Debt buyer Asta Funding Inc. on Wednesday reported a decline in revenue due to a sharp drop in cash collections for its fiscal year first quarter ended Dec. 31.
The Englewood Cliffs, N.J. company reported net cash collections of $21.1 million in the quarter, down 28% from a year ago when it received an additional $2.4 million from account sales that counted toward cash collections.
Asta reported net income of $2.67 million, an increase of 7.7% from the same period a year ago. Revenue declined to $10.8 million, down 2%.
"The progress we made last year in strengthening our balance sheet, increasing our cash position and generating strong cash flow has continued into fiscal year 2011," said Gary Stern, Asta's chairman and CEO, in a press release. "Although there are signs of economic recovery, the current economic environment remains challenging and we continue to be selective buyers of distressed, performing or semi-performing debt portfolios."
Asta's invested $2.9 million in debt portfolios during the quarter, as compared to $2.3 million in the first quarter of fiscal year 2010. The p
The portfolios acquired during the quarter included semi-performing litigation-related medical accounts receivable portfolios. As a portion of the accounts are performing, the cost of the portfolio was higher than the traditional charged off non-performing assets.