PRA Reports Fourth Quarter and Full Year 2013 Results

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| Source: PRA Group

NORFOLK, Va., Feb. 19, 2014 (GLOBE NEWSWIRE) -- Portfolio Recovery Associates, Inc. (Nasdaq:PRAA), a financial and business services company operating in the U.S. and U.K., today reported continued, strong financial results for the fourth quarter and full year 2013.

Fourth Quarter Highlights

  • Cash collections of $278.9 million, up 22% from the fourth quarter of 2012.
  • Revenues of $184.9 million, up 20%.
  • Net income attributable to PRA of $45.8 million, up 28%.
  • $0.91 diluted earnings per share, compared with $0.70 a year ago, up 30%.
  • $99.5 million in portfolio purchases.

Full Year 2013 Highlights

  • Cash collections of $1.1 billion, up 26% from full year 2012, with estimated remaining collections of $2.7 billion.
  • Revenues of $735.1 million, up 24%, including $71.6 million in fee income, up 15%.
  • Net income attributable to PRA of $175.3 million, up 38%.
  • $3.45 diluted EPS, compared with $2.46 for 2012, up 40%.
  • 22.2% return on average equity, exceeding PRA's full year 20% target.

"Our fourth quarter results in 2013 contributed to our strongest year ever. As the global debt buying industry continues to evolve at a rapid pace, 2014 promises to be a year of extraordinary opportunity and challenge. PRA is well positioned to sustain itself as a dominant, global player," said Steve Fredrickson, chairman, president and chief executive officer, PRA.

REVENUES

  • Revenues of $184.9 million in the fourth quarter, largely driven by cash collections, included finance receivables income net of principal amortization and allowance charges or reversals. Net finance receivables income was $168.7 million, up 22% from $138.1 million in the year-ago quarter.

Cash Collections from Finance Receivables

  • Cash collections increased 22% in the fourth quarter from the year-ago quarter to $278.9 million, and included collections from these finance receivables sources:
 
Cash Collection Source ($ in thousands) Q42013 Q32013 Q22013 Q12013 Q42012
Call Center and Other Collections  $ 84,375  $ 89,512  $ 90,229  $ 89,037  $ 72,624
External Legal Collections  46,066  48,274  50,131  47,910  41,521
Internal Legal Collections  34,101  33,288  30,365  29,283  23,968
Bankruptcy Court Trustee Payments  114,384  120,577  125,672  109,233  91,098
Total Cash Collections  $ 278,926  $ 291,651  $ 296,397  $ 275,463  $ 229,211
 
  • Principal amortization of finance receivables in the fourth quarter was $110.2 million or 39.5% of cash collections, compared with 39.8% in the year-ago quarter. Principal amortization included a net allowance reversal of $0.4 million recorded against certain pools of finance receivables in the quarter, compared with a net allowance charge of $2.3 million recorded in the year-ago quarter.     

Fee Income

  • Revenues in the fourth quarter also included income from PRA's fee-based businesses of $16.1 million, compared with $16.2 million in the year-ago quarter.  

EXPENSES AND OPERATING INCOME

  • Operating expenses were $106.5 million in the fourth quarter of 2013, compared with $94.3 million a year ago, an increase of 13%.  In association with the Company's legal collection strategy, external legal collection expenses (fees and costs) increased $6.4 million from the year-ago quarter. 
     
  • Operating income increased 31% to $78.4 million, compared with $60.0 million in the year-ago quarter.  The operating margin increased to 42.4% from 38.9% in the fourth quarter of 2012.
     
  • The provision for income taxes was $27.7 million in the fourth quarter, up 23% from the year-ago quarter. PRA's provision for income taxes was 37.7% of income before taxes in the fourth quarter, compared with 38.6% in the year-ago quarter. 

