PR Newswire
NORFOLK, Va., Feb. 28, 2019
NORFOLK, Va., Feb. 28, 2019 /PRNewswire/ -- PRA Group (Nasdaq: PRAA), a global leader in acquiring and collecting nonperforming loans, today reported its financial results for the fourth quarter and full year of 2018. Net income attributable to PRA Group, Inc. in the fourth quarter of 2018 was $14.9 million compared to $88.9 million in the fourth quarter of 2017. Diluted earnings per share in the fourth quarter of 2018 were $0.33 compared to $1.96 in the fourth quarter of 2017. For the year ended December 31, 2018, net income attributable to PRA Group, Inc. was $65.6 million, or $1.44 in diluted earnings per share, compared to $164.3 million, or $3.59 in diluted earnings per share, during the year ended December 31, 2017. Financial performance in the fourth quarter and full year of 2017 was impacted by a net after-tax benefit of $73.2 million due to the Tax Cuts and Jobs Act.
During the quarter, the Company completed a review of seller contracts in light of recent interpretations of the rules governing revenue recognition on portfolios that do not qualify for sale accounting. As a result, the Company has determined that two contracts in Austria did not meet the recent interpretations, and the Company should have applied different revenue recognition methodology for portfolios acquired under these contracts. The impact of this change is that the Company should have recognized an additional $5.5 million of revenue from 2016 to 2018. Of the $5.5 million, $1.2 million should have been recognized during 2018. These revenue increases were spread over a number of prior years and, although none were material to any individual year, the impact could have been material had the Company reflected the full change in its 2018 results. The conclusion does not impact the economics of the transactions, only the revenue recognition methodology. This press release includes reconciliations from previously reported results to results adjusted for the additional revenue for the three and twelve months ended December 31, 2017. Additionally, all numbers presented herein reflect adjusted results.
As a result of this analysis, the Company experienced unanticipated delays in completing the year end closing process. The Company, and as a result, its auditors, have not fully completed the activities required to complete Form 10-K for the fiscal year ended December 31, 2018. Therefore, the Company is not in a position to file its Form 10-K within the prescribed time period without unreasonable expense and effort. The Company expects to file its Form 10-K within the 15 day period specified by Rule 12b-25 of the Securities Exchange Act of 1934, as amended.
Fourth Quarter Highlights
Full-Year Highlights
"The fourth quarter of 2018 culminated a year of exceptional portfolio investment and record cash collections for PRA Group. During the fourth quarter, we invested nearly a half billion dollars, with substantial deployments in Americas Core and in European countries where we have extensive data and operational experience. This increased estimated remaining collections to an all-time high of $6.14 billion," said Kevin Stevenson, president and chief executive officer of PRA Group, Inc. "Total cash collections for the year set a record at $1.63 billion, fueled by growth in Americas Core and Europe Core. U.S call centers delivered an increase of 16% compared to 2017 and we are seeing U.S. legal collections accelerate after the investment in the third and fourth quarters."
Cash Collections, Revenues, and Net Allowance Charges
Cash Collection Source | 2018 | 2017 | |||||
($ in thousands) | Q4 | Q3 | Q2 | Q1 | Q4 | ||
Americas-Core | $ 233,937 | $ 231,253 | $ 233,752 | $ 246,237 | $ 204,245 | ||
Americas-Insolvency | 48,000 | 48,518 | 56,063 | 55,280 | 59,103 | ||
Europe-Core | 113,154 | 102,780 | 109,359 | 118,109 | 107,124 | ||
Europe-Insolvency | 7,618 | 6,731 | 7,460 | 6,954 | 5,794 | ||
Total Cash Collections | $ 402,709 | $ 389,282 | $ 406,634 | $ 426,580 | $ 376,266 | ||
Cash Collection Source - | |||||||
Constant Currency Adjusted | 2018 | 2017 | |||||
($ in thousands) | Q4 | Q4 | |||||
Americas-Core | $ 233,937 | $ 201,559 | |||||
Americas-Insolvency | 48,000 | 59,013 | |||||
Europe-Core | 113,154 | 103,442 | |||||
Europe-Insolvency | 7,618 | 5,615 | |||||
Total Cash Collections | $ 402,709 | $ 369,629 | |||||
Expenses
Portfolio Acquisitions
Portfolio Purchase Source | 2018 | 2017 | ||||
($ in thousands) | Q4 | Q3 | Q2 | Q1 | Q4 | |
Americas-Core | $ 172,511 | $ 170,426 | $ 182,768 | $ 131,427 | $ 160,278 | |
Americas-Insolvency | 52,871 | 17,151 | 16,651 | 13,436 | 44,195 | |
Europe-Core | 231,810 | 45,754 | 19,403 | 18,000 | 152,417 | |
Europe-Insolvency | 33,661 | 4,159 | 2,577 | 5,392 | 17,698 | |
Total Portfolio Purchasing | $ 490,853 | $ 237,490 | $ 221,399 | $ 168,255 | $ 374,588 | |
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 877-870-4263 in the U.S. or 412-317-0790 outside the U.S. and ask for the PRA Group conference call. To listen to a replay of the call until March 07, 2019, call 877-344-7529 in the U.S. or 412-317-0088 outside the U.S. and use access code 10125880.
