Principal Financial Group, Inc. Announces First Quarter Results

  Principal Financial Group, Inc. Announces First Quarter Results

                 Company Also Announces Common Stock Dividend

                              Company Highlights

  *1Q 2013 Operating Earnings^1 of $233.3 million, $0.79 per diluted share
  *1Q 2013 Net Income was $178.3 million, $0.61 per diluted share
  *Record quarter end assets under management of $456.1 billion
  *First quarter total company net cash flows of $6.5 billion
  *Company declares second quarter 2013 dividend of $0.23 per share of common
    stock

Business Wire

DES MOINES, Iowa -- April 25, 2013

Principal Financial Group, Inc. (NYSE: PFG) today announced results for first
quarter 2013.

First Quarter 2013 Results

  *Operating earnings increased 8 percent to $233.3 million for first quarter
    2013, compared to $215.3 million for first quarter 2012. Operating
    earnings per diluted share (EPS) were $0.79 for first quarter 2013,
    compared to $0.71 for first quarter 2012.
  *Net income available to common stockholders of $178.3 million, or $0.61
    per diluted share for first quarter 2013, was a $25.6 million decrease
    from $203.9 million, or $0.68 per diluted share for first quarter 2012.
    Net realized losses were $56.4 million in the first quarter 2013 compared
    to losses of $9.9 million in first quarter 2012.
  *Operating revenues for first quarter 2013 were $2,238.3 million, an
    increase of 6 percent, compared to $2,107.4 million for the same period
    last year.
  *Quarterly dividend declared by its board of directors of $0.23 per share
    of common stock. The dividend will be payable on June 28, 2013 to
    shareholders of record as of June 3, 2013.

“2013 is off to a very good start, with 8 percent growth in reported operating
earnings over the prior year period, continuing the momentum in our businesses
for several quarters. Our ability to attract and retain institutional,
retirement and retail investors around the world resulted in more than $28
billion of net cash flows over the trailing twelve months,” said Larry D.
Zimpleman, chairman, president and chief executive officer. “Our acquisition
of Cuprum successfully completed in the first quarter, contributing
meaningfully to our current results. We continue to grow in the right markets
with the right solutions, offering our clients long-term savings, investment
solutions and risk protection, to help them achieve financial security.”

Added Terry Lillis, senior vice president and chief financial officer, “Total
company fees and other revenues are growing by double digits, reflecting our
shift toward a fee-based business model. As our business model generates
increasing amounts of deployable capital, we’re able to put that capital to
work opportunistically for the long-term benefit to our shareholders. Since
the beginning of 2012, we’ve allocated $2.4 billion on strategic acquisitions,
common stock dividends and share repurchases. For the remainder of the year,
we’ll focus on onboarding Cuprum and look at opportunities to deploy
additional capital in the second half of the year.”

Highlights

Business

  *Retirement and Investor Services Accumulation sales were up 15 percent in
    the first quarter compared to the year ago quarter. This includes $2.9
    billion for Full Service Accumulation, a record $5.2 billion for Principal
    Funds and $419 million for Individual Annuities. Net cash flows were $0.7
    billion for Full Service Accumulation and $2.4 billion for Principal
    Funds.
  *Full Service Accumulation defined contribution plan count is up nearly
    1,900 plans, a 6 percent increase over a year ago quarter.
  *Principal Global Investors had unaffiliated net cash flows of $1.8 billion
    and record unaffiliated assets under management (AUM) of $102.7 billion as
    of quarter end.
  *Principal International reported net cash flows of $2.5 billion and record
    AUM of $107.4 billion as of quarter end (excluding $12.1 billion of AUM in
    our asset management joint venture in China, which is not reported in
    AUM).
  *U.S. Insurance Solutions had strong sales in the first quarter, with
    Individual Life sales up 49 percent and Specialty Benefits sales up 20
    percent, both over first quarter 2012.

