Debt-buying giant Encore Capital Group Inc. on Thursday reported first-quarter profit of $29.4 million.
Gross collections from the portfolio purchasing and recovery business grew in Q1 to a record $425 million, compared to $397 million in Q1 last year.
"Encore delivered strong financial performance in the first quarter as our international expansion and consumer-focused programs drove record collections. With our foreign subsidiaries now assimilated into Encore, our businesses outside of the United States grew collections 29% over last year and now comprise more than a quarter of our total collections worldwide," said Kenneth A. Vecchione, president and CEO.
Investment in receivable portfolios in the portfolio purchasing and recovery business totaled $125 million, to purchase $1.0 billion in face value of debt, compared to $468 million, to purchase $4.3 billion in face value of debt in the first quarter of 2014. Last years figure included Cabot's $208 million acquisition of Marlin's portfolio in February 2014.
Encore's subsidiary Propel Financial Services also purchased $54 million of tax liens during this year's first quarter, raising Encore's total deployment in the quarter to $179 million.
The San Diego-based company reported $1.23 earnings per share for Q1, beating analysts' consensus estimate of $1.19 - as surveyed by Zacks Investment Research.
The company had revenue of $285.7 million for Q1, compared to the consensus estimate of $283.6 million. During the same quarter last year, the Encore posted $1.08 earnings per share. Encore's revenue was up 12.6% compared to the same quarter last year.
Encore, which purchases portfolios of defaulted consumer receivables, and its subsidiaries have operations spanning seven countries, including debt recovery services for consumers and property owners across a range of financial assets.
Total operating expenses for the company jumped 8% to $200 million, compared to $185 million in the same period of the previous year. Adjusted operating expenses (defined as operating expenses excluding stock-based compensation expense, expenses related to non-portfolio purchasing and recovery business, one-time charges and acquisition and integration related expenses) per dollar collected for the portfolio purchasing and recovery business increased to 38.8%, compared to 37.7% in the same period last year.