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Steady growth, together.

Graphic of a calendar.

Setting goals for continued long-term growth.

As we turn our focus to 2021, we’re confident that we will provide our investors with healthy long-term financial growth as demonstrated by our total company long-term financial targets.

Long-term financial targets

Profitability

9-12%

annual growth in
operating earnings1
and earnings per share2

Free cash flow

70-80%

of net income

Capital and liquidity

20-25%

targeted debt-to-capital ratio

approx.
400%

targeted
risk-based
capital (RBC)
ratio

1Non-GAAP operating earnings

2Non-GAAP operating earnings per diluted share

Financial highlights

Principal met the challenges of 2020 head-on. While our financial results were impacted by COVID-19 and the resulting macroeconomic volatility, we ended the year in a stronger financial position than we began, with record assets under management.

Total assets under management

  • $627
  • $735
  • $807

Net income attributable to PFG

  • $1,547
  • $1,394
  • $1,396

Non-GAAP operating earnings1

  • $1,598
  • $1,569
  • $1,366

Total revenue

  • $14,237
  • $16,222
  • $14,742

Non-GAAP operating earnings per diluted common share1

  • $5.53
  • $5.58
  • $4.94

Dividends paid per common share

  • $2.10
  • $2.18
  • $2.24

Closing PFG common stock price

  • $44.17
  • $55.00
  • $49.61

Total stockholders’ equity attributable to PFG

  • $11,390
  • $14,618
  • $16,559

Non-GAAP operating earnings ROE available to common stockholders, excluding AOCI other than foreign currency translation adjustment1,2

  • 13.6%
  • 13.1%
  • 10.9%

Capital deployments

(in millions)

In 2018 $1.4 billion in capital was deployed through $599 million in common stock dividends paid, $650 million in share repurchases, and $140 million in mergers and acquisition.
In 2019 $2.1 billion in capital was deployed through $606 million in common stock dividends paid, $257 million in share repurchases, and $1,200 million in mergers and acquisition.
In 2020 $908 million in capital was deployed through $615 million in common stock dividends paid and $293 million in share repurchases.

Non-GAAP Financial Measure Reconciliations

(in millions, except as indicated)

  For the year ended Dec. 31
Net income attributable to PFG 2018 2019 2020
Net income attributable to PFG 1,546.5 1,394.2 1,395.8
Net realized capital (gains) losses, as adjusted1 51.0 174.9 (29.4)
Non-GAAP operating earnings 1,597.5 1,569.1 1,366.4
1 This is a non-GAAP financial measure. See reconciliation below.
Net realized capital gains (losses)
GAAP net realized capital gains (losses) (75.4) (52.8) 302.6
Recognition of front-end fee revenues 0.4 8.5 11.4
Market value adjustments to fee revenues 0.1 - (1.6)
Net realized capital gains (losses) related to equity method investments (5.4) 2.6 (1.5)
Derivative and hedging-related revenue adjustments (64.9) (80.4) (132.9)
Sponsored investment fund adjustments 12.9 23.6 17.3
Amortization of deferred acquisition costs (25.6) (15.7) (0.5)
Capital gains distributed - operating expenses 15.7 (31.6) (41.7)
Amortization of other actuarial balances (1.4) (25.1) (26.3)
Market value adjustments of embedded derivatives 18.5 66.6 (55.0)
Capital gains distributed - cost of interest credited (1.3) (36.6) (8.2)
Net realized capital gains (losses) tax adjustments 71.4 (1.3) (28.2)
Net realized capital gains (losses) attributable to noncontrolling interest, after-tax 4.0 (32.7) (6.0)
Total net realized capital gains (losses) after-tax adjustments 24.4 (122.1) (273.2)
Net realized capital gains (losses), as adjusted (51.0) (174.9) 29.4
 
Diluted earnings per common share
Net income 5.36 4.96 5.05
Net realized capital (gains) losses, as adjusted 0.17 0.62 (0.11)
Non-GAAP operating earnings 5.53 5.58 4.94
 
Stockholders' equity
Stockholders' equity 11,456.0 14,685.8 16,617.3
Noncontrolling interest (66.0) (67.8) (58.4)
Stockholders' equity attributable to Principal Financial Group, Inc. 11,390.0 14,618.0 16,558.9
Net unrealized capital (gains) losses (207.3) (2,815.3) (4,156.5)
Net unrecognized postretirement benefit obligation 512.9 435.6 460.5
Stockholders’ equity, excluding AOCI other than foreign currency translation adjustment, available to common stockholders 11,695.6 12,238.3 12,862.9
 
Net income ROE available to common stockholders (including AOCI)
Net income ROE available to common stockholders (including AOCI) 12.8 10.7 9.0
Net unrealized capital gains (losses) 0.9 1.4 2.5
Net unrecongnized postretirement benefit obligation -0.5 -0.4 -0.4
Net income ROE available to common stockholders (x-AOCI, other than FCTA) 13.2 11.7 11.1
Net realized capital (gains) losses 0.4 1.4 0.2
Operating earnings ROE (x-AOCI other than FCTA) 13.6 13.1 10.9
Uplifting communities (ESG)
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