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 almost 5,400 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 which 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 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.
PRA Group, Inc. | |||||||
Unaudited Consolidated Income Statements | |||||||
(in thousands, except per share amounts) | |||||||
Three Months Ended | Twelve Months Ended | ||||||
December 31, | December 31, | ||||||
2018 | 2017 | 2018 | 2017 | ||||
Revenues: | |||||||
Income recognized on finance receivables | $ 231,029 | $ 203,397 | $ 891,899 | $ 795,435 | |||
Fee income | 4,686 | 6,043 | 14,916 | 24,916 | |||
Other revenue | 1,027 | 1,454 | 1,441 | 7,855 | |||
Total revenues | 236,742 | 210,894 | 908,256 | 828,206 | |||
Net allowance charges | (21,381) | (2,486) | (33,425) | (11,898) | |||
Operating expenses: | |||||||
Compensation and employee services | 79,123 | 69,253 | 319,400 | 273,033 | |||
Legal collection fees | 11,501 | 10,061 | 42,941 | 43,351 | |||
Legal collection costs | 33,281 | 18,781 | 104,988 | 76,047 | |||
Agency fees | 9,088 | 7,877 | 33,854 | 35,530 | |||
Outside fees and services | 17,068 | 15,815 | 61,492 | 62,792 | |||
Communication | 10,645 | 8,028 | 43,224 | 33,132 | |||
Rent and occupancy | 4,319 | 3,985 | 16,906 | 14,823 | |||
Depreciation and amortization | 5,092 | 4,666 | 19,322 | 19,763 | |||
Other operating expenses | 13,030 | 12,032 | 47,444 | 44,103 | |||
Total operating expenses | 183,147 | 150,498 | 689,571 | 602,574 | |||
Income from operations | 32,214 | 57,910 | 185,260 | 213,734 | |||
Other income and (expense): | |||||||
Gain on sale of subsidiaries | 26,575 | - | 26,575 | 48,474 | |||
Interest expense, net | (33,549) | (28,379) | (121,078) | (98,041) | |||
Foreign exchange (loss)/gain | (4,553) | 317 | (944) | (1,104) | |||
Other | (381) | (2,790) | (316) | (2,790) | |||
Income before income taxes | 20,306 | 27,058 | 89,497 | 160,273 | |||
Income tax expense/(benefit) | 1,980 | (63,709) | 13,763 | (10,852) | |||
Net income | 18,326 | 90,767 | 75,734 | 171,125 | |||
Adjustment for net income attributable to noncontrolling interests | 3,384 | 1,847 | 10,171 | 6,810 | |||
Net income attributable to PRA Group, Inc. | $ 14,942 | $ 88,920 | $ 65,563 | $ 164,315 | |||
Net income per common share attributable to PRA Group, Inc.: | |||||||
Basic | $ 0.33 | $ 1.97 | $ 1.45 | $ 3.60 | |||
Diluted | $ 0.33 | $ 1.96 | $ 1.44 | $ 3.59 | |||
Weighted average number of shares outstanding: | |||||||
Basic | 45,304 | 45,170 | 45,280 | 45,671 | |||
Diluted | 45,394 | 45,318 | 45,413 | 45,823 |
PRA Group, Inc. | |||
Consolidated Balance Sheets | |||
December 31, 2018 and December 31, 2017 | |||
(Amounts in thousands) | |||
(unaudited) | |||
December 31, | December 31, | ||
ASSETS | 2018 | 2017 | |
Cash and cash equivalents | $ 98,695 | $ 120,516 | |
Investments | 45,173 | 78,290 | |
Finance receivables, net | 3,084,777 | 2,776,199 | |
Other receivables, net | 46,157 | 15,770 | |
Income taxes receivable | 16,809 | 21,686 | |
Net deferred tax asset | 61,453 | 56,459 | |
Property and equipment, net | 54,136 | 49,311 | |
Goodwill | 464,116 | 526,513 | |
Intangible assets, net | 5,522 | 23,572 | |
Other assets | 32,721 | 32,656 | |
Total assets | $ 3,909,559 | $ 3,700,972 | |
