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Condensed Consolidating Financial Information
3 Months Ended
Mar. 31, 2013
Condensed Consolidating Financial Information  
Condensed Consolidating Financial Information

14.  Condensed Consolidating Financial Information

 

Principal Life has established special purpose entities to issue secured medium-term notes. Under the program, the payment obligations of principal and interest on the notes are secured by funding agreements issued by Principal Life. Principal Life’s payment obligations on the funding agreements are fully and unconditionally guaranteed by PFG. All of the outstanding stock of Principal Life is indirectly owned by PFG and PFG is the only guarantor of the payment obligations of the funding agreements.

 

The following tables set forth condensed consolidating financial information of (i) PFG, (ii) Principal Life, (iii) Principal Financial Services, Inc. (“PFS”) and all other direct and indirect subsidiaries of PFG on a combined basis and (iv) the eliminations necessary to arrive at the information for PFG on a consolidated basis as of March 31, 2013 and December 31, 2012, and for the three months ended March 31, 2013 and 2012.

 

In presenting the condensed consolidating financial statements, the equity method of accounting has been applied to (i) PFG’s interest in PFS, (ii) Principal Life’s interest in all direct subsidiaries of Principal Life and (iii) PFS’s interest in Principal Life even though all such subsidiaries meet the requirements to be consolidated under U.S. GAAP. Earnings of subsidiaries are, therefore, reflected in the parent’s investment and earnings. All intercompany balances and transactions, including elimination of the parent’s investment in subsidiaries, between PFG, Principal Life and PFS and all other subsidiaries have been eliminated, as shown in the column “Eliminations.” These condensed consolidating financial statements should be read in conjunction with the consolidated financial statements. The financial information may not necessarily be indicative of results of operations, cash flows or financial position had the subsidiaries operated as independent entities.

 

Condensed Consolidating Statements of Financial Position

March 31, 2013

 

 

 

Principal

 

Principal Life

 

Principal Financial

 

 

 

Principal

 

 

 

Financial

 

Insurance

 

Services, Inc. and

 

 

 

Financial

 

 

 

Group, Inc.

 

Company

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

Fixed maturities, available-for-sale

 

$

—

 

$

44,789.5

 

$

6,661.0

 

$

(366.4

)

$

51,084.1

 

Fixed maturities, trading

 

—

 

279.2

 

349.7

 

—

 

628.9

 

Equity securities, available-for-sale

 

—

 

130.0

 

17.0

 

—

 

147.0

 

Equity securities, trading

 

—

 

0.3

 

731.9

 

—

 

732.2

 

Mortgage loans

 

—

 

10,107.7

 

1,801.3

 

(331.1

)

11,577.9

 

Real estate

 

—

 

8.3

 

1,193.7

 

—

 

1,202.0

 

Policy loans

 

—

 

833.5

 

33.0

 

—

 

866.5

 

Investment in unconsolidated entities

 

12,036.1

 

3,321.2

 

4,666.1

 

(19,142.0

)

881.4

 

Other investments

 

9.0

 

2,504.8

 

1,358.1

 

(1,566.1

)

2,305.8

 

Cash and cash equivalents

 

112.7

 

711.1

 

751.9

 

85.5

 

1,661.2

 

Accrued investment income

 

—

 

518.2

 

68.0

 

(1.7

)

584.5

 

Premiums due and other receivables

 

—

 

1,020.6

 

1,460.9

 

(1,306.3

)

1,175.2

 

Deferred acquisition costs

 

—

 

2,504.7

 

210.8

 

—

 

2,715.5

 

Property and equipment

 

—

 

395.2

 

77.4

 

—

 

472.6

 

Goodwill

 

—

 

54.3

 

1,143.1

 

—

 

1,197.4

 

Other intangibles

 

—

 

27.6

 

1,562.7

 

—

 

1,590.3

 

Separate account assets

 

—

 

73,423.6

 

47,482.5

 

—

 

120,906.1

 

Other assets

 

66.2

 

983.3

 

1,660.8

 

(1,676.0

)

1,034.3

 

Total assets

 

$

12,224.0

 

$

141,613.1

 

$

71,229.9

 

$

(24,304.1

)

$

200,762.9

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

Contractholder funds

 

$

—

 

$

35,868.5

 

$

1,113.9

 

$

(280.8

)

$

36,701.6

 

Future policy benefits and claims

 

—

 

18,048.2

 

4,854.2

 

(212.9

)

22,689.5

 

Other policyholder funds

 

—

 

767.4

 

44.1

 

(0.3

)

811.2

 

Short-term debt

 

—

 

—

 

46.5

 

—

 

46.5

 

Long-term debt

 

2,448.6

 

99.4

 

573.6

 

(331.1

)

2,790.5

 

Income taxes currently payable

 

—

 

—

 

82.2

 

(72.4

)

9.8

 

Deferred income taxes

 

—

 

230.6

 

686.8

 

(126.0

)

791.4

 

Separate account liabilities

 

—

 

73,423.6

 

47,482.5

 

—

 

120,906.1

 

Other liabilities

 

51.8

 

5,531.5

 

4,143.6

 

(3,596.1

)

6,130.8

 

Total liabilities

 

2,500.4

 

133,969.2

 

59,027.4

 

(4,619.6

)

190,877.4

 

 

 

 

 

 

 

 

 

 

 

 

 

Redeemable noncontrolling interest

 

—

 

—

 

58.9

 

—

 

58.9

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

 

 

 

Series A preferred stock

 

—

 

—

 

—

 

—

 

—

 

Series B preferred stock

 

0.1

 

—

 

—

 

—

 

0.1

 

Common stock

 

4.6

 

2.5

 

—

 

(2.5

)

4.6

 

Additional paid-in capital

 

9,771.5

 

5,745.0

 

9,394.8

 

(15,139.8

)

9,771.5

 

Retained earnings

 

4,971.7

 

1,318.0

 

1,986.1

 

(3,304.1

)

4,971.7

 

Accumulated other comprehensive income

 

621.0

 

578.4

 

655.2

 

(1,233.6

)

621.0

 

Treasury stock, at cost

 

(5,645.3

)

—

 

—

 

—

 

(5,645.3

)

Total stockholders’ equity attributable to PFG

 

9,723.6

 

7,643.9

 

12,036.1

 

(19,680.0

)

9,723.6

 

Noncontrolling interest

 

—

 

—

 

107.5

 

(4.5

)

103.0

 

Total stockholders’ equity

 

9,723.6

 

7,643.9

 

12,143.6

 

(19,684.5

)

9,826.6

 

Total liabilities and stockholders’ equity

 

$

12,224.0

 

$

141,613.1

 

$

71,229.9

 

$

(24,304.1

)

$

200,762.9

 

 

Condensed Consolidating Statements of Financial Position

December 31, 2012

 

 

 

Principal

 

Principal Life

 

Principal Financial

 

 

 

Principal

 

 

 

Financial

 

Insurance

 

Services, Inc. and

 

 

 

Financial

 

 

 

Group, Inc.

