3,178,960)
(7,008,183)
(6,312,853)
(9,709,506)
Advisor
Class
...................
(4,451,687)
(13,110,289)
(38,803,723)
(67,381,826)
Total
distributions
to
shareholders
.....
(41,561,900)
(90,397,421)
(176,715,325)
(328,982,384)
Capital
share
transactions:
(Note
2
)
Class
A
........................
(48,615,772)
(204,548,972)
44,789,931
235,216,595
Class
A1
.......................
(104,945,124)
(227,866,480)
(89,195,307)
(116,776,805)
Class
C
........................
(464,492)
(57,456,291)
(30,385,186)
(52,951,717)
Class
R
........................
195,149
(1,409,442)
3,754,262
21,829,002
Class
R6
.......................
(6,407,153)
(63,528,606)
492,996
75,674,198
Advisor
Class
...................
(20,152,613)
(315,646,464)
(42,424,954)
198,701,770
Total
capital
share
transactions
.......
(180,390,005)
(870,456,255)
(112,968,258)
361,693,043
Net
increase
(decrease)
in
net
assets
.....................
(109,213,898)
(1,423,958,501)
142,038,655
352,341,739
Net
assets:
Beginning
of
period
................
2,914,410,454
4,338,368,955
6,444,735,127
6,092,393,388
End
of
period
.....................
$2,805,196,556
$2,914,410,454
$6,586,773,782
$6,444,735,127
Franklin
Custodian
Funds
119
franklintempleton.com
Semiannual
Report
Notes
to
Financial
Statements
(unaudited)
1.
Organization
and
Significant
Accounting
Policies
Franklin
Custodian
Funds (Trust)
is
registered
under
the
Investment
Company
Act
of
1940
(1940
Act)
as
an
open-
end
management
investment
company,
consisting
of
six
separate
funds
(Funds).
The
Funds
follow
the
accounting
and
reporting
guidance
in
Financial
Accounting
Standards
Board
(FASB)
Accounting
Standards
Codification
Topic
946,
Financial
Services
–
Investment
Companies
(ASC
946)
and
apply
the
specialized
accounting
and
reporting
guidance
in
U.S.
Generally
Accepted
Accounting
Principles
(U.S.
GAAP),
including,
but
not
limited
to,
ASC
946.
The
classes
of
shares
offered
within
each
of
the
Funds
are
indicated
below.
Class
C
shares
automatically
convert
to
Class
A
shares
on
a
monthly
basis,
after
they
have
been
held
for
8
years.
Each
class
of
shares
may
differ
by
its
initial
sales
load,
contingent
deferred
sales
charges,
voting
rights
on
matters
affecting
a
single
class,
its
exchange
privilege
and
fees
due
to
differing
arrangements
for
distribution
and
transfer
agent
fees.
Class
A,
Class
C,
Class
R,
Class
R6,
&
Advisor
Class
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Class
A,
Class
A1,
Class
C,
Class
R,
Class
R6,
&
Advisor
Class
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
The
following
summarizes
the Funds'
significant
accounting
policies
.
a.
Financial
Instrument
Valuation
The
Funds'
investments
in
financial
instruments
are
carried
at
fair
value
daily.
Fair
value
is
the
price
that
would
be
received
to
sell
an
asset
or
paid
to
transfer
a
liability
in
an
orderly
transaction
between
market
participants
on
the
measurement
date.
The
Funds
calculate
the
net
asset
value
(NAV)
per
share
each
business
day
as
of
4
p.m.
Eastern
time
or
the
regularly
scheduled
close
of
the
New
York
Stock
Exchange
(NYSE),
whichever
is
earlier.
Under
compliance
policies
and
procedures
approved
by
the
Trust’s
Board
of
Trustees
(the
Board),
the
Board
has
designated
the
Funds’
investment
manager
as
the
valuation
designee
and
has
responsibility
for
oversight
of
valuation.
The
investment
manager
is
assisted
by
the
Funds'
administrator
in
performing
this
responsibility,
including
leading
the
cross-
functional
Valuation
Committee
(VC).
The
Funds
may
utilize
independent
pricing
services,
quotations
from
securities
and
financial
instrument
dealers,
and
other
market
sources
to
determine
fair
value.
Equity
securities
and
derivative
financial
instruments
listed
on
an
exchange
or
on
the
NASDAQ
National
Market
System
are
valued
at
the
last
quoted
sale
price
or
the
official
closing
price of
the
day,
respectively.
Foreign
equity
securities
are
valued
as
of
the
close
of
trading
on
the
foreign
stock
exchange
on
which
the
security
is
primarily
traded,
or
as
of
4
p.m.
Eastern
time.
The
value
is
then
converted
into
its
U.S.
dollar
equivalent
at
the
foreign
exchange
rate
in
effect
at
4
p.m.
Eastern
time
on
the
day
that
the
value
of
the
security
is
determined.
Over-the-counter
(OTC)
securities
are
valued
within
the
range
of
the
most
recent
quoted
bid
and
ask
prices.
Securities
that
trade
in
multiple
markets
or
on
multiple
exchanges
are
valued
according
to
the
broadest
and
most
representative
market.
Certain
equity
securities
are
valued
based
upon
fundamental
characteristics
or
relationships
to
similar
securities.
Debt
securities
generally
trade
in
the
OTC
market
rather
than
on
a
securities
exchange.
The
Funds'
pricing
services
use
multiple
valuation
techniques
to
determine
fair
value.
In
instances
where
sufficient
market
activity
exists,
the
pricing
services
may
utilize
a
market-based
approach
through
which
quotes
from
market
makers
are
used
to
determine
fair
value.
In
instances
where
sufficient
market
activity
may
not
exist
or
is
limited,
the
pricing
services
also
utilize
proprietary
valuation
models
which
may
consider
market
characteristics
such
as
benchmark
yield
curves,
credit
spreads,
estimated
default
rates,
anticipated
market
interest
rate
volatility,
coupon
rates,
anticipated
timing
of
principal
repayments,
underlying
collateral,
and
other
unique
security
features
in
order
to
estimate
the
relevant
cash
flows,
which
are
then
discounted
to
calculate
the
fair
value.
Securities
denominated
in
a
foreign
currency
are
converted
into
their
U.S.
dollar
equivalent
at
the
foreign
exchange
rate
in
effect
at
4
p.m.
Eastern
time
on
the
date
that
the
values
of
the
foreign
debt
securities
are
determined.
Investments
in
open-end
mutual
funds
are
valued
at
the
closing
NAV.
The
Funds
have
procedures
to
determine
the
fair
value
of
financial
instruments
for
which
market
prices
are
not
reliable
or
readily
available.
Under
these
procedures,
the
Funds
primarily
employ
a
market-based
approach
which
may
use
related
or
comparable
assets
or
liabilities,
recent
transactions,
market
multiples,
and
other
relevant
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
120
franklintempleton.com
Semiannual
Report
information
for
the
investment
to
determine
the
fair
value
of
the
investment.
An
income-based
valuation
approach
may
also
be
used
in
which
the
anticipated
future
cash
flows
of
the
investment
are
discounted
to
calculate
fair
value.
Discounts
may
also
be
applied
due
to
the
nature
or
duration
of
any
restrictions
on
the
disposition
of
the
investments.
Due
to
the
inherent
uncertainty
of
valuations
of
such
investments,
the
fair
values
may
differ
significantly
from
the
values
that
would
have
been
used
had
an
active
market
existed.
Trading
in
securities
on
foreign
securities
stock
exchanges
and
OTC
markets
may
be
completed
before
4
p.m.
Eastern
time.
In
addition,
trading
in
certain
foreign
markets
may
not
take
place
on
every
Funds'
business
day.
Events
can occur
between
the
time
at
which
trading
in
a
foreign
security
is
completed
and
4
p.m.
Eastern
time
that
might
call
into
question
the
reliability
of
the
value
of
a
portfolio
security
held
by
the
Fund.
As
a
result,
differences
may
arise
between
the
value
of
the
Funds'
portfolio
securities
as
determined
at
the
foreign
market
close
and
the
latest
indications
of
value
at
4
p.m.
Eastern
time.
In
order
to
minimize
the
potential
for
these
differences,
an
independent
pricing
service
may
be
used
to
adjust
the
value
of
the
Funds'
portfolio
securities
to
the
latest
indications
of
fair
value
at
4
p.m.
Eastern
time.
At
March
31,
2023,
certain
securities
may
have
been
fair
valued
using
these
procedures,
in
which
case
the
securities
were
categorized
as
Level
2
within
the
fair
value
hierarchy
(referred
to
as
“market
level
fair
value”).
See
the
Fair
Value
Measurements
note
for
more
information.
When
the
last
day
of
the
reporting
period
is
a
non-business
day,
certain
foreign
markets
may
be
open
on
those
days
that
the
Funds'
NAV
is
not
calculated,
which
could
result
in
differences
between
the
value
of
the
Funds'
portfolio
securities
on
the
last
business
day
and
the
last
calendar
day
of
the
reporting
period.
Any
security
valuation
changes
due
to
an
open
foreign
market
are
adjusted
and
reflected
by
the
Funds
for
financial
reporting
purposes.
b.
Foreign
Currency
Translation
Portfolio
securities
and
other
assets
and
liabilities
denominated
in
foreign
currencies
are
translated
into
U.S.
dollars
based
on
the
exchange
rate
of
such
currencies
against
U.S.
dollars
on
the
date
of
valuation.
The
Funds
may
enter
into
foreign
currency
exchange
contracts
to
facilitate
transactions
denominated
in
a
foreign
currency.
Purchases
and
sales
of
securities,
income
and
expense
items
denominated
in
foreign
currencies
are
translated
into
U.S.
dollars
at
the
exchange
rate
in
effect
on
the
transaction
date.
Portfolio
securities
and
assets
and
liabilities
denominated
in
foreign
currencies
contain
risks
that
those
currencies
will
decline
in
value
relative
to
the
U.S.
dollar.
Occasionally,
events
may
impact
the
availability
or
reliability
of
foreign
exchange
rates
used
to
convert
the
U.S.
dollar
equivalent
value.
If
such
an
event
occurs,
the
foreign
exchange
rate
will
be
valued
at
fair
value
using
procedures
established
and
approved
by
the
Board.
The
Funds
do
not
separately
report
the
effect
of
changes
in
foreign
exchange
rates
from
changes
in
market
prices
on
securities
held.
Such
changes
are
included
in
net
realized
and
unrealized
gain
or
loss
from
investments
in
the
Statements
of
Operations.
Realized
foreign
exchange
gains
or
losses
arise
from
sales
of
foreign
currencies,
currency
gains
or
losses
realized
between
the
trade
and
settlement
dates
on
securities
transactions
and
the
difference
between
the
recorded
amounts
of
dividends,
interest,
and
foreign
withholding
taxes
and
the
U.S.
dollar
equivalent
of
the
amounts
actually
received
or
paid.
Net
unrealized
foreign
exchange
gains
and
losses
arise
from
changes
in
foreign
exchange
rates
on
foreign
denominated
assets
and
liabilities
other
than
investments
in
securities
held
at
the
end
of
the
reporting
period.
c.
Securities
Purchased
on
a
Delayed
Delivery
Basis
Certain
or
all
Funds
purchase
securities
on
a
delayed
delivery
basis,
with
payment
and
delivery
scheduled
for
a
future
date.
These
transactions
are
subject
to
market
fluctuations
and
are
subject
to
the
risk
that
the
value
at
delivery
may
be
more
or
less
than
the
trade
date
purchase
price.
Although
the
Funds
will
generally
purchase
these
securities
with
the
intention
of
holding
the
securities,
they
may
sell
the
securities
before
the
settlement
date.
d.
Derivative
Financial
Instruments
Certain
or
all
Funds
invested
in
derivative
financial
instruments
in
order
to
manage
risk
or
gain
exposure
to
various
other
investments
or
markets.
Derivatives
are
financial
contracts
based
on
an
underlying
or
notional
amount,
require
no
initial
investment
or
an
initial
net
investment
that
is
smaller
than
would
normally
be
required
1.
Organization
and
Significant
Accounting
Policies
(continued)
a.