Capital

  *Strong capital position with a quarter-end estimated risk based capital
    ratio of approximately 415 percent, which was unchanged from year-end
    2012, and $1.1 billion of excess capital.^2
  *Paid a first quarterly dividend of $0.23 cents per share, up 10 percent
    over fourth quarter 2012.
  *Repurchased 2.4 million shares of common stock in the first quarter at an
    average price of $31.37.
  *Book value per share, excluding AOCI^3 was $29.19, up 6 percent over first
    quarter 2012.

Net Income

  *Net income available to common stockholders of $178.3 million for first
    quarter 2013, down 13 percent compared to first quarter 2012 reflecting:

       *Net realized capital losses of $56.4 million, which includes:

            *$18.7 million of credit related net losses, down 28 percent from
              a year ago quarter, related to sales and permanent impairments
              of fixed maturity securities. This includes $12.9 million of
              losses on commercial mortgage backed securities, which is down
              10 percent from first quarter 2012;
            *Losses on Derivatives and Related Activities used for hedging
              risk; and
            *Volatility on Other Gains/Losses.

Segment Results                               
Retirement and
Investor Services                             
- Accumulation^4
(in millions         Quarter To Date             Trailing Twelve Months
except percentages
or otherwise         1Q13    1Q12    %        1Q13      1Q12      %
noted)                                 Change                          Change
Operating Earnings   $141.8  $120.2  18%                          
                                                 
Net Revenue          $559.9   $493.5   13%       $2,110.5   $1,919.8   10%
Pretax Return on    31.0%   31.2%           29.5%*    30.6%     
Net Revenue

*Pretax Return on Net Revenue for the trailing twelve months as of first
quarter 2013 was 30.6 percent after  adjusting for the third  quarter 2012
actuarial assumption review.

  *Operating Earnings increased $21.6 million primarily due to growth in
    average account values. Results also benefited from an $8.4 million
    after-tax dividend accrual benefit in Full Service Accumulation, and a
    $2.5 million after-tax benefit from a Principal Funds legal settlement.
    First quarter 2012 was negatively impacted by a legal settlement in Bank
    and Trust Services. Excluding these items, first quarter 2013 operating
    earnings were up 7 percent from first quarter 2012.
  *Net Revenue increased 13 percent in first quarter aided by an increase in
    account values resulting from positive net cash flows and strong equity
    markets.

Retirement and
Investor Services -                              
Guaranteed^5
(in millions except     Quarter To Date           Trailing Twelve Months
percentages or
otherwise noted)         1Q13   1Q12   % Change  1Q13    1Q12    % Change
Operating Earnings       $28.2  $23.4  21%                       
                                                    
Net Revenue              $48.7   $41.2   18%        $162.6   $157.1   4%
Pretax Return on Net    83.2%  79.9%           79.4%   78.2%   
Revenue
                                                                      

  *Operating Earnings increased $4.8 million primarily due to net revenue
    growth.
  *Net Revenue increased $7.5 million due to improved spreads.

Principal Global                                 
Investors
(in millions except   Quarter To Date             Trailing Twelve Months
percentages or
otherwise noted)       1Q13    1Q12    % Change  1Q13    1Q12    % Change
Operating Earnings     $20.3   $16.2   25%                       
                                                    
Operating Revenue      $153.7   $138.1   11%        $606.8   $559.1   9%
Pretax Margin          22.4%    19.8%               23.4%    21.1%
                                                                      
Total PGI Assets
Under Management       $273.0   $242.2   13%
(billions)
Unaffiliated Assets
Under Management      $102.7  $90.7   13%                     
(billions)
                                                                      

  *Operating Earnings increased $4.1 million primarily due to revenue growth
    and improved pretax margin.
  *Operating Revenue increased $15.6 million for first quarter 2013 as a
    result of higher management fees due to growth in AUM aided by positive
    net cash flows and strong investment performance.