 

Company

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

 

 

Fixed maturities, available-for-sale

 

$

—

 

$

44,614.6

 

$

6,681.7

 

$

(357.0

)

$

50,939.3

 

Fixed maturities, trading

 

10.5

 

284.4

 

331.8

 

—

 

626.7

 

Equity securities, available-for-sale

 

—

 

131.3

 

5.2

 

—

 

136.5

 

Equity securities, trading

 

—

 

0.3

 

252.5

 

—

 

252.8

 

Mortgage loans

 

—

 

10,054.2

 

1,775.5

 

(310.0

)

11,519.7

 

Real estate

 

—

 

8.4

 

1,171.9

 

—

 

1,180.3

 

Policy loans

 

—

 

834.0

 

30.9

 

—

 

864.9

 

Investment in unconsolidated entities

 

11,853.3

 

3,309.2

 

4,808.3

 

(19,101.8

)

869.0

 

Other investments

 

11.1

 

2,834.0

 

1,208.4

 

(1,631.4

)

2,422.1

 

Cash and cash equivalents

 

207.1

 

1,698.4

 

2,286.9

 

(15.2

)

4,177.2

 

Accrued investment income

 

—

 

521.6

 

64.5

 

(1.7

)

584.4

 

Premiums due and other receivables

 

0.1

 

916.7

 

1,327.1

 

(1,159.5

)

1,084.4

 

Deferred acquisition costs

 

—

 

2,394.8

 

195.2

 

—

 

2,590.0

 

Property and equipment

 

—

 

402.2

 

62.0

 

—

 

464.2

 

Goodwill

 

—

 

54.3

 

489.1

 

—

 

543.4

 

Other intangibles

 

—

 

27.9

 

886.8

 

—

 

914.7

 

Separate account assets

 

—

 

69,217.8

 

12,436.0

 

—

 

81,653.8

 

Other assets

 

78.0

 

947.8

 

1,567.7

 

(1,586.7

)

1,006.8

 

Total assets

 

$

12,160.1

 

$

138,251.9

 

$

35,581.5

 

$

(24,163.3

)

$

161,830.2

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

Contractholder funds

 

$

—

 

$

37,053.3

 

$

1,011.9

 

$

(278.7

)

$

37,786.5

 

Future policy benefits and claims

 

—

 

17,944.9

 

4,679.6

 

(188.3

)

22,436.2

 

Other policyholder funds

 

—

 

676.5

 

40.3

 

(0.4

)

716.4

 

Short-term debt

 

—

 

—

 

40.8

 

—

 

40.8

 

Long-term debt

 

2,448.6

 

99.4

 

433.3

 

(310.0

)

2,671.3

 

Income taxes currently payable

 

—

 

—

 

84.7

 

(69.4

)

15.3

 

Deferred income taxes

 

—

 

324.5

 

378.4

 

(102.9

)

600.0

 

Separate account liabilities

 

—

 

69,217.8

 

12,436.0

 

—

 

81,653.8

 

Other liabilities

 

28.1

 

5,375.1

 

4,538.4

 

(3,795.5

)

6,146.1

 

Total liabilities

 

2,476.7

 

130,691.5

 

23,643.4

 

(4,745.2

)

152,066.4

 

 

 

 

 

 

 

 

 

 

 

 

 

Redeemable noncontrolling interest

 

—

 

—

 

60.4

 

—

 

60.4

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

 

 

 

Series A preferred stock

 

—

 

—

 

—

 

—

 

—

 

Series B preferred stock

 

0.1

 

—

 

—

 

—

 

0.1

 

Common stock

 

4.5

 

2.5

 

—

 

(2.5

)

4.5

 

Additional paid-in capital

 

9,730.9

 

5,747.6

 

9,393.8

 

(15,141.4

)

9,730.9

 

Retained earnings

 

4,862.0

 

1,167.7

 

1,783.4

 

(2,951.1

)

4,862.0

 

Accumulated other comprehensive income

 

640.3

 

642.6

 

676.1

 

(1,318.7

)

640.3

 

Treasury stock, at cost

 

(5,554.4

)

—

 

—

 

—

 

(5,554.4

)

Total stockholders’ equity attributable to PFG

 

9,683.4

 

7,560.4

 

11,853.3

 

(19,413.7

)

9,683.4

 

Noncontrolling interest

 

—

 

—

 

24.4

 

(4.4

)

20.0

 

Total stockholders’ equity

 

9,683.4

 

7,560.4

 

11,877.7

 

(19,418.1

)

9,703.4

 

Total liabilities and stockholders’ equity

 

$

12,160.1

 

$

138,251.9

 

$

35,581.5

 

$

(24,163.3

)

$

161,830.2

 

 

Condensed Consolidating Statements of Operations

For the three months March 31, 2013

 

 

 

Principal

 

Principal Life

 

Principal Financial

 

 

 

Principal

 

 

 

Financial

 

Insurance

 

Services, Inc. and

 

 

 

Financial

 

 

 

Group, Inc.