PORTFOLIO PURCHASES

  • PRA invested $99.5 million in new finance receivables from U.S. and U.K. creditors in the fourth quarter of 2013, compared with $199.1 million in the year-ago quarter.   Fourth quarter 2012 portfolio investment included the acquisition of bankruptcy portfolios from National Capital Management, LLC. Receivables purchased were acquired in 83 portfolios from 17 different sellers. For full year 2013, PRA invested a record $656.8 million in new portfolios.
 
Portfolio Purchase Source ($ in thousands) Q42013 Q32013 Q22013 Q12013 Q42012
Core Customer Debt  $ 67,522  $ 100,081  $ 118,195  $ 128,338  $ 88,107
Bankruptcy Court Claims  31,987  41,794  82,273  86,595  111,001
Total Portfolio Purchases  $ 99,509  $ 141,875  $ 200,468  $ 214,933  $ 199,108
 
  • Core customer debt purchased in the fourth quarter included $65.8 million in U.S. accounts and $1.8 million in U.K. accounts.

BALANCE SHEET

  • Borrowings totaled $451.8 million at December 31, 2013, and consisted of $256.8 million in convertible senior notes and $195.0 million in other long-term debt. Total borrowings were $327.5 million at December 31, 2012. Remaining borrowing availability, subject to normal borrowing and collateral provisions, under PRA's credit facility was $435.5 million.
     
  • Cash and cash equivalents were $162.0 million at December 31, 2013, compared with $32.7 million at December 31, 2012. 
     
  • Net deferred tax liabilities were $208.7 million at December 31, 2013, compared with $185.3 million a year ago. 
     
  • Stockholders' equity increased to $869.5 million at December 31, 2013, from $708.4 million at December 31, 2012.   

Conference Call Information

PRA will hold a conference call today at 5:00 p.m. ET to discuss results with institutional investors and stock analysts. A webcast of the call, both live and archived, will be available at http://ir.PortfolioRecovery.com/events.cfm. Please access the call by calling 888-695-7639 in the U.S. or 970-315-0482 outside the U.S.  The conference ID is 38054651. A question-and-answer session will be open only to institutional investors and analysts.   A replay of the call and webcast will be available until March 4, 2014.  Use the phone numbers and conference ID above to access the replay. 

About PRA

As a leader in the U.S. debt buying industry, Portfolio Recovery Associates, Inc. (PRA) returns capital to banks and other creditors that helps expand financial services for consumers.  PRA collaborates with its customers to create affordable, realistic debt repayment plans. The company also provides a broad range of fee-based services to local governments and law enforcement, auto lenders and insurers, businesses and institutional investors, global hedge funds, and U.K. banks and creditors. 

In 2013 and 2012, PRA was named one of Fortune's 100 Fastest-Growing Companies in the world, who also trade on a major U.S. stock exchange. Since 2007, PRA has been rising in the annual ranking of Forbes' Best Small Companies in America. For more information, please visit www.PortfolioRecovery.com.

About Forward-Looking Statements

Statements herein which are not historical, including PRA's or its management's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future, including future revenue and earnings growth, statements with respect to future contributions of its subsidiaries to earnings and future portfolio-purchase opportunities, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include references to PRA's presentations and webcasts. The forward-looking statements in this press release are based upon management's beliefs, assumptions and expectations of PRA's future operations and economic performance, taking into account currently available information. These statements are not statements of historical fact. Forward-looking statements involve risks and uncertainties, some of which are not currently known to us.  Actual events or results may differ from those expressed or implied in any such forward-looking statements as a result of various factors. Additional risk factors and other risks are described from time to time in PRA's filings with the Securities and Exchange Commission (SEC) including but not limited to its annual reports on Form 10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K, filed with the SEC and available through PRA's website, which contain a more detailed discussion of PRA's business, including risks and uncertainties that may affect future results. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. Information in this press release may be superseded by more recent information or statements, which may be disclosed in later press releases, subsequent filings with the SEC or otherwise. Except as required by law, PRA assumes no obligation to publicly update or revise its forward-looking statements contained herein to reflect any change in PRA's expectations with regard thereto or to reflect any change in events, conditions or circumstances on which any such forward-looking statements are based, in whole or in part.

