Market Overview

PRA Group Reports Third Quarter 2020 Results

Share:

NORFOLK, Va., Nov. 5, 2020 /PRNewswire/ -- PRA Group, Inc. (NASDAQ:PRAA), a global leader in acquiring and collecting nonperforming loans, today reported its financial results for the third quarter of 2020.  Net income attributable to PRA Group, Inc. was $42.5 million compared to $25.0 million in the third quarter of 2019. Diluted earnings per share were $0.92 compared to $0.55 in the third quarter of 2019.  For the nine months ended September 30, 2020, net income attributable to PRA Group, Inc. was $119.5 million, or $2.60 per diluted share, compared to $58.8 million, or $1.29 per diluted share, during the same period in 2019. 

Third Quarter Highlights

  • Record global cash collections of $519.3 million, an increase of 15%, or 14% on a constant currency adjusted basis, compared to the third quarter of 2019.
  • Total revenues of $267.9 million, an increase of 7% compared to the third quarter of 2019.
  • Income from operations of $88.7 million, an increase of 37% compared to the third quarter of 2019. 
  • Cash efficiency ratio of 65.6% during the quarter compared to 60.2% in the third quarter of 2019. 
  • Net income of $42.5 million, an increase of 70% compared to the third quarter of 2019. 
  • Diluted earnings per share of $0.92, an increase of 67% compared to the third quarter of 2019.
  • Debt to Adjusted EBITDA1 for the last twelve months was 1.90x, a decrease from 2.54x at December 31, 2019. 
  • Total portfolio purchases of $177.6 million.  
  • Estimated Remaining Collections (ERC) of $6.3 billion.   

"The third quarter of 2020 built upon the trends that we saw during the first half of the year.  We produced record quarterly global cash collections driven by growth in both the Americas and Europe.  U.S. cash collections continued to be strong and Europe cash collections grew as countries relaxed restrictions and courts returned to more normal operations," said Kevin Stevenson, president and chief executive officer.  "Investment levels in Europe were strong in a quarter that is typically seasonally softer as sellers restarted their sales processes.  In the U.S., supply was impacted by lower bankruptcy filings and payment deferral programs which depressed charge-off volumes during the quarter.  Based on the significant loss provisioning by most financial institutions, we believe that charge-off rates will rise over the next year, increasing supply globally."      

Cash Collections and Revenues
The following table presents cash collections by quarter and by source on an as reported and constant currency adjusted basis:










Cash Collection Source


2020


2019


($ in thousands)

Q3

Q2

Q1


Q4

Q3


Americas Core

$  336,322

$  343,269

$  305,780


$  276,639

$  279,902


Americas Insolvency

37,344

38,685

43,210


40,801

45,759


Europe Core

131,702

115,145

131,340


126,649

118,917


Europe Insolvency

13,971

12,841

14,243


12,520

8,639


Total Cash Collections

$  519,339

$  509,940

$  494,573


$  456,609

$  453,217


























Cash Collection Source








Constant Currency Adjusted

2020





2019


($ in thousands)

Q3





Q3


Americas Core 

$  336,322





$  274,962


Americas Insolvency

37,344





45,756


Europe Core

131,702





123,807


Europe Insolvency

13,971





9,069


Total Cash Collections

$  519,339





$  453,594

















 

  • Cash collections in the quarter increased $66.1 million compared to the third quarter of 2019.  The increase was primarily due to a 37% increase in U.S. call center and other cash collections and an 11% increase in Europe Core cash collections.  This was partially offset by a decrease in Americas Insolvency cash collections where investment levels did not offset the runoff of older portfolios.  For the nine months ended September 30, 2020, cash collections increased $139.2 million compared to the same period last year. 
  • Portfolio income was $240.3 million compared to $247.5 million in income recognized on finance receivables in the third quarter of 2019. For the nine months ended September 30, 2020, portfolio income was $750.6 million compared to $735.5 million in income recognized on finance receivables for the same time period in 2019. 
  • Changes in expected recoveries were a net positive of $25.4 million.  This reflects $89.0 million in recoveries in excess of forecast from overperformance during the quarter, partially offset by a negative $63.6 million adjustment for changes in expected future recoveries as the Company has assumed the majority of the current quarter overperformance is acceleration of future collections and made cash forecast adjustments deemed appropriate given the current environment in which the Company operates. 

