Principal Announces First Quarter 2018 Results
April 26, 2018 at 16:15 PM EDT
Principal Financial Group® (Nasdaq: PFG) today announced results for first quarter 2018.
“First quarter was a good start to the year for Principal®, with our diversified, integrated businesses delivering record non-GAAP operating earnings and record assets under management,” said Dan Houston, chairman, president, and CEO of Principal. “Our continued growth reflects very strong investment performance, and ongoing investments in our businesses to enhance our solution set, expand our distribution reach, improve the customer experience and deliver better outcomes for customers and clients.”
“We continue to balance investments in growth with disciplined expense management,” added Houston. “We committed more than $80 million to strategic acquisitions during the quarter. We also distributed more than $325 million to shareholders through common stock dividends and share buybacks, reflecting our balanced approach to capital deployment and our ongoing commitment to creating long-term value for our shareholders.”
Other first quarter highlights
Forward looking and cautionary statements
Use of Non-GAAP financial measures
Earnings conference call
The company’s financial supplement and slide presentation is currently available at principal.com/investor, and may be referred to during the call.
*U.S. GAAP (GAAP) net income attributable to PFG versus non-GAAP operating earnings
Management uses non-GAAP operating earnings, which is a financial measure that excludes the effect of net realized capital gains and losses, as adjusted, and other after-tax adjustments the company believes are not indicative of overall operating trends, for goal setting, as a basis for determining employee and senior management awards and compensation, and evaluating performance on a basis comparable to that used by investors and securities analysts. Note: it is possible these adjusting items have occurred in the past and could recur in future reporting periods. While these items may be significant components in understanding and assessing our consolidated financial performance, management believes the presentation of non-GAAP operating earnings enhances the understanding of results of operations by highlighting earnings attributable to the normal, ongoing operations of the company’s businesses.
1 Use of non-GAAP financial measures is discussed in this release after segment results. Non-GAAP operating earnings for total company is after tax.
2 Represents the percentage of Principal actively managed mutual funds, exchange traded funds (ETFs), insurance separate accounts, and collective investment trusts (CITs) in the top two Morningstar quartiles. Excludes Money Market, Stable Value, Liability Driven Investment (Short, Intermediate and Extended Duration), Hedge Fund Separate Account & US Property Separate Account.
3 The company has provided reconciliations of the non-GAAP measures to the most directly comparable U.S. GAAP measures at the end of the release. The company has determined this measure is more representative of underlying operating revenues growth for PGI as it removes commissions that are collected through fee revenue and passed through expenses with no impact to pre-tax operating earnings.
4 Premium and fees = premiums and other considerations plus fees and other revenues.
5 Pre-tax operating earnings = operating earnings before income taxes and after noncontrolling interest.
6 Net revenue = operating revenues less benefits, claims and settlement expenses less dividends to policyholders.
7 Pre-tax return on net revenue = pre-tax operating earnings divided by net revenue.
8 Pre-tax return on operating revenues less pass-through commissions = pre-tax operating earnings, adjusted for noncontrolling interest divided by operating revenues less pass-through commissions.
9 Combined net revenue: net revenue for all Principal International companies at 100% less pass-through commissions. Prior to 1Q 2018, pass-through commissions were not excluded from this definition. The company has determined combined net revenue (at PFG share) is more representative of underlying net revenue growth for Principal International as it reflects our proportionate share of consolidated and equity method subsidiaries. In addition, using this net revenue metric provides a more meaningful representation of our profit margins. net revenue (at PFG share)
10 Pre-tax return on premium and fees = pre-tax operating earnings divided by premium and fees.
11 Principal, Principal and symbol design and Principal Financial Group are trademarks and service marks of Principal Financial Services, Inc., a member of the Principal Financial Group.