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Segment Information (Tables)
 9 Months Ended
Sep. 30, 2015
Segment Information  
Reconciliation of Assets from Segment to Consolidated (Table)

 

 

 

 

September 30, 2015

 

December 31, 2014

 

 

 

(in millions)

 

Assets:

 

 

 

 

 

Retirement and Investor Services

 

$
137,404.4 

 

$
138,549.4 

 

Principal Global Investors

 
1,149.9 

 
1,175.1 

 

Principal International

 
50,458.0 

 
53,531.8 

 

U.S. Insurance Solutions

 
22,180.7 

 
21,554.5 

 

Corporate

 
4,172.4 

 
4,276.2 

 

 

 

 

 

 

 

Total consolidated assets

 

$
215,365.4 

 

$
219,087.0 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Operating Revenues and Operating Earnings (Losses) by Segment (Table)

 

 

 

 

For the three months ended

 

For the nine months ended

 

 

 

September 30,

 

September 30,

 

 

 

2015

 

2014

 

2015

 

2014

 

 

 

(in millions)

 

Operating revenues by segment:

 

 

 

 

 

 

 

 

 

Retirement and Investor Services

 

$
1,957.5

 

$
1,324.7

 

$
5,385.5

 

$
3,851.0

 

Principal Global Investors

 
182.8

 
173.6

 
557.8

 
517.9

 

Principal International

 
311.2

 
294.5

 
862.4

 
952.2

 

U.S. Insurance Solutions

 
853.2

 
821.0

 
2,572.7

 
2,436.8

 

Corporate

 
(69.0

)
(61.1

)
(191.3

)
(163.3

)

 

 

 

 

 

 

 

 

 

 

Total segment operating revenues

 
3,235.7

 
2,552.7

 
9,187.1

 
7,594.6

 

Net realized capital gains (losses), net of related revenue adjustments

 
4.8

 
(68.2

)
(90.9

)
(25.0

)

Other income on a tax indemnification

 

—

 

—

 
60.2

 

—

 

Exited group medical insurance business

 
0.4

 
(0.2

)
1.0

 

—

 

 

 

 

 

 

 

 

 

 

 

Total revenues per consolidated statements of operations

 

$
3,240.9

 

$
2,484.3

 

$
9,157.4

 

$
7,569.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating earnings (loss) by segment, net of related income taxes:

 

 

 

 

 

 

 

 

 

Retirement and Investor Services

 

$
163.3

 

$
204.3

 

$
590.9

 

$
632.9

 

Principal Global Investors

 
30.4

 
25.3

 
92.6

 
79.6

 

Principal International

 
45.8

 
73.8

 
165.0

 
205.1

 

U.S. Insurance Solutions

 
114.5

 
83.3

 
228.4

 
175.7

 

Corporate

 
(37.0

)
(33.0

)
(109.6

)
(99.4

)

 

 

 

 

 

 

 

 

 

 

Total segment operating earnings, net of related income taxes

 
317.0

 
353.7

 
967.3

 
993.9

 

Net realized capital losses, as adjusted (1)

 
(16.5

)
(55.2

)
(86.2

)
(47.3

)

Other after-tax adjustments (2)

 
(0.1

)
(57.8

)
74.6

 
(105.9

)

 

 

 

 

 

 

 

 

 

 

Net income available to common stockholders per consolidated statements of operations

 

$
300.4

 

$
240.7

 

$
955.7

 

$
840.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Net realized capital gains (losses), as adjusted, is derived as follows:

 

 

 

For the three months ended

 

For the nine months ended

 

 

 

September 30,

 

September 30,

 

 

 

2015

 

2014

 

2015

 

2014

 

 

 

(in millions)

 

Net realized capital gains (losses):

 

 

 

 

 

 

 

 

 

Net realized capital gains (losses)

 

$
38.4

 

$
(46.4

)

$
(10.0

)

$
41.0

 

Certain derivative and hedging-related adjustments

 
(34.2

)
(21.9

)
(80.3

)
(66.4

)

Certain market value adjustments to fee revenues

 

—

 

—

 
(1.1

)

—

 

Certain adjustments related to seed money

 
0.5

 

—

 
0.5

 

—

 

Recognition of front-end fee (revenue) expense

 
0.1

 
0.1

 

—

 
0.4

 

 

 

 

 

 

 

 

 

 

 

Net realized capital gains (losses), net of related revenue adjustments

 
4.8

 
(68.2

)
(90.9

)
(25.0

)

Amortization of deferred acquisition costs and other actuarial balances

 
(28.6

)
(3.6

)
(28.4

)
(26.8

)

Capital (gains) losses distributed

 
12.9

 
(8.8

)
14.8

 
(18.1

)

Certain market value adjustments of embedded derivatives

 
(1.1

)
5.7

 
(2.0

)
6.0

 

Net realized capital losses associated with exited group medical insurance business

 
0.1

 

—

 
0.1

 

—

 

Noncontrolling interest capital gains

 
(3.7

)
(0.1

)
(5.7

)
(0.2

)

Income tax effect

 
(0.9

)
19.8

 
25.9

 
16.8

 

 

 

 

 

 

 

 

 

 

 

Net realized capital losses, as adjusted

 

$
(16.5

)

$
(55.2

)

$
(86.2

)

$
(47.3

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2)

For the three months ended September 30, 2015, other after-tax adjustments included the negative effect of losses associated with our exited group medical insurance business that did not qualify for discontinued operations accounting treatment under U.S. GAAP.