Expenses

  • Operating expenses in the quarter decreased $2.0 million compared to the third quarter of 2019.  The decrease was primarily driven by a reduction in legal collection costs mainly as a result of the Company's decision earlier in the year to temporarily pause moving accounts into a legal eligible status in the U.S. and a shift in collections from the legal channel to the call center and digital channels.  In addition, there was a decrease in compensation and employee benefits from a reduction in U.S. call center staff as a result of efficiencies realized through technology and data and analytics.  For the nine months ended September 30, 2020, operating expenses decreased $28.5 million compared to the same period in 2019. 
  • Interest expense, net decreased $2.2 million compared to the third quarter of 2019 primarily due to lower average interest rates.  For the nine months ended September 30, 2020, interest expense, net was almost flat to the same period in 2019. 
  • The effective tax rate for the nine months ended September 30, 2020 was 15.9%.

Portfolio Acquisitions

  • The Company purchased $177.6 million in finance receivables in the third quarter of 2020.     
  • At the end of the third quarter, the Company had in place forward flow commitments of up to $395.6 million with $343.8 million in the Americas and $51.8 million in Europe. 

 










Portfolio Acquisition Source


2020


2019


($ in thousands)

Q3

Q2

Q1


Q4

Q3


Americas Core

$      84,139

$    110,474

$    172,697


$    118,153

$    168,185


Americas Insolvency

14,328

14,527

20,772


22,650

26,311


Europe Core

74,930

34,247

60,990


218,919

64,728


Europe Insolvency

4,203

5,251

18,778


42,613

19,772


Total Portfolio Acquisitions

$    177,600

$    164,499

$    273,237


$    402,335

$    278,996

















Conference Call Information
PRA Group, Inc. will hold a conference call today at 5:00 p.m. ET to discuss results with institutional investors and stock analysts.  To listen to a webcast of the call and view the accompanying slides, visit https://ir.pragroup.com/events-and-presentations. To listen by phone, call 844-835-9982 in the U.S. or 412-317-5267 outside the U.S. and ask for the PRA Group conference call.  To listen to a replay of the call until Nov. 12, 2020, call 877-344-7529 in the U.S. or 412-317-0088 outside the U.S. and use access code 10148612.                         

About PRA Group, Inc.
As a global leader in acquiring and collecting nonperforming loans, PRA Group, Inc. returns capital to banks and other creditors to help expand financial services for consumers in the Americas and Europe. With thousands of employees worldwide, PRA Group, Inc. companies collaborate with customers to help them resolve their debt. For more information, please visit www.pragroup.com.

About Forward-Looking Statements
Statements made herein that are not historical in nature, including PRA Group, Inc.'s or its management's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future, 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.

The forward-looking statements in this press release are based upon management's current beliefs, estimates, assumptions and expectations of PRA Group, Inc.'s future operations and financial and economic performance, taking into account currently available information. These statements are not statements of historical fact or guarantees of future performance, and there can be no assurance that anticipated events will transpire or that our expectations will prove to be correct. Forward-looking statements involve risks and uncertainties, some of which are not currently known to PRA Group, Inc.  Actual events or results may differ materially from those expressed or implied in any such forward-looking statements as a result of various factors, including risk factors and other risks that are described from time to time in PRA Group, Inc.'s filings with the Securities and Exchange Commission including but not limited to PRA Group, Inc.'s annual reports on Form 10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K, which are available through PRA Group, Inc.'s website and contain a detailed discussion of PRA Group, Inc.'s business, including risks and uncertainties that may affect future results.

Due to such uncertainties and risks, you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of today. 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 Securities and Exchange Commission or otherwise. Except as required by law, PRA Group, Inc. assumes no obligation to publicly update or revise its forward-looking statements contained herein to reflect any change in PRA Group, Inc.'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.

1.

A reconciliation of this non-GAAP financial measure to the most directly comparable GAAP measure can be found at the end of this press release.

 

 

PRA Group, Inc.

