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Financial highlights

Throughout a truly transformational year, Principal delivered strong results—including a 37% increase in non-GAAP operating earnings per diluted share and a 340 basis point improvement in return on equity compared to 2020. Additionally, we met or exceeded all of our financial targets from our 2021 outlook for the enterprise and for each of our businesses.

Financial targets

ANNUAL GROWTH IN EARNINGS PER SHARE1

9-12%

1 Non-GAAP operating earnings per diluted share

RETURN ON EQUITY2

15%+

2 Non-GAAP operating earnings return on average equity, excluding AOCI other then foreign currency translation ajustment

FREE CAPITAL FLOW CONVERSION

75-85%

2021 financial results

Non GAAP pre-tax operating earnings4

(as of Dec. 31, 2021)

Total assets under management (AUM)5

  • $628
  • $665
  • $714

Net income attributable to Principal Financial Group

  • $1,394
  • $1,396
  • $1,711

Non-GAAP operating earnings6

  • $1,569
  • $1,366
  • $1,848

Total revenue

  • $16,222
  • $14,742
  • $14,263

Non-GAAP operating earnings per diluted common share6

  • $5.58
  • $4.94
  • $6.77

Dividends paid per common share

  • $2.18
  • $2.24
  • $2.44

Closing PFG common stock price

  • $55.00
  • $49.61
  • $72.33

Total stockholders' equity attributable to Principal Financial Group

  • $14,618
  • $16,559
  • $16,069

NON-GAAP OPERATING EARNINGS RETURN ON EQUITY (ROE) AVAILABLE TO COMMON STOCKHOLDERS (excluding AOCI other than foreign currency translation adjustment6,7)

  • 13.1%
  • 10.9%
  • 14.3%
  • 5 At the end of 2021, the company changed its definition of AUM to exclude assets managed by third parties on its retirement platforms. Prior periods have been recast to reflect the updated definition.
  • 6 This is a non-GAAP financial measure. See non-GAAP financial measure reconciliations.
  • 7 Non-GAAP operating earnings return on equity equals trailing 12 months non-GAAP operating earnings divided by average stockholders' equity available to common stockholders excluding accumulated other comprehensive income (loss) other than foreign currency translation adjustment (FCTA).

Capital deployments

(in millions)

Common stock dividends paid

Share repurchases

M&A

Non-GAAP Financial Measure Reconciliations

(in millions, except as indicated)

For the year ended Dec. 31
2019 2020 2021
Net income attributable to Principal Financial Group
Net income attributable to Principal Financial Group 1,394.2 1,395.8 1,710.6
Net realized capital (gains) losses, as adjusted8 174.9 (29.4) 137.0
Non-GAAP operating earnings 1,569.1 1,366.4 1,847.6
8 This is a non-GAAP financial measure. See reconciliation below.
Net realized capital gains (losses)
GAAP net realized capital gains (losses) (52.8) 302.6 2.5
Recognition of front-end fee revenues 8.5 11.4 (2.9)
Market value adjustments to fee revenues - (1.6) (0.6)
Net realized capital gains (losses) related to equity method investments 2.6 (1.5) (24.0)
Derivative and hedging-related revenue adjustments (80.4) (132.9) (160.3)
Sponsored investment fund adjustments 23.6 17.3 21.3
Amortization of deferred acquisition costs (15.7) (0.5) (0.2)
Capital gains distributed—operating expenses (31.6) (41.7) (69.4)
Amortization of other actuarial balances (25.1) (26.3) 11.3
Market value adjustments of embedded derivatives 66.6 (55.0) 79.8
Capital gains distributed—cost of interest credited (36.6) (8.2) (37.3)
Net realized capital gains (losses) tax adjustments (1.3) (28.2) 56.2
Net realized capital gains (losses) attributable to noncontrolling interest, after-tax (32.7) (6.0) (13.4)
Total net realized capital gains (losses) after-tax adjustments (122.1) (273.2) (139.5)
Net realized capital gains (losses), as adjusted (174.9) 29.4 (137.0)
Diluted earnings per common share
Net income 4.96 5.05 6.27
Net realized capital (gains) losses, as adjusted 0.62 (0.11) 0.50
Non-GAAP operating earnings 5.58 4.94 6.77
Stockholders' equity
Stockholders' equity 14,685.8 16,617.3 16,125.8
Noncontrolling interest (67.8) (58.4) (56.4)
Stockholders' equity attributable to Principal Financial Group, Inc. 14,618.0 16,558.9 16,069.4
Net unrealized capital (gains) losses (2,815.3) (4,156.5) (3,519.2)
Net unrecognized postretirement benefit obligation 435.6 460.5 344.7
Stockholders' equity, excluding AOCI other than foreign currency translation adjustment, available to common stockholders 12,238.3 12,862.9 12,894.9
Net income ROE available to common stockholders (including AOCI)
Net income ROE available to common stockholders (including AOCI) 10.7 9.0 10.5
Net unrealized capital (gains) losses 1.4 2.5 3.1
Net unrecongnized postretirement benefit obligation -0.4 -0.4 -0.3
Net income ROE available to common stockholders (x-AOCI, other than FCTA) 11.7 11.1 13.3
Net realized capital (gains) losses 1.4 -0.2 1.0
Non-GAAP operating earnings ROE (x-AOCI other than FCTA) 13.1 10.9 14.3
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