8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) October 21, 2004

LEGG MASON, INC.

(Exact name of registrant as specified in its charter)

Maryland	1-8529	52-1200960
(State or Other Jurisdiction of Incorporation)	(Commission File No.)	(IRS Employer Identification No.)

100 Light Street, Baltimore, Maryland	21202
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code: (410) 539-0000

Not Applicable 

(Former name or former address if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02	Results of Operations and Financial Condition.
	On October 21, 2004, Legg Mason, Inc. announced its results of operations for the quarter and six months ended September 30, 2004. A copy of the related press release is attached hereto as Exhibit 99.
	The information in this Form 8-K and the Exhibit attached hereto shall not be deemed "filed" for purposes of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
Item 9.01	Financial Statements and Exhibits.
(c)	Exhibits
	Exhibit No.	Subject Matter
	99	Press release of Legg Mason, Inc. dated October 21, 2004

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	LEGG MASON, INC.
	(Registrant)
Date:  October 21, 2004	By:	/s/ Robert F. Price
		Robert F. Price
		Senior Vice President, Secretary
		and General Counsel

3

LEGG MASON, INC.

EXHIBIT INDEX

Exhibit No.	Subject Matter
99	Press Release of Legg Mason, Inc. dated October 21, 2004.

4

EX-99

Exhibit 99

For immediate release	For information contact:
	F. Barry Bilson
	(410) 539-0000
	www.leggmason.com

LEGG MASON ANNOUNCES SEPTEMBER QUARTER RESULTS
Earnings per Share $0.81, up 31%;
Assets Under Management up $74 Billion, or 31%, to $311 Billion

Baltimore, Maryland - October 21, 2004 -- Legg Mason, Inc. (NYSE: LM) today reported that the firm's revenues, earnings per share and assets under management in the September 2004 quarter were the highest in the firm's history; investment advisory and related fees also set a new firm record:

• Net revenues for the quarter ended September 30, 2004 were $568.0 million, up 24% from the September 2003 quarter. The previous record, set in the March 2004 quarter, was $559.6 million.
• Net earnings were $91.7 million, up 38% from a year ago, and down slightly from the record of $91.9 million set in the March 2004 quarter.
• Diluted earnings per share were $0.81, up 31% from a year ago. The previous record was $0.80 per share, set in the March 2004 quarter.
• Investment advisory and related fees were $393.9 million, up 40% from a year ago, and up 7% from $368.8 million in the June 2004 quarter, which was the previous record.
• Assets under management aggregated $311.0 billion, up $74.1 billion, or 31%, from a year ago and up $15.3 billion, or 5%, from $295.7 billion in June, the previous record.

All share and earnings per share numbers have been restated for the 3-for-2 stock split effective September 24, 2004.

Commenting on the results, Raymond A. "Chip" Mason, chairman and CEO, said:

"Naturally we're delighted to be able to report these results in what has been a somewhat challenging market environment this past quarter.

"Our continued growth in assets under management -- up $74 billion in the last year and up $15 billion in the last three months -- has provided the key underpinning to these results. This asset growth translated into a 40% increase in our investment advisory and related fees in the last year and a 7% increase in the last quarter.

"The continuing momentum we have seen in our assets under management, both the aggregate amount of assets and the positive flows, has been our primary strength. As we have witnessed in the past, increasing our assets under management should bode well for our future revenues and profits."

LEGG MASON, INC.
News Release - October 21, 2004
Page 2

Consolidated Results for the Quarter

Investment advisory and related fees for the quarter ended September 30, 2004 set a new record this quarter, up 40% from the year ago quarter and up 7% from June, the prior record. These results were primarily due to an increase in revenues at Private Capital Management, Western Asset, Legg Mason Capital Management¹ and Royce, and to increased fee-based brokerage revenues in our Private Client Group. Investment advisory and related fees represented 69% of the firm's consolidated net revenues in the current quarter, up from 62% a year ago.

Revenues from retail and institutional securities brokerage, which includes commissions and principal transaction revenues, totaled $122.9 million, down 2% from a year ago. Commission revenues declined by 1%, as a decline in over-the-counter agency commissions more than offset increases in non-proprietary mutual fund and listed commissions. Commissions represented 15% of the firm's consolidated net revenues in the current quarter, down from 18% a year ago. Principal transaction revenues were down 3%, as increases in over-the-counter and European markets and institutional taxable fixed income transactions were more than offset by a decline in retail fixed income volume.