Principal International
(in millions        Quarter To Date            Trailing Twelve Months
except percentages
or otherwise         1Q13    1Q12    %        1Q13      1Q12      %
noted)                                 Change                          Change
Operating Earnings   $44.6   $44.1   1%                           
                                                 
Combined^6
Combined basis:
all Principal        $319.0   $279.3   14%       $1,156.1   $1,121.3   3%
International
companies at 100%.
Net Revenue
Combined Pretax
Return on Net        57.2%    58.2%              55.6%      54.0%
Revenue
                                                                       
Assets Under
Management          $107.4  $59.2   81%                        
(billions)
                                                                       

  *Operating Earnings increased $0.5 million. Results benefited from the one
    month of Cuprum’s earnings and higher AUM overall. This was partially
    offset by inflation in Latin America, foreign exchange rates, and a $2.2
    million tax on repatriated earnings from Hong Kong.
  *Combined Net Revenue increased primarily due to growth in AUM from strong
    net cash flows and the Cuprum acquisition.

Individual Life                                  
(in millions except   Quarter To Date             Trailing Twelve Months
percentages or
otherwise noted)       1Q13    1Q12    % Change  1Q13    1Q12    % Change
Operating Earnings     $14.9   $31.7   (53%)                     
                                                    
Premium and Fees       $239.0   $173.4   38%        $922.4   $826.9   12%
Pretax Operating      8.3%    26.4%            4.1%*   19.2%   
Margin

*Pretax Operating Margin for the trailing twelve months as of first quarter
2013 was 14.8 percent after adjusting for the third quarter 2012 actuarial
assumption review.

  *Operating Earnings decreased $16.8 million primarily due to an
    approximately $6.0 million impact from an adverse fluctuation in mortality
    and the continued impact of the low interest rate environment. First
    quarter 2012 benefited from a $3.3 million change in amortization basis as
    well as favorable mortality.
  *Premium and Fees increased $65.6 million on a reported basis. Adjusting
    for the first quarter 2012 change in amortization basis for certain
    policies, premium and fees are up 9 percent due to strong sales and growth
    in the business.

Specialty                                     
Benefits
(in millions       Quarter To Date             Trailing Twelve Months
except
percentages or      1Q13    1Q12    % Change  1Q13     1Q12      % Change
otherwise noted)
Operating           $20.8   $18.5   12%                          
Earnings
                                                 
Premium and Fees    $366.7   $353.7   4%         1,456.6   $1,392.4   5%
Pretax Operating    8.7%     8.0%                9.6%*     9.9%
Margin
                                                                      
Incurred Loss      67.1%   68.6%            67.9%    68.4%     
Ratio

*Pretax Operating Margin for the trailing twelve months as of first quarter
2013 was 9.8 percent after adjusting for the third quarter 2012 actuarial
assumption review.

  *Operating Earnings increased $2.3 million due to improved claims
    experience and business growth.
  *Premium and Fees growth of 4 percent reflects strong premium growth in
    Individual Disability, sales in Group Benefits, and in-group growth and
    salary trends.
  *Incurred Loss Ratio improved due to lower claims in Group Benefits,
    particularly in dental, partially offset by higher Individual Disability
    claims experience.

Corporate                                        
(in millions except percentages or otherwise     Quarter To Date
noted)                                            1Q13     1Q12     % Change
Operating Losses                                 ($37.3)  ($38.8)  4%
                                                                   

  *Operating Losses for first quarter 2013 was negatively impacted by
    one-time closing costs related to the Cuprum acquisition, which were
    largely offset by additional interest income received in Chile from cash
    used in the Cuprum acquisition and lower than expected expense accruals.
    First quarter 2012 results reflected higher tax and legal expenses.

Principal International Earnings Recast

In conjunction with our first quarter 2013 acquisition of AFP Cuprum S.A.
(“Cuprum”), we re-evaluated the accounting treatment for similar products
offered in other foreign jurisdictions, including the AFORE retirement
accumulation business in Mexico. As a result of this evaluation, we concluded
that the AFORE product, which was previously accounted for as an investment
contract under insurance accounting standards, should be accounted for as a
long term service contract, consistent with the accounting requirements for
our recently acquired retirement accumulation business in Chile. The revision
to the accounting treatment for the AFORE product in Mexico will result in the
following changes:

  *Fewer acquisition costs are capitalized. Specifically, we expense as
    incurred salary and related costs associated with the successful efforts
    of our proprietary sales force and sales support staff. All direct and
    incremental costs such as commissions will continue to be deferred.
  *Deferred costs are amortized on a straight line basis over the expected
    contract life rather than based on estimated gross profits. The
    amortization method change also impacts purchased customer intangible
    assets.