 

Company

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

Premiums and other considerations

 

$

—

 

$

605.1

 

$

89.6

 

$

—

 

$

694.7

 

Fees and other revenues

 

—

 

413.2

 

404.3

 

(83.9

)

733.6

 

Net investment income

 

—

 

602.0

 

179.9

 

7.4

 

789.3

 

Net realized capital gains (losses), excluding impairment losses on available-for-sale securities

 

6.3

 

(304.9

)

272.1

 

0.1

 

(26.4

)

Total other-than-temporary impairment losses on available-for-sale securities

 

—

 

(44.2

)

(0.5

)

—

 

(44.7

)

Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified to other comprehensive income

 

—

 

20.1

 

0.1

 

—

 

20.2

 

Net impairment losses on available-for-sale securities

 

—

 

(24.1

)

(0.4

)

—

 

(24.5

)

Net realized capital gains (losses)

 

6.3

 

(329.0

)

271.7

 

0.1

 

(50.9

)

Total revenues

 

6.3

 

1,291.3

 

945.5

 

(76.4

)

2,166.7

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

Benefits, claims and settlement expenses

 

—

 

950.3

 

147.3

 

(3.1

)

1,094.5

 

Dividends to policyholders

 

—

 

48.3

 

—

 

—

 

48.3

 

Operating expenses

 

35.0

 

470.7

 

362.5

 

(72.5

)

795.7

 

Total expenses

 

35.0

 

1,469.3

 

509.8

 

(75.6

)

1,938.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(28.7

)

(178.0

)

435.7

 

(0.8

)

228.2

 

Income taxes (benefits)

 

(11.5

)

(88.4

)

138.2

 

(0.1

)

38.2

 

Equity in the net income (loss) of subsidiaries

 

203.7

 

240.6

 

(90.3

)

(354.0

)

—

 

Net income

 

186.5

 

151.0

 

207.2

 

(354.7

)

190.0

 

Net income attributable to noncontrolling interest

 

—

 

—

 

3.5

 

—

 

3.5

 

Net income attributable to PFG

 

186.5

 

151.0

 

203.7

 

(354.7

)

186.5

 

Preferred stock dividends

 

8.2

 

—

 

—

 

—

 

8.2

 

Net income available to common stockholders

 

$

178.3

 

$

151.0

 

$

203.7

 

$

(354.7

)

$

178.3

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

186.5

 

$

151.0

 

$

207.2

 

$

(354.7

)

$

190.0

 

Other comprehensive income (loss)

 

(81.3

)

(65.9

)

59.7

 

67.1

 

(20.4

)

Comprehensive income

 

$

105.2

 

$

85.1

 

$

266.9

 

$

(287.6

)

$

169.6

 

 

Condensed Consolidating Statements of Operations

For the three months March 31, 2012

 

 

 

Principal

 

Principal Life

 

Principal Financial

 

 

 

Principal

 

 

 

Financial

 

Insurance

 

Services, Inc. and

 

 

 

Financial

 

 

 

Group, Inc.

 

Company

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

Premiums and other considerations

 

$

—

 

$

583.4

 

$

96.4

 

$

—

 

$

679.8

 

Fees and other revenues

 

0.1

 

343.8

 

329.7

 

(75.6

)

598.0

 

Net investment income

 

1.0

 

626.8

 

195.4

 

1.6

 

824.8

 

Net realized capital gains (losses), excluding impairment losses on available-for-sale securities

 

—

 

(350.5

)

389.3

 

(16.7

)

22.1

 

Total other-than-temporary impairment losses on available-for-sale securities

 

—

 

(33.0

)

(0.7

)

—

 

(33.7

)

Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified to other comprehensive income

 

—

 

4.5

 

0.4

 

—

 

4.9

 

Net impairment losses on available-for-sale securities

 

—

 

(28.5

)

(0.3

)

—

 

(28.8

)

Net realized capital gains (losses)

 

—

 

(379.0

)

389.0

 

(16.7

)

(6.7

)

Total revenues

 

1.1

 

1,175.0

 

1,010.5

 

(90.7

)

2,095.9

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

Benefits, claims and settlement expenses

 

—

 

1,034.5

 

181.2

 

(3.2

)

1,212.5

 

Dividends to policyholders

 

—

 

50.3

 

—

 

—

 

50.3

 

Operating expenses

 

29.9

 

282.0

 

309.1

 

(65.9

)

555.1

 

Total expenses

 

29.9

 

1,366.8

 

490.3

 

(69.1

)

1,817.9

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(28.8

)

(191.8

)

520.2

 

(21.6

)

278.0

 

Income taxes (benefits)

 

(11.3

)

(84.9

)

153.1

 

(0.2

)

56.7

 

Equity in the net income (loss) of subsidiaries

 

229.6

 

275.1

 

(128.3

)

(376.4

)

—

 

Net income

 

212.1

 

168.2

 

238.8

 

(397.8

)

221.3

 

Net income attributable to noncontrolling interest

 

—

 

—

 

9.2

 

—

 

9.2

 

Net income attributable to PFG

 

212.1

 

168.2

 

229.6

 

(397.8

)

212.1

 

Preferred stock dividends

 

8.2

 

—

 

—

 

—

 

8.2

 

Net income available to common stockholders

 

$

203.9

 

$

168.2

 

$

229.6

 

$

(397.8

)

$

203.9

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

212.1

 

$

168.2

 

$

238.8

 

$

(397.8

)

$

221.3

 

Other comprehensive income

 

180.6

 

141.5

 

91.2

 

(188.1

)

225.2

 

Comprehensive income

 

$

392.7

 

$

309.7

 

$

330.0

 

$

(585.9

)

$

446.5

 

 

Condensed Consolidating Statements of Cash Flows

For the three months March 31, 2013

 

 

 

Principal

 

Principal Life

 

Principal Financial

 

 

 

Principal

 

 

 

Financial

 

Insurance

 

Services, Inc. and

 

 

 

Financial

 

 

 

Group, Inc.

