| --- | --- | |--------------|-------| | | | | O Principal® | | Use of non-GAAP financial measures A non-GAAP financial measure is a numerical measure of performance, financial position, or cash flow that includes adjustments from a comparable financial measure presented in accordance with U.S. GAAP. The company uses a number of non-GAAP financial measures management believes are useful to investors because they illustrate the performance of the company's normal, ongoing operations which is important in und ...

Principal Financial Group, Inc. (NASDAQ:PFG) Q1 2021 Earnings Conference Call April 28, 2021 10:00 AM ET Company Participants John Egan - VP, IR Dan Houston - CEO Deanna Strable - CFO Amy Friedrich - President-U.S. Insurance Solutions Renee Schaaf - President-Retirement Income Solutions Pat Halter - Global Asset Management Conference Call Participants Jimmy Bhullar - JPMorgan Humphrey Lee - Dowling & Partners Andrew Kligerman - Credit Suisse Erik Bass - Autonomous Research Ryan Krueger - KBW John Barnidge - ...

| --- | --- | |--------------|-------| | | | | Q Principal® | | Use of non-GAAP financial measures A non-GAAP financial measure is a numerical measure of performance, financial position, or cash flow that includes adjustments from a comparable financial measure presented in accordance with U.S. GAAP. The company usesa number of non-GAAP financial measures management believes are useful to investors because they illustrate the performance of the company's normal, ongoing operations which is important in unde ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-16725 PRINCIPAL FINANCIAL GROUP, INC. (Exact name of Registrant as specified in its charter) Delaware (State or other jurisdicti ...

Principal Financial Group, Inc. (NASDAQ:PFG) Q4 2020 Earnings Conference Call January 29, 2021 10:00 AM ET Company Participants John Egan - Vice President, Investor Relations Dan Houston - Chief Executive Officer Deanna Strable - Chief Financial Officer Amy Friedrich - President-U.S. Insurance Solutions Renee Schaaf - President-Retirement and Income Solutions Luis Valdés - Principal International Pat Halter - Global Asset Management Conference Call Participants Ryan Krueger - KBW Humphrey Lee - Dowling & Pa ...

| --- | --- | |-----------------------------------------------------------------------------------------------|-------| | | | | Q Principal® | | | | | | Principal Financial Group Fourth Quarter and Full Year 2020 Earnings Results January 28, 2021 | | Use of non-GAAP financial measures A non-GAAP financial measure is a numerical measure of performance, financial position, or cash flow that includes adjustments from a comparable financial measure presented in accordance with U.S. GAAP. The company uses a numb ...