Unaudited Consolidated Income Statements

(in thousands, except per share amounts)










Three Months Ended


Nine Months Ended


September 30,


September 30,


2020


2019


2020


2019









Revenues:








     Portfolio income

$  240,250


$             -


$   750,556


$                -

     Changes in expected recoveries

25,403


-


32,388


-

     Income recognized on finance receivables

-


247,471


-


735,526

     Fee income

1,978


2,391


6,826


11,472

     Other revenue

233


152


1,788


950

          Total revenues

267,864


250,014


791,558


747,948









Net allowance charges

-


(4,136)


-


(11,427)









Operating expenses:








     Compensation and employee services

71,974


75,317


217,617


234,770

     Legal collection fees

13,661


14,083


41,975


41,439

     Legal collection costs

26,043


31,395


79,997


99,745

     Agency fees

14,900


12,788


38,619


39,833

     Outside fees and services

22,719


16,733


60,796


48,274

     Communication

9,379


10,310


31,702


34,335

     Rent and occupancy

4,460


4,414


13,415


13,268

     Depreciation and amortization

4,301


4,046


12,494


13,341

     Other operating expenses

11,761


12,102


34,457


34,613

          Total operating expenses

179,198


181,188


531,072


559,618

          Income from operations

88,666


64,690


260,486


176,903









Other income and (expense):








     Interest expense, net

(33,692)


(35,864)


(106,319)


(105,872)

     Foreign exchange gains

61


5,406


3,027


11,359

     Other

291


(19)


(1,367)


(123)

          Income before income taxes

55,326


34,213


155,827


82,267









          Income tax expense

7,497


6,665


24,734


15,607

          Net income

47,829


27,548


131,093


66,660

               Adjustment for net income attributable to noncontrolling interests

5,337


2,577


11,552


7,843

          Net income attributable to PRA Group, Inc.

$    42,492


$   24,971


$   119,541


$      58,817









Net income per common share attributable to PRA Group, Inc.:








     Basic

$       0.93


$      0.55


$        2.63


$         1.30

     Diluted

$       0.92


$      0.55


$        2.60


$         1.29









Weighted average number of shares outstanding:








     Basic

45,579


45,410


45,526


45,378

     Diluted

46,140


45,645


45,971


45,520

 

PRA Group, Inc.

Consolidated Balance Sheets

(in thousands, except per share amounts)

(Amounts in thousands)


(unaudited)



September 30,

December 31,

ASSETS

2020

2019




Cash and cash equivalents

$                 92,779

$               119,774

Investments

37,821

56,176

Finance receivables, net

3,332,748

3,514,165

Other receivables, net

12,575

10,606

Income taxes receivable

27,554

17,918

Deferred tax assets, net

79,121

63,225

Property and equipment, net

57,826

56,501

Right-of-use assets

51,606

68,972

Goodwill

456,308

480,794

Intangible assets, net

3,392

4,497

Other assets

45,519

31,263




              Total assets

$            4,197,249

$            4,423,891




LIABILITIES AND EQUITY






Liabilities:



     Accounts payable

$                   4,285

$                   4,258

     Accrued expenses

81,913

88,925

     Income taxes payable

18,885

4,046

     Deferred tax liabilities, net

48,144

85,390

     Lease liabilities

55,987

73,377

     Interest-bearing deposits

119,834

106,246

     Borrowings

2,524,429

2,808,425

     Other liabilities

71,600

26,211




               Total liabilities

2,925,077

3,196,878




Equity:



     Preferred stock, par value $0.01, authorized shares, 2,000,
          issued and outstanding shares, 0

-

-

     Common stock, par value $0.01, 100,000 shares authorized, 45,579 shares
          issued and outstanding at September 30, 2020; 100,000 shares authorized,
          45,416 shares issued and outstanding at December 31, 2019

456

454

     Additional paid-in capital

70,036

67,321

     Retained earnings

1,482,172

1,362,631

     Accumulated other comprehensive loss

(313,560)

(261,018)

          Total stockholders' equity - PRA Group, Inc.