 
Portfolio Recovery Associates, Inc.
Unaudited Consolidated Income Statements
(in thousands, except per share amounts)
 
  Three Months Three Months Year Year
  Ended Ended Ended Ended
  December 31, December 31, December 31, December 31,
  2013 2012 2013 2012
         
Revenues:        
Income recognized on finance receivables, net $ 168,728 $ 138,068 $ 663,546 $ 530,635
Fee income 16,125 16,183 71,589 62,166
         
Total revenues 184,853 154,251 735,135 592,801
         
Operating expenses:        
Compensation and employee services 46,393 44,849 192,474 168,356
Legal collection fees 10,144 9,153 41,488 34,393
Legal collection costs 20,044 14,619 83,063 72,325
Agent fees 1,608 1,411 5,901 5,906
Outside fees and services 6,827 7,292 31,615 28,867
Communications 7,537 6,255 28,936 25,943
Rent and occupancy 2,075 1,728 7,536 6,781
Depreciation and amortization 3,732 3,681 14,385 14,515
Other operating expenses 8,143 5,274 25,809 19,651
Impairment of goodwill -- -- 6,397 --
         
Total operating expenses 106,503 94,262 437,604 376,737
         
Income from operations 78,350 59,989 297,531 216,064
         
Other income and (expense):        
Interest income 3 2 3 10
Interest expense (4,862) (1,818) (14,469) (9,041)
         
Income before income taxes 73,491 58,173 283,065 207,033
         
Provision for income taxes 27,714 22,441 106,146 80,934
         
Net income $ 45,777 $ 35,732 $ 176,919 $ 126,099
         
Adjustment for income/(loss) attributable to redeemable noncontrolling interest -- (70) 1,605 (494)
         
Net income attributable to Portfolio Recovery Associates, Inc. $ 45,777 $ 35,802 $ 175,314 $ 126,593
         
Net income per common share attributable to Portfolio Recovery Associates, Inc.:        
Basic  $ 0.92  $ 0.71  $ 3.48  $ 2.48
Diluted  $ 0.91  $ 0.70  $ 3.45  $ 2.46
         
Weighted average number of shares outstanding:        
Basic 49,750 50,649 50,366 50,991
Diluted 50,375 51,216 50,873 51,369
 
Portfolio Recovery Associates, Inc.
Unaudited Consolidated Balance Sheets
(in thousands, except per share amounts)
 
  December 31, December 31,
ASSETS 2013 2012
     
Cash and cash equivalents $ 162,004 $ 32,687
Finance receivables, net 1,239,191 1,078,951
Accounts receivable, net 12,359 10,486
Income taxes receivable 11,710 --
Property and equipment, net 31,541 25,312
Deferred tax asset 1,361 --
Goodwill 103,843 109,488
Intangible assets, net 15,767 20,364
Other assets 23,456 11,668
     
Total assets $ 1,601,232 $ 1,288,956
     
LIABILITIES AND EQUITY    
     
Liabilities:    
Accounts payable $ 14,819 $ 12,155
Accrued expenses and other liabilities 27,655 18,953
Income taxes payable -- 3,125
Accrued compensation 27,431 12,804
Net deferred tax liability 210,071 185,277
Borrowings 451,780 327,542
     
Total liabilities 731,756 559,856
     
Redeemable noncontrolling Interest -- 20,673
     
Stockholders' equity:    
Preferred stock, par value $0.01, authorized shares, 2,000, issued and outstanding shares - 0 -- --
Common stock, par value $0.01, 60,000 authorized shares, 49,840 issued and outstanding shares at December 31, 2013, and 50,727 issued and outstanding shares at December 31, 2012 498 507
Additional paid-in capital 135,441 150,878
Retained earnings 729,505 554,191
Accumulated other comprehensive income 4,032 2,851
Total stockholders' equity 869,476 708,427
     