Part I - FINANCIAL INFORMATION This section details the company's financial statements, management's analysis, market risk disclosures, and internal controls [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the company's condensed consolidated financial statements, including statements of financial position, operations, and cash flows, along with explanatory notes [Condensed Consolidated Statements of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Financial%20Position) This section details the company's financial position, including total assets, liabilities, and equity, at period-end Condensed Consolidated Statements of Financial Position (in millions) | Account | September 30, 2020 (Unaudited) | December 31, 2019 | | :--- | :--- | :--- | | **Total investments** | $103,033.8 | $96,351.4 | | **Total assets** | $278,484.8 | $276,087.8 | | **Total liabilities** | $262,485.2 | $261,137.1 | | **Total stockholders' equity** | $15,721.1 | $14,685.8 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section outlines the company's revenues, net income, and earnings per share for the reported periods Condensed Consolidated Statements of Operations (in millions, except per share data) | Metric | Three Months Ended Sep 30, 2020 | Three Months Ended Sep 30, 2019 | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | **Total revenues** | $3,310.7 | $4,458.4 | $10,976.6 | $12,174.9 | | **Net income** | $235.9 | $284.6 | $937.0 | $1,128.8 | | **Net income attributable to PFG, Inc.** | $236.0 | $277.1 | $923.2 | $1,093.3 | | **Diluted earnings per common share** | $0.85 | $0.98 | $3.34 | $3.89 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section details the company's cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (in millions) | Cash Flow Activity | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $3,110.4 | $4,464.8 | | **Net cash used in investing activities** | ($3,639.9) | ($4,926.2) | | **Net cash provided by financing activities** | $1,570.3 | $681.9 | | **Net increase in cash and cash equivalents** | $1,040.8 | $220.5 | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations of significant accounting policies, estimates, and events affecting the financial statements - The company adopted new accounting guidance for credit losses (CECL) on January 1, 2020, resulting in a cumulative effect adjustment of **$8.4 million** as a **decrease** to retained earnings[34](index=34&type=chunk) - In response to COVID-19, the company elected TDR relief provided by the CARES Act for certain loan modifications, temporarily suspending TDR accounting for qualifying loans[37](index=37&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=123&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, noting decreased net income due to actuarial updates, while affirming strong capital and liquidity - Net income for Q3 2020 **decreased** primarily due to an **$81.7 million** more unfavorable impact from actuarial assumption updates and model refinements compared to Q3 2019[388](index=388&type=chunk) - For the nine months ended September 30, 2020, net income **decreased** due to the unfavorable actuarial updates, **$33.0 million** of unfavorable market performance on required regulatory investments in Latin America, and **$32.7 million** from negative foreign currency impacts[396](index=396&type=chunk) - The company maintains a strong liquidity position, with **$2.6 billion** of cash and liquid assets held in its holding companies and other subsidiaries available for corporate purposes as of September 30, 2020[454](index=454&type=chunk) [Results of Operations by Segment](index=131&type=section&id=Results%20of%20Operations%20by%20Segment) This section analyzes pre-tax operating earnings and losses across the company's various business segments Pre-tax Operating Earnings (Losses) by Segment (in millions) | Segment | Three Months Ended Sep 30, 2020 | Three Months Ended Sep 30, 2019 | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | Retirement and Income Solutions | $281.1 | $169.7 | $700.1 | $666.5 | | Principal Global Investors | $140.9 | $123.0 | $361.0 | $339.3 | | Principal International | $58.7 | $108.9 | $184.0 | $313.2 | | U.S. Insurance Solutions | ($134.1) | $120.1 | $150.4 | $377.1 | | Corporate | ($69.7) | ($102.1) | ($244.8) | ($284.6) | | **Total** | **$276.9** | **$419.6** | **$1,150.7** | **$1,411.5** | - Retirement and Income Solutions pre-tax operating earnings for Q3 2020 **increased** to **$281.1 million**, primarily due to a favorable **$72.3 million** impact from actuarial assumption updates in the Fee business[406](index=406&type=chunk) - U.S. Insurance Solutions reported a pre-tax operating **loss** of **$134.1 million** for Q3 2020, a significant **decline** from a **$120.1 million** profit in Q3 2019, mainly due to more unfavorable actuarial assumption updates in the Individual Life business[428](index=428&type=chunk) [Liquidity and Capital Resources](index=142&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's ability to meet financial obligations and maintain adequate capital levels - The company believes its liquidity and capital resources are strong and sufficient to meet operating needs, supported by cash flows, credit facilities, and a strong risk-based capital position, despite the uncertainty from the COVID-19 pandemic[441](index=441&type=chunk)[442](index=442&type=chunk) Capitalization Summary (in millions) | Component | September 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | Total debt | $4,355.6 | $3,827.5 | | Total stockholders' equity attributable to PFG | $15,650.9 | $14,618.0 | | **Total capitalization** | **$20,006.5** | **$18,445.5** | | Debt to capitalization | 22% | 21% | - Dividends from the primary subsidiary, Principal Life, are limited by Iowa law[453](index=453&type=chunk) For 2020, the ordinary dividend limitation is approximately **$1,060.3 million**[454](index=454&type=chunk) For the nine months ended Sep 30, 2020, Principal Life paid **$400.0 million** in extraordinary dividends, which required regulatory approval[454](index=454&type=chunk) [Investments](index=149&type=section&id=Investments) This section details the composition and quality of the company's investment portfolio - Total invested