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PFG · Principal Financial Group

25 filings

10-K

PFG 10-K Annual Reports

Principal Financial Group - 25 annual reports

Filing record · 2016–202610-K1110-Q338-K163

2025
Principal Financial Group Annual Report, Year Ended Dec 31, 2025
Principal Financial Group, Inc. (PFG) reported total assets under administration of $1,814.6 billion, including $781.0 billion in assets under management as of December 31, 2025. Net income attributable to Principal Financial Group, Inc. was $1,185.1 million in 2025, down from $1,571.0 million in 2024, with the decline driven primarily by a $654.5 million unfavorable change in the fair value of the funds withheld embedded derivative and a $119.7 million impact from asset write-downs tied to exiting Hong Kong MPF sponsor and trustee roles. These were partially offset by a $170.4 million one-time unfavorable impact in 2024 from YRT reinsurance transactions. Total revenues were $15,625.5 million versus $16,127.7 million in 2024, and diluted earnings per share were $5.25 compared with $6.68. Segment pre-tax operating earnings were $1,185.6 million for Retirement and Income Solutions (up from $1,056.2 million), $930.2 million for Principal Asset Management (up from $861.2 million), and $523.2 million for Benefits and Protection (up from $463.2 million). Stockholders' equity attributable to PFG rose to $11,883.9 million from $11,086.4 million. The company returned $1,585.3 million to common stockholders in 2025 through $684.0 million of dividends and $901.3 million of share repurchases, and completed its $1.5 billion February 2024 repurchase program in December 2025. The filing also discloses a January 2026 agreement to sell the Chilean annuities business to Banco Santander, which the company expects to close in the third quarter of 2026 and expects to produce an estimated $280.0 million pre-tax net realized capital loss. Financial strength ratings from A.M. Best, Fitch, Moody's and S&P were unchanged, with stable outlooks.
Feb 18, 2026
2024
Principal Financial Group Annual Report, Year Ended Dec 31, 2024
Principal Financial Group, Inc. (PFG) reported 2024 net income attributable to Principal Financial Group, Inc. of $1,571.0 million, up from $623.2 million in 2023, and total revenues of $16,127.7 million versus $13,665.8 million. The increase was driven primarily by a $1,211.2 million after-tax favorable change in the fair value of the funds withheld embedded derivative, partially offset by a $170.4 million unfavorable one-time impact of the YRT Reinsurance Transactions in 2024. Segment pre-tax operating earnings were $2,005.0 million in total, compared with $2,009.9 million in 2023. Assets under administration reached $1,663.9 billion and assets under management $712.1 billion as of December 31, 2024. Total stockholders' equity attributable to PFG was $11,086.4 million, and total debt was $4,108.0 million, or 37% of equity. Net cash provided by operating activities was $4,602.9 million. The company returned $1,700.8 million to common stockholders in 2024 through $658.4 million of dividends and $1,042.4 million of share repurchases, and its Board authorized a new $1.5 billion repurchase program in February 2025. The filing also flags a planned one-time charge of approximately $140.0 million in the first quarter of 2025 tied to the January 2025 agreement to exit the Hong Kong MPF sponsor and trustee roles, with the transaction expected to close in the first quarter of 2026. Chief Executive Officer Daniel Houston retired effective January 7, 2025, and Deanna Strable-Soethout assumed the role of President and CEO on that date; Joel Pitz serves as Interim Chief Financial Officer.
Feb 19, 2025
2023
Principal Financial Group Annual Report, Year Ended Dec 31, 2023
Principal Financial Group, Inc. (PFG) reported total assets under administration of $1,578.7 billion, including $694.5 billion in assets under management, as of December 31, 2023. The company operates four reportable segments: Retirement and Income Solutions, Principal Asset Management, Benefits and Protection, and a Corporate segment. Net income attributable to Principal Financial Group, Inc. was $623.2 million for 2023, down from $4,756.9 million in 2022, primarily due to the change in fair value of the funds withheld embedded derivative, which produced a $1,085.7 million loss in 2023 versus a $3,652.8 million gain in 2022. Pre-tax operating earnings by segment were $1,051.4 million for Retirement and Income Solutions, $817.7 million for Principal Asset Management, and $537.6 million for Benefits and Protection, with Corporate at $(396.8) million. Total revenues were $13,665.8 million in 2023 compared with $17,536.1 million in 2022. Net cash provided by operating activities was $3,792.4 million. Total stockholders' equity attributable to PFG rose to $10,916.0 million from $9,976.7 million, and the company's $1.5 billion share repurchase authorization approved in February 2024 is in addition to $287.9 million remaining under the prior program. Treasury stock acquisitions totaled $748.8 million for 2023 under the company's repurchase programs. Ratings were reported as stable across A.M. Best, Fitch, Moody's and S&P, with Principal Life Insurance Company rated A+ by A.M. Best and S&P.