LIABILITIES AND EQUITY | |||
Liabilities: | |||
Accounts payable | $ 6,110 | $ 4,992 | |
Accrued expenses | 79,396 | 85,993 | |
Income taxes payable | 15,080 | 10,771 | |
Net deferred tax liability | 114,979 | 171,185 | |
Interest-bearing deposits | 82,666 | 98,580 | |
Borrowings | 2,473,656 | 2,170,182 | |
Other liabilities | 7,370 | 9,018 | |
Total liabilities | 2,779,257 | 2,550,721 | |
Redeemable noncontrolling interest | 6,333 | 9,534 | |
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, 45,304 shares | |||
issued and outstanding at December 31, 2018; 100,000 shares authorized, | |||
45,189 shares issued and outstanding at December 31, 2017 | 453 | 452 | |
Additional paid-in capital | 60,303 | 53,870 | |
Retained earnings | 1,276,473 | 1,214,840 | |
Accumulated other comprehensive loss | (242,109) | (178,607) | |
Total stockholders' equity - PRA Group, Inc. | 1,095,120 | 1,090,555 | |
Noncontrolling interests | 28,849 | 50,162 | |
Total equity | 1,123,969 | 1,140,717 | |
Total liabilities and equity | $ 3,909,559 | $ 3,700,972 |
Select Expenses (Income) | ||||||||
(in thousands) | Three Months Ended | |||||||
December 31, | September 30, | June 30, 2018 | March 31, | December 31, | September 30, | June 30, 2017 | March 31, | |
Acquisition/divestiture-related expenses | - | 4 | 10 | - | - | - | 2,100 | |
Legal costs not associated with normal operations | 647 | 95 | 231 | 92 | 160 | 218 | 2,615 | 1,024 |
Noncash interest expense - amortization of debt | 2,986 | 2,958 | 2,904 | 2,877 | 2,823 | 2,796 | 1,809 | 1,155 |
Noncash interest expense - amortization of debt | 2,723 | 2,524 | 2,532 | 2,553 | 2,501 | 2,505 | 2,635 | 1,928 |
Change in fair value on Interest rate swap | 673 | (504) | 972 | (3,673) | 420 | (1,025) | (1,578) | 158 |
Amortization of intangibles | 907 | 994 | 1,133 | 1,222 | 1,016 | 1,037 | 869 | 1,410 |
Share-based compensation expense | 1,600 | 2,361 | 2,146 | 2,415 | 2,415 | 2,218 | 1,846 | 2,199 |
Purchase Price Mutiples | |||||||
as of December 31, 2018 | |||||||
Amounts in thousands | |||||||
Purchase Period | Purchase Price (1)(2) | Net Finance | ERC-Historical | Total Estimated | ERC-Current | Current | Original |
Americas-Core | |||||||
1996-2008 | $ 804,883 | $ 9,108 | $ 35,385 | $ 2,423,212 | $ 35,385 | 301% | 236% |
2009 | 125,153 | 653 | 22,518 | 459,318 | 22,518 | 367% | 252% |
2010 | 148,199 | 4,644 | 37,181 | 534,994 | 37,181 | 361% | 247% |
2011 | 209,607 | 10,434 | 64,203 | 738,173 | 64,203 | 352% | 245% |
2012 | 254,142 | 19,643 | 79,446 | 681,221 | 79,446 | 268% | 226% |
2013 | 391,031 | 50,555 | 143,328 | 942,934 | 143,328 | 241% | 211% |
2014 | 405,459 | 81,050 | 210,315 | 930,676 | 206,685 | 230% | 204% |
2015 | 444,063 | 134,024 | 310,233 | 965,382 | 310,059 | 217% | 205% |
2016 | 454,552 | 196,236 | 458,039 | 1,041,655 | 452,225 | 229% | 201% |
2017 | 534,410 | 371,366 | 724,197 | 1,112,042 | 720,535 | 208% | 193% |
2018 | 658,490 | 630,508 | 1,204,192 | 1,327,453 | 1,201,445 | 202% | 202% |
Subtotal | 4,429,989 | 1,508,221 | 3,289,037 | 11,157,060 | 3,273,010 | ||
Americas-Insolvency | |||||||
2004-2008 | 241,465 | - | 658 | 365,653 | 658 | 151% | 155% |
2009 | 155,988 | - | 1,232 | 470,626 | 1,232 | 302% | 214% |
2010 | 208,942 | - | 2,191 | 547,219 | 2,191 | 262% | 184% |
