1. PRAA reported a 19% increase in portfolio purchases. 2. Cash collections grew for four consecutive quarters. 3. CEO transition aims to leverage global growth strategies. 4. Profitability impacted by lower-than-expected consumer tax refunds. 5. Financial targets remain unchanged, despite lower return expectations.
PRAA's significant growth in portfolio purchases and consistent cash collection trends suggest positive market movement. For instance, similar companies that report substantial growth often see a boost in stock prices based on operational performance.
The financial performance and strategy developments reported in the article significantly affect PRAA's stock valuation. Changes in leadership and operational success are often pivotal for investor confidence, suggesting a reasonable likelihood of price movement.
The immediate effects of PRAA's quarterly results and leadership transition can impact stock price rapidly, as seen historically when companies announce strong earnings or growth potential, prompting investor interest.
NORFOLK, Va., May 5, 2025 /PRNewswire/ -- PRA Group, Inc. (Nasdaq: PRAA) (the "Company"), a global leader in acquiring and collecting nonperforming loans, today reported its financial results for the first quarter of 2025 ("Q1 2025").
| ($ in thousands, except per share amounts) | 2025 | 2024 |
|---|---|---|
| Net income attributable to PRA Group, Inc. | $ 3,659 | $ 3,475 |
| Diluted earnings per share | $ 0.09 | $ 0.09 |
"Building on a successful 2024, we delivered another strong quarter, including an increase in portfolio purchases of 19%, record ERC, our fourth consecutive quarter of double-digit cash collections growth, and a nearly 300 basis point improvement in cash efficiency, as we continued to execute on our cash-generating and operational initiatives in the U.S.," said Vikram Atal, president and chief executive officer. "Changes in Expected Recoveries moderated from recent levels. Historically, our first quarter cash collections in the U.S. have experienced seasonality increases, typically driven by consumer tax refunds, that didn't materialize this quarter to the extent that we modeled, resulting in lower profitability compared to prior quarters. I am very proud of the team's accomplishments to improve the cash-generation capabilities of the U.S. business—which we believe, coupled with the continued strength of our European business, sets us up for overall success moving forward."
"As we look ahead, we are excited to welcome our newly appointed president and CEO Martin Sjolund, who has been with the Company for 13 years and brings a successful European playbook to build on our global three-pillar strategy."
"We are confident in the overall trajectory of the business and, at this time, we are not changing our previously provided financial targets, except for the return on average tangible equity, which is likely to be at a lower level than our target of approximately 12%. As we move through the coming quarters, we will reaffirm, raise, or lower these targets as appropriate. We continue to take a long-term approach to managing the business and we believe we are well-positioned to execute on our strategy to drive continued growth, profitability, and shareholder value."
The following table presents cash collections by quarter and by source on an as reported and constant currency-adjusted basis:
| 2025 | 2024 | ($ in thousands) |
|---|---|---|
| Americas and Australia Core | $ 288,160 | $ 256,861 |
| Americas Insolvency | $ 23,700 | $ 25,209 |
| Europe Core | $ 164,371 | $ 145,933 |
| Europe Insolvency | $ 21,205 | $ 21,515 |
| Total cash collections | $ 497,436 | $ 449,518 |
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, Europe, and Australia. With thousands of employees worldwide, PRA Group, Inc. companies collaborate with customers to help them resolve their debt. For more information, please visit www.pragroup.com.
Statements made herein that 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.