Financial
Instrument
Valuation
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
121
franklintempleton.com
Semiannual
Report
to
have
a
similar
response
to
changes
in
market
factors,
and
require
or
permit
net
settlement.
Derivatives
contain
various
risks
including
the
potential
inability
of
the
counterparty
to
fulfill
their
obligations
under
the
terms
of
the
contract,
the
potential
for
an
illiquid
secondary
market,
and/or
the
potential
for
market
movements
which
expose
the
Fund
to
gains
or
losses
in
excess
of
the
amounts
shown
in
the
Statements
of
Assets
and
Liabilities.
Realized
gain
and
loss
and
unrealized
appreciation
and
depreciation
on
these
contracts
for
the
period
are
included
in
the
Statements
of
Operations.
Collateral
requirements
differ
by
type
of
derivative.
Collateral
or
initial
margin
requirements
are
set
by
the
broker
or
exchange
clearing
house
for
exchange
traded
and
centrally
cleared
derivatives.
Initial
margin
deposited
is
held
at
the
exchange
and
can
be
in
the
form
of
cash
and/or
securities.
Certain
or
all
Funds
entered
into
exchange
traded
futures
contracts
primarily
to
manage
and/or
gain
exposure
to
interest
rate
risk
.
A
futures
contract
is
an
agreement
between
the
Fund
and
a
counterparty
to
buy
or
sell
an
asset
at
a
specified
price
on
a
future
date.
Required
initial
margins
are
pledged
by
the
Fund,
and
the
daily
change
in
fair
value
is
accounted
for
as
a
variation
margin
payable
or
receivable
in
the
Statements
of
Assets
and
Liabilities.
At
March
31,
2023
,
Franklin
DynaTech
Fund,
Franklin
Focused
Growth
Fund,
Franklin
Growth
Fund,
Franklin
U.S.
Government
Securities
F
und
and
Franklin
Utilities
Fund
had
no
futures
contracts.
Certain
or
all
Funds
purchased
or
wrote
exchange
traded
option
contracts
primarily
to
manage
exposure
to
equity
price
risk.
An
option
is
a
contract
entitling
the
holder
to
purchase
or
sell
a
specific
amount
of
shares
or
units
of
an
asset
or
notional
amount
of
a
swap
(swaption),
at
a
specified
price.
When
an
option
is
purchased
or
written,
an
amount
equal
to
the
premium
paid
or
received
is
recorded
as
an
asset
or
liability,
respectively.
Upon
exercise
of
an
option,
the
acquisition
cost
or
sales
proceeds
of
the
underlying
investment
is
adjusted
by
any
premium
received
or
paid.
Upon
expiration
of
an
option,
any
premium
received
or
paid
is
recorded
as
a
realized
gain
or
loss.
Upon
closing
an
option
other
than
through
expiration
or
exercise,
the
difference
between
the
premium
received
or
paid
and
the
cost
to
close
the
position
is
recorded
as
a
realized
gain
or
loss.
At
March
31,
2023
,
Franklin
DynaTech
Fund,
Franklin
Focused
Growth
Fund,
Franklin
Growth
Fund,
Franklin
U.S.
Government
Securities
Fund
and
Franklin
Utilities
Fund
had
no
options.
See
Note
10
regarding
other
derivative
information.
e.
Equity-Linked
Securities
Certain
or
all
Funds
invest in
equity-linked
securities.
Equity-linked
securities
are
hybrid
financial
instruments
that
generally
combine
both
debt
and
equity
characteristics
into
a
single
note
form.
Income
received
from
equity-linked
securities
is
recorded
as
realized
gains
in
the
Statements
of
Operations
and
may
be
based
on
the
performance
of
an
underlying
equity
security,
an
equity
index,
or
an
option
position.
The
risks
of
investing
in
equity-linked
securities
include
unfavorable
price
movements
in
the
underlying
security
and
the
credit
risk
of
the
issuing
financial
institution.
There
may
be
no
guarantee
of
a
return
of
principal
with
equity-linked
securities
and
the
appreciation
potential
may
be
limited.
Equity-linked
securities
may
be
more
volatile
and
less
liquid
than
other
investments
held
by
the
Funds.
f.
Securities
Lending
Certain
or
all
Funds
participate
in
an
agency
based
securities
lending
program
to
earn
additional
income.
The
Fund
receives
collateral
in
the
form
of
cash
and/or
U.S.
Government
and
Agency
securities
against
the
loaned
securities
in
an
amount
equal
to
at
least
102%
of
the
fair
value
of
the
loaned
securities.
Collateral
is
maintained
over
the
life
of
the
loan
in
an
amount
not
less
than
100%
of
the
fair
value
of
loaned
securities,
as
determined
at
the
close
of
Fund
business
each
day;
any
additional
collateral
required
due
to
changes
in
security
values
is
delivered
to
the
Fund
on
the
next
business
day.
Any
cash
collateral
received
is
deposited
into
a
joint
cash
account
with
other
funds
and
is
used
to
invest
in
a
money
market
fund
managed
by
Franklin
Advisers,
Inc.,
an
affiliate
of
the
Funds,
and/or
a
joint
repurchase
agreement.
Additionally,
at
March
31,
2023,
Franklin
DynaTech
Fund
and
Franklin
Income
Fund
held
$977
and
$3,582,070,
respectively,
in
U.S.
Government
and
Agency
securities
as
collateral.
These
securities
are
held
as
collateral
in
segregated
accounts
with
the
Fund’s
custodian.
The
Fund
cannot
repledge
or
resell
these
securities
held
as
collateral.
As
such,
the
non-cash
collateral
is
excluded
from
the
Statements
of
Assets
and
Liabilities.
The
Fund
may
receive
income
from
the
investment
of
cash
collateral,
in
addition
to
lending
fees
and
rebates
paid
by
the
borrower.
Income
from
securities
loaned,
net
of
fees
paid
to
the
1.
Organization
and
Significant
Accounting
Policies
(continued)
d.
Derivative
Financial
Instruments
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
122
franklintempleton.com
Semiannual
Report
securities
lending
agent
and/or
third-party
vendor,
is
reported
separately
in
the
Statements
of
Operations.
The
Fund
bears
the
market
risk
with
respect
to
any
cash
collateral
investment,
securities
loaned,
and
the
risk
that
the
agent
may
default
on
its
obligations
to
the
Fund.
If
the
borrower
defaults
on
its
obligation
to
return
the
securities
loaned,
the
Fund
has
the
right
to
repurchase
the
securities
in
the
open
market
using
the
collateral
received.
The
securities
lending
agent
has
agreed
to
indemnify
the
Fund
in
the
event
of
default
by
a
third
party
borrower.
At
March
31,
2023,
Franklin
Focused
Growth
Fund,
Franklin
Growth
Fund,
Franklin
U.S.
Government
Securities
Fund
and
Franklin
Utilities
Fund
had
no
securities
on
loan.
g.
Senior
Floating
Rate
Interests
Certain
or
all
Funds
invest
in
senior
secured
corporate
loans
that
pay
interest
at
rates
which
are
periodically
reset
by
reference
to
a
base
lending
rate
plus
a
spread.
These
base
lending
rates
are
generally
the
prime
rate
offered
by
a
designated
U.S.
bank
or
the
Secured
Overnight
Financing
Rate
(SOFR).
Senior
secured
corporate
loans
often
require
prepayment
of
principal
from
excess
cash
flows
or
at
the
discretion
of
the
borrower.
As
a
result,
actual
maturity
may
be
substantially
less
than
the
stated
maturity.
Senior
secured
corporate
loans
in
which
the
Funds
invest
are
generally
readily
marketable,
but
may
be
subject
to
certain
restrictions
on
resale.
h.
Income
and
Deferred
Taxes
It
is each
Fund's
policy
to
qualify
as
a
regulated
investment
company
under
the
Internal
Revenue
Code. Each
Fund
intends
to
distribute
to
shareholders
substantially
all
of
its
taxable
income
and
net
realized
gains
to
relieve
it
from
federal
income
and excise
taxes.
As
a
result,
no
provision
for
U.S.
federal
income
taxes
is
required.
The
Funds
may
be
subject
to
foreign
taxation
related
to
income
received,
capital
gains
on
the
sale
of
securities
and
certain
foreign
currency
transactions
in
the
foreign
jurisdictions
in
which
the
Funds
invest.
Foreign
taxes,
if
any,
are
recorded
based
on
the
tax
regulations
and
rates
that
exist
in
the
foreign
markets
in
which
the
Funds
invest.
When
a
capital
gain
tax
is
determined
to
apply,
certain
or
all
Funds
record
an
estimated
deferred
tax
liability
in
an
amount
that
would
be
payable
if
the
securities
were
disposed
of
on
the
valuation
date.
As
a
result
of
several
court
cases,
in
certain
countries
across
the
European
Union,
certain
or
all
Funds
filed
additional
tax
reclaims
for
previously
withheld
taxes
on
dividends
earned
in
those
countries
(EU
reclaims).
Income
recognized,
if
any,
for
EU
reclaims
is
reflected
as
other
income
in
the
Statements of
Operations
and
any
related
receivable,
if
any,
is
reflected
as
European
Union
tax
reclaims
in
the
Statements
of
Assets
and
Liabilities.
Any
fees
associated
with
these
filings
are
reflected
in
other
expenses
in
the
Statements
of
Operations.
When
uncertainty
exists
as
to
the
ultimate
resolution
of
these
proceedings,
the
likelihood
of
receipt
of
these
EU
reclaims,
and
the
potential
timing
of
payment,
no
amounts
are
reflected
in
the
financial
statements.
For
U.S.
income
tax
purposes,
EU
reclaims
received
by
the
Funds,
if
any,
reduce
the
amount
of
foreign
taxes
Fund
shareholders
can
use
as
tax
deductions
or
credits
on
their
income
tax
returns.
Each
Fund
may
recognize
an
income
tax
liability
related
to
its
uncertain
tax
positions
under
U.S.
GAAP
when
the
uncertain
tax
position
has
a
less
than
50%
probability
that
it
will
be
sustained
upon
examination
by
the
tax
authorities
based
on
its
technical
merits.
As
of
March
31,
2023, each
Fund
has
determined
that
no
tax
liability
is
required
in
its
financial
statements
related
to
uncertain
tax
positions
for
any
open
tax
years
(or
expected
to
be
taken
in
future
tax
years).
Open
tax
years
are
those
that
remain
subject
to
examination
and
are
based
on
the
statute
of
limitations
in
each
jurisdiction
in
which
the
Fund
invests.
i.
Security
Transactions,
Investment
Income,
Expenses
and
Distributions
Security
transactions
are
accounted
for
on
trade
date.
Realized
gains
and
losses
on
security
transactions
are
determined
on
a
specific
identification
basis.
Interest
income
and
estimated
expenses
are
accrued
daily.
Amortization
of
premium
and
accretion
of
discount
on
debt
securities
are
included
in
interest
income.
Paydown
gains
and
losses
are
recorded
separately
on
the Statements
of
Operations.
Facility
fees
are
recognized
as
income
over
the
expected
term
of
the
loan.
Dividend
income
is
recorded
on
the
ex-
dividend
date
except
for
certain
dividends
from
securities
where
the
dividend
rate
is
not
available.
In
such
cases,
the
dividend
is
recorded
as
soon
as
the
information
is
received
by
the
Funds.
Distributions
to shareholders
are
recorded
on
the
ex-dividend
date.
Distributable
earnings
are
determined
1.
Organization
and
Significant
Accounting
Policies
(continued)
f.
Securities
Lending
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
123
franklintempleton.com
Semiannual
Report
according
to
income
tax
regulations
(tax
basis)
and
may
differ
from
earnings
recorded
in
accordance
with
U.S.
GAAP.
These
differences
may
be
permanent
or
temporary.
Permanent
differences
are
reclassified
among
capital
accounts
to
reflect
their
tax
character.
These
reclassifications
have
no
impact
on
net
assets
or
the
results
of
operations.
Temporary
differences
are
not
reclassified,
as
they
may
reverse
in
subsequent
periods.