1,239,104

1,169,388

               Noncontrolling interests

33,068

57,625

               Total equity

1,272,172

1,227,013

                    Total liabilities and equity

$            4,197,249

$            4,423,891

 

Select Expenses (Income)









(in thousands, pre-tax)

Three Months Ended


September 30,
2020

June 30,
2020

March 31,
2020

December 31,
2019

September 30,
2019

June 30,
2019

March 31,
2019

December 31,
2018

Acquisition/divestiture-related expenses

-

-

-

-

-

227

223

-

Legal costs not associated with normal operations

-

-

-

-

-

-

-

647

Noncash interest expense - amortization of debt
discount

2,388

3,247

3,217

3,157

3,128

3,071

3,042

2,986

Noncash interest expense - amortization of debt
issuance costs

2,476

2,743

2,640

2,649

2,649

2,655

2,636

2,723

Change in fair value on derivatives

3,701

3,284

2,039

1,247

1,126

1,645

349

673

Amortization of intangibles

360

351

349

407

400

418

347

907

Share-based compensation expense

3,097

3,063

2,857

2,809

2,974

2,620

2,314

1,600

 

Purchase Price Multiples

as of September 30, 2020

Amounts in thousands








Purchase Period

Purchase Price
(1)(2)

ERC-Historical
Period Exchange
Rates (3)

Total Estimated
Collections (4)

ERC-Current
Period Exchange
Rates (5)

Current
Estimated
Purchase Price
Multiple

Original
Estimated
Purchase Price
Multiple (6)

Americas Core







1996-2009

$              930,026

$             23,046

$           2,877,116

$             23,046

309%

238%

2010

148,193

14,122

526,052

14,122

355%

247%

2011

209,602

26,186

725,498

26,186

346%

245%

2012

254,076

31,217

660,403

31,217

260%

226%

2013

390,826

57,085

912,068

57,085

233%

211%

2014

404,117

91,301

891,499

89,353

221%

204%

2015

443,114

149,049

933,513

148,585

211%

205%

2016

455,767

273,495

1,101,186

260,392

242%

201%

2017

532,851

406,451

1,209,406

402,103

227%

193%

2018

653,975

587,961

1,348,402

576,414

206%

202%

2019

581,476

812,641

1,234,909

784,614

212%

206%

2020

367,050

688,459

770,975

688,459

210%

210%

Subtotal

5,371,073

3,161,013

13,191,027

3,101,576



Americas Insolvency






1996-2009

397,453

578

835,901

578

210%

178%

2010

208,942

737

546,812

737

262%

184%

2011

180,432

649

370,158

649

205%

155%

2012

251,395

356

392,527

356

156%

136%

2013

227,834

1,093

354,914

1,093

156%

133%

2014

148,420

1,660

217,699

1,649

147%

124%

2015

63,170

2,633

87,590

2,633

139%

125%

2016

91,442

11,549

116,138

11,554

127%

123%

2017

275,257

73,636

347,183

73,636

126%

125%

2018

97,879

73,500

130,542

73,500

133%

127%

2019

123,077

124,052

160,344

123,982

130%

128%

2020

49,626

63,719

68,018

63,719

137%

137%

Subtotal

2,114,927

354,162

3,627,826

354,086



Total Americas

7,486,000

3,515,175

16,818,853

3,455,662



Europe Core







2012

20,409

121

40,963

96

201%

187%

2013

20,334

65

25,294

51

124%

119%

2014

773,811

698,195

2,223,673

628,800

287%

208%

2015

411,340

293,515

733,024

272,301

178%

160%

2016

333,090

288,132

558,471

290,464

168%

167%

2017

252,174

207,615

358,335

195,887

142%

144%

2018

341,775

360,283

527,239

362,163

154%

148%

2019

518,610

632,065

777,563

627,204

150%

152%

2020

172,494

289,657

306,357

289,657

178%

178%

Subtotal

2,844,037

2,769,648

5,550,919

2,666,623



Europe Insolvency






2014

10,876

377

18,190

333

167%

129%

2015

18,973

3,432

29,036

2,996

153%

139%

2016

39,338

11,064

56,719

11,709

144%

130%

2017

39,235

22,247

48,969

21,292

125%

128%

2018

44,908

38,230

54,791

38,778

122%

123%

2019

77,218

80,148

101,336

78,302

131%

130%

2020

28,221

36,180

38,249

36,180

136%

136%

Subtotal

258,769

191,678

347,290

189,590



Total Europe

3,102,806

2,961,326

5,898,209

2,856,213



Total PRA Group

$      10,588,806

$     6,476,501

$      22,717,062

$     6,311,875










(1) Includes the acquisition date finance receivables portfolios that were acquired through our business acquisitions.