We have revised our prior period consolidated financial statements
accordingly. These revisions, inclusive of any other potential adjustments,
are not material in any prior period and, as a result, amendment of previously
filed periodic reports is not required. Rather, these revisions will be made
the next time we file the prior period financial statements.

Forward looking and cautionary statements
This press release contains forward-looking statements, including, without
limitation, statements as to operating earnings, net income available to
common stockholders, net cash flows, realized and unrealized gains and losses,
capital and liquidity positions, sales and earnings trends, and management's
beliefs, expectations, goals and opinions. The company does not undertake to
update these statements, which are based on a number of assumptions concerning
future conditions that may ultimately prove to be inaccurate. Future events
and their effects on the company may not be those anticipated, and actual
results may differ materially from the results anticipated in these
forward-looking statements. The risks, uncertainties and factors that could
cause or contribute to such material differences are discussed in the
company's annual report on Form 10-K for the year ended Dec. 31, 2012, filed
by the company with the Securities and Exchange Commission, as updated or
supplemented from time to time in subsequent filings. These risks and
uncertainties include, without limitation: adverse capital and credit market
conditions may significantly affect the company’s ability to meet liquidity
needs, access to capital and cost of capital; continued difficult conditions
in the global capital markets and the economy generally; continued volatility
or further declines in the equity markets; changes in interest rates or credit
spreads; the company’s investment portfolio is subject to several risks that
may diminish the value of its invested assets and the investment returns
credited to customers; the company’s valuation of securities may include
methodologies, estimations and assumptions that are subject to differing
interpretations; the determination of the amount of allowances and impairments
taken on the company’s investments requires estimations and assumptions that
are subject to differing interpretations; gross unrealized losses may be
realized or result in future impairments; competition from companies that may
have greater financial resources, broader arrays of products, higher ratings
and stronger financial performance; a downgrade in the company’s financial
strength or credit ratings; inability to attract and retain sales
representatives and develop new distribution sources; international business
risks; the company’s actual experience could differ significantly from its
pricing and reserving assumptions; the company’s ability to pay stockholder
dividends and meet its obligations may be constrained by the limitations on
dividends or distributions Iowa insurance laws impose on Principal Life; the
pattern of amortizing the company’s DAC and other actuarial balances on its
universal life-type insurance contracts, participating life insurance policies
and certain investment contracts may change; the company may need to fund
deficiencies in its “Closed Block” assets that support participating ordinary
life insurance policies that had a dividend scale in force at the time of
Principal Life’s 1998 conversion into a stock life insurance company; the
company’s reinsurers could default on their obligations or increase their
rates; risks arising from acquisitions of businesses; changes in laws,
regulations or accounting standards; a computer system failure or security
breach could disrupt the company’s business, and damage its reputation;
results of litigation and regulatory investigations; from time to time the
company may become subject to tax audits, tax litigation or similar
proceedings, and as a result it may owe additional taxes, interest and
penalties in amounts that may be material; fluctuations in foreign currency
exchange rates; and applicable laws and the company’s certificate of
incorporation and by-laws may discourage takeovers and business combinations
that some stockholders might consider in their best interests.

Use of Non-GAAP Financial Measures
The company uses a number of non-GAAP financial measures that management
believes are useful to investors because they illustrate the performance of
normal, ongoing operations, which is important in understanding and evaluating
the company’s financial condition and results of operations. They are not,
however, a substitute for U.S. GAAP financial measures. Therefore, the company
has provided reconciliations of the non-GAAP measures to the most directly
comparable U.S. GAAP measure at the end of the release. The company adjusts
U.S. GAAP measures for items not directly related to  ongoing operations.
However, it is possible these adjusting items have occurred in the past and
could recur in future reporting periods. Management also uses non-GAAP
measures for goal setting, as a basis for determining employee and senior
management awards and compensation, and evaluating performance on a basis
comparable to that used by investors and securities analysts.