 

Company

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Operating activities

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities

 

$

28.0

 

$

812.7

 

$

(385.0

)

$

140.2

 

$

595.9

 

Investing activities

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities:

 

 

 

 

 

 

 

 

 

 

 

Purchases

 

—

 

(2,242.7

)

(206.4

)

2.0

 

(2,447.1

)

Sales

 

—

 

392.7

 

128.7

 

(18.3

)

503.1

 

Maturities

 

—

 

1,596.0

 

194.9

 

—

 

1,790.9

 

Mortgage loans acquired or originated

 

—

 

(573.2

)

(59.8

)

22.1

 

(610.9

)

Mortgage loans sold or repaid

 

—

 

519.3

 

79.2

 

(42.7

)

555.8

 

Real estate acquired

 

—

 

0.1

 

(23.5

)

—

 

(23.4

)

Net (purchases) sales of property and equipment

 

—

 

(2.0

)

8.7

 

—

 

6.7

 

Purchases of interests in subsidiaries, net of cash acquired

 

—

 

—

 

(1,268.3

)

—

 

(1,268.3

)

Dividends and returns of capital received from (contributions to) unconsolidated entities

 

18.8

 

25.4

 

15.8

 

(60.0

)

—

 

Net change in other investments

 

(3.0

)

56.3

 

(104.0

)

18.5

 

(32.2

)

Net cash provided by (used in) investing activities

 

15.8

 

(228.1

)

(1,234.7

)

(78.4

)

(1,525.4

)

Financing activities

 

 

 

 

 

 

 

 

 

 

 

Issuance of common stock

 

20.3

 

—

 

—

 

—

 

20.3

 

Acquisition of treasury stock

 

(90.9

)

—

 

—

 

—

 

(90.9

)

Proceeds from financing element derivatives

 

—

 

14.3

 

—

 

—

 

14.3

 

Payments for financing element derivatives

 

—

 

(12.7

)

—

 

—

 

(12.7

)

Excess tax benefits from share-based payment arrangements

 

—

 

1.3

 

2.5

 

—

 

3.8

 

Purchase of subsidiary shares from noncontrolling interest

 

—

 

—

 

(30.6

)

—

 

(30.6

)

Dividends to common stockholders

 

(67.6

)

—

 

—

 

—

 

(67.6

)

Issuance of long-term debt

 

—

 

—

 

3.5

 

—

 

3.5

 

Principal repayments of long-term debt

 

—

 

—

 

20.7

 

(21.1

)

(0.4

)

Capital received from (dividends and capital paid to) parent

 

—

 

(15.8

)

(44.2

)

60.0

 

—

 

Investment contract deposits

 

—

 

1,292.1

 

127.6

 

—

 

1,419.7

 

Investment contract withdrawals

 

—

 

(2,850.3

)

(1.7

)

—

 

(2,852.0

)

Net increase in banking operation deposits

 

—

 

—

 

6.9

 

—

 

6.9

 

Other

 

—

 

(0.8

)

—

 

—

 

(0.8

)

Net cash provided by (used in) financing activities

 

(138.2

)

(1,571.9

)

84.7

 

38.9

 

(1,586.5

)

Net decrease in cash and cash equivalents

 

(94.4

)

(987.3

)

(1,535.0

)

100.7

 

(2,516.0

)

Cash and cash equivalents at beginning of period

 

207.1

 

1,698.4

 

2,286.9

 

(15.2

)

4,177.2

 

Cash and cash equivalents at end of period

 

$

112.7

 

$

711.1

 

$

751.9

 

$

85.5

 

$

1,661.2

 

 

Condensed Consolidating Statements of Cash Flows

For the three months March 31, 2012

 

 

 

Principal

 

Principal Life

 

Principal Financial

 

 

 

Principal

 

 

 

Financial

 

Insurance

 

Services, Inc. and

 

 

 

Financial

 

 

 

Group, Inc.

 

Company

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Operating activities

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities

 

$

79.9

 

$

930.6

 

$

(217.8

)

$

109.0

 

$

901.7

 

Investing activities

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities:

 

 

 

 

 

 

 

 

 

 

 

Purchases

 

—

 

(1,749.5

)

(329.5

)

18.5

 

(2,060.5

)

Sales

 

—

 

412.3

 

23.6

 

(7.4

)

428.5

 

Maturities

 

—

 

1,352.1

 

260.0

 

—

 

1,612.1

 

Mortgage loans acquired or originated

 

—

 

(887.1

)

(32.5

)

—

 

(919.6

)

Mortgage loans sold or repaid

 

—

 

389.7

 

81.5

 

(109.8

)

361.4

 

Real estate acquired

 

—

 

—

 

(21.3

)

—

 

(21.3

)

Net purchases of property and equipment

 

—

 

(11.8

)

(5.5

)

—

 

(17.3

)

Dividends and returns of capital received from unconsolidated entities

 

189.3

 

140.0

 

189.2

 

(518.5

)

—

 

Net change in other investments

 

—

 

(29.6

)

(25.9

)

(18.3

)

(73.8

)

Net cash provided by (used in) investing activities

 

189.3

 

(383.9

)

139.6

 

(635.5

)

(690.5

)

Financing activities

 

 

 

 

 

 

 

 

 

 

 

Issuance of common stock

 

9.1

 

—

 

—

 

—

 

9.1

 

Acquisition of treasury stock

 

(64.2

)

—

 

—

 

—

 

(64.2

)

Proceeds from financing element derivatives

 

—

 

20.4

 

—

 

—

 

20.4

 

Payments for financing element derivatives

 

—

 

(16.2

)

—

 

—

 

(16.2

)

Excess tax benefits from share-based payment arrangements

 

—

 

4.8

 

5.1

 

—

 

9.9

 

Dividends to common stockholders

 

(54.3

)

—

 

—

 

—

 

(54.3

)

Dividends to preferred stockholders

 

(8.2

)

—

 

—

 

—

 

(8.2

)

Issuance of long-term debt

 

—

 

—

 

1.0

 

—

 

1.0

 

Principal repayments of long-term debt

 

—

 

—

 

(9.0

)

8.2

 

(0.8

)

Net repayments of short-term borrowings

 

—

 

—

 

(7.5

)

—

 

(7.5

)

Dividends and capital paid to parent

 

—

 

(189.2

)

(329.3

)

518.5

 

—

 

Investment contract deposits

 

—

 

1,522.7

 

95.9

 

—

 

1,618.6

 

Investment contract withdrawals

 

—

 

(2,885.4

)

(0.5

)

—

 

(2,885.9

)

Net decrease in banking operation deposits

 

—

 

—

 

(13.4

)

—

 

(13.4

)

Other

 

—

 

(1.7

)

—

 

—

 

(1.7

)

Net cash used in financing activities

 

(117.6

)

(1,544.6

)

(257.7

)

526.7

 

(1,393.2

)

Net increase (decrease) in cash and cash equivalents

 

151.6

 

(997.9

)

(335.9

)

0.2

 

(1,182.0

)

Cash and cash equivalents at beginning of period

 

226.7

 

1,344.5

 

1,277.6

 

(14.9

)

2,833.9

 

Cash and cash equivalents at end of period

 

$

378.3

 

$

346.6

 

$

941.7

 

$

(14.7

)

$

1,651.9

 

 

On May 24, 2011, our shelf registration statement was filed with the SEC and became effective. The shelf registration replaces the shelf registration that had been in effect since June 2008, as it was scheduled to expire in June 2011. Under our current shelf registration, we have the ability to issue unsecured senior debt securities or subordinated debt securities, junior subordinated debt, preferred stock, common stock, warrants, depository shares, stock purchase contracts and stock purchase units of PFG, trust preferred securities of three subsidiary trusts and guarantees by PFG of these trust preferred securities. Our wholly owned subsidiary, PFS, may guarantee, fully and unconditionally or otherwise, our obligations with respect to any non-convertible securities, other than common stock, described in the shelf registration statement.

