Principal Financial Group Inc. reported an 8 percent increase in first-quarter operating earnings on Thursday, with results buoyed in part by completion of its $1.5 billion acquisition of AFP Cuprum SA, a leading pension management company in Chile. The Des Moines-based financial services company will seek further acquisition opportunities in the second half of the year, officials said.
"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," said Larry Zimpleman, Principal chairman, president and CEO, in a release. "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 12 months."
Net income available to common stockholders was $178.3 million, or 61 cents per share, for the first quarter, a $25.6 million decrease from $203.9 million, or 68 cents per share, for first-quarter 2012. Net realized losses were $56.5 million in the first quarter of 2013, compared with losses of $9.9 million in first quarter 2012.
Analysts polled by Thomson Reuters expected the company to earn 74 cents per share on revenue of $2.3 billion for the first quarter; actual operating revenue was $2.2 billion. Analysts' estimates typically exclude special items.
Since the beginning of 2012, Principal has allocated $2.4 billion to strategic acquisitions, common stock dividends and share repurchases, said Terry Lillis, senior vice president and chief financial officer. "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," he said in a release.
The completion of the Cuprum acquisition "contributed meaningfully" to the current results, Zimpleman said. The company said earlier that it expects the purchase to boost Principal's earnings per share by approximately 12 cents this year and 23 cents in 2014. Cuprum manages approximately $32.7 billion in assets.
"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," Zimpleman said.