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Principal Financial Group Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: November 2, 2011 10:42AM
Principal Financial Group Inc. (PFG) filed Quarterly Report for the period ended 2011-09-30.
Highlight of Business Operations:At September 30, 2011 and December 31, 2010, the separate accounts include a separate account valued at $136.8 million and $221.7 million, respectively, which primarily includes shares of our stock that were allocated and issued to eligible participants of qualified employee benefit plans administered by us as part of the policy credits issued under our 2001 demutualization. These shares are included in both basic and diluted earnings per share calculations. In the consolidated statements of financial position, the separate account shares are recorded at fair value and are reported as separate account assets with a corresponding separate account liability to eligible participants of the qualified plan. Changes in fair value of the separate account shares are reflected in both the separate account assets and separate account liabilities and do not impact our results of operations.
Proceeds from sales of investments (excluding call and maturity proceeds) in fixed maturities, available-for-sale were $0.1 billion and $0.2 billion for the three months ended September 30, 2011 and 2010, and $0.8 billion and $1.3 billion for the nine months ended September 30, 2011 and 2010, respectively.
(1) Reflects inter-segment revenues of $54.0 million and $48.9 million for the three months ended September 30, 2011 and 2010, respectively, and $161.5 million and $148.2 million for the nine months ended September 30, 2011 and 2010, respectively. These revenues are eliminated within the Corporate segment.
With the exception of corporate overhead, amounts related to our group medical insurance business previously included in segment operating earnings have been removed from operating earnings for all periods presented and are reported as other after-tax adjustments. The operating revenues associated with our exited group medical insurance business were $117.7 million and $344.1 million for the three months ended September 30, 2011 and 2010, respectively, and $553.4 million and $1,050.2 million for the nine months ended September 30, 2011 and 2010, respectively. The other after-tax adjustments associated with the after-tax earnings (losses) of our exited group medical insurance business were $14.9 million and $(45.8) million for the three months ended September 30, 2011 and 2010, respectively, and $50.8 million and $1.0 million for the nine months ended September 30, 2011 and 2010, respectively.
Foreign currency exchange rate fluctuations create variances in our financial statement line items but have not had a material impact on our consolidated financial results. Principal International segment operating earnings were positively impacted by $3.0 million and $8.5 million for the three and nine months ended September 30, 2011, respectively, as a result of fluctuations in foreign currency to U.S. dollar exchange rates. For a discussion of our approaches to managing foreign currency exchange rate risk, see Item 3.
Stocks Discussed: PFG,