Common
expenses
incurred
by
the
Trust
are
allocated
among
the
Funds
based
on
the
ratio
of
net
assets
of
each
Fund
to
the
combined
net
assets
of
the
Trust
or
based
on
the
ratio
of
number
of
shareholders
of
each
Fund
to
the
combined
number
of
shareholders
of
the
Trust.
Fund
specific
expenses
are
charged
directly
to
the
Fund
that
incurred
the
expense.
Realized
and
unrealized
gains
and
losses
and
net
investment
income,
excluding
class
specific
expenses,
are
allocated
daily
to
each
class
of
shares
based
upon
the
relative
proportion
of
net
assets
of
each
class.
Differences
in
per
share
distributions
by
class
are
generally
due
to
differences
in
class
specific
expenses.
j.
Accounting
Estimates
The
preparation
of
financial
statements
in
accordance
with
U.S.
GAAP
requires
management
to
make
estimates
and
assumptions
that
affect
the
reported
amounts
of
assets
and
liabilities
at
the
date
of
the
financial
statements
and
the
amounts
of
income
and
expenses
during
the
reporting
period.
Actual
results
could
differ
from
those
estimates.
k.
Guarantees
and
Indemnifications
Under
the
Trust's
organizational
documents,
its
officers
and
trustees
are
indemnified
by
the
Trust
against
certain
liabilities
arising
out
of
the
performance
of
their
duties
to
the
Trust.
Additionally,
in
the
normal
course
of
business,
the
Trust,
on
behalf
of
the
Funds,
enters
into
contracts
with
service
providers
that
contain
general
indemnification
clauses.
The
Trust's
maximum
exposure
under
these
arrangements
is
unknown
as
this
would
involve
future
claims
that
may
be
made
against
the
Trust
that
have
not
yet
occurred.
Currently,
the
Trust
expects
the
risk
of
loss
to
be
remote.
1.
Organization
and
Significant
Accounting
Policies
(continued)
i.
Security
Transactions,
Investment
Income,
Expenses
and
Distributions
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
124
franklintempleton.com
Semiannual
Report
2.
Shares
of
Beneficial
Interest
At
March
31,
2023,
there
were
an
unlimited
number
of
shares
authorized
(without
par
value).
Transactions
in
the
Funds'
shares
were
as
follows:
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Shares
Amount
Shares
Amount
Class
A
Class
A
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
a
...................................
4,685,166
$460,901,763
437,081
$8,927,863
Shares
redeemed
...............................
(7,027,391)
(685,661,870)
(460,881)
(9,492,602)
Net
increase
(decrease)
..........................
(2,342,225)
$(224,760,107)
(23,800)
$(564,739)
Year
ended
September
30,
2022
Shares
sold
a
...................................
14,363,386
$1,856,702,021
1,213,199
$33,600,799
Shares
issued
in
reinvestment
of
distributions
..........
1,053,354
163,733,239
15,386
489,286
Shares
redeemed
...............................
(14,802,906)
(1,827,958,180)
(1,027,936)
(25,688,699)
Net
increase
(decrease)
..........................
613,834
$192,477,080
200,649
$8,401,386
Class
C
Class
C
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
488,176
$38,511,045
39,255
$794,606
Shares
redeemed
a
..............................
(1,234,662)
(96,634,732)
(44,407)
(894,840)
Net
increase
(decrease)
..........................
(746,486)
$(58,123,687)
(5,152)
$(100,234)
Year
ended
September
30,
2022
Shares
sold
...................................
1,588,693
$169,004,456
97,172
$2,671,024
Shares
issued
in
reinvestment
of
distributions
..........
175,065
22,063,462
1,220
38,258
Shares
redeemed
a
..............................
(2,641,655)
(263,269,319)
(82,494)
(1,997,545)
Net
increase
(decrease)
..........................
(877,897)
$(72,201,401)
15,898
$711,737
Class
R
Class
R
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
111,287
$10,339,910
9,255
$181,749
Shares
redeemed
...............................
(212,985)
(20,500,816)
(4,169)
(87,459)
Net
increase
(decrease)
..........................
(101,698)
$(10,160,906)
5,086
$94,290
Year
ended
September
30,
2022
Shares
sold
...................................
453,729
$56,189,217
24,654
$667,940
Shares
issued
in
reinvestment
of
distributions
..........
30,631
4,583,974
186
5,897
Shares
redeemed
...............................
(422,749)
(50,654,066)
(18,389)
(477,266)
Net
increase
(decrease)
..........................
61,611
$10,119,125
6,451
$196,571
Class
R6
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
125
franklintempleton.com
Semiannual
Report
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Shares
Amount
Shares
Amount
Class
R6
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
7,310,819
$753,323,014
368
$8,013
Shares
redeemed
...............................
(9,111,231)
(946,584,492)
—
—
Net
increase
(decrease)
..........................
(1,800,412)
$(193,261,478)
368
$8,013
Year
ended
September
30,
2022
Shares
sold
...................................
19,924,717
$2,652,793,439
—
$—
Shares
issued
in
reinvestment
of
distributions
..........
819,201
134,013,149
13
415
Shares
redeemed
...............................
(15,624,599)
(1,998,257,143)
—
—
Net
increase
(decrease)
..........................
5,119,319
$788,549,445
13
$415
Advisor
Class
Advisor
Class
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
2,596,154
$265,725,546
262,336
$5,397,904
Shares
redeemed
...............................
(5,170,202)
(522,192,575)
(117,214)
(2,389,014)
Net
increase
(decrease)
..........................
(2,574,048)
$(256,467,029)
145,122
$3,008,890
Year
ended
September
30,
2022
Shares
sold
...................................
8,399,379
$1,127,784,359
315,963
$8,974,322
Shares
issued
in
reinvestment
of
distributions
..........
331,088
53,493,894
4,116
131,564
Shares
redeemed
...............................
(11,793,370)
(1,459,742,868)
(618,869)
(17,335,380)
Net
increase
(decrease)
..........................
(3,062,903)
$(278,464,615)
(298,790)
$(8,229,494)
2.
Shares
of
Beneficial
Interest
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
126
franklintempleton.com
Semiannual
Report
Franklin
Growth
Fund
Franklin
Income
Fund
Shares
Amount
Shares
Amount
Class
A
Class
A
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
a
...................................
3,437,816
$371,119,221
1,030,086,796
$2,337,638,915
Shares
issued
in
reinvestment
of
distributions
..........
8,412,604
874,237,952
219,687,812
498,953,240
Shares
redeemed
...............................
(7,151,713)
(776,550,635)
(617,671,671)
(1,399,760,379)
Net
increase
(decrease)
..........................
4,698,707
$468,806,538
632,102,937
$1,436,831,776
Year
ended
September
30,
2022
Shares
sold
a
...................................
7,112,775
$950,008,754
1,967,528,153
$4,769,802,324
Shares
issued
in
reinvestment
of
distributions
..........
7,829,335
1,123,352,847
441,349,127
1,064,714,504
Shares
redeemed
...............................
(13,642,430)
(1,794,954,226)
(1,046,858,486)
(2,525,056,501)
Net
increase
(decrease)
..........................
1,299,680
$278,407,375
1,362,018,794
$3,309,460,327
Class
A1
Class
A1
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
—
$—
210,456,105
$478,478,333
Shares
issued
in
reinvestment
of
distributions
..........
—
—
383,696,060
872,094,476
Shares
redeemed
...............................
—
—
(864,749,439)
(1,964,354,732)
Net
increase
(decrease)
..........................
—
$—
(270,597,274)
$(613,781,923)
Year
ended
September
30,
2022
Shares
sold
...................................
—
$—
462,966,749
$1,128,353,082
Shares
issued
in
reinvestment
of
distributions
..........
—
—
921,359,816
2,231,616,951
Shares
redeemed
...............................
—
—
(1,716,035,662)
(4,169,117,838)
Net
increase
(decrease)
..........................
—
$—
(331,709,097)
$(809,147,805)
Class
C
Class
C
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
271,699
$25,235,702
159,595,937
$370,402,159
Shares
issued
in
reinvestment
of
distributions
..........
495,655
44,157,863
63,636,929
147,427,513
Shares
redeemed
a
..............................
(846,377)
(79,363,901)
(425,275,563)
(981,977,513)
Net
increase
(decrease)
..........................
(79,023)
$(9,970,336)
(202,042,697)
$(464,147,841)
Year
ended
September
30,
2022
Shares
sold
...................................
555,692
$66,038,572
376,265,055
$933,445,062
Shares
issued
in
reinvestment
of
distributions
..........
521,624
65,667,219
172,175,078
424,342,430
Shares
redeemed
a
..............................
(1,579,860)
(181,243,556)
(943,189,191)
(2,334,966,527)
Net
increase
(decrease)
..........................
(502,544)
$(49,537,765)
(394,749,058)
$(977,179,035)
Class
R
2.
Shares
of
Beneficial
Interest
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
127
franklintempleton.com
Semiannual
Report
Franklin
Growth
Fund
Franklin
Income
Fund
Shares
Amount
Shares
Amount
Class
R
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
135,397
$14,547,505
13,865,236
$30,844,749
Shares
issued
in
reinvestment
of
distributions
..........
242,555
24,932,196
3,709,635
8,244,652
Shares
redeemed
...............................
(319,210)
(34,485,636)
(11,576,386)
(25,719,933)
Net
increase
(decrease)
..........................
58,742
$4,994,065
5,998,485
$13,369,468
Year
ended
September
30,
2022
Shares
sold
...................................
225,684
$29,038,794
38,495,084
$91,632,223
Shares
issued
in
reinvestment
of
distributions
..........
244,578
34,832,817
7,597,250
17,950,459
Shares
redeemed
...............................
(699,391)
(94,080,831)
(23,493,263)
(55,725,464)
Net
increase
(decrease)
..........................
(229,129)
$(30,209,220)
22,599,071
$53,857,218
Class
R6
Class
R6
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
1,273,623
$138,229,779
237,262,719
$534,267,242
Shares
issued
in
reinvestment
of
distributions
..........
1,715,972
179,878,131
15,649,013
35,407,199
Shares
redeemed
...............................
(2,783,858)
(306,870,107)
(59,154,435)
(133,574,632)
Net
increase
(decrease)
..........................
205,737
$11,237,803
193,757,297
$436,099,809
Year
ended
September
30,
2022
Shares
sold
...................................
3,675,674
$475,633,325
297,381,010
$723,113,206
Shares
issued
in
reinvestment
of
distributions
..........
1,758,267
253,489,423
25,240,470
60,705,956
Shares
redeemed
in-kind
(Note
13
)
..................
(448,827)
(65,832,485)
—
—
Shares
redeemed
...............................
(6,581,226)
(867,937,830)
(83,879,771)
(202,206,227)
Net
increase
(decrease)
..........................
(1,596,112)
$(204,647,567)
238,741,709
$581,612,935
Advisor
Class
Advisor
Class
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
2,212,577
$241,128,327
828,674,687
$1,871,685,832
Shares
issued
in
reinvestment
of
distributions
..........
2,262,495
237,226,372
160,441,957
361,368,031
Shares
redeemed
...............................
(3,760,985)
(414,735,520)
(699,939,283)
(1,571,598,832)
Net
increase
(decrease)
..........................
714,087
$63,619,179
289,177,361
$661,455,031
Year
ended
September
30,
2022
Shares
sold
...................................
5,539,441
$691,586,170
1,421,259,437
$3,411,492,621
Shares
issued
in
reinvestment
of
distributions
..........
2,305,617
332,746,676
333,722,149
799,087,621
Shares
redeemed
in-kind
(Note
3h)
..................
(924,131)
(104,759,504)
—
—
Shares
redeemed
...............................
(9,694,616)
(1,226,572,517)
(1,157,679,072)
(2,765,165,069)
Net
increase
(decrease)
..........................
(2,773,689)
$(306,999,175)
597,302,514
$1,445,415,173
2.
Shares
of
Beneficial
Interest
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
128
franklintempleton.com
Semiannual
Report
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Shares
Amount
Shares
Amount
Class
A
Class
A
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
a
...................................
10,623,324
$54,323,068
7,328,292
$153,964,181
Shares
issued
in
reinvestment
of
distributions
..........