2011 | 180,434 | - | 434 | 368,821 | 434 | 204% | 155% |
2012 | 251,419 | - | 356 | 389,910 | 356 | 155% | 136% |
2013 | 227,904 | - | 5,820 | 355,738 | 5,820 | 156% | 133% |
2014 | 148,712 | 7,493 | 16,938 | 215,568 | 16,896 | 145% | 124% |
2015 | 63,184 | 16,234 | 22,790 | 83,989 | 22,790 | 133% | 125% |
2016 | 92,285 | 30,580 | 39,669 | 114,088 | 39,516 | 124% | 123% |
2017 | 275,293 | 155,609 | 200,144 | 346,550 | 200,144 | 126% | 125% |
2018 | 99,386 | 95,194 | 119,444 | 126,142 | 119,444 | 127% | 127% |
Subtotal | 1,945,012 | 305,110 | 409,676 | 3,384,304 | 409,481 | ||
Total Americas | 6,375,001 | 1,813,331 | 3,698,713 | 14,541,364 | 3,682,491 | ||
Europe-Core | |||||||
2012 | 20,424 | - | 1,387 | 39,210 | 1,086 | 192% | 187% |
2013 | 20,347 | 100 | 831 | 24,227 | 639 | 119% | 119% |
2014 | 796,899 | 240,603 | 921,669 | 2,173,128 | 791,947 | 273% | 208% |
2015 | 420,956 | 189,588 | 421,252 | 751,455 | 377,175 | 179% | 160% |
2016 | 348,436 | 225,044 | 395,574 | 582,324 | 394,089 | 167% | 167% |
2017 | 247,757 | 188,893 | 284,707 | 357,298 | 276,223 | 144% | 144% |
2018 (8) | 346,933 | 325,907 | 488,989 | 513,635 | 484,567 | 148% | 148% |
Subtotal | 2,201,752 | 1,170,135 | 2,514,409 | 4,441,277 | 2,325,726 | ||
Europe-Insolvency | |||||||
2014 | 10,876 | 985 | 2,656 | 18,010 | 2,389 | 166% | 129% |
2015 | 19,396 | 5,059 | 10,245 | 29,042 | 8,805 | 150% | 139% |
2016 | 42,190 | 19,002 | 29,476 | 61,117 | 28,993 | 145% | 130% |
2017 | 38,830 | 31,688 | 41,590 | 50,661 | 40,206 | 130% | 128% |
2018 | 45,636 | 44,577 | 55,360 | 56,029 | 54,569 | 123% | 123% |
Subtotal | 156,928 | 101,311 | 139,327 | 214,859 | 134,962 | ||
Total Europe | 2,358,680 | 1,271,446 | 2,653,736 | 4,656,136 | 2,460,688 | ||
Total PRA Group | $ 8,733,681 | $ 3,084,777 | $ 6,352,449 | $ 19,197,500 | $ 6,143,179 | ||
(1) The amount reflected in the Purchase Price also includes the acquisition date finance receivables portfolios that were acquired through our various business acquisitions. | |||||||
(2) For our international amounts, Purchase Price is presented at the exchange rate at the end of the quarter in which the pool was purchased. In addition, any purchase price adjustments that occur throughout the life of the pool are presented at the period-end exchange rate for the respective quarter of purchase. | |||||||
(3) For our international amounts, Net Finance Receivables are presented at the December 31, 2018 exchange rate. | |||||||
(4) For our international amounts, Estimated Remaining Collections ("ERC")-Historical Period Exchange Rates is presented at the period-end exchange rate for the respective quarter of purchase. | |||||||
(5) For our international amounts, Total Estimated Collections is presented at the period-end exchange rate for the respective quarter of purchase. | |||||||
(6) For our international amounts, ERC-Current Period Exchange Rates is presented at the December 30, 2018 exchange rate. | |||||||
(7) The Original Estimated Purchase Price Multiple represents the purchase price multiple at the end of the year of acquisition. | |||||||
(8) The Europe-Core purchases include a $34.9 million finance receivables portfolio addition in the third quarter of 2018 relating to the consolidation of a Polish investment fund. |