Feb 20, 2024
2022
Principal Financial Group Annual Report, Year Ended Dec 31, 2022
Principal Financial Group, Inc. (PFG) reported $1,455.8 billion in assets under administration and $635.3 billion in assets under management as of December 31, 2022. The company describes itself as a leader in global investment management, offering retirement, asset management and insurance products through four reportable segments: Retirement and Income Solutions, Principal Global Investors, Principal International and U.S. Insurance Solutions, plus a Corporate segment. Financially, net income attributable to Principal Financial Group, Inc. rose to $4,811.6 million in 2022 from $1,710.6 million in 2021, primarily due to the change in fair value of the funds withheld embedded derivative ($3,652.8 million gain) tied to the Reinsurance Transaction with Talcott Life & Annuity Re, which closed in the second quarter of 2022. Total revenues increased to $17,491.6 million from $14,262.7 million. Operating revenue trends were mixed: fees and other revenues fell to $4,177.7 million from $5,012.6 million, largely due to the Reinsurance Transaction and declining financial markets, and net investment income declined to $3,830.4 million from $4,406.1 million. Balance sheet and capital activity were significantly affected by 2022 market conditions. Stockholders' equity attributable to PFG fell to $10,001.7 million from $16,069.4 million, mainly due to a change in accumulated other comprehensive income (loss), which moved to a $(7,199.0) million balance. The company returned $2,303.4 million to common stockholders in 2022 through dividends of $642.3 million and share repurchases of $1,661.1 million. The filing also notes that the new long-duration insurance accounting guidance (LDTI) takes effect January 1, 2023, with an estimated transition-date decrease to total stockholders' equity of approximately $5.3 billion.
Feb 16, 2023
2021
Principal Financial Group Annual Report, Year Ended Dec 31, 2021
Principal Financial Group, Inc. (PFG) reported $1,622.6 billion in assets under administration (AUA), including $713.9 billion in assets under management (AUM), as of December 31, 2021. The company is a global investment management and retirement, asset management and insurance provider, organized into four reportable segments: Retirement and Income Solutions, Principal Global Investors, Principal International and U.S. Insurance Solutions, plus a Corporate segment. Net income attributable to Principal Financial Group, Inc. rose to $1,710.6 million in 2021 from $1,395.8 million in 2020, and total revenues were $14,262.7 million compared with $14,741.7 million. Diluted earnings per common share were $6.27, versus $5.05 in 2020. The most significant development disclosed is the January 31, 2022 Master Transaction Agreement with Sutton Cayman, Ltd., an affiliate of Talcott Resolution Life, Inc., under which PFG will cede 100% of its in-force U.S. retail fixed annuity and universal life insurance with secondary guarantee blocks through 100% coinsurance with funds withheld. The transaction is expected to close in the second quarter of 2022, subject to regulatory approval, with economics effective January 1, 2022. The company states that deployable proceeds, along with additional capital-efficiency transactions, will be returned to shareholders through share repurchases, and the Board approved a $1.6 billion increase to the share repurchase authorization, which had $1.1 billion remaining as of December 31, 2021. The filing also highlights a strategic shift that followed a 2021 Strategic Review: discontinuing sales of U.S. retail fixed annuities and retail U.S. life insurance, and focusing investment on fee-based businesses. Balance sheet metrics included total stockholders' equity attributable to PFG of $16,069.4 million and total debt of $4,360.0 million at year-end. Net cash provided by operating activities was $3,218.8 million. Stockholder dividends paid totaled $654.1 million and share repurchases totaled $937.2 million during 2021.
Feb 11, 2022
2020
Principal Financial Group Annual Report, Year Ended Dec 31, 2020
Principal Financial Group, Inc. (PFG) reported $806.6 billion in assets under management (AUM) as of December 31, 2020, up from $735.3 billion at year-end 2019. Net income attributable to Principal Financial Group, Inc. was $1,395.8 million in 2020, compared with $1,394.2 million in 2019, an increase of $1.6 million. Total revenues rose to $14,741.7 million from $16,222.1 million, driven mainly by lower premiums and other considerations, which fell to $6,037.4 million from $7,866.6 million, partly offset by higher net realized capital gains of $302.6 million versus a loss of $52.8 million in 2019. Diluted earnings per share were $5.05, compared with $4.96 in 2019. The company operates four reportable segments: Retirement and Income Solutions, Principal Global Investors, Principal International and U.S. Insurance Solutions. Retirement and Income Solutions pre-tax operating earnings rose to $966.9 million, supported by the Acquired Business (the Institutional Retirement & Trust business of Wells Fargo Bank, N.A., acquired July 1, 2019). Total stockholders' equity increased to $16,617.3 million from $14,685.8 million. Stockholder dividends declared were $2.24 per common share, and the company returned $921.5 million to stockholders through dividends and share repurchases. The filing notes ongoing uncertainty from the COVID-19 pandemic, a negative outlook from A.M. Best, Fitch and Moody's on the U.S. life insurance industry for 2021, and a pending agreement announced January 28, 2021, to sell its India investment and retirement operations to Sundaram Mutual. Risk factors highlighted in the filing include sensitivity of fee revenue to equity markets, exposure to low interest rates, the transition away from LIBOR, a commercial mortgage loan portfolio with 22% of its U.S. loans in California, and credit ratings that could affect surrenders and new sales.