1,758,127
8,968,078
1,386,537
29,851,732
Shares
redeemed
...............................
(21,964,498)
(111,906,918)
(6,615,764)
(139,025,982)
Net
increase
(decrease)
..........................
(9,583,047)
$(48,615,772)
2,099,065
$44,789,931
Year
ended
September
30,
2022
Shares
sold
a
...................................
28,163,866
$157,662,763
20,426,933
$453,472,027
Shares
issued
in
reinvestment
of
distributions
..........
3,489,049
19,245,353
2,332,270
48,266,115
Shares
redeemed
...............................
(68,182,403)
(381,457,088)
(12,123,828)
(266,521,547)
Net
increase
(decrease)
..........................
(36,529,488)
$(204,548,972)
10,635,375
$235,216,595
Class
A1
Class
A1
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
8,866,937
$44,834,275
2,481,737
$52,290,239
Shares
issued
in
reinvestment
of
distributions
..........
4,050,570
20,676,064
3,749,950
80,758,949
Shares
redeemed
...............................
(33,464,609)
(170,455,463)
(10,581,999)
(222,244,495)
Net
increase
(decrease)
..........................
(20,547,102)
$(104,945,124)
(4,350,312)
$(89,195,307)
Year
ended
September
30,
2022
Shares
sold
...................................
10,992,579
$61,460,301
6,815,891
$150,191,697
Shares
issued
in
reinvestment
of
distributions
..........
7,641,977
42,120,329
7,794,675
161,036,003
Shares
redeemed
...............................
(59,374,388)
(331,447,110)
(19,602,339)
(428,004,505)
Net
increase
(decrease)
..........................
(40,739,832)
$(227,866,480)
(4,991,773)
$(116,776,805)
Class
C
Class
C
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
6,477,155
$32,611,133
772,028
$16,213,243
Shares
issued
in
reinvestment
of
distributions
..........
285,122
1,444,343
329,706
7,068,284
Shares
redeemed
a
..............................
(6,826,926)
(34,519,968)
(2,579,152)
(53,666,713)
Net
increase
(decrease)
..........................
(64,649)
$(464,492)
(1,477,418)
$(30,385,186)
Year
ended
September
30,
2022
Shares
sold
...................................
4,759,211
$26,534,963
2,115,656
$46,531,797
Shares
issued
in
reinvestment
of
distributions
..........
546,780
2,996,336
769,737
15,737,676
Shares
redeemed
a
..............................
(15,663,297)
(86,987,590)
(5,296,474)
(115,221,190)
Net
increase
(decrease)
..........................
(10,357,306)
$(57,456,291)
(2,411,081)
$(52,951,717)
Class
R
2.
Shares
of
Beneficial
Interest
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
129
franklintempleton.com
Semiannual
Report
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Shares
Amount
Shares
Amount
Class
R
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
469,675
$2,429,010
754,082
$15,749,214
Shares
issued
in
reinvestment
of
distributions
..........
39,838
203,389
129,523
2,778,208
Shares
redeemed
...............................
(476,488)
(2,437,250)
(701,312)
(14,773,160)
Net
increase
(decrease)
..........................
33,025
$195,149
182,293
$3,754,262
Year
ended
September
30,
2022
Shares
sold
...................................
781,481
$4,240,961
1,807,582
$39,910,876
Shares
issued
in
reinvestment
of
distributions
..........
66,564
366,299
212,284
4,365,844
Shares
redeemed
...............................
(1,083,625)
(6,016,702)
(1,033,330)
(22,447,718)
Net
increase
(decrease)
..........................
(235,580)
$(1,409,442)
986,536
$21,829,002
Class
R6
Class
R6
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
4,204,299
$21,609,304
2,497,370
$52,754,719
Shares
issued
in
reinvestment
of
distributions
..........
609,932
3,127,584
289,637
6,295,835
Shares
redeemed
...............................
(6,072,388)
(31,144,041)
(2,754,318)
(58,557,558)
Net
increase
(decrease)
..........................
(1,258,157)
$(6,407,153)
32,689
$492,996
Year
ended
September
30,
2022
Shares
sold
...................................
9,713,988
$54,869,336
5,404,404
$121,039,182
Shares
issued
in
reinvestment
of
distributions
..........
1,245,685
6,913,611
460,767
9,666,565
Shares
redeemed
...............................
(22,336,576)
(125,311,553)
(2,484,233)
(55,031,549)
Net
increase
(decrease)
..........................
(11,376,903)
$(63,528,606)
3,380,938
$75,674,198
Advisor
Class
Advisor
Class
Shares:
Six
Months
ended
March
31,
2023
Shares
sold
...................................
6,740,162
$34,689,613
7,448,326
$158,471,155
Shares
issued
in
reinvestment
of
distributions
..........
764,342
3,913,945
1,681,519
36,561,209
Shares
redeemed
...............................
(11,461,384)
(58,756,171)
(11,193,258)
(237,457,318)
Net
increase
(decrease)
..........................
(3,956,880)
$(20,152,613)
(2,063,413)
$(42,424,954)
Year
ended
September
30,
2022
Shares
sold
...................................
26,643,569
$146,873,967
18,972,988
$427,940,062
Shares
issued
in
reinvestment
of
distributions
..........
2,135,912
11,924,174
3,023,204
63,261,713
Shares
redeemed
...............................
(86,296,878)
(474,444,605)
(13,271,920)
(292,500,005)
Net
increase
(decrease)
..........................
(57,517,397)
$(315,646,464)
8,724,272
$198,701,770
a
May
include
a
portion
of
Class
C
shares
that
were
automatically
converted
to
Class
A.
2.
Shares
of
Beneficial
Interest
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
130
franklintempleton.com
Semiannual
Report
3.
Transactions
with
Affiliates
Franklin
Resources,
Inc.
is
the
holding
company
for
various
subsidiaries
that
together
are
referred
to
as
Franklin
Templeton.
Certain
officers
and
trustees
of
the
Trust
are
also
officers
and/or
directors
of
the
following
subsidiaries:
a.
Management
Fees
Franklin
Income
Fund
and
Franklin
Utilities
Fund
pay
an
investment
management
fee,
calculated
daily
and
paid
monthly,
to
Advisers
based
on
the
month-end
net
assets
of
each
of
the
Funds
as
follows:
Franklin
DynaTech
Fund,
Franklin
Growth
Fund
and
Franklin
U.S.
Government
Securities
Fund
pay
an
investment
management
fee,
calculated
daily
and
paid
monthly,
to
Advisers
based
on
the
month-end
net
assets
of
each
of
the
Funds
as
follows:
Subsidiary
Affiliation
Franklin
Advisers,
Inc.
(Advisers)
Investment
manager
Franklin
Templeton
Services,
LLC
(FT
Services)
Administrative
manager
Franklin
Distributors,
LLC
(Distributors)
Principal
underwriter
Franklin
Templeton
Investor
Services,
LLC
(Investor
Services)
Transfer
agent
Annualized
Fee
Rate
Net
Assets
0.625%
Up
to
and
including
$100
million
0.500%
Over
$100
million,
up
to
and
including
$250
million
0.450%
Over
$250
million,
up
to
and
including
$7.5
billion
0.440%
Over
$7.5
billion,
up
to
and
including
$10
billion
0.430%
Over
$10
billion,
up
to
and
including
$12.5
billion
0.420%
Over
$12.5
billion,
up
to
and
including
$15
billion
0.400%
Over
$15
billion,
up
to
and
including
$17.5
billion
0.380%
Over
$17.5
billion,
up
to
and
including
$20
billion
0.360%
Over
$20
billion,
up
to
and
including
$35
billion
0.355%
Over
$35
billion,
up
to
and
including
$50
billion
0.350%
Over
$50
billion,
up
to
and
including
$65
billion
0.345%
Over
$65
billion,
up
to
and
including
$80
billion
0.340%
In
excess
of
$80
billion
Annualized
Fee
Rate
Net
Assets
0.625%
Up
to
and
including
$100
million
0.500%
Over
$100
million,
up
to
and
including
$250
million
0.450%
Over
$250
million,
up
to
and
including
$7.5
billion
0.440%
Over
$7.5
billion,
up
to
and
including
$10
billion
0.430%
Over
$10
billion,
up
to
and
including
$12.5
billion
0.420%
Over
$12.5
billion,
up
to
and
including
$15
billion
0.400%
Over
$15
billion,
up
to
and
including
$17.5
billion
0.380%
Over
$17.5
billion,
up
to
and
including
$20
billion
0.360%
Over
$20
billion,
up
to
and
including
$35
billion
0.355%
Over
$35
billion,
up
to
and
including
$50
billion
0.350%
In
excess
of
$50
billion
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
131
franklintempleton.com
Semiannual
Report
Franklin
Focused
Growth
Fund
pays
an
investment
management
fee,
calculated
daily
and
paid
monthly,
to
Advisers
based
on
the
average
daily
net
assets
of
the
Fund as
follows:
For
the
period
ended
March
31,
2023,
each
Fund's
annualized
gross
effective
investment
management
fee
rate
based
on
average
daily
net
assets
was
as
follows:
b.
Administrative
Fees
Under
an
agreement
with
Advisers,
FT
Services
provides
administrative
services
to
the
Funds.
The
fee
is
paid
by
Advisers
based
on
each
of
the
Funds'
average
daily
net
assets,
and
is
not
an
additional
expense
of
the
Funds.
c.
Distribution
Fees
The
Board
has
adopted
distribution
plans
for
each
share
class,
with
the
exception
of
Class
R6
and
Advisor
Class
shares,
pursuant
to
Rule
12b-1
under
the
1940
Act.
Under
the
Funds’
Class
A
and
A1
reimbursement
distribution
plans,
the
Funds
reimburse
Distributors
for
costs
incurred
in
connection
with
the
servicing,
sale
and
distribution
of each
Fund's
shares
up
to
the
maximum
annual
plan
rate
for
each
class.
Under
the
Class
A
and
A1
reimbursement
distribution
plans,
costs
exceeding
the
maximum
for
the
current
plan
year
cannot
be
reimbursed
in
subsequent
periods.
In
addition,
under
the
Funds’
Class
C
and
R
compensation
distribution
plans,
the
Funds
pay
Distributors
for
costs
incurred
in
connection
with
the
servicing,
sale
and
distribution
of
each
Fund's
shares
up
to
the
maximum
annual
plan
rate
for
each
class.
The
plan
year,
for
purposes
of
monitoring
compliance
with
the
maximum
annual
plan
rates,
is
February
1
through
January
31
for
each
Fund.
The
maximum
annual
plan
rates,
based
on
the
average
daily
net
assets,
for
each
class,
are
as
follows:
Annualized
Fee
Rate
Net
Assets
0.700%
Up
to
and
including
$500
million
0.600%
Over
$500
million,
up
to
and
including
$1
billion
0.550%
Over
$1
billion,
up
to
and
including
$3
billion
0.500%
Over
$3
billion,
up
to
and
including
$5
billion
0.450%
In
excess
of
$5
billion
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Gross
effective
investment
management
fee
rate
........
0.435%
0.700%
0.440%
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Gross
effective
investment
management
fee
rate
........
0.376%
0.455%
0.450
%
3.
Transactions
with
Affiliates
(continued)
a.
Management
Fees
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
132
franklintempleton.com
Semiannual
Report
d.
Sales
Charges/Underwriting
Agreements
Front-end
sales
charges
and
contingent
deferred
sales
charges
(CDSC)
do
not
represent
expenses
of
the
Funds.
These
charges
are
deducted
from
the
proceeds
of
sales
of
fund
shares
prior
to
investment
or
from
redemption
proceeds
prior
to
remittance,
as
applicable.
Distributors
has
advised
the
Funds
of
the
following
commission
transactions
related
to
the
sales
and
redemptions
of
the
Funds'
shares
for
the
period:
Effective
March
1,
2023,
any
front-end
sales
charges
applicable
to
the
purchase
of
Franklin
Focused
Growth
Fund
shares
or
CDSC
applicable
to
the
redemption
of
the
Fund’s
shares
are
waived.
e.
