WASHINGTON (dpa-AFX) - Principal Financial Group Inc. (PFG), said Monday its profit for the second quarter nearly doubled from the prior year, due to growth across all of its segments, as well from one-time capital gains. Excluding items, operating earnings increased from last year and topped Street estimates, on a 15 percent growth in assets under management.
Principal Financial, which provides retirement savings, investment, and insurance products, posted a profit of $258.0 million or $0.80 per share for the quarter. This compares to a profit of $134.0 million or $0.42 per share a year earlier.
Results for the quarter include one-time capital gains of $21.4 million, compared to a loss of $69.3 million in the prior year.
Excluding items, operating earnings for the quarter were $237.3 million or $0.73 per share, compared to $190.4 million or $0.59 per share last year.
On average, 19 analysts polled by Thomson Reuters expected earnings of $0.72 per share for the quarter. Analysts' estimate typically exclude special items.
Commenting on the results, CEO Larry Zimpleman said, '...We ended the quarter once again with record assets under management for the total company as well as in Principal International, and record account values in Retirement and Investor Services. Despite an economic recovery that remains fragile, we continue to see strong growth and increasing earnings from our businesses.'
The Des Moines, Iowa-based company reported operating revenues of $2.15 billion for the quarter, up from $1.98 billion last year. Eight Wall Street analysts expected revenues of $2.07 billion for the quarter.
Among revenue streams, premiums increased to $596 million from $552 million, and Fees & other revenues grew to $654 million from $528 million a year ago. Net investment income improved slightly to $899 million from $896 million last year.
By segment, Retirement and Investor Services operating earnings rose to $161.3 million from $129.0 million last year. Revenues at the segment grew to $1.04 billion from $1.02 million, on an 8 percent improvement in accumulation businesses.
At Principal Global Investors, operating earnings increased to $20.8 million from $12.3 million, due to an increase in assets under management and additional operating leverage. Revenues were $136.3 million, up from $114.3 million, reflecting higher management and transaction fees.
Principal International operating earnings rose to $37.5 million from $35.0 million, while revenues climbed to $227.4 million from $188.2 million last year.
At U.S. Insurance Solutions, operating earnings dropped to $49.5 million from $50 million a year ago, while revenues increased to $781.1 million from $687.3 million. Revenue growth due to significantly higher business owner and executive life insurance sales, with positive trends in both sales and lapses in Specialty Benefits.
During the quarter, the company's total expenses increased to $1.83 billion from $1.72 billion last year. While claims and settlement expenses declined to $951 million from $1.09 billion, amortization overheads sharply rose to $254 million from $45 million.
At the end of the quarter, Principal Financial had assets under management totaling $335.8 billion, an increase of 18 percent from last year.
PFG closed Monday's regular trade at $27.42, down $0.21 or 0.76%, on a volume of 2.7 million shares on the NYSE. In after hours, the stock gained $0.03 or 0.12%.
Copyright RTT News/dpa-AFX