Following code helped me with mixed (UTF8+ISO-8859-1(x)) encodings. In this case, I have template files made and maintained by designers who do not care about encoding and MySQL data in utf8_binary_ci encoded tables.

<?php

class Helper
{
    function strSplit($text, $split = 1)
    {
        if (!is_string($text)) return false;
        if (!is_numeric($split) && $split < 1) return false;

        $len = strlen($text);

        $array = array();

        $i = 0;

        while ($i < $len)
        {
            $key = NULL;

            for ($j = 0; $j < $split; $j += 1)
            {
                $key .= $text{$i};

                $i += 1;
            }

            $array[] = $key;
        }

        return $array;
    }

    function UTF8ToHTML($str)
    {
        $search = array();
        $search[] = "/([\\xC0-\\xF7]{1,1}[\\x80-\\xBF]+)/e";
        $search[] = "/&#228;/";
        $search[] = "/&#246;/";
        $search[] = "/&#252;/";
        $search[] = "/&#196;/";
        $search[] = "/&#214;/";
        $search[] = "/&#220;/";
        $search[] = "/&#223;/";

        $replace = array();
        $replace[] = 'Helper::_UTF8ToHTML("\\1")';
        $replace[] = "ä";
        $replace[] = "ö";
        $replace[] = "ü";
        $replace[] = "Ä";
        $replace[] = "Ö";
        $replace[] = "ü";
        $replace[] = "ß";

        $str = preg_replace($search, $replace, $str);

        return $str;
    }

    function _UTF8ToHTML($str)
    {
        $ret = 0;

        foreach((Helper::strSplit(strrev(chr((ord($str{0}) % 252 % 248 % 240 % 224 % 192) + 128).substr($str, 1)))) as $k => $v)
            $ret += (ord($v) % 128) * pow(64, $k);
        return "&#".$ret.";";
    }
}

// Usage example:

$tpl = file_get_contents("template.tpl");
/* ... */
$row = mysql_fetch_assoc($result);

print(Helper::UTF8ToHTML(str_replace("{VAR}", $row['var'], $tpl)));

?>