 

The following tables set forth condensed consolidating financial information of (i) PFG, (ii) PFS, (iii) Principal Life and all other direct and indirect subsidiaries of PFG on a combined basis and (iv) the eliminations necessary to arrive at the information for PFG on a consolidated basis as of March 31, 2013 and December 31, 2012, and for the three months ended March 31, 2013 and 2012.

 

In presenting the condensed consolidating financial statements, the equity method of accounting has been applied to (i) PFG’s interest in PFS and (ii) PFS’s interest in Principal Life and all other subsidiaries, where applicable, even though all such subsidiaries meet the requirements to be consolidated under U.S. GAAP. Earnings of subsidiaries are, therefore, reflected in the parent’s investment and earnings. All intercompany balances and transactions, including elimination of the parent’s investment in subsidiaries, between PFG, PFS and Principal Life and all other subsidiaries have been eliminated, as shown in the column “Eliminations.” These condensed consolidating financial statements should be read in conjunction with the consolidated financial statements. The financial information may not necessarily be indicative of results of operations, cash flows or financial position had the subsidiaries operated as independent entities.

 

Condensed Consolidating Statements of Financial Position

March 31, 2013

 

 

 

 

 

 

 

Principal Life

 

 

 

 

 

 

 

Principal

 

Principal

 

Insurance Company

 

 

 

Principal

 

 

 

Financial

 

Financial

 

and Other

 

 

 

Financial

 

 

 

Group, Inc.

 

Services, Inc.

 

Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

Fixed maturities, available-for-sale

 

$

—

 

$

—

 

$

51,084.1

 

$

—

 

$

51,084.1

 

Fixed maturities, trading

 

—

 

—

 

628.9

 

—

 

628.9

 

Equity securities, available-for-sale

 

—

 

—

 

147.0

 

—

 

147.0

 

Equity securities, trading

 

—

 

—

 

732.2

 

—

 

732.2

 

Mortgage loans

 

—

 

—

 

11,577.9

 

—

 

11,577.9

 

Real estate

 

—

 

—

 

1,202.0

 

—

 

1,202.0

 

Policy loans

 

—

 

—

 

866.5

 

—

 

866.5

 

Investment in unconsolidated entities

 

12,036.1

 

10,819.4

 

872.7

 

(22,846.8

)

881.4

 

Other investments

 

9.0

 

52.1

 

2,244.7

 

—

 

2,305.8

 

Cash and cash equivalents

 

112.7

 

584.8

 

1,755.9

 

(792.2

)

1,661.2

 

Accrued investment income

 

—

 

—

 

584.5

 

—

 

584.5

 

Premiums due and other receivables

 

—

 

990.8

 

2,176.4

 

(1,992.0

)

1,175.2

 

Deferred acquisition costs

 

—

 

—

 

2,715.5

 

—

 

2,715.5

 

Property and equipment

 

—

 

—

 

472.6

 

—

 

472.6

 

Goodwill

 

—

 

—

 

1,197.4

 

—

 

1,197.4

 

Other intangibles

 

—

 

—

 

1,590.3

 

—

 

1,590.3

 

Separate account assets

 

—

 

—

 

120,906.1

 

—

 

120,906.1

 

Other assets

 

66.2

 

82.8

 

1,071.0

 

(185.7

)

1,034.3

 

Total assets

 

$

12,224.0

 

$

12,529.9

 

$

201,825.7

 

$

(25,816.7

)

$

200,762.9

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

Contractholder funds

 

$

—

 

$

—

 

$

36,701.6

 

$

—

 

$

36,701.6

 

Future policy benefits and claims

 

—

 

—

 

22,689.5

 

—

 

22,689.5

 

Other policyholder funds

 

—

 

—

 

811.2

 

—

 

811.2

 

Short-term debt

 

—

 

—

 

2,353.4

 

(2,306.9

)

46.5

 

Long-term debt

 

2,448.6

 

—

 

341.9

 

—

 

2,790.5

 

Income taxes currently payable

 

—

 

18.3

 

49.1

 

(57.6

)

9.8

 

Deferred income taxes

 

—

 

—

 

899.8

 

(108.4

)

791.4

 

Separate account liabilities

 

—

 

—

 

120,906.1

 

—

 

120,906.1

 

Other liabilities

 

51.8

 

475.5

 

6,091.8

 

(488.3

)

6,130.8

 

Total liabilities

 

2,500.4

 

493.8

 

190,844.4

 

(2,961.2

)

190,877.4

 

 

 

 

 

 

 

 

 

 

 

 

 

Redeemable noncontrolling interest

 

—

 

—

 

58.9

 

—

 

58.9

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

 

 

 

Series A preferred stock

 

—

 

—

 

—

 

—

 

—

 

Series B preferred stock

 

0.1

 

—

 

—

 

—

 

0.1

 

Common stock

 

4.6

 

—

 

17.8

 

(17.8

)

4.6

 

Additional paid-in capital

 

9,771.5

 

9,394.8

 

8,306.5

 

(17,701.3

)

9,771.5

 

Retained earnings

 

4,971.7

 

1,986.1

 

1,854.8

 

(3,840.9

)

4,971.7

 

Accumulated other comprehensive income

 

621.0

 

655.2

 

642.3

 

(1,297.5

)

621.0

 

Treasury stock, at cost

 

(5,645.3

)

—

 

(2.0

)

2.0

 

(5,645.3

)

Total stockholders’ equity attributable to PFG

 

9,723.6

 

12,036.1

 

10,819.4

 

(22,855.5

)

9,723.6

 

Noncontrolling interest

 

—

 

—

 

103.0

 

—

 

103.0

 

Total stockholders’ equity

 

9,723.6

 

12,036.1

 

10,922.4

 

(22,855.5

)

9,826.6

 

Total liabilities and stockholders’ equity

 

$

12,224.0

 

$

12,529.9

 

$

201,825.7

 

$

(25,816.7

)

$

200,762.9

 

 

Condensed Consolidating Statements of Financial Position

December 31, 2012

 

 

 

 

 

 

 

Principal Life

 

 

 

 

 

 

 

Principal

 

Principal

 

Insurance Company

 

 

 

Principal

 

 

 

Financial

 

Financial

 

and Other

 

 

 

Financial

 

 

 

Group, Inc.