assets were **$103.0 billion** as of September 30, 2020, with fixed maturities (**74%**) and commercial mortgage loans (**16%**) being the major categories[479](index=479&type=chunk)[480](index=480&type=chunk)[481](index=481&type=chunk) Fixed Maturities by NAIC Designation (Carrying Amount, in millions) | NAIC Designation | September 30, 2020 | % of Total | December 31, 2019 | % of Total | | :--- | :--- | :--- | :--- | :--- | | 1 (Highest Quality) | $48,726.2 | 67% | $46,300.5 | 69% | | 2 (High Quality) | $20,748.4 | 28% | $18,079.2 | 27% | | 3-6 (Below Investment Grade) | $3,730.3 | 5% | $2,590.4 | 4% | | **Total** | **$73,204.9** | **100%** | **$66,970.1** | **100%** | [Quantitative and Qualitative Disclosures About Market Risk](index=170&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section details the company's exposure to interest rate, equity, and foreign currency risks, including their potential impact and management strategies - A hypothetical **100 basis point** immediate, parallel increase in interest rates would reduce the net reported fair value of financial assets and derivatives by **$5,123.0 million** as of September 30, 2020[577](index=577&type=chunk) - An immediate **10% decline** in the S&P 500 index is estimated to reduce annual segment pre-tax operating earnings by approximately **5% to 7%** over the next 12 months, excluding potential unlocking of DAC[599](index=599&type=chunk) - A **10%** immediate unfavorable change in foreign currency exchange rates would reduce the total equity of international operations by **$305.9 million** as of September 30, 2020[591](index=591&type=chunk) [Controls and Procedures](index=181&type=section&id=Item%204.%20Controls%20and%20Procedures) The CEO and CFO affirmed the effectiveness of disclosure controls and procedures, noting the integration of the Wells Fargo IRT business - The CEO and CFO have concluded that the company's disclosure controls and procedures are effective as of September 30, 2020[604](index=604&type=chunk) - During the third quarter of 2020, the company completed the integration of the acquired Wells Fargo IRT business into its internal control over financial reporting[605](index=605&type=chunk) Part II — OTHER INFORMATION This section covers legal proceedings, key risk factors, equity security sales, and required exhibits [Legal Proceedings](index=183&type=section&id=Item%201.%20Legal%20Proceedings) The company is defending a class action lawsuit regarding alleged ERISA breaches, with management not expecting a material adverse effect - The company is defending a class action lawsuit (Frederick Rozo v. Principal Life) concerning alleged ERISA breaches related to its Principal Fixed Income Option (PFIO)[209](index=209&type=chunk) A summary judgment in favor of Principal Life was reversed and the case has been remanded to the district court[209](index=209&type=chunk) - As of September 30, 2020, no **loss** has been accrued for this legal matter as management believes the chance of **loss** is not probable and the amount cannot be reasonably estimated[210](index=210&type=chunk) [Risk Factors](index=183&type=section&id=Item%201A.%20Risk%20Factors) This section details new risk factors, primarily the COVID-19 pandemic's potential adverse effects on claims, investments, and sales - A new risk factor was added to address the ongoing COVID-19 pandemic and its potential adverse effects on the business, financial condition, and liquidity[607](index=607&type=chunk)[608](index=608&type=chunk) - Specific pandemic-related risks include **increased** claims (life and disability), higher defaults on fixed maturity and mortgage loan portfolios, reduced value of invested assets, and lower sales due to rising unemployment[609](index=609&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=185&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 4.1 million shares, pausing a new $900 million program due to market uncertainty, with $850.3 million remaining - In February 2020, the Board of Directors authorized a new share repurchase program of up to **$900.0 million**[614](index=614&type=chunk) However, the program was paused in March 2020 due to the macro-environment[614](index=614&type=chunk) Issuer Purchases of Equity Securities (Q1 2020) | Period | Total Shares Purchased (Public Program) | Average Price Paid per Share | | :--- | :--- | :--- | | Jan 2020 | 2,075,857 | $55.26 | | Feb 2020 | 965,166 | $55.20 | | Mar 2020 | 1,107,799 | $45.19 | - As of September 30, 2020, **$850.3 million** remained available for repurchase under the current program[614](index=614&type=chunk) The company may resume repurchases as early as Q4 2020 or Q1 2021[614](index=614&type=chunk) [Exhibits](index=186&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and financial statements in iXBRL - The exhibits filed with this report include certifications from the CEO and CFO as required by the Sarbanes-Oxley Act, and financial data formatted in iXBRL[615](index=615&type=chunk)

Principal Financial Group (NASDAQ:PFG) Q3 2020 Results Conference Call October 27, 2020 10:00 AM ET Company Participants John Egan - Investor Relations Dan Houston - Chief Executive Officer Deanna Strable - Chief Financial Officer Renee Schaaf - President-Retirement and Income Solutions Amy Friedrich - President-U.S. Insurance Solutions Tim Dunbar - President-Principal Global Asset Management Conference Call Participants Humphrey Lee - Dowling & Partners John Barnidge - Piper Sandler Ryan Krueger - KBW Su ...

| --- | --- | |--------------------------------------------------------------------------------|-------| | | | | O Principal® | | | | | | Principal Financial Group Third Quarter 2020 Earnings Results October 26, 2020 | | Use of non-GAAP financial measures A non-GAAP financial measure is a numerical measure of performance, financial position, or cash flow that includes adjustments from a comparable financial measure presented in accordance with U.S. GAAP. The company usesa number of non-GAAP financial measur ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 1-16725 (Commission file number) PRINCIPAL FINANCIAL GROUP, INC. (Exact name of registrant as specified in its charter) Delaware 42-1520346 (I.R.S. Employer Identification Number) (St ...