Portfolio Financial Information | |||||||
Year-to-date as of December 31, 2018 | |||||||
Amounts in thousands | |||||||
Purchase Period | Purchase | Cash | Gross | Amortization (3) | Net Allowance | Net Revenue (3)(4) | Net Finance |
Americas-Core | |||||||
1996-2008 | $ 804,883 | $ 15,092 | $ 10,645 | $ 4,447 | $ (1,970) | $ 12,615 | $ 9,108 |
2009 | 125,153 | 8,180 | 7,899 | 281 | 125 | 7,774 | 653 |
2010 | 148,199 | 11,140 | 9,654 | 1,486 | (2,625) | 12,279 | 4,644 |
2011 | 209,607 | 21,622 | 18,912 | 2,710 | 25 | 18,887 | 10,434 |
2012 | 254,142 | 27,797 | 18,251 | 9,546 | (4,005) | 22,256 | 19,643 |
2013 | 391,031 | 56,449 | 41,274 | 15,175 | 11,480 | 29,794 | 50,555 |
2014 | 405,459 | 82,244 | 58,426 | 23,818 | 22,395 | 36,031 | 81,050 |
2015 | 444,063 | 126,605 | 74,083 | 52,522 | 4,632 | 69,451 | 134,024 |
2016 | 454,552 | 194,605 | 110,399 | 84,206 | 631 | 109,768 | 196,236 |
2017 | 534,410 | 278,733 | 155,298 | 123,435 | 318 | 154,980 | 371,366 |
2018 | 658,490 | 122,712 | 96,202 | 26,510 | - | 96,202 | 630,508 |
Subtotal | 4,429,989 | 945,179 | 601,043 | 344,136 | 31,006 | 570,037 | 1,508,221 |
Americas-Insolvency | |||||||
2004-2008 | 241,465 | 356 | 356 | - | - | 356 | - |
2009 | 155,988 | 747 | 747 | - | - | 747 | - |
2010 | 208,942 | 1,352 | 1,352 | - | - | 1,352 | - |
2011 | 180,434 | 1,584 | 1,584 | - | - | 1,584 | - |
2012 | 251,419 | 4,284 | 4,284 | - | - | 4,284 | - |
2013 | 227,904 | 21,948 | 14,364 | 7,584 | - | 14,364 | - |
2014 | 148,712 | 28,759 | 9,433 | 19,326 | - | 9,433 | 7,493 |
2015 | 63,184 | 19,769 | 3,793 | 15,976 | - | 3,793 | 16,234 |
2016 | 92,285 | 25,047 | 4,209 | 20,838 | 435 | 3,774 | 30,580 |
2017 | 275,293 | 97,315 | 17,518 | 79,797 | - | 17,518 | 155,609 |
2018 | 99,386 | 6,700 | 2,509 | 4,191 | - | 2,509 | 95,194 |
Subtotal | 1,945,012 | 207,861 | 60,149 | 147,712 | 435 | 59,714 | 305,110 |
Total Americas | 6,375,001 | 1,153,040 | 661,192 | 491,848 | 31,441 | 629,751 | 1,813,331 |
Europe-Core | |||||||
2012 | 20,424 | 1,996 | 2,000 | (4) | - | 2,000 | - |
2013 | 20,347 | 1,331 | 894 | 437 | - | 894 | 100 |
2014 | 796,899 | 206,255 | 131,812 | 74,443 | (1,393) | 133,205 | 240,603 |
2015 | 420,956 | 80,858 | 34,556 | 46,302 | (3,258) | 37,814 | 189,588 |
2016 | 348,436 | 72,603 | 28,839 | 43,764 | 6,035 | 22,804 | 225,044 |
2017 | 247,757 | 56,033 | 15,027 | 41,006 | 599 | 14,428 | 188,893 |
2018 (6) | 346,933 | 24,326 | 6,585 | 17,741 | - | 6,585 | 325,907 |
Subtotal | 2,201,752 | 443,402 | 219,713 | 223,689 | 1,983 | 217,730 | 1,170,135 |
Europe-Insolvency | |||||||
2014 | 10,876 | 2,620 | 1,496 | 1,124 | - | 1,496 | 985 |
2015 | 19,396 | 4,783 | 1,891 | 2,892 | (63) | 1,954 | 5,059 |
2016 | 42,190 | 12,856 | 4,941 | 7,915 | 64 | 4,877 | 19,002 |
2017 | 38,830 | 7,862 | 2,411 | 5,451 | - | 2,411 | 31,688 |
2018 | 45,636 | 642 | 255 | 387 | - | 255 | 44,577 |
Subtotal | 156,928 | 28,763 | 10,994 | 17,769 | 1 | 10,993 | 101,311 |
Total Europe | 2,358,680 | 472,165 | 230,707 | 241,458 | 1,984 | 228,723 | 1,271,446 |
Total PRA Group | $ 8,733,681 | $ 1,625,205 | $ 891,899 | $ 733,306 | $ 33,425 | $ 858,474 | $ 3,084,777 |
(1) The amount reflected in the Purchase Price also includes the acquisition date finance receivables portfolios that were acquired through our various business acquisitions. | |||||||