Feb 12, 2021
2019
Principal Financial Group Annual Report, Year Ended Dec 31, 2019
Principal Financial Group, Inc. (PFG) reported $735.3 billion in assets under management (AUM) as of December 31, 2019, up from $626.8 billion in 2018. Total revenues were $16,222.1 million in 2019 versus $14,237.2 million in 2018, while net income attributable to Principal Financial Group, Inc. declined to $1,394.2 million from $1,546.5 million. Diluted earnings per share were $4.96, compared with $5.36 in 2018. The decline was driven primarily by a $73.9 million favorable 2018 real estate realignment item and $68.6 million of unfavorable actuarial assumption updates in 2019. The company completed the acquisition of the Institutional Retirement & Trust (IRT) business from Wells Fargo Bank, N.A. on July 1, 2019, for $1.2 billion in cash plus an earn-out of up to $150.0 million. The IRT business had $898.2 billion in assets under administration at year-end, and the filing notes that customer migration is expected to begin in late 2020 and continue into 2021. Total stockholders' equity rose to $14,685.8 million from $11,456.0 million, and total assets were $276,087.8 million. Cash returned to common stockholders totaled $887.0 million in 2019, comprising $606.0 million in dividends and $281.0 million in share repurchases. Dividends declared per share increased to $2.18 from $2.10. Net cash provided by operating activities was $5,493.2 million. The filing reports senior debt ratings of A-/Baa2 for PFG and A+ insurer financial strength ratings for Principal Life and PNLIC from A.M. Best and S&P, with A.M. Best affirming its ratings in February 2020.
Feb 14, 2020
2018
Principal Financial Group Annual Report, Year Ended Dec 31, 2018
Principal Financial Group, Inc. (PFG) reported total assets of $243.04 billion and assets under management (AUM) of $626.8 billion as of December 31, 2018, and described itself as a leader in global investment management offering retirement, asset management and insurance products. Net income attributable to Principal Financial Group, Inc. was $1,546.5 million in 2018, down from $2,310.4 million in 2017, primarily due to a $568.3 million U.S. tax reform net benefit and a $410.8 million after-tax realized capital gain from real estate transactions recognized in 2017. Diluted earnings per share were $5.36 in 2018 versus $7.88 in 2017. Total revenues rose to $14,237.2 million from $14,093.2 million, while total stockholders' equity declined to $11,456.0 million from $12,921.9 million, largely reflecting a $1,835.7 million other comprehensive loss. AUM decreased from $668.6 billion at year-end 2017 to $626.8 billion, driven by negative net cash flow and market performance in the Retirement and Income Solutions and Principal Global Investors segments, as well as the realignment of a real estate team and the exit from the actively managed currency market. Pre-tax operating earnings were $553.2 million for Principal Global Investors, which benefited from a $253.1 million accelerated performance fee, while Retirement and Income Solutions earned $880.6 million. Cash returned to stockholders totaled $1,270.2 million in 2018, including $598.6 million in dividends and $671.6 million in share repurchases, and dividends declared per share rose to $2.10 from $1.87. The filing also highlights ongoing risks, including interest rate sensitivity, equity market exposure through fee-based revenues, commercial mortgage loan concentration (21% in California), and dependence on the insurance subsidiary Principal Life for dividends, which are constrained by Iowa law. Unrealized losses on available-for-sale fixed maturities were $1,229.7 million at year-end 2018, and PFG's senior debt was rated A- by S&P and Fitch, with Principal Life's insurer financial strength rated A+ by A.M. Best and S&P.
Feb 13, 2019
2017
Principal Financial Group Annual Report, Year Ended Dec 31, 2017
Principal Financial Group, Inc. (PFG) reported $668.6 billion in assets under management (AUM) and approximately 22.8 million customers worldwide as of December 31, 2017. The company operates four reportable segments: Retirement and Income Solutions, Principal Global Investors, Principal International and U.S. Insurance Solutions, plus a Corporate segment. Net income attributable to Principal Financial Group, Inc. was $2,310.4 million in 2017, up from $1,316.5 million in 2016, and diluted earnings per share were $7.88, compared with $4.50 in 2016. The filing states that net income benefited $568.3 million from U.S. tax reform and $410.8 million after-tax from real estate transactions completed in September 2017. Total revenues rose to $14,093.2 million from $12,394.1 million, with net realized capital gains of $524.2 million, including $690.9 million of pre-tax gains from the real estate transactions. Total stockholders' equity increased to $12,921.9 million from $10,293.8 million. Total assets were $253,941.2 million. Net cash provided by operating activities was $4,188.0 million. Management highlights growth in fee revenues and account values in Retirement and Income Solutions, and AUM growth in Principal Global Investors, which reached $430.9 billion. The filing also points to pending transactions, including the acquisition of MetLife Afore in Mexico (expected to close in the first half of 2018), the acquisition of INTERNOS, a London-based real estate investment manager, and a realignment of ownership in CPAM and CPIAM in Southeast Asia to 60%. Key risks cited include interest rate sensitivity, a sustained low interest rate environment, dependence on dividends from Principal Life limited by Iowa law, and exposure to commercial mortgage loans concentrated in California.
