Debt buyer Asta Funding reported flat earnings and revenue Tuesday and a drop in cash collections for the quarter ended March 31. The Englewood Cliffs, N.J. firm also reported spending more on debt portfolios in the quarter.
Asta reported net income of $2.85 million for the quarter, which is its 2011 fiscal year second quarter. The total compares to net income of $2.9 million for the year-ago period. The company also reported $11.2 million in total revenue in the quarter, nearly the same as what it reported a year ago. Cash collections fell 14.7% to $21.9 million.
Investments in new debt portfolios totaled $2.1 million in the quarter, compared to just $971,000 spent in the year-ago period. The company noted that it had invested more on performing portfolios, including a semi-performing litigation-related medical accounts portfolio. As a portion of the accounts are performing, the cost of the portfolio is higher than the traditional charged-off non-performing assets, which sell for reduced rates.
Spending on portfolios also rose during the six months ended March 31, totaling $5 million as compared to $3.3 million during the six months ended March 31, 2010.
"We are pleased with the [overall] results as we continue to generate strong cash flow and improve our liquidity position," said Gary Stern, chairman and CEO. "We are also pleased with the quality of the legacy portfolio as we reported an increase in zero basis revenue of 8.7% to $17.8 million in the first six months of fiscal year 2011 from $16.4 million during the same period of the prior year."
Asta's quarterly filing follows those of debt buyers Portfolio Recovery Associates (