Total liabilities and equity $ 1,601,232 $ 1,288,956
 
Portfolio Recovery Associates, Inc.
Unaudited Consolidated Statements of Cash Flows
(in thousands)
 
  Year Year
  Ended Ended
  December 31, December 31,
  2013 2012
Cash flows from operating activities:    
Net income $ 176,919 $ 126,099
Adjustments to reconcile net income to net cash provided by operating activities:    
Amortization of share-based compensation 12,272 11,282
Depreciation and amortization 14,385 14,515
Amortization of debt discount 1,508 --
Impairment of goodwill 6,397 --
Deferred tax expense/(benefit) 11,011 (8,621)
Changes in operating assets and liabilities:    
Other assets (4,751) 1,523
Accounts receivable (1,786) (474)
Accounts payable 2,556 1,049
Income tax payable/receivable, net (14,814) (11,193)
Accrued expenses 14,179 469
Accrued compensation 7,251 (3,237)
     
Net cash provided by operating activities 225,127 131,412
     
Cash flows from investing activities:    
Purchases of property and equipment (15,875) (7,115)
Acquisition of finance receivables, net of buybacks (638,616) (457,068)
Collections applied to principal on finance receivables 478,891 378,049
Business acquisition, net of cash acquired -- (148,995)
Proceeds from due from seller -- 29,548
     
Net cash used in investing activities (175,600) (205,581)
     
Cash flows from financing activities:    
Income tax benefit from share-based compensation 4,552 2,138
Payment of liability-classified contingent consideration (5,240) --
Proceeds from line of credit 217,000 294,000
Principal payments on line of credit (344,000) (187,000)
Repurchases of common stock (58,511) (22,735)
Payments of line of credit origination costs and fees -- (4,994)
Cash paid for noncontrolling interest (5,663) --
Distributions paid to noncontrolling interest (2,075) --
Principal payments on long-term debt (5,542) (704)
Proceeds from convertible debt, net 279,281 --
     
Net cash provided by financing activities 79,802 80,705
     
Effect of exchange rate on cash (12) (546)
     
Net increase in cash and cash equivalents 129,317 5,990
     
Cash and cash equivalents, beginning of year 32,687 26,697
     
Cash and cash equivalents, end of year $ 162,004 $ 32,687
     
Supplemental disclosure of cash flow information:    
Cash paid for interest $ 9,830 $ 9,566
Cash paid for income taxes  105,719  98,738
     
Noncash investing and financing activities:    
Adjustment of the redeemable noncontrolling interest measurement amount $ (184) $ (3,597)
Purchase of noncontrolling interest  14,986  -- 
Distributions payable relating to noncontrolling interest  --   261
Employee stock relinquished for payment of taxes  (7,350)  (3,593)
Conversion of revolving line of credit to long-term debt -- 200,000
 
FINANCIAL HIGHLIGHTS
  Three Months Ended   Year Ended  
  December 31, % December 31, %
  2013 2012 Change 2013 2012 Change
EARNINGS (in thousands)            
Income recognized on finance receivables, net  $ 168,728  $ 138,068 22%  $ 663,546  $ 530,635 25%
Fee income  16,125  16,183 0%  71,589  62,166 15%
Total revenues  184,853  154,251 20%  735,135  592,801 24%
Operating expenses  106,503  94,262 13%  437,604  376,737 16%
Income from operations  78,350  59,989 31%  297,531  216,064 38%
Net interest expense  4,860  1,816 168%  14,467  9,031 60%
Net income  45,777  35,732 28%  176,919  126,099 40%
Net income attributable to Portfolio Recovery Associates, Inc.  45,777  35,802 28%  175,314  126,593 38%
             