Transfer
Agent
Fees
Each
class
of
shares
pays
transfer
agent
fees
to
Investor
Services
for
its
performance
of
shareholder
servicing
obligations.
Effective
October
1,
2022,
the
fees
are
based
on
an
annualized
asset
based
fee
of
0.016%
plus
a
reduced
transaction
based
fee.
Prior
to
October
1,
2022,
the
fees
were
based
on
an
annualized
asset
based
fee
of
0.02%
plus
a
transaction
based
fee.
In
addition,
each
class
reimburses
Investor
Services
for
out
of
pocket
expenses
incurred
and,
except
for
Class
R6,
reimburses
shareholder
servicing
fees
paid
to
third
parties.
These
fees
are
allocated
daily
based
upon
their
relative
proportion
of
such
classes'
aggregate
net
assets.
Class
R6
pays
Investor
Services
transfer
agent
fees
specific
to
that
class.
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Class
A
...............................
0.25%
0.25%
0.25%
Class
C
...............................
1.00%
1.00%
1.00%
Class
R
...............................
0.50%
0.50%
0.50%
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Class
A
...............................
0.25%
0.25%
0.25%
Class
A1
..............................
0.15%
0.15%
0.15%
Class
C
...............................
0.65%
0.65%
0.65%
Class
R
...............................
0.50%
0.50%
0.50%
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Sales
charges
retained
net
of
commissions
paid
to
unaffiliated
brokers/dealers
..................
$835,348
$8,681
$458,912
CDSC
retained
...........................
$69,219
$181
$22,843
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Sales
charges
retained
net
of
commissions
paid
to
unaffiliated
brokers/dealers
..................
$1,206,392
$10,541
$63,308
CDSC
retained
...........................
$605,399
$7,971
$27,637
3.
Transactions
with
Affiliates
(continued)
c.
Distribution
Fees
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
133
franklintempleton.com
Semiannual
Report
For
the
period
ended
March
31,
2023,
the
Funds
paid
transfer
agent
fees
as
noted
in
the
Statements
of
Operations
of
which
the
following
amounts
were
retained
by
Investor
Services:
f.
Investments
in
Affiliated
Management
Investment
Companies
Certain
or
all
Funds
invest
in
one
or
more
affiliated
management
investment
companies.
As
defined
in
the
1940
Act,
an
investment
is
deemed
to
be
a
“Controlled
Affiliate”
of
a
fund
when
a
fund
owns,
either
directly
or
indirectly,
25%
or
more
of
the
affiliated
fund’s
outstanding
shares
or
has
the
power
to
exercise
control
over
management
or
policies
of
such
fund.
The
Funds
do
not
invest
for
purposes
of
exercising
a
controlling
influence
over
the
management
or
policies.
Management
fees
paid
by
the
Funds
are
waived
on
assets
invested
in
the
affiliated
management
investment
companies,
as
noted
in
the
Statements
of
Operations,
in
an
amount
not
to
exceed
the
management
and
administrative
fees
paid
directly
or
indirectly
by
each
affiliate.
During
the
period
ended
March
31,
2023,
investments
in
affiliated
management
investment
companies
were
as
follows:
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Transfer
agent
fees
........................
$2,476,755
$39,555
$2,646,391
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Transfer
agent
fees
........................
$9,753,692
$791,715
$1,176,648
aa
Value
at
Beginning
of
Period
Purchases
Sales
Realized
Gain
(Loss)
Net
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
End
of
Period
Number
of
Shares
Held
at
End
of
Period
Investment
Income
a
a
a
a
a
a
a
a
Franklin
DynaTech
Fund
Non-Controlled
Affiliates
Dividends
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
$
270,863,972
$
1,120,218,106
$
(1,151,526,635)
$
—
$
—
$
239,555,443
239,555,443
$
2,506,726
Non-Controlled
Affiliates
Income
from
securities
loaned
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
$385,000
$42,513,000
$(31,424,000)
$—
$—
$11,474,000
11,474,000
$91,388
Total
Affiliated
Securities
...
$271,248,972
$1,162,731,106
$(1,182,950,635)
$—
$—
$251,029,443
$2,598,114
Franklin
Focused
Growth
Fund
Non-Controlled
Affiliates
Dividends
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
$1,276,224
$9,474,862
$(9,549,377)
$—
$—
$1,201,709
1,201,709
$38,722
Total
Affiliated
Securities
...
$1,276,224
$9,474,862
$(9,549,377)
$—
$—
$1,201,709
$38,722
3.
Transactions
with
Affiliates
(continued)
e.
Transfer
Agent
Fees
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
134
franklintempleton.com
Semiannual
Report
aa
Value
at
Beginning
of
Period
Purchases
Sales
Realized
Gain
(Loss)
Net
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
End
of
Period
Number
of
Shares
Held
at
End
of
Period
Investment
Income
Franklin
Growth
Fund
Non-Controlled
Affiliates
Dividends
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
$69,725,524
$822,019,714
$(797,097,877)
$—
$—
$94,647,361
94,647,361
$1,497,435
Non-Controlled
Affiliates
Income
from
securities
loaned
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
$—
$1,386,000
$(1,386,000)
$—
$—
$—
—
$453
Total
Affiliated
Securities
...
$69,725,524
$823,405,714
$(798,483,877)
$—
$—
$94,647,361
$1,497,888
Franklin
Income
Fund
Non-Controlled
Affiliates
Dividends
Clarion
Partners
Real
Estate
Income
Fund,
Inc.,
Class
I
....
$75,098,472
$25,000,000
$—
$—
$(3,324,129)
$96,774,343
7,867,833
$2,560,350
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
880,891,701
8,707,735,691
(7,412,136,314)
—
—
2,176,491,078
2,176,491,078
20,800,395
Total
Non-Controlled
Affiliates
$955,990,173
$8,732,735,691
$(7,412,136,314)
$
—
$
(3,324,129)
$2,273,265,421
$
23,360,745
Non-Controlled
Affiliates
Income
from
securities
loaned
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
$124,103,000
$379,739,000
$(330,660,000)
$—
$—
$173,182,000
173,182,000
$2,915,543
Total
Affiliated
Securities
...
$1,080,093,173
$9,112,474,691
$(7,742,796,314)
$—
$(3,324,129)
$2,446,447,421
$26,276,288
Franklin
U.S.
Government
Securities
Fund
Non-Controlled
Affiliates
Dividends
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
$47,626,883
$223,973,996
$(226,592,778)
$—
$—
$45,008,101
45,008,101
$883,404
Total
Affiliated
Securities
...
$47,626,883
$223,973,996
$(226,592,778)
$—
$—
$45,008,101
$883,404
3.
Transactions
with
Affiliates
(continued)
f.
Investments
in
Affiliated
Management
Investment
Companies
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
135
franklintempleton.com
Semiannual
Report
g.
Waiver
and
Expense
Reimbursements
Advisers
has
contractually
agreed
in
advance
to
waive
or
limit
its
respective
fees
and
to
assume
as
its
own
expense
certain
expenses
otherwise
payable
by
Franklin
Focused
Growth
Fund
so
that
the
operating
expenses
(excluding
interest
expense,
distribution
fees,
acquired
fund
fees
and
expenses
and
certain
non-routine
expenses
or
costs,
including
those
relating
to
litigation,
indemnification,
reorganizations,
and
liquidations)
for
each
class
of
the
Fund
does
not
exceed
0.85%
based
on
the
average
net
assets
of
each
class
until
January
31,
2024.
Total
expenses
waived
or
paid
are
not
subject
to
recapture
subsequent
to
the
Fund’s
fiscal
year
end.
Investor
Services
has
contractually
agreed
in
advance
to
waive
or
limit
its
fees
so
that
the
Class
R6
transfer
agent
fees
do
not
exceed
0.03%
based
on
the
average
net
assets
of
the
class
until
January
31,
2024.
h.
Other
Affiliated
Transactions
During
the
year
ended
September
30,
2022,
the
New
Jersey
Better
Educational
Savings
Trust
Program
–
Franklin
Templeton
Managed
Investments
Options
(529
Portfolios)
redeemed
out
of
Franklin
Growth
Fund.
As
a
result,
on
July
15,
2022,
the
Fund
delivered
portfolio
securities
and
cash
that
were
transferred
in-kind
to
the
529
Portfolios,
which
included
$74,761,884
of
net
realized
gains.
As
such
gains
are
not
taxable
to
the
Fund
and
are
not
distributed
to
remaining
shareholders,
they
are
reclassified
from
accumulated
net
realized
gains
to
paid-in
capital.
4.
Expense
Offset
Arrangement
The
Funds
have entered
into
an
arrangement
with
their
custodian
whereby
credits
realized
as
a
result
of
uninvested
cash
balances
are
used
to
reduce
a
portion
of
the
Funds'
custodian
expenses.
During
the period
ended
March
31,
2023, the
custodian
fees
were
reduced
as
noted
in
the
Statements
of
Operations.
aa
Value
at
Beginning
of
Period
Purchases
Sales
Realized
Gain
(Loss)
Net
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
End
of
Period
Number
of
Shares
Held
at
End
of
Period
Investment
Income
Franklin
Utilities
Fund
Non-Controlled
Affiliates
Dividends
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.371%
$67,045,219
$274,296,307
$(322,596,865)
$—
$—
$18,744,661
18,744,661
$477,191
Total
Affiliated
Securities
...
$67,045,219
$274,296,307
$(322,596,865)
$—
$—
$18,744,661
$477,191
3.
Transactions
with
Affiliates
(continued)
f.
Investments
in
Affiliated
Management
Investment
Companies
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
136
franklintempleton.com
Semiannual
Report
5.
Income
Taxes
For
tax
purposes,
capital
losses
may
be
carried
over
to
offset
future
capital
gains.
At
September
30,
2022,
the
capital
loss
carryforwards
were
as
follows:
For
tax
purposes,
the
Funds
may
elect
to
defer
any
portion
of
a
post-October
capital
loss
or
late-year
ordinary
loss
to
the
first
day
of
the
following
fiscal
year.
At
September
30,
2022,
the
deferred
losses
were
as
follows:
At
March
31,
2023,
the
cost
of
investments
and
net
unrealized
appreciation
(depreciation)
for
income
tax
purposes
were
as
follows:
Differences
between
income
and/or
capital
gains
as
determined
on
a
book
basis
and
a
tax
basis
are
primarily
due
to
differing
treatments
of
defaulted
securities,
EU
reclaims,
paydown
losses,
bond
discounts
and
premiums,
equity-linked
securities,
wash
sales
and
gains
realized
on
in-kind
shareholder
redemptions.
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
1
1
1
Capital
loss
carryforwards
not
subject
to
expiration:
Short
term
.............................
$
686,503,830
$
348,984,907
Long
term
.............................
—
434,722,766
Total
capital
loss
carryforwards
............
$686,503,830
$783,707,673
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
1
1
1
Late-year
ordinary
loss
....................
$50,086,969
$430,108
Post-October
capital
loss
..................
883,455,170
11,785,456
$933,542,139
$12,215,564
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
a
a
a
a
Cost
of
investments
.......................
$11,701,043,761
$75,235,858
$5,245,170,977
Unrealized
appreciation
.....................
$7,330,901,105
$12,990,316
$10,954,062,837
Unrealized
depreciation
.....................
(193,262,904)
(6,059,838)
(262,312,516)
Net
unrealized
appreciation
(depreciation)
.......
$7,137,638,201
$6,930,478
$10,691,750,321
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
a
a
a
a
Cost
of
investments
.......................
$72,141,098,592
$3,093,995,821
$3,250,502,157
Unrealized
appreciation
.....................
$3,534,322,209
$5,635,916
$3,339,317,657
Unrealized
depreciation
.....................
(3,952,908,380)
(299,451,170)
(9,342,089)
Net
unrealized
appreciation
(depreciation)
.......
$(418,586,171)
$(293,815,254)
$3,329,975,568
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
137
franklintempleton.com
Semiannual
Report
6.
Investment
Transactions
Purchases
and
sales
of
investments
(excluding
short
term
securities)
for
the
period
ended
March
31,
2023,
were
as
follows:
At
March
31,
2023,
in
connection
with
securities
lending
transactions,
certain
or
all
Funds
loaned
investments
and
received
cash
collateral
as
follows:
7.