 

Services, Inc.

 

Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

Fixed maturities, available-for-sale

 

$

—

 

$

—

 

$

50,939.3

 

$

—

 

$

50,939.3

 

Fixed maturities, trading

 

10.5

 

—

 

616.2

 

—

 

626.7

 

Equity securities, available-for-sale

 

—

 

—

 

136.5

 

—

 

136.5

 

Equity securities, trading

 

—

 

—

 

252.8

 

—

 

252.8

 

Mortgage loans

 

—

 

—

 

11,519.7

 

—

 

11,519.7

 

Real estate

 

—

 

—

 

1,180.3

 

—

 

1,180.3

 

Policy loans

 

—

 

—

 

864.9

 

—

 

864.9

 

Investment in unconsolidated entities

 

11,853.3

 

10,632.1

 

860.2

 

(22,476.6

)

869.0

 

Other investments

 

11.1

 

39.6

 

2,371.4

 

—

 

2,422.1

 

Cash and cash equivalents

 

207.1

 

612.5

 

4,241.3

 

(883.7

)

4,177.2

 

Accrued investment income

 

—

 

—

 

584.4

 

—

 

584.4

 

Premiums due and other receivables

 

0.1

 

1,122.1

 

2,206.7

 

(2,244.5

)

1,084.4

 

Deferred acquisition costs

 

—

 

—

 

2,590.0

 

—

 

2,590.0

 

Property and equipment

 

—

 

—

 

464.2

 

—

 

464.2

 

Goodwill

 

—

 

—

 

543.4

 

—

 

543.4

 

Other intangibles

 

—

 

—

 

914.7

 

—

 

914.7

 

Separate account assets

 

—

 

—

 

81,653.8

 

—

 

81,653.8

 

Other assets

 

78.0

 

51.0

 

1,003.5

 

(125.7

)

1,006.8

 

Total assets

 

$

12,160.1

 

$

12,457.3

 

$

162,943.3

 

$

(25,730.5

)

$

161,830.2

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

Contractholder funds

 

$

—

 

$

—

 

$

37,786.5

 

$

—

 

$

37,786.5

 

Future policy benefits and claims

 

—

 

—

 

22,436.2

 

—

 

22,436.2

 

Other policyholder funds

 

—

 

—

 

716.4

 

—

 

716.4

 

Short-term debt

 

—

 

—

 

2,564.1

 

(2,523.3

)

40.8

 

Long-term debt

 

2,448.6

 

—

 

222.7

 

—

 

2,671.3

 

Income taxes currently payable

 

—

 

0.1

 

47.2

 

(32.0

)

15.3

 

Deferred income taxes

 

—

 

—

 

686.1

 

(86.1

)

600.0

 

Separate account liabilities

 

—

 

—

 

81,653.8

 

—

 

81,653.8

 

Other liabilities

 

28.1

 

603.9

 

6,117.8

 

(603.7

)

6,146.1

 

Total liabilities

 

2,476.7

 

604.0

 

152,230.8

 

(3,245.1

)

152,066.4

 

 

 

 

 

 

 

 

 

 

 

 

 

Redeemable noncontrolling interest

 

—

 

—

 

60.4

 

—

 

60.4

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

 

 

 

Series A preferred stock

 

—

 

—

 

—

 

—

 

—

 

Series B preferred stock

 

0.1

 

—

 

—

 

—

 

0.1

 

Common stock

 

4.5

 

—

 

17.8

 

(17.8

)

4.5

 

Additional paid-in capital

 

9,730.9

 

9,393.8

 

8,287.7

 

(17,681.5

)

9,730.9

 

Retained earnings

 

4,862.0

 

1,783.4

 

1,666.7

 

(3,450.1

)

4,862.0

 

Accumulated other comprehensive income

 

640.3

 

676.1

 

661.9

 

(1,338.0

)

640.3

 

Treasury stock, at cost

 

(5,554.4

)

—

 

(2.0

)

2.0

 

(5,554.4

)

Total stockholders’ equity attributable to PFG

 

9,683.4

 

11,853.3

 

10,632.1

 

(22,485.4

)

9,683.4

 

Noncontrolling interest

 

—

 

—

 

20.0

 

—

 

20.0

 

Total stockholders’ equity

 

9,683.4

 

11,853.3

 

10,652.1

 

(22,485.4

)

9,703.4

 

Total liabilities and stockholders’ equity

 

$

12,160.1

 

$

12,457.3

 

$

162,943.3

 

$

(25,730.5

)

$

161,830.2

 

 

Condensed Consolidating Statements of Operations

For the three months March 31, 2013

 

 

 

 

 

 

 

Principal Life

 

 

 

 

 

 

 

Principal

 

Principal

 

Insurance

 

 

 

Principal

 

 

 

Financial

 

Financial

 

Company and

 

 

 

Financial

 

 

 

Group, Inc.

 

Services, Inc.