(2) For our non-US amounts, purchase price is presented at the exchange rate at the end of the year in which the pool was purchased.  In addition, any purchase price adjustments that occur throughout the life of the pool are presented at the year-end exchange rate for the respective year of purchase.

(3) For our non-US amounts, ERC-Historical Period Exchange Rates is presented at the year-end exchange rate for the respective year 

of purchase.







(4) For our non-U.S. amounts, Total Estimated Collections is presented at the year-end exchange rate for the respective year of purchase.

(5) For our non-U.S. amounts, ERC-Current Period Exchange Rates is presented at the September 30, 2020 exchange rate.


(6) The Original Estimated Purchase Price Multiple represents the purchase price multiple at the end of the year of acquisition.








 

Portfolio Financial Information

Year-to-date as of September 30, 2020

Amounts in thousands







Purchase Period

Cash
Collections(1)

Portfolio
Income (1)

Changes in
Expected
Recoveries(1)

Total Portfolio
Revenue (1) (2)

Net Finance
Receivables as of
September 30,
2020 (3)

Americas Core






1996-2009

$           10,283

$           7,623

$               (942)

$              6,681

$                     5,632

2010

4,915

4,815

(1,249)

3,566

2,135

2011

8,705

8,080

(2,493)

5,587

4,587

2012

9,544

8,200

(4,924)

3,276

9,732

2013

18,522

13,507

(8,147)

5,360

20,420

2014

25,834

19,101

(15,624)

3,477

32,450

2015

46,778

27,520

(13,397)

14,123

60,495

2016

84,173

46,641

2,896

49,537

104,052

2017

156,140

72,319

17,633

89,952

174,974

2018

269,287

108,426

14,505

122,931

308,890

2019

268,687

137,243

24,458

161,701

406,209

2020

82,503

46,636

13,745

60,381

344,306

Subtotal

985,371

500,111

26,461

526,572

1,473,882

Americas Insolvency





1996-2009

282

$              339

(42)

297

-

2010

383

444

(59)

385

-

2011

379

324

57

381

-

2012

746

597

429

1,026

-

2013

1,041

1,050

(7)

1,043

-

2014

1,841

2,193

(850)

1,343

190

2015

7,101

3,572

(538)

3,034

1,708

2016

11,196

2,793

280

3,073

9,292

2017

46,234

12,563

(1,726)

10,837

60,022

2018

22,905

6,801

2,804

9,605

61,150

2019

22,832

8,657

3,103

11,760

102,671

2020

4,299

2,366

(737)

1,629

46,617

Subtotal

119,239

41,699

2,714

44,413

281,650

Total Americas

1,104,610

541,810

29,175

570,985

1,755,532

Europe Core






2012

920

589

331

920

-

2013

510

281

230

511

-

2014

109,979

80,855

5,230

86,085

165,812

2015

40,402

23,441

(1,084)

22,357

142,366

2016

35,954

20,203

(1,431)

18,772

167,280

2017

26,862

10,270

(2,975)

7,295

135,303

2018

53,388

19,851

4,565

24,416

234,456

2019

93,784

32,805

(5,338)

27,467

414,706

2020

16,388

6,371

2,529

8,900

164,342

Subtotal

378,187

194,666

2,057

196,723

1,424,265

Europe Insolvency





2014

640

434

41

475

141

2015

2,241

1,099

44

1,143

1,887

2016

5,970

2,418

(324)

2,094

8,382

2017

7,207

1,527

357

1,884

18,575

2018

7,436

2,244

(517)

1,727

33,282

2019

15,521

5,059

1,215

6,274

62,948

2020

2,040

1,299

340

1,639

27,736

Subtotal

41,055

14,080

1,156

15,236

152,951

Total Europe

419,242

208,746

3,213

211,959

1,577,216

Total PRA Group

$      1,523,852

$       750,556

$            32,388

$          782,944

$              3,332,748







(1) For our non-U.S. amounts, amounts are presented using the average exchange rates during the current reporting period.