Feb 9, 2018
2016
Principal Financial Group Annual Report, Year Ended Dec 31, 2016
Principal Financial Group, Inc. (PFG) reported $591.6 billion in assets under management (AUM) and approximately 22.1 million customers worldwide as of December 31, 2016. The company operates four reportable segments: Retirement and Income Solutions, Principal Global Investors, Principal International and U.S. Insurance Solutions, plus a Corporate segment. Net income attributable to Principal Financial Group, Inc. was $1,316.5 million in 2016, compared with $1,234.0 million in 2015, and diluted earnings per share were $4.50 versus $4.06. Total revenues rose to $12,394.1 million from $11,964.4 million, and total assets reached $228,014.3 million. The 2016 results included an unfavorable $68.8 million net income impact from actuarial assumption updates and model refinements, and $86.4 million of one-time costs to extinguish long-term debt. The filing shows growth in the asset management and accumulation franchise. Principal Global Investors AUM rose to $390.5 billion from $360.8 billion, driven by $9.0 billion of net cash flow and $21.7 billion of investment performance. Pre-tax operating earnings were $794.5 million for Retirement and Income Solutions, $443.8 million for Principal Global Investors, $288.1 million for Principal International and $361.2 million for U.S. Insurance Solutions, with the Corporate segment reporting a pre-tax operating loss of $218.9 million. Net cash provided by operating activities was $3,857.8 million. Shareholders received $742.2 million in total cash returns, including $464.9 million in dividends and $277.3 million in share repurchases, and dividends declared per share increased to $1.61 from $1.50. The filing also highlights risk factors tied to the low interest rate environment, regulatory changes such as principles-based reserving and NAIC capital reforms, and market exposure in commercial mortgage loans and equity-linked products. Financial strength ratings were affirmed in 2016, with A.M. Best at A+ (stable), Fitch at AA- (stable), Moody's at A1 (stable) and S&P at A+ (stable) for Principal Life, and A.M. Best, Moody's and Fitch changed their outlook on the U.S. life insurance sector to negative from stable.
Feb 8, 2017
2015
Principal Financial Group Annual Report, Year Ended Dec 31, 2015
Principal Financial Group, Inc. (PFG) reported $527.4 billion in assets under management and approximately 19.1 million customers worldwide as of December 31, 2015. The company operates through four reportable segments: Retirement and Income Solutions, Principal Global Investors, Principal International and U.S. Insurance Solutions, plus a Corporate segment. Net income attributable to Principal Financial Group, Inc. was $1,234.0 million in 2015, up from $1,144.1 million in 2014, and net income available to common stockholders was $1,209.3 million, with diluted earnings per share of $4.06 compared with $3.65 in 2014. Total revenues rose to $11,964.4 million from $10,477.6 million, though net realized capital losses of $51.1 million partly offset growth. Segment results were mixed. Retirement and Income Solutions pre-tax operating earnings fell to $740.1 million from $851.2 million, driven by an unfavorable DAC unlocking and higher staff costs in the Fee business and lower variable investment income in the Spread business. Principal Global Investors pre-tax operating earnings rose to $388.5 million from $350.1 million on higher management fee revenue tied to AUM, which grew to $360.8 billion. Principal International pre-tax operating earnings declined to $271.3 million from $352.7 million, reflecting currency weakness in Latin America, Chilean pension fund market changes and intangible asset impairments in Brazil. U.S. Insurance Solutions pre-tax operating earnings increased to $429.5 million from $344.1 million. Balance sheet and capital activity were significant in 2015. Long-term debt increased to $3,290.8 million from $2,531.2 million after the issuance of $400.0 million of 3.4% senior notes due 2025 and $400.0 million of junior subordinated notes due 2055. The company redeemed its series A and series B preferred stock, which required $550.0 million, and returned $741.6 million to common stockholders through dividends of $441.0 million and repurchases of $300.6 million. Total stockholders' equity declined to $9,377.4 million from $10,232.0 million, largely due to a $922.6 million decline in accumulated other comprehensive income. Net cash provided by operating activities was $4,377.1 million.
Feb 10, 2016
2014
Principal Financial Group Annual Report, Year Ended Dec 31, 2014
Principal Financial Group, Inc. (PFG) reported $519.3 billion in assets under management and approximately 19.7 million customers worldwide as of December 31, 2014. The company focuses on small and medium-sized businesses and operates four reportable segments: Retirement and Investor Services, Principal Global Investors, Principal International, and U.S. Insurance Solutions, plus a Corporate segment. Net income attributable to Principal Financial Group, Inc. was $1,144.1 million in 2014, up from $912.7 million in 2013, and net income available to common stockholders was $1,111.1 million, or $3.65 diluted earnings per share, compared with $2.95 in 2013. Total revenues rose to $10,477.6 million from $9,289.5 million, and total assets reached $219,087.0 million. The filing attributes the earnings growth primarily to double-digit earnings growth in all segments, lower net realized capital losses, and gains on fixed maturities, partly offset by an increase in net deferred tax liabilities from Chilean tax legislation enacted in the third quarter of 2014 and a court ruling on uncertain tax positions in the second quarter. Retirement and Investor Services operating earnings rose to $828.1 million from $694.4 million, driven by higher fees on growing account values. Stockholders' equity was $10,232.0 million at year-end, and the company returned $599.3 million to common stockholders through dividends of $376.6 million and share repurchases of $222.7 million. Dividends declared per common share rose to $1.28 from $0.98. The filing also flags material risks, including adverse capital and credit market conditions, a sustained low interest rate environment that compresses spreads, exposure to equity market declines that affect asset-based fees, and pending regulatory changes such as the NAIC's Actuarial Guideline 48 and principles-based reserving. Principal Life's financial strength ratings were affirmed in 2014 (A.M. Best A+, Fitch AA-, S&P A+, Moody's A1), and the company announced an acquisition of AXA's Hong Kong MPF and ORSO pension business for approximately $335.0 million, expected to close in the third quarter of 2015.