 

For the three months ended September 30, 2014, other after-tax adjustments included the negative effect of an increase in net deferred tax liabilities resulting from the third quarter 2014 enactment of tax legislation in Chile ($58.1 million) and the positive effect of gains associated with our exited group medical insurance business that did not qualify for discontinued operations accounting treatment under U.S. GAAP ($0.3 million).

 

For the nine months ended September 30, 2015, other after-tax adjustments included the positive effect of a change in deferred tax balances related to the merger of two of our Chilean legal entities ($105.2 million) and the negative effect of: (1) the impact of a court ruling on some uncertain tax positions ($30.3 million) and (2) losses associated with our exited group medical insurance business that did not qualify for discontinued operations accounting treatment under U.S. GAAP ($0.3 million).

 

For the nine months ended September 30, 2014, other after-tax adjustments included the negative effect of: (a) an increase in net deferred tax liabilities resulting from the third quarter 2014 enactment of tax legislation in Chile ($58.1 million); (b) the impact of a court ruling on some uncertain tax positions ($47.5 million) and (c) losses associated with our exited group medical insurance business that did not qualify for discontinued operations accounting treatment under U.S. GAAP ($0.3 million).

 

 

 

Operating Revenue for Products and Services by Segment (Table)

 

 

 

 

For the three months ended

 

For the nine months ended

 

 

 

September 30,

 

September 30,

 

 

 

2015

 

2014

 

2015

 

2014

 

 

 

(in millions)

 

Retirement and Investor Services:

 

 

 

 

 

 

 

 

 

Full service accumulation

 

$
383.0

 

$
392.1

 

$
1,153.8

 

$
1,170.0

 

Principal Funds

 
231.8

 
219.7

 
699.9

 
638.2

 

Individual annuities

 
476.7

 
335.6

 
1,524.0

 
1,082.9

 

Bank and trust services

 
19.9

 
21.9

 
64.2

 
63.7

 

Eliminations

 
(36.9

)
(38.8

)
(115.0

)
(116.3

)

 

 

 

 

 

 

 

 

 

 

Total Accumulation

 
1,074.5

 
930.5

 
3,326.9

 
2,838.5

 

Investment only

 
63.8

 
73.4

 
199.9

 
234.5

 

Full service payout

 
819.2

 
320.8

 
1,858.7

 
778.0

 

 

 

 

 

 

 

 

 

 

 

Total Guaranteed

 
883.0

 
394.2

 
2,058.6

 
1,012.5

 

 

 

 

 

 

 

 

 

 

 

Total Retirement and Investor Services

 
1,957.5

 
1,324.7

 
5,385.5

 
3,851.0

 

Principal Global Investors (1)

 
182.8

 
173.6

 
557.8

 
517.9

 

Principal International

 
311.2

 
294.5

 
862.4

 
952.2

 

U.S. Insurance Solutions:

 

 

 

 

 

 

 

 

 

Individual life insurance

 
389.6

 
382.7

 
1,178.2

 
1,148.5

 

Specialty benefits insurance

 
463.6

 
438.3

 
1,394.6

 
1,288.4

 

Eliminations

 

—

 

—

 
(0.1

)
(0.1

)

 

 

 

 

 

 

 

 

 

 

Total U.S. Insurance Solutions

 
853.2

 
821.0

 
2,572.7

 
2,436.8

 

Corporate

 
(69.0

)
(61.1

)
(191.3

)
(163.3

)

 

 

 

 

 

 

 

 

 

 

Total operating revenues

 

$
3,235.7

 

$
2,552.7

 

$
9,187.1

 

$
7,594.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating revenues

 

$
3,235.7

 

$
2,552.7

 

$
9,187.1

 

$
7,594.6

 

Net realized capital gains (losses), net of related revenue adjustments

 
4.8

 
(68.2

)
(90.9

)
(25.0

)

Other income on a tax indemnification

 

—

 

—

 
60.2

 

—

 

Exited group medical insurance business

 
0.4

 
(0.2

)
1.0

 

—

 

 

 

 

 

 

 

 

 

 

 

Total revenues per consolidated statements of operations

 

$
3,240.9

 

$
2,484.3

 

$
9,157.4

 

$
7,569.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Reflects inter-segment revenues of $76.1 million and $71.0 million for the three months ended September 30, 2015 and 2014, respectively, and $237.7 million and $214.4 million for the nine months ended September 30, 2015 and 2014, respectively.