Earnings Conference Call
On Friday, April 26, 2013 at 10:00 a.m. (ET), Chairman, President and Chief
Executive Officer Larry Zimpleman and Senior Vice President and Chief
Financial Officer Terry Lillis will lead a discussion of results, asset
quality and capital adequacy during a live conference call, which can be
accessed as follows:

  *Via live Internet webcast. Please go to www.principal.com/investor at
    least 10-15 minutes prior to the start of the call to register, and to
    download and install any necessary audio software.
  *Via telephone by dialing 800-374-1609 (U.S. and Canadian callers) or
    706-643-7701 (International callers) approximately 10 minutes prior to the
    start of the call. The access code is 25954736.
  *Replay of the earnings call via telephone is available by dialing
    855-859-2056 (U.S. and Canadian callers) or 404-537-3406 (International
    callers). The access code is 25954736. This replay will be available
    approximately two hours after the completion of the live earnings call
    through the end of day May 3, 2013.
  *Replay of the earnings call via webcast as well as a transcript of the
    call will be available after the call at: www.principal.com/investor.

The company's financial supplement and additional investment portfolio detail
for first quarter 2013 is currently available at www.principal.com/investor,
and may be referred to during the call. Slides related to the call will be
available at www.principal.com/investor approximately one-half hour prior to
call start time.

About the Principal Financial Group
The Principal Financial Group^® (The Principal ^®)^7 is a global investment
management leader offering retirement services, insurance solutions and asset
management. The Principal offers businesses, individuals and institutional
clients a wide range of financial products and services, including retirement,
asset management and insurance through its diverse family of financial
services companies. Founded in 1879 and a member of the FORTUNE 500^®, the
Principal Financial Group has $456.1 billion in assets under management^8 and
serves some 19.1 million customers worldwide from offices in Asia, Australia,
Europe, Latin America and the United States. Principal Financial Group, Inc.
is traded on the New York Stock Exchange under the ticker symbol PFG. For more
information, visit www.principal.com.

Explanation of Terms

The terms used within this press release and other documents related to
financials defined below explain the results of our ongoing businesses in a
manner that allows for a better understanding of the underlying trends in
those businesses.

Net revenue is defined as operating revenue less benefits, claims, settlement
expenses, and dividends to policyholders. This provides a more accurate view
of the ongoing revenue available to the businesses to fund operational
expenses and generate profits.

Pretax operating earnings is defined as operating earnings before income
taxes, noncontrolling interest and preferred stock dividends. This provides
management better insight into the underlying trends of the businesses.

Pretax return on net revenue is calculated as pretax operating earnings
divided by net revenue. This metric measures both revenue and expenses of
primary business activities in Retirement and Investor Services and provides a
clearer depiction of the profitability.

Pretax margin is calculated as pretax operating earnings divided by operating
revenue. This metric measures both the revenue and expenses associated with
the company’s primary business activities and provides a clearer picture of
the profitability of Principal Global Investors.

Combined basis is all Principal International companies at 100% ownership.
Using U.S. GAAP accounting presentation for joint ventures masks the growth
and profitability of our operations.

Premiums and fees is the sum of premiums, fees, and other revenue. Premiums
and fees provide management in US Insurance Solutions a current view of the
ongoing revenue in the business.

Pretax operating margin is calculated as pretax operating earnings divided by
premium and fees. This metric measures the proportion of premium and fees
remaining after claims and expenses, excluding income taxes, and provides an
indicator of the profitability of the business.

Trailing twelve months is a better indicator of trend analysis because it
normalizes quarterly volatility over a longer time period.