Feb 11, 2015
2013
Principal Financial Group Annual Report, Year Ended Dec 31, 2013
Principal Financial Group, Inc. (PFG) reported that it is a global investment management leader offering retirement services, insurance solutions and asset management, with $483.2 billion in assets under management and approximately 19.4 million customers worldwide as of December 31, 2013. The company focuses on small and medium-sized businesses and describes itself as the leading provider of corporate defined contribution plans in the U.S. according to Spectrum Group. Its reportable segments are Retirement and Investor Services, Principal Global Investors, Principal International and U.S. Insurance Solutions, plus a Corporate segment. Financially, total revenues rose to $9,289.5 million in 2013 from $9,215.1 million in 2012, while net income attributable to Principal Financial Group, Inc. was $912.7 million compared with $806.6 million a year earlier. Net income available to common stockholders was $879.7 million, or $2.95 diluted earnings per share, versus $2.58 in 2012. Total assets grew to $208,191.4 million from $161,830.2 million, largely reflecting separate account assets, and total stockholders' equity was $9,777.0 million. The 2013 results were supported by higher fee revenues in Retirement and Investor Services and Principal International, the February 2013 acquisition of Cuprum in Chile for a purchase price of $1.3 billion, and positive equity market performance. Key risks highlighted include net realized capital losses of $225.2 million in 2013, low interest rate pressures on spreads, a Moody's downgrade of Principal Life's financial strength rating to A1 in November 2013, and ongoing litigation and regulatory inquiries. Capital returned to stockholders totaled $442.0 million in 2013, including $288.4 million in common dividends and $153.6 million in share repurchases.
Feb 12, 2014
2012
Principal Financial Group Annual Report, Year Ended Dec 31, 2012
Principal Financial Group, Inc. (PFG) reported assets under management of $403.0 billion and approximately 18.3 million customers worldwide as of December 31, 2012. The company describes itself as a global investment management leader offering retirement services, insurance solutions and asset management, with a primary focus on small and medium-sized businesses. It organizes its business into four reportable segments: Retirement and Investor Services, Principal Global Investors, Principal International and U.S. Insurance Solutions, plus a Corporate segment. Net income attributable to Principal Financial Group, Inc. was $805.9 million in 2012, up from $652.7 million in 2011, and net income available to common stockholders was $772.9 million, or $2.57 per diluted share, compared with $1.95 in 2011. Total revenues rose to $9,215.1 million from $8,670.7 million. Total assets were $161,926.5 million and total stockholders' equity was $9,773.2 million at year-end. Management attributed the earnings improvement largely to higher gains tied to the Catalyst Health Solutions merger and the absence of a 2011 court ruling on uncertain tax positions, with the 2012 effective tax rate at 14% versus 23% in 2011. AUM rose from $335.0 billion to $403.0 billion over the year. The filing also highlights the February 4, 2013 acquisition of roughly 90% of AFP Cuprum S.A. in Chile for approximately $1.4 billion, funded in part by senior notes issued in 2012. Long-term debt increased to $2,671.3 million from $1,564.8 million. The filing notes that a 2012 DPAC and actuarial balance unlocking decreased net income by $96.7 million, and that continued low interest rates pressure spreads. Ratings agencies carry negative outlooks on several insurer ratings following the Cuprum transaction.
Feb 13, 2013
2011
Principal Financial Group Annual Report, Year Ended Dec 31, 2011
Principal Financial Group, Inc. (PFG) reported $335.0 billion in assets under management and approximately 18.0 million customers worldwide as of December 31, 2011. The company focuses on small and medium-sized businesses and operates four reportable segments: Retirement and Investor Services, Principal Global Investors, Principal International, and U.S. Insurance Solutions, plus a Corporate segment. Net income available to common stockholders was $682.0 million in 2011, up from $666.3 million in 2010, and diluted earnings per share were $2.15 versus $2.06. Total revenues were $8,709.6 million, down from $9,158.6 million, largely because group medical premiums fell as the company exited that business. Total stockholders' equity rose to $10,013.0 million at year-end 2011, and total assets were $148,298.0 million. Net cash provided by operating activities was $2,713.3 million. The company returned $770.1 million to stockholders in 2011, including $556.4 million of share repurchases and $213.7 million of common dividends ($0.70 per share). Retirement and Investor Services account values reached $183.3 billion, and Principal Global Investors AUM reached $227.8 billion. Investors should note several risk items disclosed in the filing: $1,523.9 million of gross unrealized losses on U.S. available-for-sale fixed maturities, $524.4 million of problem, potential problem and restructured fixed maturities (1.12% of total fixed maturities), and $2.8 billion of variable annuity account value carrying GMWB riders. The company also expects its adoption of new deferred acquisition cost guidance on January 1, 2012 to reduce retained earnings by approximately $640.0 million and to reduce 2012 net income by between $35.0 million and $45.0 million.