Investment banking revenues were down 21% from a year ago, as a result of substantial decreases in retail selling concessions and corporate advisory fees.

Net interest profit was $7.9 million, up 57% from a year ago, primarily due to higher average customer margin account balances and higher average interest rates earned on margin and firm investment balances, partially offset by an increase in the interest rates credited on lower customer credit balances. Other revenues were up 86%, primarily due to realized declines in the value of firm investments in the prior year quarter.

The pre-tax profit margin on net revenues was 26.2% in the current quarter, up from 21.1% a year ago, and the effective tax rate decreased slightly, to 38.3% from 38.6%. The annualized return on equity increased to 21.7% from 17.5%².

As of September 30, 2004, stockholders' equity was $1.728 billion, up 24% from a year ago, and book value per share was up 22%, to $16.69. The Company had 103.5 million shares outstanding at quarter end, including exchangeable shares, and the weighted average number of diluted shares outstanding during the quarter was 114.7 million.

Assets Under Management and Total Client Assets

Assets under management as of September 30, 2004 aggregated $311.0 billion, up $74.1 billion, or 31%, from $236.9 billion a year ago, and up $15.3 billion, or 5%, from $295.7 billion in June. Net flows contributed 83% of the increase during the quarter, with all of our asset management

__________________________

1 Effective October 1, 2004, Legg Mason Funds Management and Legg Mason Capital Management began operating as a single business under the name Legg Mason Capital Management.
2 Annualized return on equity in the September 2003 quarter excludes the net gain on the sale of our commercial mortgage servicing business and related discontinued operations.

LEGG MASON, INC.
News Release - October 21, 2004
Page 3

divisions -- Institutional, Wealth Management and Mutual Funds -- experiencing positive net flows.

Our Institutional asset management division is currently responsible for 66% of our total assets under management, with our Mutual Funds management division responsible for 22% and our Wealth Management division, 12%. Equity assets account for 38% of our total assets under management.

Total client assets, which include assets in our clients' securities brokerage accounts plus assets under management, minus any overlap, aggregated $381.1 billion at September 30, 2004, up from $299.6 billion a year ago.

Segment Results for the Quarter

Asset Management continued to drive our consolidated results: in the current quarter, this business segment accounted for 57% of the firm's net revenues and 71% of pre-tax earnings.

The 46% increase in Asset Management revenues over the year ago quarter, and the 50% increase in pre-tax earnings, were primarily due to increases in the assets under management and resulting increases in the investment advisory fees at our four largest money managers: Private Capital Management, Western Asset, Legg Mason Capital Management and Royce.

Private Client's net revenues were up 5% from a year ago, as increased investment advisory and related fees more than offset decreases in retail selling concessions, retail commissions and principal transaction revenues. Private Client's pre-tax earnings decreased by 7%, however, primarily due to an increase in overhead costs. Private Client accounted for 31% of the firm's net revenues and 20% of pre-tax earnings in the current quarter.

Although institutional equity sales were up from year ago levels, the net revenues and pre-tax earnings of our Capital Markets business segment were down 1% and 2%, respectively, from the year ago quarter, primarily due to sharp declines in new public offerings and other corporate financing activity. Capital Markets accounted for 13% of the firm's net revenues and 8% of pre-tax earnings in the current quarter.

Fiscal Year to Date Results

For the six months ended September 30, 2004, net revenues were up 26% from the comparable period a year ago. Investment advisory and related fees were up 46%, and represented 69% of the firm's consolidated net revenues. Commissions were up slightly, and represented 15% of consolidated net revenues, while principal transactions were down 2%. Investment banking was down 18%. Net interest profit was up 33% and other revenues were up 20%.

Net earnings for the six months ended September 30, 2004 were up 42% and diluted earnings per share were up 33%. Legg Mason's pre-tax profit margin was 26.0%, up from 21.9%, and the effective tax rate was 38.0%, down from 38.6% in the year ago period.

LEGG MASON, INC.
News Release - October 21, 2004
Page 4

Conference Call to Discuss Results

A conference call to discuss the Company's results, hosted by Mr. Mason, will be held at 10:00 a.m. EDT today. The call will be open to the general public. Interested participants should access the call by dialing 1-877-692-2592 (or 1-973-582-2700 for international calls) at least 10 minutes prior to the scheduled start to ensure connection.

A replay or transcript of the live broadcast will be available on the Legg Mason website or by dialing 1-877-519-4471 (or 1-973-341-3080 for international calls), access Pin Number 5254427, after the completion of the call.