Credit Risk
and
Defaulted
Securities
At
March
31,
2023,
Franklin
Income
Fund
had
30.3%
of
its
portfolio
invested
in
high
yield
securities,
senior
secured
floating
rate
loans,
or
other
securities
rated
below
investment
grade
and
unrated
securities.
These
securities
may
be
more
sensitive
to
economic
conditions
causing
greater
price
volatility
and
are
potentially
subject
to
a
greater
risk
of
loss
due
to
default
than
higher
rated
securities.
Franklin
Income
Fund
held
defaulted
securities
and/or
other
securities
for
which
the
income
has
been
deemed
uncollectible.
At
March
31,
2023,
the
aggregate
value
of
these
securities
was
$228,685,228,
representing
0.3%
of
the
Fund's
net
assets.
The
Fund
discontinues
accruing
income
on
securities
for
which
income
has
been
deemed
uncollectible
and
provides
an
estimate
for
losses
on
interest
receivable.
The
securities
have
been
identified
in
the
accompanying Schedule
of
Investments.
8.
Restricted
Securities
Certain
or
all
Funds
invest
in
securities
that
are
restricted
under
the
Securities
Act
of
1933
(1933
Act).
Restricted
securities
are
often
purchased
in
private
placement
transactions,
and
cannot
be
sold
without
prior
registration
unless
the
sale
is
pursuant
to
an
exemption
under
the
1933
Act.
Disposal
of
these
securities
may
require
greater
effort
and
expense,
and
prompt
sale
at
an
acceptable
price
may
be
difficult.
The
Funds
may
have
registration
rights
for
restricted
securities.
The
issuer
generally
incurs
all
registration
costs.
Franklin
DynaTech
Fund
Franklin
Focused
Growth
Fund
Franklin
Growth
Fund
Purchases
..............................
$1,405,053,533
$7,276,938
$245,417,406
Sales
..................................
$2,203,155,551
$5,178,174
$1,125,156,032
Franklin
Income
Fund
Franklin
U.S.
Government
Securities
Fund
Franklin
Utilities
Fund
Purchases
..............................
$21,154,643,819
$—
$183,972,121
Sales
..................................
$21,404,550,829
$181,093,680
$344,876,236
Franklin
DynaTech
Fund
Franklin
Income
Fund
Securities
lending
transactions
a
:
Equity
investments
b
........................
$11,474,000
$173,182,000
a
The
agreements
can
be
terminated
at
any
time.
b
The
gross
amount
of
recognized
liability
for
such
transactions
is
included
in
payable
upon
return
of
securities
loaned
in
the
Statements
of
Assets
and
Liabilities.
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
138
franklintempleton.com
Semiannual
Report
At
March
31,
2023,
investments
in
restricted
securities,
excluding
securities
exempt
from
registration
under
the
1933
Act,
were
as
follows:
9.
Unfunded
Capital
Commitments
Certain
or
all
Funds
may
enter
into
certain
capital
commitments
and
may
be
obligated
to
perform
on
such
agreements
at
a
future
date.
The
Fund
monitors
these
commitments
and
assesses
the
probability
of
required
performance.
For
any
agreements
whose
probability
of
performance
is
determined
to
be
greater
than
remote,
the
Fund
assesses
the
fair
value
of
the
commitment.
In
instances
where
the
probability
of
performance
is
greater
than
remote
and
the
performance
under
the
commitment
would
result
in
a
material
unrealized
loss,
the
Fund
recognizes
such
losses
in
the
Statements
of
Assets
and
Liabilities
and
the
Statements
of
Operations.
At
March
31,
2023,
Franklin
Growth
Fund
had
an
unfunded
capital
commitment
with
a
maximum
amount
of
$15,399,657,
for
which
no
depreciation
has
been
recognized.
10.
Other
Derivative
Information
At
March
31,
2023,
investments
in
derivative
contracts
are
reflected
in
the
Statements
of
Assets
and
Liabilities
as
follows:
Shares
Issuer
Acquisition
Date
Cost
Value
Franklin
Growth
Fund
25,413
Canva,
Inc.
................................
11/08/21
$
43,323,040
$
20,112,109
2,353
Canva,
Inc.,
A
..............................
11/08/21
4,011,298
1,862,188
94
Canva,
Inc.,
A-3
.............................
11/08/21
160,247
74,393
8
Canva,
Inc.,
A-4
.............................
11/08/21
13,638
6,331
5
Canva,
Inc.,
A-5
.............................
11/08/21
8,524
3,957
96,603
Checkout
Payments
Group
Ltd.,
B
...............
1/11/22
30,000,062
8,763,882
822,494
Gusto,
Inc.,
E
...............................
7/13/21
24,999,977
28,668,904
849,894
OneTrust
LLC,
C
............................
4/01/21
16,666,676
9,348,834
540,043
Stripe,
Inc.,
B
...............................
5/18/21
21,671,052
10,873,301
756,137
Stripe,
Inc.,
H
...............................
3/15/21
30,339,997
15,224,168
1,230,266
Stripe,
Inc.,
I
...............................
3/15/23
24,770,348
24,770,348
Total
Restricted
Securities
(Value
is
0.8%
of
Net
Assets)
..............
$195,964,859
$119,708,415
Asset
Derivatives
Liability
Derivatives
Derivative
Contracts
Not
Accounted
for
as
Hedging
Instruments
Statement
of
Assets
and
Liabilities
Location
Fair
Value
Statement
of
Assets
and
Liabilities
Location
Fair
Value
Franklin
Income
Fund
Interest
rate
contracts
.......
Variation
margin
on
futures
contracts
$
192,520,971
a
Variation
margin
on
futures
contracts
$
—
Equity
contracts
...........
Investments
in
securities,
at
value
—
Options
written,
at
value
50,464,750
Total
....................
$192,520,971
$50,464,750
8.
Restricted
Securities
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
139
franklintempleton.com
Semiannual
Report
For
the
period
ended
March
31,
2023,
the
effect
of
derivative
contracts
in
the
Statements
of
Operations
was
as
follows:
For
the
period
ended
March
31,
2023,
the
average
month
end
notional
amount
of
options
represented
49,707,129
shares.
The
average
month
end
notional
amount
of
futures
contracts
was
$4,688,272,321.
See
Note
1(d) regarding
derivative
financial
instruments.
11.
Upcoming
Reorganization
On
December
14,
2022,
the
Board
for
Franklin
Custodian
Funds
approved
a
proposal
to
reorganize
Franklin
Focused
Growth
Fund
into
the
Franklin
Focused
Growth
ETF
effective
November
3,
2023,
subject
to
approval
by
the
shareholders
of
Franklin
Focused
Growth
Fund.
12.
Credit
Facility
The
Funds,
together
with
other
U.S.
registered
and
foreign
investment
funds
(collectively,
Borrowers),
managed
by
Franklin
Templeton,
are
borrowers
in
a
joint
syndicated
senior
unsecured
credit
facility
totaling
$2.675
billion
(Global
Credit
Facility)
which
matures
on
February
2,
2024.
This
Global
Credit
Facility
provides
a
source
of
funds
to
the
Borrowers
for
temporary
and
emergency
purposes,
including
the
ability
to
meet
future
unanticipated
or
unusually
large
redemption
requests.
Under
the
terms
of
the
Global
Credit
Facility,
the
Funds
shall,
in
addition
to
interest
charged
on
any
borrowings
made
by
the
Funds
and
other
costs
incurred
by
the
Funds,
pay
their
share
of
fees
and
expenses
incurred
in
connection
with
the
implementation
and
maintenance
of
the
Global
Credit
Facility,
based
upon
their
relative
share
of
the
aggregate
net
assets
of
all
of
the
Borrowers,
including
an
annual
commitment
fee
of
0.15%
based
upon
the
unused
portion
of
the
Global
Credit
Facility.
These
fees
are
reflected
in
other
expenses
in
the
Statements
of
Operations.
During
the
period ended
March
31,
2023,
the
Funds
did
not
use
the
Global
Credit
Facility.
a
This
amount
reflects
the
cumulative
appreciation
(depreciation)
of
futures
contracts
as
reported
in
the
Schedule
of
Investments.
Only
the
variation
margin
receivable/payable
at
period
end
is
separately
reported
within
the
Statement
of
Assets
and
Liabilities.
Prior
variation
margin
movements
were
recorded
to
cash
upon
receipt
or
payment.
Derivative
Contracts
Not
Accounted
for
as
Hedging
Instruments
Statement
of
Operations
Location
Net
Realized
Gain
(Loss)
for
the
Period
Statement
of
Operations
Location
Net
Change
in
Unrealized
Appreciation
(Depreciation)
for
the
Period
Franklin
Income
Fund
Net
realized
gain
(loss)
from:
Net
change
in
unrealized
appreciation
(depreciation)
on:
Interest
rate
contracts
..........
Futures
contracts
$(29,340,528)
Futures
contracts
$177,716,721
Equity
Contracts
..............
Written
options
181,110,682
Written
options
24,572,876
Total
.......................
$151,770,154
$202,289,597
10.
Other
Derivative
Information
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
140
franklintempleton.com
Semiannual
Report
13.
Redemption
In-Kind
During
the
year
ended
September
30,
2022,
Franklin
Growth
Fund
realized
$47,765,967
of
net
gains
resulting
from
redemptions
in-kind
in
which
a
shareholder
redeemed
fund
shares
for
cash
and
securities
held
by
the
Fund.
Because
such
gains
are
not
taxable
to
the
Fund
and
are
not
distributed
to
remaining
shareholders,
they
are
reclassified
from
accumulated
net
realized
gains
to
paid-in
capital.
14.
Fair
Value
Measurements
The Funds
follow
a
fair
value
hierarchy
that
distinguishes
between
market
data
obtained
from
independent
sources
(observable
inputs)
and
the Funds'
own
market
assumptions
(unobservable
inputs).
These
inputs
are
used
in
determining
the
value
of
the Funds' financial
instruments
and
are
summarized
in
the
following
fair
value
hierarchy:
Level
1
–
quoted
prices
in
active
markets
for
identical
financial
instruments
Level
2
–
other
significant
observable
inputs
(including
quoted
prices
for
similar
financial
instruments,
interest
rates,
prepayment
speed,
credit
risk,
etc.)
Level
3
–
significant
unobservable
inputs
(including
the Funds'
own
assumptions
in
determining
the
fair
value
of
financial
instruments)
The
input
levels
are
not
necessarily
an
indication
of
the
risk
or
liquidity
associated
with
financial
instruments
at
that
level.
A
summary
of
inputs
used
as
of
March
31,
2023,
in
valuing
the
Funds'
assets
and
liabilities
carried
at
fair
value,
is
as
follows:
Level
1
Level
2
Level
3
Total
Franklin
DynaTech
Fund
Assets:
Investments
in
Securities:
Common
Stocks
:
Aerospace
&
Defense
...................
$
242,915,000
$
—
$
—
$
242,915,000
Automobile
Components
.................
12,981,000
—
—
12,981,000
Automobiles
..........................
518,650,000
—
—
518,650,000
Biotechnology
.........................
103,175,000
111,411,779
—
214,586,779
Broadline
Retail
.......................
1,329,911,000
—
—
1,329,911,000
Capital
Markets
........................
493,537,000
—
—
493,537,000
Chemicals
...........................
178,065,500
—
—
178,065,500
Construction
&
Engineering
...............
183,304,000
—
—
183,304,000
Electric
Utilities
........................
308,320,000
—
—
308,320,000
Electrical
Equipment
....................
34,054,000
4,489,461
—
38,543,461
Electronic
Equipment,
Instruments
&
Components
........................
97,378,000
154,637,805
—
252,015,805
Energy
Equipment
&
Services
.............
218,095,000
—
—
218,095,000
Entertainment
.........................
4,327,500
—
—
4,327,500
Financial
Services
......................
853,019,500
318,700,450
—
1,171,719,950
Ground
Transportation
..................
39,625,000
—
—
39,625,000
Health
Care
Equipment
&
Supplies
.........
