Principal Financial Group (PFG) Q4 2024 earnings summary

Executive summary

• Achieved 11% adjusted non-GAAP EPS growth in 2024, with a 16% increase in Q4, aligning with long-term guidance of 9–12% growth.

• Returned $1.7 billion to shareholders in 2024 via $1.0 billion in share repurchases and $0.7 billion in dividends, including a 10% dividend increase.

• Board approved a new $1.5 billion share repurchase authorization, with $0.8 billion remaining from prior authorization.

• Ended 2024 with $712 billion in AUM, up 3% year-over-year, despite a 4% sequential decline due to FX and net cash flow.

• Strategic focus on Retirement ecosystem, SMBs, and global Asset Management drove results and positions for future growth.

Financial highlights

• Full year non-GAAP operating earnings were $1.8 billion ($7.65 per share), up 11% over 2023, excluding significant variances.

• Reported net income (excluding exit business) was $1.5 billion, with modest credit losses.

• Non-GAAP operating ROE improved 90 bps to 13.7%, on track for 14%-16% in 2025.

• Top-line growth of 5% and margin expansion of 60 bps in 2024.

• Free capital flow conversion at 80%, within the 75%-85% target.

Outlook and guidance

• 2025 targets reaffirmed: 9%-12% EPS growth, 75%-85% free capital flow conversion, 14%-16% ROE.

• Capital deployment guidance for 2025: $1.4-$1.7 billion, including $700 million-$1 billion in share repurchases.

• First quarter 2025 dividend raised to $0.75 per share, a 9% increase year-over-year.

• Segment guidance: Retirement & Income Solutions net revenue growth 2-5%, margin 37-41%; Asset Management revenue growth 4-7%, margin 34-38%.

• RIS margin guidance revised upward; Specialty Benefits premium and fees growth expected at 6%-9%, with growth near the low end in 2025.