Principal Financial : Latest Presentation

Principal'

First Quarter 2022 Earnings Call Presentation

PRINCIPAL FINANCIAL GROUP

April 29, 2022

RETIREMENT

ASSET MANAGEMENT

INSURANCE

Use of non-GAAP financial measures

A non-GAAP financial measure is a numerical measure of performance, financial position, or cash flow that includes adjustments from a comparable financial measure presented in accordance with U.S. GAAP.

The company uses a number of non-GAAP financial measures management believes are useful to investors because they illustrate the performance of the company's normal, ongoing operations which is important in understanding and evaluating the company's financial condition and results of operations. While such measures are also consistent with measures utilized by investors to evaluate performance, they are not, however, a substitute for U.S. GAAP financial measures. Therefore, the company has provided reconciliations of the non-GAAP financial measures to the most directly comparable U.S. GAAP financial measure within the slides. The company adjusts U.S. GAAP financial 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 financial 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.

The company also uses a variety of other operational measures that do not have U.S. GAAP counterparts, and therefore do not fit the definition of non-GAAP financial measures. Assets under management is an example of an operational measure that is not considered a non-GAAP financial measure.

Forward looking statements

Certain statements made by the company which are not historical facts may be considered forward-looking statements, including, without limitation, statements as to non-GAAP operating earnings, net income attributable to PPG, net cash flow, 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, 2021, filed by the company with the U.S. 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; conditions in the global capital markets and the economy generally; volatility or declines in the equity, bond or real estate markets; changes in interest rates or credit spreads or a sustained low interest rate environment; the elimination of the London Inter-Bank Offered Rate ("LIBOR"); 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 investments and the determination of the amount of allowances and impairments taken on such investments may include methodologies, estimations and assumptions that are subject to differing interpretations; any impairments of or valuation allowances against the company's deferred tax assets; the company's actual experience for insurance and annuity products could differ significantly from its pricing and reserving assumptions; the pattern of amortizing the company's DAC asset and other actuarial balances on its universal life-type insurance contracts, participating life insurance policies and certain investment contracts may change; changes in laws, regulations or accounting standards; the company may not be able to protect its intellectual property and may be subject to infringement claims; the company's ability to pay stockholder dividends, make share repurchases and meet its obligations may be constrained by the limitations on dividends or other distributions Iowa insurance laws impose on Principal Life; 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; 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; competition, including from companies that may have greater financial resources, broader arrays of products, higher ratings and stronger financial performance; technological and societal changes may disrupt the company's business model and impair its ability to retain existing customers, attract new customers and maintain its profitability; damage to the company's reputation; a downgrade in the company's financial strength or credit ratings; client terminations, withdrawals or changes in investor preferences; the company's hedging or risk management strategies prove ineffective or insufficient; inability to attract, develop and retain qualified employees and sales representatives and develop new distribution sources; an interruption in information technology, infrastructure or other internal or external systems used for business operations, or a failure to maintain the confidentiality, integrity or availability of data residing on such systems; international business risks including changes to mandatory pension schemes; risks arising from participation in joint ventures; the company may need to fund deficiencies in its "Closed Block" assets; a pandemic, terrorist attack, military action or other catastrophic event; the ongoing COVID-19 pandemic and the resulting financial market impacts; the company's reinsurers could default on their obligations or increase their rates; risks arising from acquisitions of businesses; risks related to the company's acquisition of Wells Fargo Bank, N.A.'s IRT business; risks in completing the company's announced reinsurance transaction for its in-force U.S. retail fixed annuity and universal life with secondary guarantee blocks of business within the terms or timing contemplated; loss of key vendor relationships or failure of a vendor to protect information of our customers or employees; the company's enterprise risk management framework may not be fully effective in identifying or mitigating all of the risks to which the company is exposed; and global climate change.

1 Q 2022 financial highlights

1Q 2022 OPERATING EARNINGS AND EPS

Reported non-GAAP operating earnings1

$429M

(+1% vs. 1Q 2021)

Reported non-GAAP operating earnings per diluted share1 (EPS)

$1.63

(+7% vs.IQ 2021)

Impact of significant variances to non-GAAP operating earnings2

$49M after-tax

($63M pre-tax)

Impact of significant variances to non-GAAP EPS2

~$0.19

Non-GAAP operating earnings, excluding significant variances (xSV)

$478M

(+8% vs. 1Q 2021)

Non-GAAP EPS. xSV

$1.81

(+13% vs.1Q 2021)

AUM & NCF

Total company AUM managed by PFG

$714B

Total company net cash flow +$3.0B

CAPITAL & LIQUIDITY

Excess and available capital

$1.7B $1,4B at Hold Co $325M excess cash at subsidiaries

Estimated PLIC RBC ratio

400%

Debt to capital ratio3

24.8%

CAPITAL DEPLOYMENTS

1Q 2022 capital deployments

$891M

$724M of share repurchases $167M of common stock dividends

Announced 2Q 2022 common stock dividend

$0.64

$0.03 increase (+5%) over 2Q 2021

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1 This is a non-GAAP financial measure; see reconciliation in appendix. 2 See slide 14 for details. 3 This is a non-GAAP financial measure. Debt to capital ratio excludes AOCI.

Principal"

2022 capital deployments

• • Executed $700M accelerated share repurchase (ASR) program

  • • $560M delivered in 1Q22

  • • Balance will be completed in 2Q22

• • $1.8B remaining on current repurchase authorizations and reflects entire $700M ASR

Returned ~$900M of capital to shareholders in 1Q22

n Share repurchases n Common stock dividends

$2.5B-$3.0B

$2.0B-$2.3B includes

$891M

$724M

$167M

2022 YTD

Targeted 40% dividend payout ratio

2022 guidance

Q Principal*