Summary of Segment and Principal Financial Group, Inc. Results

                                                   
                                                   

                                                    Operating Earnings
                                                    (Loss)*
                                                    in millions

                                                   Three Months Ended,

Segment                                             3/31/13   3/31/12
Retirement and Investor Services                    $ 170.0   $ 143.6
Principal Global Investors                           20.3     16.2
Principal International                              44.6     44.1
U.S. Insurance Solutions                             35.7     50.2
Corporate                                            (37.3)   (38.8)
Operating Earnings                                  $ 233.3   $ 215.3
Net realized capital losses, as adjusted             (56.4)   (9.9)
Other after-tax adjustments                          1.4      (1.5)
Net income available to common stockholders         $ 178.3   $ 203.9

                                                    Per Diluted Share
                                                    Three Months Ended,
                                                    3/31/13   3/31/12
Operating Earnings                                  $ 0.79    $ 0.71
Net realized capital losses, as adjusted             (0.18)   (0.03)
Other after-tax adjustments                          0.00     0.00
Net income available to common stockholders         $ 0.61    $ 0.68
Weighted-average diluted common shares outstanding   297.1    304.7
                                                              

*Operating earnings versus U.S. GAAP (GAAP) net income available to common
stockholders
Management uses operating earnings, which excludes the effect of net realized
capital gains and losses, as adjusted, and other after-tax adjustments, for
goal setting, as a basis for determining employee compensation, and evaluating
performance on a basis comparable to that used by investors and securities
analysts. Segment operating earnings are determined by adjusting U.S. GAAP net
income available to common stockholders for net realized capital gains and
losses, as adjusted, and other after-tax adjustments the company believes are
not indicative of overall operating trends. Note: it is possible these
adjusting items have occurred in the past and could recur in future reporting
periods. While these items may be significant components in understanding and
assessing our consolidated financial performance, management believes the
presentation of segment operating earnings enhances the understanding of
results of operations by highlighting earnings attributable to the normal,
ongoing operations of the company’s businesses.

Principal Financial Group, Inc.
Results of Operations
(in millions)
                                                        
                                                         Three Months Ended,
                                                         3/31/13    3/31/12
Premiums and other considerations                        $ 691.7    $ 677.1
Fees and other revenues                                    733.6       582.7
Net investment income                                     813.0     847.6
Total operating revenues                                  2,238.3   2,107.4
                                                                     
Benefits, claims and settlement expenses                   1,099.4     1,216.2
Dividends to policyholders                                 48.3        50.3
Commissions                                                179.6       159.8
Capitalization of DPAC                                     (124.2)     (99.6)
Amortization of DPAC                                       57.2        (103.7)
Depreciation and amortization                              22.3        19.4
Interest expense on corporate debt                         36.0        31.1
Compensation and other                                    615.3     546.7
Total expenses                                            1,933.9   1,820.2
                                                                     
Operating earnings before tax, noncontrolling interest     304.4       287.2
and preferred stock dividends
Less:
Income tax                                                 59.4        62.6
Operating earnings attributable to noncontrolling          3.5         1.1
interest
Preferred stock dividends                                 8.2       8.2
Operating earnings                                       $ 233.3    $ 215.3
                                                                     
Net realized capital losses, as adjusted                   (56.4)      (9.9)
Other after-tax adjustments                               1.4       (1.5)
Net income available to common stockholders              $ 178.3    $ 203.9
                                                                       

Selected Balance Sheet Statistics
                                            
                                             Period Ended,
                                             3/31/13    12/31/12   3/31/12
Total assets (in billions)                   $ 200.8    $ 161.8    $ 153.6
Total common equity (in millions)            $ 9,181.6   $ 9,141.4   $ 8,754.1
Total common equity excluding accumulated    $ 8,560.6   $ 8,501.1   $ 8,258.3
other comprehensive income (in millions)
End of period common shares outstanding       293.3      293.8      300.9
(in millions)
Book value per common share                  $ 31.30     $ 31.11     $ 29.09
Book value per common share excluding        $ 29.19     $ 28.93     $ 27.45
accumulated other comprehensive income
                                                                     

Principal Financial Group, Inc.
Reconciliation of Non-GAAP Financial Measures to U.S. GAAP
(in millions, except as indicated)
                                                        
                                                         Three Months Ended,
                                                         3/31/13    3/31/12
Diluted Earnings Per Common Share:                                 
Operating earnings                                       $ 0.79      $ 0.71
Net realized capital losses                                (0.18)      (0.03)
Other after-tax adjustments                               -         -
Net income available to common stockholders              $ 0.61     $ 0.68
                                                                     