PERIOD-END BALANCES (in thousands)            
Cash and cash equivalents  $ 162,004  $ 32,687 396%  $ 162,004  $ 32,687 396%
Finance receivables, net  1,239,191  1,078,951 15%  1,239,191  1,078,951 15%
Goodwill and intangible assets, net  119,610  129,852 -8%  119,610  129,852 -8%
Total assets  1,601,232  1,288,956 24%  1,601,232  1,288,956 24%
Borrowings  451,780  327,542 38%  451,780  327,542 38%
Total liabilities  731,756  559,856 31%  731,756  559,856 31%
Total equity  869,476  708,427 23%  869,476  708,427 23%
             
FINANCE RECEIVABLE COLLECTIONS (dollars in thousands)            
Cash collections  $ 278,926  $ 229,211 22%  $ 1,142,437  $ 908,684 26%
Cash collections on fully amortized pools  9,801  6,211 58%  35,520  28,972 23%
Principal amortization without allowance charges  110,626  88,851 25%  480,913  371,497 29%
Principal amortization with allowance charges  110,197  91,142 21%  478,891  378,049 27%
Principal amortization w/ allowance charges as % of cash collections:            
Including fully amortized pools 39.5% 39.8% -1% 41.9% 41.6% 1%
Excluding fully amortized pools 40.9% 40.9% 0% 43.3% 43.0% 1%
             
ALLOWANCE FOR FINANCE RECEIVABLES (dollars in thousands)            
Allowance (reversal)/charge  (429)  2,291 -119%  (2,022)  6,552 -131%
Allowance (reversal)/charge to period-end net finance receivables 0.0% 0.2% -116% -0.2% 0.6% -127%
Allowance (reversal)/charge to net finance receivable income -0.3% 1.7% -115% -0.3% 1.2% -125%
Allowance (reversal)/charge to cash collections -0.2% 1.0% -115% -0.2% 0.7% -125%
             
PURCHASES OF FINANCE RECEIVABLES (dollars in thousands)            
Purchase price - core  $ 65,759  $ 85,476 -23%  $ 395,068  $ 259,795 52%
Face value - core  774,543  901,512 -14%  4,704,609  3,581,246 31%
Purchase price - bankruptcy  31,987  111,001 -71%  242,649  262,630 -8%
Face value - bankruptcy  235,064  946,927 -75%  2,814,044  2,104,977 34%
Purchase price - other  1,763  2,631 -33%  19,068  16,120 18%
Face value - other  22,493  59,953 -62%  341,443  468,750 -27%
Purchase price - total  99,509  199,108 -50%  656,784  538,545 22%
Face value - total  1,032,100  1,908,392 -46%  7,860,096  6,154,972 28%
Number of portfolios - total 83 104 -20% 347 416 -17%
ESTIMATED REMAINING COLLECTIONS (in thousands)            
Estimated remaining collections - core  $ 1,824,132  $ 1,387,711 31%  $ 1,824,132  $ 1,387,711 31%
Estimated remaining collections - bankruptcy  822,988  905,136 -9%  822,988  905,136 -9%
Estimated remaining collections - other  22,150  22,342 -1%  22,150  22,342 -1%
Estimated remaining collections - total  2,669,270  2,315,189 15%  2,669,270  2,315,189 15%
             
SHARE DATA-ADJUSTED (7) (share amounts in thousands)            
Net income per common share - diluted  $ 0.91  $ 0.70 30%  $ 3.45  $ 2.46 40%
Weighted average number of shares outstanding - diluted  50,375  51,217 -2%  50,873  51,369 -1%
Shares repurchased  --  0 -100%  1,203  994 21%
Average price paid per share repurchased (including acquisitions costs)  $ --   $ 31.01 -100%  $ 48.62  $ 22.85 113%
Closing market price  $ 52.84  $ 35.62 48%  $ 52.84  $ 35.62 48%
             