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

Premiums and other considerations

 

$

—

 

$

—

 

$

694.7

 

$

—

 

$

694.7

 

Fees and other revenues

 

—

 

—

 

733.7

 

(0.1

)

733.6

 

Net investment income

 

—

 

0.7

 

788.5

 

0.1

 

789.3

 

Net realized capital gains (losses), excluding impairment losses on available-for-sale securities

 

6.3

 

2.1

 

(34.8

)

—

 

(26.4

)

Total other-than-temporary impairment losses on available-for-sale securities

 

—

 

—

 

(44.7

)

—

 

(44.7

)

Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified to other comprehensive income

 

—

 

—

 

20.2

 

—

 

20.2

 

Net impairment losses on available-for-sale securities

 

—

 

—

 

(24.5

)

—

 

(24.5

)

Net realized capital gains (losses)

 

6.3

 

2.1

 

(59.3

)

—

 

(50.9

)

Total revenues

 

6.3

 

2.8

 

2,157.6

 

—

 

2,166.7

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

Benefits, claims and settlement expenses

 

—

 

—

 

1,094.5

 

—

 

1,094.5

 

Dividends to policyholders

 

—

 

—

 

48.3

 

—

 

48.3

 

Operating expenses

 

35.0

 

8.2

 

752.5

 

—

 

795.7

 

Total expenses

 

35.0

 

8.2

 

1,895.3

 

—

 

1,938.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(28.7

)

(5.4

)

262.3

 

—

 

228.2

 

Income taxes (benefits)

 

(11.5

)

(1.0

)

50.7

 

—

 

38.2

 

Equity in the net income of subsidiaries

 

203.7

 

208.1

 

—

 

(411.8

)

—

 

Net income

 

186.5

 

203.7

 

211.6

 

(411.8

)

190.0

 

Net income attributable to noncontrolling interest

 

—

 

—

 

3.5

 

—

 

3.5

 

Net income attributable to PFG

 

186.5

 

203.7

 

208.1

 

(411.8

)

186.5

 

Preferred stock dividends

 

8.2

 

—

 

—

 

—

 

8.2

 

Net income available to common stockholders

 

$

178.3

 

$

203.7

 

$

208.1

 

$

(411.8

)

$

178.3

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

186.5

 

$

203.7

 

$

211.6

 

$

(411.8

)

$

190.0

 

Other comprehensive loss

 

(81.3

)

(21.9

)

(21.0

)

103.8

 

(20.4

)

Comprehensive income

 

$

105.2

 

$

181.8

 

$

190.6

 

$

(308.0

)

$

169.6

 

 

Condensed Consolidating Statements of Operations

For the three months March 31, 2012

 

 

 

 

 

 

 

Principal Life

 

 

 

 

 

 

 

Principal

 

Principal

 

Insurance

 

 

 

Principal

 

 

 

Financial

 

Financial

 

Company and

 

 

 

Financial

 

 

 

Group, Inc.

 

Services, Inc.

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

Premiums and other considerations

 

$

—

 

$

—

 

$

679.8

 

$

—

 

$

679.8

 

Fees and other revenues

 

0.1

 

—

 

598.2

 

(0.3

)

598.0

 

Net investment income

 

1.0

 

—

 

823.5

 

0.3

 

824.8

 

Net realized capital gains, excluding impairment losses on available-for-sale securities

 

—

 

—

 

22.1

 

—

 

22.1

 

Total other-than-temporary impairment losses on available-for-sale securities

 

—

 

—

 

(33.7

)

—

 

(33.7

)

Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified to other comprehensive income

 

—

 

—

 

4.9

 

—

 

4.9

 

Net impairment losses on available-for-sale securities

 

—

 

—

 

(28.8

)

—

 

(28.8

)

Net realized capital losses

 

—

 

—

 

(6.7

)

—

 

(6.7

)

Total revenues

 

1.1

 

—

 

2,094.8

 

—

 

2,095.9

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

Benefits, claims and settlement expenses

 

—

 

—

 

1,212.5

 

—

 

1,212.5

 

Dividends to policyholders

 

—

 

—

 

50.3

 

—

 

50.3

 

Operating expenses

 

29.9

 

0.4

 

524.8

 

—

 

555.1

 

Total expenses

 

29.9

 

0.4

 

1,787.6

 

—

 

1,817.9

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(28.8

)

(0.4

)

307.2

 

—

 

278.0

 

Income taxes (benefits)

 

(11.3

)

(1.7

)

69.7

 

—

 

56.7

 

Equity in the net income of subsidiaries

 

229.6

 

228.3

 

—

 

(457.9

)

—

 

Net income

 

212.1

 

229.6

 

237.5

 

(457.9

)

221.3

 

Net income attributable to noncontrolling interest

 

—

 

—

 

9.2

 

—

 

9.2

 

Net income attributable to PFG

 

212.1

 

229.6

 

228.3

 

(457.9

)

212.1

 

Preferred stock dividends

 

8.2

 

—

 

—

 

—

 

8.2

 

Net income available to common stockholders

 

$

203.9

 

$

229.6

 

$

228.3

 

$

(457.9

)

$

203.9

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

212.1

 

$

229.6

 

$

237.5

 

$

(457.9

)

$

221.3

 

Other comprehensive income

 

180.6

 

224.3

 

224.9

 

(404.6

)

225.2

 

Comprehensive income

 

$

392.7

 

$

453.9

 

$

462.4

 

$

(862.5

)

$

446.5

 

 

Condensed Consolidating Statements of Cash Flows

For the three months March 31, 2013

 

 

 

 

 

 

 

Principal Life

 

 

 

 

 

 

 

Principal

 

Principal

 

Insurance

 

 

 

Principal

 

 

 

Financial

 

Financial

 

Company and

 

 

 

Financial

 

 

 

Group, Inc.

 

Services, Inc.

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Operating activities

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities

 

$

28.0

 

$

(19.8

)

$

712.4

 

$

(124.7

)

$

595.9

 

Investing activities

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities:

 

 

 

 

 

 

 

 

 

 

 

Purchases

 

—

 

—

 

(2,447.1

)

—

 

(2,447.1

)

Sales

 

—

 

—

 

503.1

 

—

 

503.1

 

Maturities

 

—

 

—

 

1,790.9

 

—

 

1,790.9

 

Mortgage loans acquired or originated

 

—

 

—

 

(610.9

)

—

 

(610.9

)

Mortgage loans sold or repaid

 

—

 

—

 

555.8

 

—

 

555.8

 

Real estate acquired

 

—

 

—

 

(23.4

)

—

 

(23.4

)

Net sales of property and equipment

 

—

 

—

 

6.7

 

—

 

6.7

 

Purchases of interests in subsidiaries, net of cash acquired

 

—

 

—

 

(1,268.3

)

—

 

(1,268.3

)

Dividends and returns of capital received from (contributions to) unconsolidated entities

 

18.8

 

21.4

 

—

 

(40.2

)

—

 

Net change in other investments

 