1,037,258,500
—
—
1,037,258,500
Health
Care
Providers
&
Services
..........
236,295,000
—
—
236,295,000
Health
Care
Technology
.................
82,705,500
—
—
82,705,500
Hotels,
Restaurants
&
Leisure
.............
128,510,250
—
—
128,510,250
Interactive
Media
&
Services
..............
622,380,000
—
—
622,380,000
IT
Services
...........................
424,749,830
—
—
424,749,830
Life
Sciences
Tools
&
Services
............
1,240,392,000
120,406,520
—
1,360,798,520
Pharmaceuticals
.......................
307,649,250
—
—
307,649,250
Professional
Services
...................
55,080,000
—
—
55,080,000
Semiconductors
&
Semiconductor
Equipment
.
3,141,803,450
91,331,905
—
3,233,135,355
Software
.............................
5,327,175,950
3,032,799
—
5,330,208,749
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
141
franklintempleton.com
Semiannual
Report
Level
1
Level
2
Level
3
Total
Franklin
DynaTech
Fund
(continued)
Assets:
(continued)
Investments
in
Securities:
Common
Stocks:
Specialized
REITs
......................
$
91,705,000
$
—
$
—
$
91,705,000
Technology
Hardware,
Storage
&
Peripherals
.
412,250,000
—
—
412,250,000
Trading
Companies
&
Distributors
..........
16,182,000
—
—
16,182,000
Preferred
Stocks
.........................
—
42,147,570
—
42,147,570
Short
Term
Investments
...................
251,029,443
—
—
251,029,443
Total
Investments
in
Securities
...........
$17,992,523,673
$846,158,289
a
$—
$18,838,681,962
Franklin
Focused
Growth
Fund
Assets:
Investments
in
Securities:
Common
Stocks
:
Aerospace
&
Defense
...................
1,124,250
—
—
1,124,250
Automobiles
..........................
3,526,820
—
—
3,526,820
Broadline
Retail
.......................
7,065,136
—
—
7,065,136
Capital
Markets
........................
1,958,915
—
—
1,958,915
Consumer
Staples
Distribution
&
Retail
......
3,974,960
—
—
3,974,960
Electric
Utilities
........................
3,545,680
—
—
3,545,680
Energy
Equipment
&
Services
.............
687,400
—
—
687,400
Financial
Services
......................
3,216,179
1,593,502
—
4,809,681
Ground
Transportation
..................
769,400
—
—
769,400
Health
Care
Equipment
&
Supplies
.........
3,925,917
—
—
3,925,917
Health
Care
Technology
.................
904,247
—
—
904,247
Interactive
Media
&
Services
..............
2,997,797
—
—
2,997,797
IT
Services
...........................
2,669,390
—
—
2,669,390
Life
Sciences
Tools
&
Services
............
4,344,614
—
—
4,344,614
Metals
&
Mining
.......................
818,200
—
—
818,200
Oil,
Gas
&
Consumable
Fuels
.............
661,700
—
—
661,700
Personal
Care
Products
.................
1,109,070
—
—
1,109,070
Pharmaceuticals
.......................
1,030,260
—
—
1,030,260
Semiconductors
&
Semiconductor
Equipment
.
15,813,261
—
—
15,813,261
Software
.............................
17,661,509
—
—
17,661,509
Specialized
REITs
......................
1,566,420
—
—
1,566,420
Short
Term
Investments
...................
1,201,709
—
—
1,201,709
Total
Investments
in
Securities
...........
$80,572,834
$1,593,502
b
$—
$82,166,336
Franklin
Growth
Fund
Assets:
Investments
in
Securities:
Common
Stocks
:
Aerospace
&
Defense
...................
772,327,508
—
—
772,327,508
Automobiles
..........................
100,739,049
—
—
100,739,049
Beverages
...........................
566,326,076
—
—
566,326,076
Biotechnology
.........................
266,853,909
—
—
266,853,909
Broadline
Retail
.......................
484,102,051
—
—
484,102,051
Building
Products
......................
235,434,846
—
—
235,434,846
Capital
Markets
........................
620,529,927
—
—
620,529,927
Chemicals
...........................
484,960,306
—
—
484,960,306
Commercial
Services
&
Supplies
...........
84,512,365
—
—
84,512,365
Construction
Materials
..................
108,256,729
—
—
108,256,729
Consumer
Staples
Distribution
&
Retail
......
26,805,640
—
—
26,805,640
Electric
Utilities
........................
151,928,226
—
—
151,928,226
Electrical
Equipment
....................
173,706,021
—
—
173,706,021
Electronic
Equipment,
Instruments
&
Components
........................
486,365,706
—
—
486,365,706
14.
Fair
Value
Measurements
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
142
franklintempleton.com
Semiannual
Report
Level
1
Level
2
Level
3
Total
Franklin
Growth
Fund
(continued)
Assets:
(continued)
Investments
in
Securities:
Common
Stocks:
Entertainment
.........................
$
53,629,024
$
—
$
—
$
53,629,024
Financial
Services
......................
639,607,657
116,869,048
—
756,476,705
Food
Products
........................
55,025,495
—
—
55,025,495
Ground
Transportation
..................
522,161,829
—
—
522,161,829
Health
Care
Equipment
&
Supplies
.........
673,120,139
—
—
673,120,139
Health
Care
Providers
&
Services
..........
145,047,803
—
—
145,047,803
Health
Care
Technology
.................
48,743,497
—
—
48,743,497
Hotels,
Restaurants
&
Leisure
.............
219,368,499
—
—
219,368,499
Industrial
REITs
.......................
16,818,996
—
—
16,818,996
Interactive
Media
&
Services
..............
478,182,702
—
—
478,182,702
IT
Services
...........................
102,881,916
—
20,112,109
122,994,025
Life
Sciences
Tools
&
Services
............
1,082,400,677
—
—
1,082,400,677
Machinery
............................
676,206,791
—
—
676,206,791
Media
...............................
55,398,617
—
—
55,398,617
Personal
Care
Products
.................
44,512,648
—
—
44,512,648
Pharmaceuticals
.......................
598,028,970
—
—
598,028,970
Professional
Services
...................
239,855,114
—
—
239,855,114
Semiconductors
&
Semiconductor
Equipment
.
1,421,201,291
—
—
1,421,201,291
Software
.............................
2,595,457,352
—
19,637,183
2,615,094,535
Specialized
REITs
......................
101,466,647
—
—
101,466,647
Technology
Hardware,
Storage
&
Peripherals
.
756,263,226
—
—
756,263,226
Textiles,
Apparel
&
Luxury
Goods
..........
218,389,463
—
—
218,389,463
Trading
Companies
&
Distributors
..........
142,380,725
—
—
142,380,725
Water
Utilities
.........................
98,451,095
—
—
98,451,095
Convertible
Preferred
Stocks
................
—
—
79,959,123
79,959,123
Preferred
Stocks
.........................
—
58,247,942
—
58,247,942
Short
Term
Investments
...................
94,647,361
—
—
94,647,361
Total
Investments
in
Securities
...........
$15,642,095,893
$175,116,990
c
$119,708,415
$15,936,921,298
Franklin
Income
Fund
Assets:
Investments
in
Securities:
Common
Stocks
:
Aerospace
&
Defense
...................
994,519,732
—
—
994,519,732
Air
Freight
&
Logistics
...................
290,985,000
—
—
290,985,000
Automobiles
..........................
177,495,400
—
—
177,495,400
Banks
...............................
2,173,856,748
—
—
2,173,856,748
Biotechnology
.........................
216,497,000
—
—
216,497,000
Broadline
Retail
.......................
154,935,000
—
—
154,935,000
Capital
Markets
........................
972,351,821
—
—
972,351,821
Communications
Equipment
..............
507,067,500
—
—
507,067,500
Consumer
Staples
Distribution
&
Retail
......
165,630,000
—
—
165,630,000
Diversified
Telecommunication
Services
.....
194,450,000
—
—
194,450,000
Electric
Utilities
........................
1,616,611,386
—
—
1,616,611,386
Ground
Transportation
..................
150,945,000
—
—
150,945,000
Household
Products
....................
408,897,500
—
—
408,897,500
Industrial
Conglomerates
................
—
486,034,137
—
486,034,137
Insurance
............................
—
559,841,268
—
559,841,268
Metals
&
Mining
.......................
547,550,000
—
—
547,550,000
Multi-Utilities
..........................
691,860,450
—
—
691,860,450
Oil,
Gas
&
Consumable
Fuels
.............
1,986,699,940
—
—
1,986,699,940
Pharmaceuticals
.......................
1,100,517,405
285,758,219
—
1,386,275,624
Semiconductors
&
Semiconductor
Equipment
.
1,002,300,000
—
—
1,002,300,000
Specialty
Retail
........................
224,881,440
—
—
224,881,440
14.
Fair
Value
Measurements
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
143
franklintempleton.com
Semiannual
Report
Level
1
Level
2
Level
3
Total
Franklin
Income
Fund
(continued)
Assets:
(continued)
Investments
in
Securities:
Common
Stocks:
Tobacco
.............................
$
194,500,000
$
—
$
—
$
194,500,000
Management
Investment
Companies
.........
96,774,343
—
—
96,774,343
Equity-Linked
Securities
...................
—
11,124,855,368
—
11,124,855,368
Convertible
Preferred
Stocks
:
Electric
Utilities
........................
512,990,000
—
—
512,990,000
Financial
Services
......................
—
27,027,880
—
27,027,880
Preferred
Stocks
.........................
6,880,000
—
—
6,880,000
Convertible
Bonds
.......................
—
44,437,500
—
44,437,500
Corporate
Bonds
........................
—
33,368,341,480
—
33,368,341,480
Senior
Floating
Rate
Interests
...............
—
226,651,250
—
226,651,250
U.S.
Government
and
Agency
Securities
.......
—
8,594,083,985
—
8,594,083,985
Asset-Backed
Securities
...................
—
41,429,502
—
41,429,502
Mortgage-Backed
Securities
................
—
26,348,111
—
26,348,111
Escrows
and
Litigation
Trusts
...............
—
56,778,757
—
56,778,757
Short
Term
Investments
...................
2,349,673,078
—
—
2,349,673,078
Total
Investments
in
Securities
...........
$16,738,868,743
$54,841,587,457
d
$—
$71,580,456,200
Other
Financial
Instruments:
Futures
contracts
........................
$
192,520,971
$
—
$
—
$
192,520,971
Total
Other
Financial
Instruments
.........
$192,520,971
$—
$—
$192,520,971
Liabilities:
Other
Financial
Instruments:
Options
written
..........................
$
50,464,750
$
—
$
—
$
50,464,750
Total
Other
Financial
Instruments
.........
$50,464,750
$—
$—
$50,464,750
Franklin
U.S.
Government
Securities
Fund
Assets:
Investments
in
Securities:
e
U.S.
Government
and
Agency
Securities
.......
—
16,551,240
—
16,551,240
Mortgage-Backed
Securities
................
—
2,738,621,226
—
2,738,621,226
Short
Term
Investments
...................
45,008,101
—
—
45,008,101
Total
Investments
in
Securities
...........
$45,008,101
$2,755,172,466
$—
$2,800,180,567
Franklin
Utilities
Fund
Assets:
Investments
in
Securities:
Common
Stocks
:
Construction
&
Engineering
...............
128,016,000
—
—
128,016,000
Diversified
Telecommunication
Services
.....
—
59,551,643
—
59,551,643
Electric
Utilities
........................
3,850,102,826
—
—
3,850,102,826
Gas
Utilities
..........................
56,112,000
—
—
56,112,000
Independent
Power
and
Renewable
Electricity
Producers
..........................
120,926,456
52,583,483
—
173,509,939
Multi-Utilities
..........................
1,796,776,117
179,918,179
—
1,976,694,296
Oil,
Gas
&
Consumable
Fuels
.............
226,094,310
—
—
226,094,310
Water
Utilities
.........................
65,475,000
26,177,050
—
91,652,050
Short
Term
Investments
...................
18,744,661
—
—
18,744,661
Total
Investments
in
Securities
...........