Feb 15, 2012
2010
Principal Financial Group Annual Report, Year Ended Dec 31, 2010
Principal Financial Group, Inc. (PFG) reported $318.8 billion in assets under management and approximately 19.1 million customers worldwide as of December 31, 2010. The company operates four reportable segments: Retirement and Investor Services, Principal Global Investors, Principal International, and U.S. Insurance Solutions, plus a Corporate segment. It focuses on small and medium-sized businesses and states it is the leading provider of corporate defined contribution plans in the U.S. In 2010 it decided to exit the group medical insurance business, which led to a $43.6 million goodwill impairment in the Corporate segment. Net income attributable to Principal Financial Group, Inc. was $699.3 million in 2010, versus $622.7 million in 2009, and net income available to common stockholders was $666.3 million, or $2.06 diluted earnings per share. Total revenues were $9,158.6 million and total assets were $145,631.1 million at year-end. Total stockholders' equity rose to $9,885.0 million from $8,016.4 million, and the company declared an annual dividend of $0.55 per share. Management attributed earnings growth primarily to higher fees from rising equity markets, which increased average account values and AUM. Investors should note the continued sensitivity of the business to credit and interest rate conditions. The filing reports $633.7 million of problem, potential problem and restructured fixed maturities, 1.37% of total fixed maturities, and $360.9 million of problem, potential problem and restructured commercial mortgages. Principal Life's financial strength ratings were A+ (A.M. Best), AA- (Fitch), Aa3 (Moody's) and A (S&P), and the company disclosed a $821.6 million excess capital position at the holding company level.
Feb 16, 2011
2009
Principal Financial Group Annual Report, Year Ended Dec 31, 2009
Principal Financial Group, Inc. (PFG) reported $284.7 billion in assets under management and approximately 18.9 million customers worldwide as of December 31, 2009. The company is a provider of retirement savings, investment and insurance products, with a primary focus on small and medium-sized businesses, and organizes its operations into four reportable segments: U.S. Asset Accumulation, Global Asset Management, International Asset Management and Accumulation, and Life and Health Insurance, plus a Corporate segment. Financial results improved in 2009. Net income available to common stockholders was $589.7 million, compared with $425.1 million in 2008, primarily due to a $211.5 million after-tax decrease in net realized capital losses. Total revenues declined to $8,849.1 million from $9,935.9 million, reflecting lower premiums, fees and net investment income. Total stockholders' equity rose to $8,016.4 million from $2,569.3 million, aided by a May 2009 common stock issuance that netted $1,109.1 million. Total assets were $137,759.4 million at year-end. The filing highlights continued pressure from the financial crisis: $553.2 million, or 1.24%, of total fixed maturity securities were classified as problem, potential problem or restructured, and the four major rating agencies maintained negative outlooks on the U.S. life insurance industry. Principal Life's financial strength ratings remained in the A+ to Aa3 range, and several class-action lawsuits related to ERISA and fund fees remained pending.
Feb 17, 2010
2008
Principal Financial Group Annual Report, Year Ended Dec 31, 2008
Principal Financial Group, Inc. (PFG) reported $247.0 billion in assets under management and approximately 19.1 million customers worldwide as of December 31, 2008. The company focuses on small and medium-sized businesses and describes itself as the leading provider of corporate defined contribution plans in the U.S., according to Spectrum Group, with over 33,000 plans. It operates four reportable segments: U.S. Asset Accumulation, Global Asset Management, International Asset Management and Accumulation, and Life and Health Insurance, plus a Corporate segment. Net income available to common stockholders fell to $425.1 million in 2008 from $827.3 million in 2007, driven primarily by a $248.4 million after-tax increase in net realized capital losses. Total revenues declined to $9,935.9 million from $10,906.5 million, and total stockholders' equity dropped to $2,472.8 million from $7,421.7 million, largely reflecting accumulated other comprehensive loss of $(4,911.6) million. Management cited the decline in equity markets, which reduced account values and AUM, and the credit market disruption. Cash and cash equivalents rose to $2.6 billion as the company built liquidity. To conserve capital, the Board reduced the common dividend to $0.45 per share, suspended share repurchases, and applied for up to $2.0 billion under the U.S. Treasury's Capital Purchase Program. Rating agencies revised their outlooks on the U.S. life insurance industry to negative, and Fitch downgraded Principal Life's insurer financial strength rating to AA- on February 13, 2009. The company also reported $454.9 million of long-term debt due in 2009, which it plans to refinance.
Feb 18, 2009
2007
Principal Financial Group Annual Report, Year Ended Dec 31, 2007
Principal Financial Group, Inc. (PFG) reported $311.1 billion in assets under management and approximately nineteen million customers worldwide as of December 31, 2007. The company describes itself as a leading provider of retirement savings, investment and insurance products, with a primary focus on small and medium-sized businesses. Its segments are U.S. Asset Accumulation, Global Asset Management, International Asset Management and Accumulation, and Life and Health Insurance. Net income available to common stockholders was $827.3 million in 2007, down from $1,031.3 million in 2006, and diluted earnings per share were $3.09 versus $3.74. The decline was driven largely by $328.8 million of net realized/unrealized capital losses, including $184.6 million of after-tax losses from impairments, linked to the second-half 2007 credit market disruption. Total revenues rose to $10,906.5 million from $9,873.1 million, and total assets reached $154,520.2 million. Total stockholders' equity declined to $7,421.7 million from $7,860.8 million, reflected in part by $756.3 million of share repurchases. Segment operating earnings totaled $1,058.4 million, up from $972.1 million, with U.S. Asset Accumulation contributing $655.8 million. The company paid an annual common dividend of $0.90 per share for 2007, up from $0.80. The filing also flags risks including market declines affecting AUM, credit defaults in a $44.5 billion U.S. fixed maturity portfolio, commercial mortgage concentration in California, and possible rating downgrades. Management reports $1,187.6 million of gross unrealized losses on available-for-sale fixed maturities as of year-end 2007.