RATIOS AND OTHER DATA (dollars in thousands)            
Return on average equity (1) 21.5% 20.6% 4% 22.2% 19.6% 13%
Return on revenue (2) 24.8% 23.2% 7% 24.1% 21.3% 13%
Return on average assets (3) 11.5% 11.8% -2% 11.9% 10.8% 10%
Operating margin (4) 42.4% 38.9% 9% 40.5% 36.4% 11%
Operating expense to cash receipts (5) 36.1% 38.4% -6% 36.0% 38.8% -7%
Debt to equity (6) 52.0% 46.2% 12% 52.0% 46.2% 12%
Number of collectors 2,313 2,153 7% 2,313 2,153 7%
Number of full-time equivalent employees 3,543 3,221 10% 3,543 3,221 10%
Cash receipts (5)  $ 295,051  $ 245,394 20%  $ 1,214,026  $ 970,852 25%
Line of credit - unused portion at period end  435,500  273,000 60%  435,500  273,000 60%

(1)  Calculated as annualized net income divided by average equity for the period

(2)  Calculated as net income divided by total revenues

(3)  Calculated as annualized net income divided by average assets for the period

(4)  Calculated as income from operations divided by total revenues

(5)  "Cash receipts" is defined as cash collections plus fee income

(6)  For purposes of this ratio, "debt" equals borrowings

(7) All per share data has been adjusted for a 3 for 1 stock split by means of a stock dividend which was declared on June 10, 2013 and payable August 1, 2013 to holders of record as of July 1, 2013

 
FINANCIAL HIGHLIGHTS
  For the Quarter Ended
  December 31 September 30 June 30 March 31 December 31
  2013 2013 2013 2013 2012
EARNINGS (in thousands)          
Income recognized on finance receivables, net  $ 168,728  $ 171,456  $ 168,570  $ 154,792  $ 138,068
Fee income  16,125  26,306  14,391  14,767  16,183
Total revenues  184,853  197,762  182,961  169,559  154,251
Operating expenses  106,503  118,294  109,135  103,672  94,262
Income from operations  78,350  79,468  73,826  65,887  59,989
Net interest expense  4,860  3,995  2,923  2,689  1,816
Net income  45,777  49,211  43,414  38,517  35,732
Net income attributable to Portfolio Recovery Associates, Inc.  45,777  47,338  43,599  38,600  35,802
           
PERIOD-END BALANCES (in thousands)          
Cash and cash equivalents  $ 162,004  $ 108,705  $ 43,459  $ 39,111  $ 32,687
Finance receivables, net  1,239,191  1,256,822  1,236,859  1,169,747  1,078,951
Goodwill and intangible assets, net  119,610  119,636  124,349  125,462  129,852
Total assets  1,601,232  1,547,985  1,457,246  1,382,739  1,288,956
Borrowings  451,780  452,229  413,774  371,159  327,542
Total liabilities  731,756  721,001  655,012  621,413  559,856
Total equity  869,476  816,647  791,898  750,990  708,427
           
FINANCE RECEIVABLE COLLECTIONS (dollars in thousands)          
Cash collections  $ 278,926  $ 291,651  $ 296,397  $ 275,463  $ 229,211
Cash collections on fully amortized pools  9,801  8,762  10,612  6,345  6,211
Principal amortization without allowance charges  110,626  122,776  129,012  118,498  88,851
Principal amortization with allowance charges  110,197  120,195  127,827  120,671  91,142
Principal amortization w/ allowance charges as % of cash collections:          
Including fully amortized pools 39.5% 41.2% 43.1% 43.8% 39.8%
Excluding fully amortized pools 40.9% 42.5% 44.7% 44.8% 40.9%
           
ALLOWANCE FOR FINANCE RECEIVABLES (dollars in thousands)          
Allowance (reversal)/charge  (429)  (2,581)  (1,185)  2,173  2,291
Allowance (reversal)/charge to period-end net finance receivables 0.0% -0.2% -0.1% 0.2% 0.2%
Allowance (reversal)/charge to net finance receivable income -0.3% -1.5% -0.7% 1.4% 1.7%
Allowance (reversal)/charge to cash collections -0.2% -0.9% -0.4% 0.8% 1.0%
           