$6,262,247,370
$318,230,355
f
$—
$6,580,477,725
a
Includes
foreign
securities
valued
at
$846,158,289,
which
were
categorized
as
Level
2
as
a
result
of
the
application
of
market
level
fair
value
procedures.
See
the
Financial
Instrument
Valuation
note
for
more
information.
14.
Fair
Value
Measurements
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
144
franklintempleton.com
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Report
A
reconciliation
in
which
Level
3
inputs
are
used
in
determining
fair
value
is
presented
when
there
are
significant
Level
3
assets
and/or
liabilities
at
the
beginning
and/or
end
of
the period.
15.
New
Accounting
Pronouncements
In
March
2020,
the FASB
issued
Accounting
Standards
Update
(ASU)
No.
2020-04,
Reference
Rate
Reform
(Topic
848)
–
Facilitation
of
the
Effects
of
Reference
Rate
Reform
on
Financial
Reporting.
In
January
2021
and
December
2022,
the
FASB
issued
ASU
No.
2021-01
and
ASU
No.
2022-06,
with
further
amendments
to
Topic
848.
The
amendments
in
the
ASUs
provide
optional
temporary
accounting
recognition
and financial
reporting
relief
from
the
effect
of
certain
types
of
contract
modifications
due
to
the
planned
discontinuation
of
LIBOR
and
other
interbank-offered
based
reference
rates
as
of
the
end
of
2021
for
certain
LIBOR
settings
and
2023
for
the
remainder. The
ASUs
are
effective
for
certain
reference
rate-related
contract
modifications
that
occur
during
the
period
March
12,
2020
through
December
31,
2024.
Management
has
reviewed
the
requirements
and
believes
the
adoption
of
these
ASUs
will
not
have
a
material
impact
on
the
financial
statements.
In June
2022,
the FASB
issued
ASU
No.
2022-03,
Fair
Value
Measurement
(Topic
820)
–
Fair
Value
Measurement
of
Equity
Securities
Subject
to
Contractual
Sale
Restrictions.
The
amendments
in
the
ASU
clarify
that
a
contractual
restriction
on
the
sale
of
an
equity
security
is
not
considered
part
of
the
unit
of
account
of
the
equity
security
and,
therefore,
should
not
be
considered
in
measuring
fair
value.
The
ASU
is
effective
for
interim
and
annual
reporting
periods
beginning
after
December
15,
2023,
with
the
option
of
early
adoption.
Management
has
reviewed
the
requirements
and
believes
that
the
adoption
of
the
ASU
will
not
have
a
material
impact
on
the
financial
statements.
16.
Subsequent
Events
The
Funds
have
evaluated
subsequent
events
through
the
issuance
of
the
financial
statements
and
determined
that
no
events
have
occurred
that
require
disclosure.
b
Includes
foreign
securities
valued
at
$1,593,502,
which
were
categorized
as
Level
2
as
a
result
of
the
application
of
market
level
fair
value
procedures.
See
the
Financial
Instrument
Valuation
note
for
more
information.
c
Includes
foreign
securities
valued
at
$175,116,990,
which
were
categorized
as
Level
2
as
a
result
of
the
application
of
market
level
fair
value
procedures.
See
the
Financial
Instrument
Valuation
note
for
more
information.
d
Includes
foreign
securities
valued
at
$1,331,633,624,
which
were
categorized
as
Level
2
as
a
result
of
the
application
of
market
level
fair
value
procedures.
See
the
Financial
Instrument
Valuation
note
for
more
information.
e
For
detailed
categories,
see
the
accompanying
Schedule
of
Investments.
f
Includes
foreign
securities
valued
at
$258,678,712,
which
were
categorized
as
Level
2
as
a
result
of
the
application
of
market
level
fair
value
procedures.
See
the
Financial
Instrument
Valuation
note
for
more
information.
14.
Fair
Value
Measurements
(continued)
Franklin
Custodian
Funds
Notes
to
Financial
Statements
(unaudited)
145
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Semiannual
Report
Abbreviations
Currency
USD
United
States
Dollar
Selected
Portfolio
ADR
American
Depositary
Receipt
CME
Chicago
Mercantile
Exchange
CVR
Contingent
Value
Right
FNMA
Federal
National
Mortgage
Association
FRN
Floating
Rate
Note
GNMA
Government
National
Mortgage
Association
LIBOR
London
Inter-Bank
Offered
Rate
PIK
Payment-In-Kind
REIT
Real
Estate
Investment
Trust
SOFR
Secured
Overnight
Financing
Rate
Franklin
Custodian
Funds
Shareholder
Information
146
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Semiannual
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Proxy
Voting
Policies
and
Procedures
The
Trust’s
investment
manager
has
established
Proxy
Voting
Policies
and
Procedures
(Policies)
that
the
Trust
uses
to
determine
how
to
vote
proxies
relating
to
portfolio
securities.
Shareholders
may
view
the
Trust’s
complete
Policies
online
at
franklintempleton.com.
Alternatively,
shareholders
may
request
copies
of
the
Policies
free
of
charge
by
calling
the
Proxy
Group
collect
at
(954)
527-
7678
or
by
sending
a
written
request
to:
Franklin
Templeton
Companies,
LLC,
300
S.E.
2nd
Street,
Fort
Lauderdale,
FL
33301,
Attention:
Proxy
Group.
Copies
of
the
Trust’s
proxy
voting
records
are
also
made
available
online
at
franklintempleton.com
and
posted
on
the
U.S.
Securities
and
Exchange
Commission’s
website
at
sec.gov
and
reflect
the
most
recent
12-month
period
ended
June
30.
Quarterly
Schedule
of
Investments
The
Trust
files
a
complete
schedule
of
investments
with
the
U.S.
Securities
and
Exchange
Commission
for
the
first
and
third
quarters
for
each
fiscal
year
as
an
exhibit
to
its
report
on
Form
N-PORT.
Shareholders
may
view
the
filed
Form
N-PORT
by
visiting
the
Commission’s
website
at
sec.gov.
The
filed
form
may
also
be
viewed
and
copied
at
the
Commission’s
Public
Reference
Room
in
Washington,
DC.
Information
regarding
the
operations
of
the
Public
Reference
Room
may
be
obtained
by
calling
(800)
SEC-0330.
Householding
of
Reports
and
Prospectuses
You
will
receive,
or
receive
notice
of
availability
of,
the
Fund’s
financial
reports
every
six
months.
In
addition,
you
will
receive
an
annual
updated
summary
prospectus
(detail
prospectus
available
upon
request).
To
reduce
Fund
expenses,
we
try
to
identify
related
shareholders
in
a
household
and
send
only
one
copy
of
the
financial
reports
(to
the
extent
received
by
mail)
and
summary
prospectus.
This
process,
called
“householding,”
will
continue
indefinitely
unless
you
instruct
us
otherwise.
If
you
prefer
not
to
have
these
documents
householded,
please
call
us
at
(800)
632-2301.
At
any
time
you
may
view
current
prospectuses/
summary
prospectuses
and
financial
reports
on
our
website.
If
you
choose,
you
may
receive
these
documents
through
electronic
delivery.
FCF
S
05/23
©
2023
Franklin
Templeton
Investments.
All
rights
reserved.
Authorized
for
distribution
only
when
accompanied
or
preceded
by
a
summary
prospectus
and/or
prospectus.
Investors
should
carefully
consider
a
fund’s
investment
goals,
risks,
charges
and
expenses
before
investing.
A
prospectus
contains
this
and
other
information;
please
read
it
carefully
before
investing.
To
help
ensure
we
provide
you
with
quality
service,
all
calls
to
and
from
our
service
areas
are
monitored
and/or
recorded.
Semiannual
Report
and
Shareholder
Letter
Franklin
Custodian
Funds
Investment
Manager
Distributor
Shareholder
Services
Franklin
Advisers,
Inc.
Franklin
Distributors,
LLC
(800)
DIAL
BEN
®
/
342-5236
franklintempleton.com
(800)
632-2301
Item
2. Code of Ethics.
(a)
The Registrant has adopted a code of ethics that applies to its principal
executive officers and principal financial and accounting officer.
(c)
N/A
(d)
N/A
(f)
Pursuant to Item 13(a)(1), the Registrant is attaching as an exhibit a copy of
its code of ethics that applies to its principal executive officers and
principal financial and accounting officer.
Item
3. Audit Committee Financial Expert.
(a)(1)
The Registrant has an audit committee financial expert serving on its audit
committee.
(2)
The audit committee financial expert is Mary C. Choksi and she is
"independent" as defined under the relevant Securities and Exchange
Commission Rules and Releases.
Item 4.Principal Accountant Fees and Services. N/A
Item
5. Audit Committee
of Listed
Registrants. N/A
Item
6. Schedule of Investments. N/A
Item
7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management
Investment Companies. N/A
Item
8. Portfolio Managers of Closed-End Management Investment Companies. N/A
Item
9. Purchases of Equity Securities by Closed-End Management Investment Company
and
Affiliated
Purchasers. N/A
Item
10. Submission of Matters to a Vote of Security Holders.
There
have been no changes to the procedures by which shareholders may recommend
nominees to the Registrant's Board of Trustees that would require disclosure
herein.
Item
11. Controls and Procedures.
(a) Evaluation of
Disclosure Controls and Procedures.
The Registrant maintains disclosure controls and
procedures that are designed to provide reasonable assurance that information
required to be disclosed in the Registrant’s filings under the Securities
Exchange Act of 1934, as amended, and the Investment Company Act of 1940 is recorded,
processed, summarized and reported within the periods specified in the rules
and forms of the Securities and Exchange Commission. Such information is
accumulated and communicated to the Registrant’s management, including its
principal executive officer and principal financial officer, as appropriate, to
allow timely decisions regarding required disclosure. The Registrant’s
management, including the principal executive officer and the principal
financial officer, recognizes that any set of controls and procedures, no matter
how well designed and operated, can provide only reasonable assurance of
achieving the desired control objectives.
Within
90 days prior to the filing date of this Shareholder Report on
Form N-CSR, the Registrant had carried out an evaluation, under the supervision
and with the participation of the Registrant’s management, including the
Registrant’s principal executive officer and the Registrant’s principal
financial officer, of the effectiveness of the design and operation of the Registrant’s
disclosure controls and procedures. Based on such evaluation, the Registrant’s
principal executive officer and principal financial officer concluded that the
Registrant’s disclosure controls and procedures are effective.
(b) Changes in Internal
Controls
.
There have been no changes in the Registrant’s internal control over financial
reporting that occurred during the period covered by this report that has
materially affected or is reasonably likely to materially affect the internal
control over financial reporting.
Item
12. Disclosure of Securities Lending Activities for Closed-End Management
Investment Company. N/A
Item
13. Exhibits.
(a)(1)
Code of Ethics
(a)(2)
Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of
Matthew T. Hinkle, Chief Executive Officer - Finance and Administration, and
Christopher Kings, Chief Financial Officer, Chief Accounting Officer and
Treasurer
(a)(2)(1)
There were no written solicitations to purchase securities under Rule 23c-1
under the Act sent or given during the period covered by the report by or on
behalf of the Registrant to 10 or more persons.
(a)(2)(2)
There was no change in the Registrant’s independent public accountant during
the period covered by the report.
(b)
Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of
Matthew T. Hinkle, Chief Executive Officer - Finance and Administration, and
Christopher Kings, Chief Financial Officer, Chief Accounting Officer and
Treasurer
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934 and the Investment
Company Act of 1940, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
FRANKLIN
CUSTODIAN FUNDS
By S\MATTHEW
T. HINKLE______________________
Matthew T. Hinkle
Chief
Executive Officer - Finance and Administration
Date
May 30, 2023
Pursuant
to the requirements of the Securities Exchange Act of 1934 and the Investment
Company Act of 1940, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the dates indicated.
By S\MATTHEW
T. HINKLE______________________
Matthew T. Hinkle
Chief
Executive Officer - Finance and Administration
Date
May 30, 2023
By S\CHRISTOPHER
KINGS______________________
Christopher
Kings
Chief
Financial Officer, Chief Accounting Officer and Treasurer
Date
May 30, 2023