Legg Mason, Inc., headquartered in Baltimore, is a holding company that provides asset management, securities brokerage, investment banking and related financial services through its subsidiaries.

This release contains forward-looking statements subject to risks, uncertainties and other factors that may cause actual results to differ materially. For a discussion of these risks and uncertainties, see Legg Mason's Annual Report on Form 10-K for the fiscal year ended March 31, 2004.

####

LEGG MASON, INC.
News Release - October 21, 2004
Page 5

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
For the Quarters Ended September 30, 2004 and 2003
			(000's, except per share amounts)
			2004				% of Net Revenues					2003		% of Net Revenues
Revenues:
	Investment advisory and related fees		$	393,900				69.4				$	281,812		61.6
	Commissions			82,549				14.5					83,719		18.3
	Principal transactions			40,356				7.1					41,407		9.0
	Investment banking			31,141				5.5					39,220		8.6
	Interest			25,436				4.5					20,027		4.4
	Other			12,134				2.1					6,536		1.4
		Total revenues		585,516				103.1					472,721		103.3
	Interest expense			17,551				3.1					14,992		3.3
		Net revenues		567,965				100.0					457,729		100.0
Non-interest expenses:
	Compensation and benefits			313,474				55.2					259,036		56.6
	Communications and technology			26,238				4.6					21,923		4.8
	Occupancy			17,514				3.1					16,402		3.6
	Distribution and service fees			18,182				3.2					10,307		2.3
	Amortization of intangible assets			5,464				1.0					5,296		1.2
	Litigation award charge					-				-			17,500		3.8
	Other			38,413				6.7					30,631		6.6
		Total non-interest expenses		419,285				73.8					361,095		78.9
Earnings from continuing operations
		before income tax provision		148,680				26.2					96,634		21.1
		Income tax provision		57,018				10.1					37,260		8.1
Net earnings from continuing operations				91,662					16.1				59,374		13.0
Discontinued operations, net of taxes					-						-		785			0.2
Gain on sale of discontinued operations,
		net of taxes			-						-		6,481			1.4
Net earnings			$	91,662				16.1				$	66,640		14.6
[continued on next page]

LEGG MASON, INC.
News Release - October 21, 2004
Page 6

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
For the Quarters Ended September 30, 2004 and 2003
(continued)
				(000's, except per share amounts)
				2004			2003
Net earnings per common share1:
	Basic
			Continuing operations	$	0.90		$	0.60
			Discontinued operations			-		0.01
			Gain on sale of discontinued operations			-		0.06
				$	0.90		$	0.67
	Diluted
			Continuing operations	$	0.81		$	0.55
			Discontinued operations			-		0.01
			Gain on sale of discontinued operations			-		0.06
				$	0.81		$	0.62
Weighted average number of common
	shares outstanding1:
			Basic		101,932			100,121
			Diluted		114,742			107,376
(1) All share and earnings per share numbers have been restated for the 3-for-2 stock split, paid on
		September 24, 2004, to shareholders of record on September 8, 2004.

LEGG MASON, INC.
News Release - October 21, 2004
Page 7

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
For the Six Months Ended September 30, 2004 and 2003
			(000's, except per share amounts)
			2004			% of Net Revenues				2003		% of Net Revenues
Revenues:
	Investment advisory and related fees		$	762,696			68.9			$	523,637		59.8
	Commissions			168,834			15.3				168,025		19.2
	Principal transactions			82,405			7.4				84,353		9.6
	Investment banking			57,658			5.2				70,687		8.1
	Interest			47,243			4.3				41,861		4.8
	Other			21,607			1.9				18,055		2.1
		Total revenues		1,140,443			103.0				906,618		103.6
	Interest expense			33,541			3.0				31,547		3.6
		Net revenues		1,106,902			100.0				875,071		100.0
Non-interest expenses:
	Compensation and benefits			613,684			55.4				500,745			57.2
	Communications and technology			51,162			4.6				44,567			5.1
	Occupancy			34,701			3.1				32,490			3.7
	Distribution and service fees			34,216			3.1				18,042			2.1
	Amortization of intangible assets			10,903			1.0				10,858			1.2
	Litigation award charge				-			-			17,500			2.0
	Other			74,855			6.8				58,911			6.8
		Total non-interest expenses		819,521			74.0				683,113		78.1
Earnings from continuing operations
	before income tax provision			287,381			26.0				191,958		21.9
	Income tax provision			109,305			9.9				74,108		8.4
Net earnings from continuing operations				178,076			16.1				117,850			13.5
Discontinued operations, net of taxes					-				-		675			0.1
Gain on sale of discontinued operations,
	net of taxes				-			-			6,481			0.7
Net earnings			$	178,076			16.1			$	125,006		14.3
[continued on next page]