(2) For our international amounts, Purchase Price is presented at the exchange rate at the end of the quarter in which the pool was purchased. In addition, any purchase price adjustments that occur throughout the life of the pool are presented at the period-end exchange rate for the respective quarter of purchase. | |||||||
(3) For our international amounts, amounts are presented using the average exchange rates during the current reporting period. | |||||||
(4) Net Revenue refers to income recognized on finance receivables, net of allowance charges/(reversals). | |||||||
(5) For our international amounts, Net Finance Receivables are presented at the December 31, 2018 exchange rate. | |||||||
(6) The Europe-Core purchases include a $34.9 million finance receivables portfolio addition in the third quarter of 2018 relating to the consolidation of a Polish investment fund. |
Cash Collections by Year, By Year of Purchase(1) | |||||||||||||
as of December 31, 2018 | |||||||||||||
Amounts in thousands | |||||||||||||
Purchase Period | Purchase Price | Cash Collections | |||||||||||
1996-2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | Total | ||
Americas-Core | |||||||||||||
1996-2008 | $ 804,883 | $ 1,366,034 | $ 240,929 | $ 200,052 | $ 169,205 | $ 132,255 | $ 95,262 | $ 66,274 | $ 46,277 | $ 29,734 | $ 19,458 | $ 15,092 | $ 2,380,572 |
2009 | 125,153 | — | 40,703 | 95,627 | 84,339 | 69,385 | 51,121 | 35,555 | 24,896 | 16,000 | 10,994 | 8,180 | 436,800 |
2010 | 148,199 | — | — | 47,076 | 113,554 | 109,873 | 82,014 | 55,946 | 38,110 | 24,515 | 15,587 | 11,140 | 497,815 |
2011 | 209,607 | — | — | — | 61,971 | 174,461 | 152,908 | 108,513 | 73,793 | 48,711 | 31,991 | 21,622 | 673,970 |
2012 | 254,142 | — | — | — | — | 56,901 | 173,589 | 146,198 | 97,267 | 59,981 | 40,042 | 27,797 | 601,775 |
2013 | 391,031 | — | — | — | — | — | 101,614 | 247,849 | 194,026 | 120,789 | 78,880 | 56,449 | 799,607 |
2014 | 405,459 | — | — | — | — | — | — | 92,660 | 253,448 | 170,311 | 114,219 | 82,244 | 712,882 |
2015 | 444,063 | — | — | — | — | — | — | — | 116,951 | 228,432 | 185,898 | 126,605 | 657,886 |
2016 | 454,552 | — | — | — | — | — | — | — | — | 138,723 | 256,531 | 194,605 | 589,859 |
2017 | 534,410 | — | — | — | — | — | — | — | — | — | 107,327 | 278,733 | 386,060 |
2018 | 658,490 | — | — | — | — | — | — | — | — | — | — | 122,712 | 122,712 |
Subtotal | 4,429,989 | 1,366,034 | 281,632 | 342,755 | 429,069 | 542,875 | 656,508 | 752,995 | 844,768 | 837,196 | 860,927 | 945,179 | 7,859,938 |
Americas-Insolvency | |||||||||||||
2004-2008 | 241,465 | 117,972 | 69,736 | 65,321 | 53,924 | 37,530 | 13,534 | 3,035 | 1,836 | 1,098 | 653 | 356 | 364,995 |
2009 | 155,988 | — | 16,635 | 81,780 | 102,780 | 107,888 | 95,725 | 53,945 | 5,781 | 2,531 | 1,581 | 747 | 469,393 |
2010 | 208,942 | — | — | 39,486 | 104,499 | 125,020 | 121,717 | 101,873 | 43,649 | 5,008 | 2,425 | 1,352 | 545,029 |
2011 | 180,434 | — | — | — | 15,218 | 66,379 | 82,752 | 85,816 | 76,915 | 35,996 | 3,726 | 1,584 | 368,386 |
2012 | 251,419 | — | — | — | — | 17,388 | 103,610 | 94,141 | 80,079 | 60,715 | 29,337 | 4,284 | 389,554 |
2013 | 227,904 | — | — | — | — | — | 52,528 | 82,596 | 81,679 | 63,386 | 47,781 | 21,948 | 349,918 |