PURCHASES OF FINANCE RECEIVABLES (dollars in thousands)          
Purchase price - core  $ 65,759  $ 89,044  $ 113,314  $ 126,951  $ 85,476
Face value - core  774,543  1,352,877  1,178,229  1,398,960  901,512
Purchase price - bankruptcy  31,987  41,794  82,273  86,595  111,001
Face value - bankruptcy  235,064  215,957  1,926,515  436,508  946,927
Purchase price - other  1,763  11,037  4,881  1,387  2,631
Face value - other  22,493  218,528  81,852  18,570  59,953
Purchase price - total  99,509  141,875  200,468  214,933  199,108
Face value - total  1,032,100  1,787,362  3,186,596  1,854,038  1,908,392
Number of portfolios - total 83 79 94 91 104
ESTIMATED REMAINING COLLECTIONS (in thousands)          
Estimated remaining collections - core  $ 1,824,132  $ 1,762,369  $ 1,694,262  $ 1,547,644  $ 1,387,711
Estimated remaining collections - bankruptcy  822,988  877,722  925,223  924,520  905,136
Estimated remaining collections - other  22,150  32,272  16,744  14,739  22,342
Estimated remaining collections - total  2,669,270  2,672,363  2,636,229  2,486,903  2,315,189
           
SHARE DATA-ADJUSTED (7) (share amounts in thousands)          
Net income per common share - diluted  $ 0.91  $ 0.93  $ 0.85  $ 0.75  $ 0.70
Weighted average number of shares outstanding - diluted  50,375  50,660  51,183  51,273  51,217
Shares repurchased  --  989  166  48  0
Average price paid per share repurchased (including acquisitions costs)  $ --   $ 50.55  $ 39.82  $ 39.34  $ 31.01
Closing market price  $ 52.84  $ 59.93  $ 51.21  $ 42.31  $ 35.62
           
RATIOS AND OTHER DATA (dollars in thousands)          
Return on average equity (1) 21.5% 23.5% 22.5% 21.1% 20.6%
Return on revenue (2) 24.8% 24.9% 23.7% 22.7% 23.2%
Return on average assets (3) 11.5% 12.5% 12.1% 11.3% 11.8%
Operating margin (4) 42.4% 40.2% 40.4% 38.9% 38.9%
Operating expense to cash receipts (5) 36.1% 37.2% 35.1% 35.7% 38.4%
Debt to equity (6) 52.0% 55.4% 52.3% 49.4% 46.2%
Number of collectors 2,313 2,054 2,190 2,159 2,153
Number of full-time equivalent employees 3,543 3,223 3,362 3,250 3,221
Cash receipts (5)  $ 295,051  $ 317,957  $ 310,788  $ 290,230  $ 245,394
Line of credit - unused portion at period end  435,500  435,500  184,000  228,000  273,000

(1)  Calculated as annualized net income divided by average equity for the period

(2)  Calculated as net income divided by total revenues

(3)  Calculated as annualized net income divided by average assets for the period

(4)  Calculated as income from operations divided by total revenues

(5)  "Cash receipts" is defined as cash collections plus fee income

(6)  For purposes of this ratio, "debt" equals borrowings

(7) All per share data has been adjusted to reflect the 3-for-1 stock split by means of a stock dividend which was declared on June 10, 2013 and payable August 1, 2013 to holders of record as of July 1, 2013

