Debt buyer NCO Group Inc., based in Horsham, Pa., reported Tuesday drops in revenue and income for the quarter ended March 31.
The company reported a net loss of $41.2 million compared to a net loss of $15.3 million in the year-ago period. Total revenue fell 11.5% to $374.7 million although revenues in the company's accounts receivable management unit fell just 6% to $324.1 million.
The company sold a portion of its purchased receivables portfolio in April 2011 and recorded the $18.6 million write-down in the first quarter. The company may sell more of its portfolio in the future, resulting in further write-downs, company officials said. The revenue total includes the portfolio write-down.
NCO is the largest U.S. accounts receivable management company based on revenue, according to Collections & Credit Risk research. The firm is organized into three divisions: Accounts Receivable Management (ARM), Customer Relationship Management (CRM) and Portfolio Management (PM). During the first quarter, the ARM division operated below its revenue target, mostly because of continued slight volume declines, but above its profitability target as a result of cost savings initiatives, company officials said.
The CRM division operated above its revenue and profitability targets, as a result of stability in client volumes. The PM division operated above its revenue target, but below its EBITDA target due to servicing fees on better than expected collections. The company announced in March that it was seeking to amend its credit facility to allow the sale of its debt portfolio.
Ronald A. Rittenmeyer became NCO's president and CEO in March, replacing Michael Barrist (