Feb 27, 2008
2006
Principal Financial Group Annual Report, Year Ended Dec 31, 2006
Principal Financial Group, Inc. (PFG) reported $256.9 billion in assets under management and approximately eighteen million customers worldwide as of December 31, 2006. The company describes itself as a leading provider of retirement savings, investment and insurance products, with a focus on small and medium-sized businesses. Its operating segments are U.S. Asset Management and Accumulation, International Asset Management and Accumulation, and Life and Health Insurance. Total U.S. GAAP revenues rose to $9,870.5 million in 2006 from $9,041.7 million in 2005, and net income increased to $1,064.3 million from $919.0 million. Net income available to common stockholders was $1,031.3 million, or $3.74 per diluted share. The year included the $741.1 million cash acquisition of WM Advisors, Inc., which closed on December 31, 2006 and added about $28.0 billion in assets under management, and the issuance of $600.0 million of 6.05% senior notes due 2036. The company also repurchased shares under several programs, including a $500.0 million accelerated repurchase completed in November 2006, and paid an annual common dividend of $0.80 per share. Total assets were $143,658.1 million and total stockholders' equity was $7,860.8 million at year-end. The filing also flags risks that bear on investors, including sensitivity to securities market declines, interest rate movements, reliance on insurance subsidiary dividends (constrained by Iowa law), possible rating downgrades, and ongoing industry-wide regulatory inquiries and a putative ERISA class action over revenue-sharing fees. Management does not believe pending litigation will have a material adverse effect on the company's financial position.
Feb 28, 2007
2005
Principal Financial Group Annual Report, Year Ended Dec 31, 2005
Principal Financial Group, Inc. (PFG) reported $195.2 billion in assets under management and approximately fifteen million customers worldwide as of December 31, 2005. The company organizes its businesses into three operating segments: U.S. Asset Management and Accumulation, International Asset Management and Accumulation, and Life and Health Insurance, with a Corporate and Other segment. Total operating revenues were $9,032.1 million in 2005, up from $8,418.6 million in 2004, and total U.S. GAAP revenues were $9,007.7 million. Net income available to common stockholders rose to $901.3 million, or $3.11 diluted net income per share, from $825.6 million in 2004, with preferred stock dividends of $17.7 million in 2005 following the June 2005 preferred issuance. Segment operating earnings totaled $862.4 million in 2005 versus $764.8 million in 2004, led by U.S. Asset Management and Accumulation at $538.4 million and Life and Health Insurance at $274.4 million. Total assets reached $127.0 billion at year-end 2005, and stockholders' equity was $7.8 billion. The company repurchased shares heavily during 2005, including an accelerated stock repurchase of approximately 13.7 million shares with an initial payment of $542.3 million, and its common shares outstanding fell to 280.6 million from 300.6 million. Key risk areas disclosed include exposure to securities market declines, credit and commercial mortgage defaults (with 18% of commercial mortgage loans in California), ratings downgrade consequences, interest rate management, litigation including a New York Attorney General subpoena and a pending sales practices class action, and dividend limits imposed by Iowa insurance law on Principal Life. Management stated that pending litigation is not expected to have a material adverse effect on the business or financial position.
Mar 2, 2006
2004
Principal Financial Group Annual Report, Year Ended Dec 31, 2004
Principal Financial Group, Inc. (PFG) reported 2004 net income of $825.6 million, up from $746.3 million in 2003, on total revenues of $8,303.7 million. Income from continuing operations rose to $702.5 million, or $2.23 diluted per share, versus $1.98 in 2003. Total assets were $113.8 billion and assets under management reached $168.7 billion at year-end. Results were helped by $128.8 million of income from discontinued operations, mainly from the sale of Principal Residential Mortgage, Inc. to CitiMortgage for approximately $620.0 million in after-tax proceeds. The core businesses showed steady growth. U.S. Asset Management and Accumulation segment operating earnings rose to $499.0 million from $422.6 million, and Life and Health Insurance operating earnings rose to $256.2 million from $241.2 million. The company also repurchased 21.7 million shares for $772.0 million during 2004 and paid a $0.55 per share annual dividend. It acquired ABN AMRO Trust Services Company at year-end 2004 and agreed to acquire Columbus Circle Investors, which closed in January 2005. Key risks flagged in the filing include a $444.0 million IRS deficiency for tax years 1999-2000 that was paid in January 2005, pending litigation over demutualization allocations, a New York Attorney General subpoena regarding retirement product compensation, and indemnification claims from Westpac related to the BT Financial Group sale. Management states it does not expect the pending litigation to have a material adverse effect on the business or financial position.
