Fourth quarter 2014, company net flows were positive $2 billion. That’s the first quarter of positive net flows for the company since the second quarter of 2009. I’ll talk a little bit more about that in a second, but let’s turn to annual net flows. The company’s total net flows for the year were $4.9 billion outflows. That reflects a really substantial improvement from the $19.7 billion of net outflows in 2013, but again, it’s still a negative number and much work remains to be done. Looking at the rest of the story of the quarter, I think it’s important to note that fourth quarter 2014, investment performance showed progress as well. Complex wide track records improved markedly, at the end of the fourth quarter 2014, 57% and 82% of mutual fund assets were in the top two Morningstar quartiles for the one and three year basis respectively, which is up from 46% and 46% a year ago. In terms of business discipline, we continue to exercise strong discipline. Operating margins were above 30% for the third consecutive quarter, which reflects higher AUM and better performance fees, but also reflects our continued commitment to be good stewards of our shareholder capital.
Our balance sheet continues to strengthen with $797 million of cash and marketable securities compared to $451 million of total debt. As you know, we like to look at annual cash flow from operations on a trailing 12 month basis because of some of the cyclicality or seasonality of that number, and on that basis we generated approximately $220 of free cash flow over the last 12 months, and we returned approximately 65% of that to the shareholders in the form of share repurchases and dividends. So we’re proud of that record. Let’s turn back for a moment to the net flows and let me say a little bit more about that. Obviously it’s much more than just Bill Gross. As we said earlier, total company flows positive for the first time since the second quarter of 2009. Janus equity net flows were positive for the first time since the first quarter of 2010. Retail and intermediary net flows were positive for the first time since first quarter 2010, with an annualized growth rate of 6%.
Our non-U.S. business had its sixth consecutive quarter of positive net inflows and our fixed income business had $2.8 billion of net inflows led by flexible bond and our global unconstrained bond strategies which meaningfully outperforms the industry. I think that’s the sixth consecutive year of net inflows for our fixed income business, and that’s a mark that we’re certainly proud of. Finally, there has been a lot of talk about Bill Gross’s personal investment in his own funds. At the end of 2014, Bill had invested more than $700 million of his personal money in the global unconstrained bond fund. He fundamentally believes that investing alongside of clients aligns interest, he believes in eating his own cooking. And that’s a concept that actually has much longer history at Janus than Bill’s short time with us.