Book Value Per Common Share Excluding Accumulated
Other Comprehensive Income:
Book value per common share excluding accumulated        $ 29.19     $ 27.45
other comprehensive income
Net unrealized capital gains                               3.91        2.93
Foreign currency translation                               (0.18)      (0.12)
Net unrecognized postretirement benefit obligations       (1.62)    (1.17)
Book value per common share including accumulated        $ 31.30    $ 29.09
other comprehensive income
                                                                     
Operating Revenues:
RIS                                                      $ 1,102.3   $ 1,055.1
PGI                                                        153.7       138.1
PI                                                         247.5       262.5
USIS                                                       778.0       697.0
Corporate                                                 (43.2)    (45.3)
Total operating revenues                                   2,238.3     2,107.4
Net realized capital losses and related adjustments        (75.2)      (30.4)
Exited group medical insurance business                   3.6       18.9
Total GAAP revenues                                      $ 2,166.7  $ 2,095.9
                                                                     
Operating Earnings:
RIS                                                      $ 170.0     $ 143.6
PGI                                                        20.3        16.2
PI                                                         44.6        44.1
USIS                                                       35.7        50.2
Corporate                                                 (37.3)    (38.8)
Total operating earnings                                   233.3       215.3
Net realized capital losses                                (56.4)      (9.9)
Other after-tax adjustments                               1.4       (1.5)
Net income available to common stockholders              $ 178.3    $ 203.9
                                                                     
Net Realized Capital Gains (Losses):
Net realized capital losses, as adjusted                 $ (56.4)    $ (9.9)
Certain derivative and hedging-related adjustments         24.1        23.3
Amortization of DAC and sale inducement costs              (3.1)       (32.8)
Certain market value adjustments of embedded               (0.1)       1.9
derivatives
Capital gains distributed                                  6.1         7.5
Tax impacts                                                (21.7)      (5.1)
Noncontrolling interest capital gains                      -           8.1
Recognition of front-end fee revenues                      0.2         0.4
Certain market value adjustments to fee revenues           -           -
Net realized capital losses associated with exited        -         (0.1)
group medical insurance business
GAAP net realized capital losses                         $ (50.9)   $ (6.7)
                                                                     
Other After-Tax Adjustments:
Earnings (losses) associated with exited group medical
                                                         $ 1.4      $ (1.5)
insurance business
Total other after-tax adjustments                        $ 1.4      $ (1.5)

Principal Financial Group, Inc.
Principal International Net Revenue Reconciliation
(in millions)
                                                         
                                                         Three Months Ended,
                                                         3/31/13    3/31/12
Total combined net revenue                               $ 319.0     $ 279.3
Add:
Principal International's share of unconsolidated          23.8        22.9
joint ventures' net income
Less:
Unconsolidated joint ventures' net revenue at 100%         223.4       209.4
Other adjustments                                         0.5       0.6
Net revenue*                                             $ 118.9    $ 92.2
                                                                     

* Net revenue is defined as total operating revenues less benefits, claims and
settlement expenses and dividends to policyholders.

^1 Use of non-GAAP financial measures is discussed in this release after
segment results. Operating Earnings is after tax.

^2 Excess capital includes cash at the holding company and capital at the life
company above the amount needed to maintain a 350 percent NAIC risk based
capital ratio for the life company.

^3 AOCI: Accumulated Other Comprehensive Income.

^4 RIS Accumulation: includes Full Service Accumulation, Principal Funds,
Individual Annuities and Bank and Trust Services.

^5 RIS Guaranteed: includes Investment Only and Full Service Payout.

^6 Combined basis: all Principal International companies at 100%.

^7 “The Principal Financial Group” and “The Principal” are registered service
marks of Principal Financial Services, Inc., a member of the Principal
Financial Group.

^8 As of March 31, 2013.

Contact:

Principal Financial Group, Inc.
Media contact:
Susan Houser, 515-248-2268
houser.susan@principal.com
or
Investor contact:
John Egan, 515-235-9500
egan.john@principal.com
 
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