Mar 4, 2005
2003
Principal Financial Group Annual Report, Year Ended Dec 31, 2003
Principal Financial Group, Inc. (PFG) reports that it was a leading provider of retirement savings, investment and insurance products with $144.9 billion in assets under management and approximately fifteen million customers worldwide as of December 31, 2003. Net income rose to $746.3 million in 2003 from $142.3 million in 2002, and diluted earnings per share were $2.28 versus $0.41. The increase was driven in part by lower net realized/unrealized capital losses ($65.7 million versus $354.8 million in 2002), a $21.8 million gain from discontinued operations tied to the 2002 sale of BT Financial Group, and the absence of the 2002 cumulative effect of accounting change of $280.9 million. Total revenues increased to $9,404.2 million from $8,822.5 million, while operating expenses rose to $3,281.3 million, reflecting a $141.3 million additional impairment charge on mortgage servicing rights in December 2003. Balance sheet growth was substantial: total assets were $107,754.4 million at year-end 2003 compared with $89,861.3 million a year earlier, and long-term debt rose to $2,767.3 million from $1,332.5 million, largely due to consolidation of variable interest entities under FIN 46, including Principal Residential Mortgage Capital Resources, LLC. Stockholders' equity increased to $7,399.6 million. The company paid a $0.45 per share annual dividend in 2003 (up from $0.25) and repurchased 15.0 million shares for $453.0 million, with $147.0 million remaining under the current authorization. The filing also highlights ongoing risks, including mortgage servicing rights valuation volatility, the Mortgage Banking segment's exposure to interest rate changes, international operations in Latin America and Asia, a New Zealand indemnification exposure of up to A$250.0 million tied to the BT Financial Group sale, and dividend limits imposed by Iowa insurance law on Principal Life. Management states that the outcome of pending litigation is not expected to have a material adverse effect on the business.
Mar 3, 2004
2002
Principal Financial Group Annual Report, Year Ended Dec 31, 2002
Principal Financial Group, Inc. (PFG) reported $111.1 billion in assets under management and approximately thirteen million customers worldwide as of December 31, 2002. The company was organized as an individual life insurer in 1879 and completed its demutualization and initial public offering on October 26, 2001, when it issued 100.0 million shares at $18.50 per share, with net IPO proceeds of $1,753.9 million. The company operates four segments: U.S. Asset Management and Accumulation, International Asset Management and Accumulation, Life and Health Insurance, and Mortgage Banking. Net income fell to $142.3 million in 2002 from $358.8 million in 2001, driven largely by a $280.9 million cumulative effect of accounting changes and a $196.7 million loss from discontinued operations related to the sale of BT Financial Group. Operating earnings rose to $749.4 million from $722.1 million, and total GAAP revenues were $8,822.5 million. Total stockholders' equity was $6,657.2 million at year-end 2002, down from $6,820.3 million, reflecting $1,118.1 million in treasury stock. The company repurchased 27.0 million shares for $750.0 million earlier in 2002 and authorized a further $300.0 million program in November 2002. Diluted earnings per share were $0.41 on net income, compared with $1.77 from continuing operations. The company paid an annual dividend of $0.25 per share. Mortgage Banking grew substantially, with operating revenues of $1,153.0 million, and the residential mortgage servicing portfolio reached $107,745.3 million. Principal Life's ratings include A+ from A.M. Best and AA from Fitch and Standard & Poor's, with S&P carrying a negative outlook. The filing also discloses pending matters, including a reserve for sales practices litigation, a sale of BT Financial Group to Westpac for A$900.0 million with estimated after-tax proceeds of $938.4 million, and a planned sale of retail mortgage lending branches to American Home Mortgage. Management stated that no pending litigation is expected to have a material adverse effect.
Mar 5, 2003
2001
Principal Financial Group Annual Report, Year Ended Dec 31, 2001
Principal Financial Group, Inc. (PFG) reported $120.2 billion in assets under management and approximately thirteen million customers worldwide as of December 31, 2001. The company describes itself as a leading provider of retirement savings, investment and insurance products, with a focus on 401(k) and defined contribution pension plans, particularly for small and medium-sized businesses. It completed its demutualization and initial public offering on October 26, 2001, issuing 100.0 million shares at $18.50 per share, with an additional 15.0 million over-allotment shares issued November 9, 2001. Net proceeds from the IPO were $1,753.9 million, of which $1,689.7 million was contributed to Principal Life Insurance Company. For 2001, net income was $358.8 million, down from $620.2 million in 2000, reflecting net realized capital losses of $514.0 million, a $10.7 million cumulative effect of accounting change, and $31.1 million of non-recurring items. Operating earnings rose to $710.9 million from $628.1 million. Total revenues were $8,817.5 million and total assets were $88,350.5 million. Mortgage Banking production surged to $37.8 billion in loans from $8.3 billion, and the mortgage servicing portfolio grew to $80.5 billion. The filing notes Enron-related impairments of $71.9 million and an estimated after-tax goodwill impairment of approximately $300.0 million to be recognized in the first quarter of 2002 upon adoption of SFAS 142. Subsequent events include the February 1, 2002 sale of the remaining Coventry Health Care stake for estimated proceeds of $325.2 million with an estimated realized gain of $183.1 million, a Fitch downgrade of Principal Life's financial strength rating from AA+ to AA, and a board authorization on February 26, 2002 to repurchase up to $450.0 million of common stock.
Mar 12, 2002