DES MOINES, Iowa, Aug 17, 2011 (BUSINESS WIRE) --
Principal Financial Group, Inc. (NYSE: PFG) announced that its Board of Directors has approved an authorization for the repurchase of up to $200 million worth of the company's outstanding common stock. The new program is in addition to the $250 million program renewed by the Board of Directors in May 2011. The company completed that program by the beginning of July 2011 by repurchasing 8.4 million shares for a total of $250 million.
"This action by our Board of Directors reflects our continued confidence and strong financial position," says Larry D. Zimpleman, chairman, president and chief executive officer of The Principal(R). "Our hybrid business model of fee-based and risk-based businesses provides financial flexibility that enables us to successfully execute our capital management strategy. We continue to generate increasing amounts of free cash flow as a result of our continued shift to a more fee-based business model. This $200 million authorization is part of our announced plan to deploy up to $400 million of capital for acquisitions or share buybacks in the second half of 2011, bringing our full year 2011 estimated total to $1 billion. However, as always, we will continue to monitor market conditions and be prudent with our capital deployment."
The repurchases will be made in the open market or through privately-negotiated transactions, from time to time, depending on market conditions. The stock repurchase program may be modified, extended or terminated at any time by the Board of Directors. Principal Financial Group, Inc. has 313.7 million shares of common stock outstanding as of June 30, 2011.
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, 2010, and in the company's quarterly report on Form 10-Q for the quarter ended June 30, 2011, 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 DPAC 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 stockholder rights plan, certificate of incorporation and by-laws may discourage takeovers and business combinations that some stockholders might consider in their best interests.
About the Principal Financial Group
The Principal Financial Group(R)(The Principal(R))1 is a retirement and global asset management leader. The Principal offers businesses, individuals and institutional clients a wide range of financial products and services, including retirement, investment services and insurance through its diverse family of financial services companies. A member of the FORTUNE 500(R), the Principal Financial Group has $335.8 billion in assets under management2and serves some 16.5 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.
1"The Principal Financial Group" and "The Principal" are registered service marks of Principal Financial Services, Inc., a member of the Principal Financial Group.
2As of June 30, 2011.
SOURCE: Principal Financial Group, Inc.
Principal Financial Group, Inc.
Susan Houser, 515-248-2268
John Egan, 515-235-9500