2014 | 148,712 | — | — | — | — | — | — | 37,045 | 50,880 | 44,313 | 37,350 | 28,759 | 198,347 |
2015 | 63,184 | — | — | — | — | — | — | — | 3,395 | 17,892 | 20,143 | 19,769 | 61,199 |
2016 | 92,285 | — | — | — | — | — | — | — | — | 18,869 | 30,426 | 25,047 | 74,342 |
2017 | 275,293 | — | — | — | — | — | — | — | — | — | 49,093 | 97,315 | 146,408 |
2018 | 99,386 | — | — | — | — | — | — | — | — | — | — | 6,700 | 6,700 |
Subtotal | 1,945,012 | 117,972 | 86,371 | 186,587 | 276,421 | 354,205 | 469,866 | 458,451 | 344,214 | 249,808 | 222,515 | 207,861 | 2,974,271 |
Total Americas | 6,375,001 | 1,484,006 | 368,003 | 529,342 | 705,490 | 897,080 | 1,126,374 | 1,211,446 | 1,188,982 | 1,087,004 | 1,083,442 | 1,153,040 | 10,834,209 |
Europe-Core | |||||||||||||
2012 | 20,424 | — | — | — | — | 11,604 | 8,995 | 5,641 | 3,175 | 2,198 | 2,038 | 1,996 | 35,647 |
2013 | 20,347 | — | — | — | — | — | 7,068 | 8,540 | 2,347 | 1,326 | 1,239 | 1,331 | 21,851 |
2014 | 796,899 | — | — | — | — | — | — | 153,180 | 291,980 | 246,365 | 220,765 | 206,255 | 1,118,545 |
2015 | 420,956 | — | — | — | — | — | — | — | 45,760 | 100,263 | 86,156 | 80,858 | 313,037 |
2016 | 348,436 | — | — | — | — | — | — | — | — | 40,368 | 78,915 | 72,603 | 191,886 |
2017 | 247,757 | — | — | — | — | — | — | — | — | — | 17,894 | 56,033 | 73,927 |
2018 (4) | 346,933 | — | — | — | — | — | — | — | — | — | — | 24,326 | 24,326 |
Subtotal | 2,201,752 | - | - | - | - | 11,604 | 16,063 | 167,361 | 343,262 | 390,520 | 407,007 | 443,402 | 1,779,219 |
Europe-Insolvency | |||||||||||||
2014 | 10,876 | — | — | — | — | — | — | 5 | 4,297 | 3,921 | 3,207 | 2,620 | 14,050 |
2015 | 19,396 | — | — | — | — | — | — | — | 2,954 | 4,366 | 5,013 | 4,783 | 17,116 |
2016 | 42,190 | — | — | — | — | — | — | — | — | 6,175 | 12,703 | 12,856 | 31,734 |
2017 | 38,830 | — | — | — | — | — | — | — | — | — | 1,233 | 7,862 | 9,095 |
2018 | 45,636 | — | — | — | — | — | — | — | — | — | — | 642 | 642 |
Subtotal | 156,928 | - | - | - | - | - | - | 5 | 7,251 | 14,462 | 22,156 | 28,763 | 72,637 |
Total Europe | 2,358,680 | - | - | - | - | 11,604 | 16,063 | 167,366 | 350,513 | 404,982 | 429,163 | 472,165 | 1,851,856 |
Total PRA Group | $ 8,733,681 | $ 1,484,006 | $ 368,003 | $ 529,342 | $ 705,490 | $ 908,684 | $ 1,142,437 | $ 1,378,812 | $ 1,539,495 | $ 1,491,986 | $ 1,512,605 | $ 1,625,205 | $ 12,686,065 |
(1) For our international amounts, Cash Collections are presented using the average exchange rates during the cash collection period. | |||||||||||||
(2) The amount reflected in the Purchase Price also includes the acquisition date finance receivables portfolios that were acquired through our various business acquisitions. | |||||||||||||
(3) For our international amounts, Purchase Price is presented at the exchange rate at the end of the quarter in which the portfolio was purchased. In addition, any purchase price adjustments that occur throughout the life of the pool are presented at the period end exchange rate for the respective quarter of purchase. | |||||||||||||
(4) The Europe-Core purchases include a $34.9 million finance receivables portfolio addition in the third quarter of 2018 relating to the consolidation of a Polish investment fund. |
PRA Group, Inc. | |||||||||||