 
Summary Portfolio Data at December 31, 2013, Entire Domestic Portfolio
($ in thousands)
        Actual Cash    
    Total Net Finance Collections Estimated Total Estimated
Purchase Purchase Estimated Receivables Including Cash Remaining Collections to
Period Price Collections Balance Sales Collections Purchase Price
1996  $ 3,080  $ 10,232  $ --   $ 10,207  $ 25 332%
1997  7,685  25,618  --   25,506  112 333%
1998  11,089  37,585  --   37,351  234 339%
1999  18,898  69,836  --   69,355  481 370%
2000  25,020  118,577  --   116,665  1,912 474%
2001  33,481  178,561  --   175,907  2,654 533%
2002  42,325  203,301  --   198,477  4,824 480%
2003  61,447  272,893  --   265,205  7,688 444%
2004  59,176  205,754  --   198,276  7,478 348%
2005  143,167  323,388  5,887  311,102  12,286 226%
2006  107,667  220,332  5,978  208,451  11,881 205%
2007  258,367  526,625  21,416  478,812  47,813 204%
2008  275,128  523,925  26,763  473,695  50,230 190%
2009  281,424  896,307  30,234  745,983  150,324 318%
2010  357,976  1,027,074  79,996  743,239  283,835 287%
2011  393,202  998,942  160,522  553,690  445,252 254%
2012  508,976  981,963  333,578  351,488  630,475 193%
2013  629,501  1,143,758  558,170  154,142  989,616 182%
Total  $ 3,217,609  $ 7,764,671  $ 1,222,544  $ 5,117,551  $ 2,647,120 241%
 
Summary Portfolio Data at December 31, 2013, Purchased Bankruptcy Portfolio - Domestic
($ in thousands)
        Actual Cash    
    Total Net Finance Collections Estimated Total Estimated
Purchase Purchase Estimated Receivables Including Cash Remaining Collections to
Period Price Collections Balance Sales Collections Purchase Price
1996-2003  $ --   $ --   $ --   $ --   $ --  0%
2004  7,468  14,544  --   14,492  52 195%
2005  29,301  43,699  17  43,641  58 149%
2006  17,627  31,794  53  31,565  229 180%
2007  78,526  104,962  137  104,131  831 134%
2008  108,586  167,161  2,330  164,188  2,973 154%
2009  156,036  471,114  11,906  404,808  66,306 302%
2010  209,175  516,133  46,039  390,722  125,411 247%
2011  181,949  306,648  89,499  164,349  142,299 169%
2012  252,442  345,503  174,298  120,998  224,505 137%
2013  235,781  312,852  200,015  52,528  260,324 133%
Total  $ 1,276,891  $ 2,314,410  $ 524,294  $ 1,491,422  $ 822,988 181%
 
Summary Portfolio Data at December 31, 2013, Core Portfolio - Domestic
($ in thousands)
        Actual Cash    
    Total Net Finance Collections Estimated Total Estimated
Purchase Purchase Estimated Receivables Including Cash Remaining Collections to
Period Price Collections Balance Sales Collections Purchase Price
1996  $ 3,080  $ 10,232  $ --   $ 10,207  $ 25 332%
1997  7,685  25,618  --   25,506  112 333%
1998  11,089  37,585  --   37,351  234 339%
1999  18,898  69,836  --   69,355  481 370%
2000  25,020  118,577  --   116,665  1,912 474%
2001  33,481  178,561  --   175,907  2,654 533%
2002  42,325  203,301  --   198,477  4,824 480%
2003  61,447  272,893  --   265,205  7,688 444%
2004  51,708  191,210  --   183,784  7,426 370%
2005  113,866  279,689  5,870  267,461  12,228 246%
2006  90,040  188,538  5,925  176,886  11,652 209%
2007  179,841  421,663  21,279  374,681  46,982 234%
2008  166,542  356,764  24,433  309,507  47,257 214%
2009  125,388  425,193  18,328  341,175  84,018 339%
2010  148,801  510,941  33,957  352,517  158,424 343%
2011  211,253  692,294  71,023  389,341  302,953 328%
2012  256,534  636,460  159,280  230,490  405,970 248%
2013  393,720  830,906  358,155  101,614  729,292 211%
Total  $ 1,940,718  $ 5,450,261  $ 698,250  $ 3,626,129  $ 1,824,132 281%
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