LEGG MASON, INC.
News Release - October 21, 2004
Page 8

LEGG MASON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
For the Six Months Ended September 30, 2004 and 2003
(continued)
				(000's, except per share amounts)
				2004			2003
Net earnings per common share1:
	Basic
			Continuing operations	$	1.75		$	1.18
			Discontinued operations			-		0.01
			Gain on sale of discontinued operations			-		0.06
				$	1.75		$	1.25
	Diluted
			Continuing operations	$	1.57		$	1.11
			Discontinued operations			-		0.01
			Gain on sale of discontinued operations			-		0.06
				$	1.57		$	1.18
Weighted average number of common
	shares outstanding1:
			Basic		101,754			99,692
			Diluted		115,181			106,370
Book value per common share				$	16.69		$	13.68
(1) All share and earnings per share numbers have been restated for the 3-for-2 stock split, paid on
		September 24, 2004, to shareholders of record on September 8, 2004.

LEGG MASON, INC.
News Release - October 21, 2004
Page 9

LEGG MASON, INC. AND SUBSIDIARIES
Business Segment Financial Results (000's)
For the Quarters Ended September 30, 2004 and 2003
			2004		% of Total			2003		% of Total
Net revenues:
	Asset Management		$	322,375			56.8	$	221,340		48.4
	Private Client			173,397			30.5		164,973		36.0
	Capital Markets			71,663			12.6		72,748		15.9
	Corporate			530			0.1		(1,332)				(0.3)
		Total	$	567,965		100.0		$	457,729		100.0
Earnings from continuing operations
	before income tax provision:
	Asset Management		$	106,064			71.3	$	70,516			73.0
	Private Client			29,997			20.2		32,232			33.4
	Capital Markets			12,432			8.4		12,720			13.1
	Corporate			187			0.1		(18,834)			(19.5)
		Total	$	148,680		100.0		$	96,634		100.0
For the Six Months Ended September 30, 2004 and 2003
			2004		% of Total			2003		% of Total
Net revenues:
	Asset Management		$	617,278			55.8	$	410,202			46.9
	Private Client			348,524			31.5		323,717			37.0
	Capital Markets			142,875			12.9		142,488			16.3
	Corporate			(1,775)			(0.2)		(1,336)			(0.2)
		Total	$	1,106,902		100.0		$	875,071		100.0
Earnings from continuing operations
	before income tax provision:
	Asset Management		$	206,556		71.9		$	125,321		65.3
	Private Client			60,416		21.0			60,383		31.4
	Capital Markets			22,724		7.9			25,304		13.2
	Corporate			(2,315)		(0.8)			(19,050)		(9.9)
		Total	$	287,381		100.0		$	191,958		100.0

LEGG MASON, INC.
News Release - October 21, 2004
Page 10

			LEGG MASON, INC. AND SUBSIDIARIES
			Assets Under Management
			(in billions)
			(unaudited)
			September 30,							March 31,
			2004		% of Total	2003			% of Total	2004		% of Total
By asset class:
	Equity		$	119.4	38.4		$	85.1	35.9	$	112.3	39.2
	Fixed Income		191.6		61.6	151.8			64.1	174.1		60.8
		Total	$	311.0	100.0		$	236.9	100.0	$	286.4	100.0
By asset management division:
	Wealth Management		$	37.5	12.0		$	26.5	11.2	$	35.1	12.3
	Institutional		203.9		65.6	160.7			67.8	187.0		65.3
	Mutual Funds		69.6		22.4	49.7			21.0	64.3		22.4
		Total	$	311.0	100.0		$	236.9	100.0	$	286.4	100.0

	Component Changes in Assets Under Management
	(in billions)
	(unaudited)
	Three Months Ended September 30,				Six Months Ended September 30,
	2004		2003		2004		2003
Beginning of period	$	295.7	$	216.6	$	286.4	$	192.2
Net client cash flows	12.7		14.3		22.8		19.7
Market appreciation, net	2.6		6.0		1.8		25.0
End of period	$	311.0	$	236.9	$	311.0	$	236.9