Unaudited Consolidated Income Statements | |||||||||||
(in thousands, except per share amounts) | |||||||||||
Three Months Ended December 31, 2017 | Twelve Months Ended December 31, 2017 | ||||||||||
As Previously | As Previously | ||||||||||
As Corrected | As Corrected | ||||||||||
Correction | Correction | ||||||||||
Revenues: | |||||||||||
Income recognized on finance receivables | $ 200,663 | $ 2,734 | $ 203,397 | $ 792,701 | $ 2,734 | $ 795,435 | |||||
Fee income | 6,043 | - | 6,043 | 24,916 | - | 24,916 | |||||
Other revenue | 1,454 | - | 1,454 | 7,855 | - | 7,855 | |||||
Total revenues | 208,160 | 2,734 | 210,894 | 825,472 | 2,734 | 828,206 | |||||
Net allowance charges | (2,486) | - | (2,486) | (11,898) | - | (11,898) | |||||
Operating expenses: | |||||||||||
Compensation and employee services | 69,253 | - | 69,253 | 273,033 | - | 273,033 | |||||
Legal collection fees | 10,061 | - | 10,061 | 43,351 | - | 43,351 | |||||
Legal collection costs | 18,781 | - | 18,781 | 76,047 | - | 76,047 | |||||
Agency fees | 7,877 | - | 7,877 | 35,530 | - | 35,530 | |||||
Outside fees and services | 15,815 | - | 15,815 | 62,792 | - | 62,792 | |||||
Communication | 8,028 | - | 8,028 | 33,132 | - | 33,132 | |||||
Rent and occupancy | 3,985 | - | 3,985 | 14,823 | - | 14,823 | |||||
Depreciation and amortization | 4,666 | - | 4,666 | 19,763 | - | 19,763 | |||||
Other operating expenses | 12,032 | - | 12,032 | 44,103 | - | 44,103 | |||||
Total operating expenses | 150,498 | - | 150,498 | 602,574 | - | 602,574 | |||||
Income from operations | 55,176 | 2,734 | 57,910 | 211,000 | 2,734 | 213,734 | |||||
Other income and (expense): | |||||||||||
Gain on sale of subsidiaries | - | - | - | 48,474 | - | 48,474 | |||||
Interest expense, net | (28,379) | - | (28,379) | (98,041) | - | (98,041) | |||||
Foreign exchange gain/(loss) | 317 | - | 317 | (1,104) | - | (1,104) | |||||
Other | (2,790) | - | (2,790) | (2,790) | - | (2,790) | |||||
Income before income taxes | 24,324 | 2,734 | 27,058 | 157,539 | 2,734 | 160,273 | |||||
Income tax (benefit)/expense | (64,393) | 684 | (63,709) | (11,536) | 684 | (10,852) | |||||
Net income | 88,717 | 2,050 | 90,767 | 169,075 | 2,050 | 171,125 | |||||
Adjustment for net income attributable to noncontrolling interests | 1,847 | - | 1,847 | 6,810 | - | 6,810 | |||||
Net income attributable to PRA Group, Inc. | $ 86,870 | $ 2,050 | $ 88,920 | $ 162,265 | $ 2,050 | $ 164,315 | |||||
Net income per common share attributable to PRA Group, Inc.: | |||||||||||
Basic | $ 1.92 | $ 0.05 | $ 1.97 | $ 3.55 | $ 0.04 | $ 3.60 | |||||
Diluted | $ 1.92 | $ 0.05 | $ 1.96 | $ 3.54 | $ 0.04 | $ 3.59 | |||||
Weighted average number of shares outstanding: | |||||||||||
Basic | 45,170 | 45,170 | 45,170 | 45,671 | 45,671 | 45,671 | |||||
Diluted | 45,318 | 45,318 | 45,318 | 45,823 | 45,823 | 45,823 |
Investor Contact:
Darby Schoenfeld, CPA
Vice President, Investor Relations
(757) 431-7913
[email protected]
News Media Contact:
Elizabeth Kersey
Vice President, Communications and Public Policy
(757) 431-3398
[email protected]
View original content:http://www.prnewswire.com/news-releases/pra-group-reports-fourth-quarter-and-full-year-2018-results-300804484.html
SOURCE PRA Group
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