Principal Financial(PFG) - 2024 Q4 - Annual Results

Financial Performance - Full-year non-GAAP operating earnings per diluted share increased 11% to $7.65, aligning with long-term guidance of 9-12% growth[7] - Net income attributable to Principal Financial Group (PFG) for 4Q24 was $905.4 million, compared to a loss of $871.7 million in 4Q23[37] - Non-GAAP net income attributable to PFG, excluding exited business, was $353.5 million in 4Q24, up from $299.1 million in 4Q23[37] - Non-GAAP operating earnings for 4Q24 were $448.1 million, slightly increasing from $440.5 million in 4Q23[37] - The company reported a non-GAAP pre-tax operating earnings of $546.9 million for 4Q24, compared to $539.8 million in 4Q23[37] - The Retirement and Income Solutions segment reported pre-tax operating earnings of $280.1 million in 4Q24, up from $264.6 million in 4Q23[37] Shareholder Returns - The company returned $1.7 billion to shareholders in 2024, including $1.0 billion in share repurchases and $0.7 billion in common stock dividends[5] - The first quarter 2025 common stock dividend was raised to $0.75 per share, a 9% increase over the first quarter 2024 dividend[7] Assets and Capital - Assets under management (AUM) reached $712 billion, contributing to total assets under administration (AUA) of $1.7 trillion[7] - Total assets increased to $313.7 billion in 4Q24 from $305.0 billion in 4Q23[42] - Stockholders' equity rose to $11,131.3 million in 4Q24, compared to $10,961.7 million in 4Q23[42] - Stockholders' equity available to common stockholders increased to $11,086.4 million in Q4 2024 from $10,916.0 million in Q4 2023, representing a growth of 1.6%[44] - Stockholders' equity, excluding cumulative change in fair value of funds withheld and AOCI, was $12,144.0 million in Q4 2024, down from $12,735.4 million in Q4 2023, a decrease of 4.6%[44] Investment Management - Investment Management AUM increased by $32 billion to $559 billion, with a record quarter in retirement investment sales[16] - Investment management operating revenues for Q4 2024 were $474.6 million, compared to $433.1 million in Q4 2023, marking an increase of 9.6%[48] Tax and Capital Gains - Total GAAP income taxes for Q4 2024 were $209.9 million, a significant increase from a tax benefit of $(268.0) million in Q4 2023[46] - Net realized capital gains (losses) for Q4 2024 were $(88.6) million, an improvement from $(112.7) million in Q4 2023[46] - Net realized capital gains (losses), as adjusted, were $(94.6) million in Q4 2024, compared to $(141.4) million in Q4 2023, showing an improvement of 33.1%[46] Future Outlook - The company anticipates 9-12% annual non-GAAP operating earnings per diluted share growth for 2025, with capital deployment expected between $1.4 billion and $1.7 billion[11] - Principal Financial Group plans to discuss future prospects and capital adequacy in an earnings conference call scheduled for February 7, 2025[32] Segment Performance - Retirement and Income Solutions (RIS) recurring deposit growth was 7%, with transfer deposit growth of 16% over 2023[16] - Specialty Benefits premium and fees increased by 7% over 2023, with a pre-tax operating earnings increase of 23% in 4Q24[24] - Pre-tax operating earnings for International Pension decreased by 42% in 4Q24, primarily due to lower net revenue[19] Other Financial Metrics - Book value per common share increased to $49.01 in 4Q24 from $46.18 in 4Q23[42] - Book value per common share, excluding cumulative change in fair value of funds withheld, rose to $53.69 in Q4 2024 compared to $53.87 in Q4 2023, indicating a slight decrease of 0.3%[44] - Operating revenues less pass-through expenses for Q4 2024 reached $435.7 million, up from $397.9 million in Q4 2023, reflecting an increase of 9.4%[48] - The change in fair value of funds withheld embedded derivative was $794.3 million in Q4 2024, a recovery from $(1,478.6) million in Q4 2023[46] - Total income from exited business for Q4 2024 was $551.9 million, a significant turnaround from a loss of $(1,170.8) million in Q4 2023[46] - Significant variances in 4Q24 included lower than expected variable investment income across multiple segments[31]