Retirement and investment products provider Principal Financial Group Inc. (PFG) reported on Monday, an increase in profit helped by lower expenses, notwithstanding a decline in revenues. However, both earnings and revenues came in short of Street estimates.
The Des Moines, Iowa-based company reported net income available to common stockholders for the fourth quarter of $141.9 million or $0.44 per share, compared to a loss available to common stockholders of $7.5 million or $0.03 per share in the year-ago quarter.
Fourth quarter net income available to common stockholders reflects net realized capital losses of $59.1 million.
Principal Financial reported operating earnings of $200.9 million or $0.62 per share for the fourth quarter of 2009, compared to $179.0 million or $0.69 per share for fourth quarter 2008.
On average, seventeen analysts polled by Thomson Reuters expected the company to earn $0.65 per share for the quarter. Analysts estimates typically exclude special items.
Total revenues for the quarter decreased to $2.23 billion from $2.28 billion in the prior-year quarter. Seven analysts had a revenue consensus of $2.51 billion for the fourth quarter.
In the immediately preceding quarter, Principal Financial reported higher third quarter profit reflecting essentially a decline in expenses, notwithstanding lower revenues registered during the quarter. The company's third-quarter net income available to common stockholders rose to $184.7 million or $0.57 per share, on revenues of $2.27 billion. Operating earnings for the quarter slipped to $238.7 million or $0.74 per share from $251.2 million or $0.96 per share for third quarter 2008.
Among peers, diversified financial services company Ameriprise Financial Inc. (AMP) on February 3, Wednesday reported a turn to profit in the fourth quarter helped by 70% rise in quarterly revenues and a surge in net investment income. Net income of Ameriprise Financial was $237 million or $0.90 per share, core operating earnings were $240 million or $0.91 per share on revenues of $ $2.27 billion for the fourth quarter.
Segment wise, Principal Financial's U.S. Asset Accumulation Segment recorded fourth quarter operating earnings of $125.3 million up from $102.8 million for the same period last year, primarily due to 9% higher average account values in fourth quarter of 2009 from a year ago. Operating revenues declined to $1.02 billion from $1.10 billion last year reflecting lower net investment income in the investment only business, which the company has been scaling back over the last several quarters.
Global Asset Management Segment generated operating earnings of $12.7 million for the quarter, significantly down from $27.0 million in the prior year quarter, since the year-ago quarter results included earnings of $15.6 million after-tax from performance fee. Operating revenues dipped to $120.4 million from $173.5 million last year, primarily due to the fourth quarter 2008 performance fee.
International Asset Management and Accumulation Segment had operating earnings of $39.5 million, up from $18.4 million last year, primarily due to higher fee revenues on higher assets under management and improving macroeconomic conditions. Operating revenues increased to $180.3 million from $148.6 million for the same period last year, primarily the result of stronger earnings from Brazil and higher annuity sales in Chile.
Life and Health Insurance Segment's operating earnings slipped to $44.6 million for quarter from $50.6 million a year ago, reflecting higher claim costs in fourth quarter 2009 for the Health division. Operating revenues declined to $1.10 billion from $1.15 billion for the same period a year ago. The decline in revenues was primarily due to a 10% fall in Health division premiums, which reflects a decrease in group medical covered members.
The company's assets under management were $284.7 billion at December 31, 2009, compared to $247.0 billion at December 31, 2008.
Total company operating expenses were $2.06 billion, down from $2.34 billion in the same quarter last year, reflecting strong expense management.
For the fiscal year 2009, the company posted net income available to common stockholders of $589.7 million, up from $425.1 million. Net income on a per share basis was $1.97, compared to $1.63 a year ago.
Operating earnings slid to $804.1 million or $2.69 per share from $942.7 million or $3.61 per share in the corresponding period last year.
Total revenues for the full year were $8.85 billion, down from $9.94 billion in the previous year.
Analysts were looking for earnings of $2.72 per share on revenues of $9.46 billion for fiscal year 2009.
PFG closed Monday's regular trading at $22.19, down $0.27 or 1.20%, on a volume of about 3.29 million shares. Further, the stock lost $0.04 or 0.18%, trading at $22.15 in after hours. For the past 52-week period, the stock moved between $5.41 - $30.87, on a 3-month average volume of 3.06 million shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.