(2) Total Portfolio Revenue refers to portfolio income and changes in expected recoveries combined.

(3) For our non-U.S. amounts, net finance receivables are presented at the September 30, 2020 exchange rate.







 

Cash Collections by Year, By Year of Purchase(1)

as of September 30, 2020

Amounts in millions




Purchase Period

Purchase Price
(2)(3)

Cash Collections

1996-2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Total

Americas Core















1996-2009

$                  930.0

$               1,647.7

$          295.7

$          253.5

$          201.6

$           146.4

$           101.8

$             71.2

$             45.7

$             30.5

$             23.3

$             19.2

$             10.3

$          2,846.9

2010

148.2

47.1

113.6

109.9

82.0

55.9

38.1

24.5

15.6

11.1

9.2

4.9

511.9

2011

209.6

62.0

174.5

152.9

108.5

73.8

48.7

32.0

21.6

16.6

8.7

699.3

2012

254.1

56.9

173.6

146.2

97.3

60.0

40.0

27.8

17.9

9.5

629.2

2013

390.8

101.6

247.8

194.0

120.8

78.9

56.4

36.9

18.6

855.0

2014

404.1

92.7

253.4

170.3

114.2

82.2

55.3

25.8

793.9

2015

443.1

117.0

228.4

185.9

126.6

83.6

46.8

788.3

2016

455.8

138.7

256.5

194.6

140.6

84.2

814.6

2017

532.9

107.3

278.7

256.5

156.1

798.6

2018

654.0

122.7

361.9

269.3

753.9

2019

581.5

143.8

268.7

412.5

2020

367.0

-

82.5

82.5

Subtotal

5,371.1

1,647.7

342.8

429.1

542.9

656.5

752.9

844.8

837.1

860.9

945.0

1,141.5

985.4

$          9,986.6

Americas Insolvency














1996-2009

397.5

204.3

147.1

156.7

145.4

109.3

57.0

7.6

3.6

2.2

1.1

0.7

0.2

835.2

2010

208.9

39.5

104.5

125.0

121.7

101.9

43.6

5.0

2.4

1.4

0.7

0.4

546.1

2011

180.4

15.2

66.4

82.8

85.8

76.9

36.0

3.7

1.6

0.7

0.4

369.5

2012

251.4

17.4

103.6

94.1

80.1

60.7

29.3

4.3

1.9

0.8

392.2

2013

227.8

52.5

82.6

81.7

63.4

47.8

21.9

2.9

1.0

353.8

2014

148.4

37.0

50.9

44.3

37.4

28.8

15.8

1.8

216.0

2015

63.2

3.4

17.9

20.1

19.8

16.7

7.1

85.0

2016

91.4

18.9

30.4

25.0

19.9

11.2

105.4

2017

275.3

49.1

97.3

80.9

46.2

273.5

2018

97.9

6.7

27.4

22.9

57.0

2019

123.1

13.4

22.9

36.3

2020

49.6

4.3

4.3

Subtotal

2,114.9

204.3

186.6

276.4

354.2

469.9

458.4

344.2

249.8

222.4

207.9

181.0

119.2

3,274.3

Total Americas

7,486.0

1,852.0

529.4

705.5

897.1

1,126.4

1,211.3

1,189.0

1,086.9

1,083.3

1,152.9

1,322.5

1,104.6

13,260.9

Europe Core















2012

20.4

11.6

9.0

5.6

3.2

2.2

2.0

2.0

1.5

0.9

38.0

2013

20.3

7.1

8.5

2.3

1.3

1.2

1.3

0.9

0.5

23.1

2014

773.8

153.2

292.0

246.4

220.8

206.3

172.9

109.9

1,401.5

2015

411.3

45.8

100.3

86.2

80.9

66.1

40.3

419.6

2016

333.1

40.4

78.9

72.6

58.0

35.9

285.8

2017

252.2

17.9

56.0

44.1

27.0

145.0

2018

341.8

24.3

88.7

53.4

166.4

2019

518.6

48.0

93.8

141.8

2020

172.5

16.4

16.4

Subtotal

2,844.0

-

-

-

11.6

16.1

167.3

343.3

390.6

407.0

443.4

480.2

378.1

2,637.6

Europe Insolvency














2014

10.9

-

4.3

3.9

3.2

2.6

1.5

0.6

16.1

2015

19.0

3.0

4.4

5.0

4.8

3.9

2.2

23.3

2016

39.3

6.2

12.7

12.9

10.7

6.0

48.5

2017

39.2

1.2

7.9

9.2

7.2

25.5

2018

44.9

0.6

8.4

7.5

16.5

2019

77.2

5.0

15.5

20.5

2020

28.3

2.1

2.1

Subtotal

258.8

-

-

-

-

-

-

7.3

14.5

22.1

28.8

38.7

41.1

152.5

Total Europe

3,102.8

-

-

-

11.6

16.1

167.3

350.6

405.1

429.1

472.2

518.9

419.2

2,790.1

Total PRA Group

$          10,588.8

$            1,852.0

$       529.4

$       705.5