(3.0

)

(10.5

)

(18.7

)

—

 

(32.2

)

Net cash provided by (used in) investing activities

 

15.8

 

10.9

 

(1,511.9

)

(40.2

)

(1,525.4

)

Financing activities

 

 

 

 

 

 

 

 

 

 

 

Issuance of common stock

 

20.3

 

—

 

—

 

—

 

20.3

 

Acquisition of treasury stock

 

(90.9

)

—

 

—

 

—

 

(90.9

)

Proceeds from financing element derivatives

 

—

 

—

 

14.3

 

—

 

14.3

 

Payments for financing element derivatives

 

—

 

—

 

(12.7

)

—

 

(12.7

)

Excess tax benefits from share-based payment arrangements

 

—

 

—

 

3.8

 

—

 

3.8

 

Purchase of subsidiary shares from noncontrolling interest

 

—

 

—

 

(30.6

)

—

 

(30.6

)

Dividends to common stockholders

 

(67.6

)

—

 

—

 

—

 

(67.6

)

Issuance of long-term debt

 

—

 

—

 

3.5

 

—

 

3.5

 

Principal repayments of long-term debt

 

—

 

—

 

(0.4

)

—

 

(0.4

)

Net repayments of short-term borrowings

 

—

 

—

 

(216.2

)

216.2

 

—

 

Capital received from (dividends and capital paid to) parent

 

—

 

(18.8

)

(21.4

)

40.2

 

—

 

Investment contract deposits

 

—

 

—

 

1,419.7

 

—

 

1,419.7

 

Investment contract withdrawals

 

—

 

—

 

(2,852.0

)

—

 

(2,852.0

)

Net increase in banking operation deposits

 

—

 

—

 

6.9

 

—

 

6.9

 

Other

 

—

 

—

 

(0.8

)

—

 

(0.8

)

Net cash used in financing activities

 

(138.2

)

(18.8

)

(1,685.9

)

256.4

 

(1,586.5

)

Net decrease in cash and cash equivalents

 

(94.4

)

(27.7

)

(2,485.4

)

91.5

 

(2,516.0

)

Cash and cash equivalents at beginning of period

 

207.1

 

612.5

 

4,241.3

 

(883.7

)

4,177.2

 

Cash and cash equivalents at end of period

 

$

112.7

 

$

584.8

 

$

1,755.9

 

$

(792.2

)

$

1,661.2

 

 

Condensed Consolidating Statements of Cash Flows

For the three months March 31, 2012

 

 

 

 

 

 

 

Principal Life

 

 

 

 

 

 

 

Principal

 

Principal

 

Insurance

 

 

 

Principal

 

 

 

Financial

 

Financial

 

Company and

 

 

 

Financial

 

 

 

Group, Inc.

 

Services, Inc.

 

Other Subsidiaries

 

 

 

Group, Inc.

 

 

 

Parent Only

 

Only

 

Combined

 

Eliminations

 

Consolidated

 

 

 

(in millions)

 

Operating activities

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities

 

$

79.9

 

$

(56.7

)

$

824.3

 

$

54.2

 

$

901.7

 

Investing activities

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities:

 

 

 

 

 

 

 

 

 

 

 

Purchases

 

—

 

—

 

(2,060.5

)

—

 

(2,060.5

)

Sales

 

—

 

—

 

428.5

 

—

 

428.5

 

Maturities

 

—

 

—

 

1,612.1

 

—

 

1,612.1

 

Mortgage loans acquired or originated

 

—

 

—

 

(919.6

)

—

 

(919.6

)

Mortgage loans sold or repaid

 

—

 

—

 

361.4

 

—

 

361.4

 

Real estate acquired

 

—

 

—

 

(21.3

)

—

 

(21.3

)

Net purchases of property and equipment

 

—

 

—

 

(17.3

)

—

 

(17.3

)

Dividends and returns of capital received from unconsolidated entities

 

189.3

 

165.5

 

—

 

(354.8

)

—

 

Net change in other investments

 

—

 

—

 

(73.8

)

—

 

(73.8

)

Net cash provided by (used in) investing activities

 

189.3

 

165.5

 

(690.5

)

(354.8

)

(690.5

)

Financing activities

 

 

 

 

 

 

 

 

 

 

 

Issuance of common stock

 

9.1

 

—

 

—

 

—

 

9.1

 

Acquisition of treasury stock

 

(64.2

)

—

 

—

 

—

 

(64.2

)

Proceeds from financing element derivatives

 

—

 

—

 

20.4

 

—

 

20.4

 

Payments for financing element derivatives

 

—

 

—

 

(16.2

)

—

 

(16.2

)

Excess tax benefits from share-based payment arrangements

 

—

 

—

 

9.9

 

—

 

9.9

 

Dividends to common stockholders

 

(54.3

)

—

 

—

 

—

 

(54.3

)

Dividends to preferred stockholders

 

(8.2

)

—

 

—

 

—

 

(8.2

)

Issuance of long-term debt

 

—

 

—

 

1.0

 

—

 

1.0

 

Principal repayments of long-term debt

 

—

 

—

 

(0.8

)

—

 

(0.8

)

Net proceeds from (repayments of) short-term borrowings

 

—

 

—

 

98.9

 

(106.4

)

(7.5

)

Dividends and capital paid to parent

 

—

 

(189.3

)

(165.5

)

354.8

 

—

 

Investment contract deposits

 

—

 

—

 

1,618.6

 

—

 

1,618.6

 

Investment contract withdrawals

 

—

 

—

 

(2,885.9

)

—

 

(2,885.9

)

Net decrease in banking operation deposits

 

—

 

—

 

(13.4

)

—

 

(13.4

)

Other

 

—

 

—

 

(1.7

)

—

 

(1.7

)

Net cash used in financing activities

 

(117.6

)

(189.3

)

(1,334.7

)

248.4

 

(1,393.2

)

Net increase (decrease) in cash and cash equivalents

 

151.6

 

(80.5

)

(1,200.9

)

(52.2

)

(1,182.0

)

Cash and cash equivalents at beginning of period

 

226.7

 

702.4

 

2,787.9

 

(883.1

)

2,833.9

 

Cash and cash equivalents at end of period

 

$

378.3

 

$

621.9

 

$

1,587.0

 

$

(935.3

)

$

1,651.9