$       908.7

$     1,142.5

$     1,378.6

$     1,539.6

$     1,492.0

$     1,512.4

$     1,625.1

$     1,841.4

$     1,523.8

$     16,051.0
















(1) For our non-U.S. amounts, Cash Collections are presented using the average exchange rates during the cash collection period. 

(2) Includes the acquisition date finance receivables portfolios that were acquired through our business acquisitions.

(3) For our non-US amounts, purchase price is presented at the exchange rate at the end of the year in which the pool was purchased.  In addition, any purchase price adjustments that occur throughout the life of the pool are presented at the year-end exchange rate for the respective year of purchase. 
















Use of Non-GAAP Financial Measures
PRA Group, Inc. reports financial results in accordance with U.S. generally accepted accounting principles (GAAP).  However, management uses certain non-GAAP financial measures, including adjusted EBITDA, internally to evaluate the Company's performance and to set performance goals.  Adjusted EBITDA is calculated as net income attributable to PRA Group, Inc. plus interest expense, net and other; plus income tax expense (or less income tax benefit); plus depreciation and amortization; plus recoveries applied to negative allowance; less gain on sale of subsidiaries; less foreign exchange gain (or plus foreign exchange loss); and plus net income attributable to noncontrolling interests. Adjusted EBITDA is a supplemental measure of performance that is not required by, or presented in accordance with, GAAP. PRA Group, Inc. presents adjusted EBITDA because the Company considers it an important supplemental measure of operations and financial performance. Management believes adjusted EBITDA helps provide enhanced period-to-period comparability of operations and financial performance and is useful to investors as other companies in the industry report similar financial measures. Adjusted EBITDA should not be considered as an alternative to net income determined in accordance with GAAP. Set forth below is a reconciliation of adjusted EBITDA to net income, the most directly comparable financial measure calculated and reported in accordance with GAAP. The calculation of adjusted EBITDA below may not be comparable to the calculation of similarly titled measures reported by other companies.


LTM Dec. 31,

LTM Sept. 30,


2019

2020

LTM Adjusted EBITDA for PRA Group, Inc.



Net Income attributable to PRA Group, Inc.

$86

$147

Income tax expense (benefit)

$20

$29

Foreign exchange (gain) loss

($12)

($4)

Interest expense, net and other 

$142

$144

Depreciation and amortization

$17

$17

Adjustment for net income attributable to noncontrolling interests

$12

$15

Gain on sale of subsidiaries

$0

$0

LTM EBITDA

$265

$348

Recoveries applied to negative allowance*

$843

$978

LTM Adjusted EBITDA 

$1,108

$1,326




*Prior to the first quarter of 2020, this represented collections applied to principle on finance receivables.




Borrowings

$2,808

$2,524

LTM Adjusted EBITDA

$1,108

$1,326

Debt to LTM Adjusted EBITDA

2.54x

1.90x

 

Investor Contact:
Darby Schoenfeld, CPA
Vice President, Investor Relations
(757) 431-7913
Darby.Schoenfeld@PRAGroup.com

News Media Contact:
Elizabeth Kersey
Vice President, Communications and Public Policy
(757) 431-3398
Elizabeth.Kersey@PRAGroup.com

Cision View original content:http://www.prnewswire.com/news-releases/pra-group-reports-third-quarter-2020-results-301167344.html

SOURCE PRA Group

View Comments and Join the Discussion!
 
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com