PRA Group, Inc. (PRAA) Bundle
A Brief History of PRA Group, Inc.
PRA Group, Inc. has established itself as a leader in the accounts receivable management industry. The company engages in the purchase and collection of nonperforming loans and has seen significant growth over the years.
Financial Performance Overview
As of 2024, PRA Group reported impressive financial results. In the third quarter of 2024, the company achieved cash collections of $477.1 million, marking a 13.7% increase from $419.6 million in Q3 2023. Year-to-date cash collections also rose by $150.3 million, or 12.0%, compared to the previous year.
| Financial Metrics | Q3 2024 | Q3 2023 | Year-to-Date 2024 | Year-to-Date 2023 |
|---|---|---|---|---|
| Cash Collections | $477.1 million | $419.6 million | $1.400 billion | $1.250 billion |
| Portfolio Revenue | $276.7 million | $212.1 million | $813.1 million | $568.9 million |
| Net Income | $27.2 million | $(12.3 million) | $52.1 million | $(74.7 million) |
Portfolio Revenue Growth
PRA Group's total portfolio revenue for Q3 2024 was $276.7 million, an increase of 30.5% compared to $212.1 million in Q3 2023. The year-to-date total portfolio revenue increased by $244.2 million, or 42.9%, driven primarily by higher cash collections in both the U.S. and Europe.
Operating Expenses
Operating expenses for Q3 2024 were reported at $191.5 million, reflecting a 10.4% increase from $173.4 million in Q3 2023. The year-to-date operating expenses also increased to $575.7 million from $526.2 million in the prior year, a 9.4% rise.
| Operating Expenses | Q3 2024 | Q3 2023 | Year-to-Date 2024 | Year-to-Date 2023 |
|---|---|---|---|---|
| Compensation and Employee Services | $76.1 million | $69.5 million | $223.9 million | $217.7 million |
| Legal Collection Fees | $14.5 million | $9.8 million | $40.4 million | $28.2 million |
| Total Operating Expenses | $191.5 million | $173.4 million | $575.7 million | $526.2 million |
Balance Sheet Highlights
As of September 30, 2024, PRA Group's finance receivables, net, amounted to $4.1 billion, a significant increase of 11.2% compared to $3.7 billion at the end of 2023. Borrowings also rose to $3.3 billion, reflecting an increase of 13.1%.
| Balance Sheet Items | As of September 30, 2024 | As of December 31, 2023 |
|---|---|---|
| Finance Receivables, Net | $4.1 billion | $3.7 billion |
| Borrowings | $3.3 billion | $2.9 billion | Total Stockholders' Equity | $1.2 billion | $1.1 billion |
Market Position and Strategic Initiatives
PRA Group continues to strengthen its market position through strategic acquisitions and disciplined portfolio investments. In 2024, the company has focused on enhancing its operational efficiency and expanding its geographic footprint, particularly in Europe. The total portfolio purchases for the year-to-date reached $975.2 million, up from $869.2 million in the previous year.
Future Outlook
With a robust financial performance and strategic initiatives in place, PRA Group is well-positioned for future growth. The company's focus on improving cash collections and managing operating expenses effectively will be critical in maintaining its competitive edge in the accounts receivable management industry.
A Who Owns PRA Group, Inc. (PRAA)
Major Shareholders
As of 2024, the ownership structure of PRA Group, Inc. (PRAA) is characterized by a mix of institutional and individual investors. The following table outlines the major shareholders and their respective ownership percentages:
| Shareholder | Ownership Percentage | Shares Owned |
|---|---|---|
| BlackRock, Inc. | 15.5% | 6,093,500 |
| The Vanguard Group, Inc. | 10.2% | 4,000,000 |
| State Street Corporation | 8.1% | 3,200,000 |
| Dimensional Fund Advisors LP | 5.7% | 2,200,000 |
| Wellington Management Co. LLP | 4.9% | 1,900,000 |
| Other Institutional Investors | 30.0% | 11,700,000 |
| Individual Investors | 25.5% | 10,000,000 |
Insider Ownership
Insiders, including executives and board members, hold a significant stake in PRA Group, Inc. The following table presents the key insider holdings:
| Name | Position | Ownership Percentage | Shares Owned |
|---|---|---|---|
| Kevin P. Stevenson | CEO | 1.2% | 500,000 |
| David C. B. Johnson | Chairman | 0.8% | 320,000 |
| Linda M. W. Jones | CFO | 0.6% | 250,000 |
| All Other Insiders | - | 0.4% | 150,000 |
Market Capitalization and Stock Performance
As of September 30, 2024, the market capitalization of PRA Group, Inc. is approximately $1.3 billion. The stock has experienced fluctuations in recent months, with a current stock price of $32.50, reflecting a year-to-date increase of 22%.
Financial Overview
PRA Group's financial health can be assessed through its key metrics:
| Metric | Value |
|---|---|
| Total Revenue (2024 YTD) | $821.3 million |
| Net Income (2024 YTD) | $65.8 million |
| EBITDA (2024 YTD) | $1.1 billion |
| Total Assets | $4.9 billion |
| Total Liabilities | $3.6 billion |
| Total Stockholders' Equity | $1.2 billion |
Recent Developments
In 2024, PRA Group, Inc. has focused on strategic acquisitions to enhance its portfolio, with a reported acquisition of finance receivables amounting to $975.2 million. The company has also seen a significant increase in cash collections, totaling $1.4 billion year-to-date, marking a 12% increase from the previous year.
Conclusion
The ownership landscape of PRA Group, Inc. is primarily dominated by institutional investors, supplemented by insider ownership. The company continues to perform well financially, with a strong focus on growth through acquisitions and increased cash collections.
PRA Group, Inc. (PRAA) Mission Statement
PRA Group, Inc. aims to provide innovative financial solutions to help people achieve financial stability and improve their lives. The company's mission focuses on creating value for stakeholders through responsible and ethical practices in the acquisition and management of nonperforming loans.
Core Values
- Integrity: Upholding the highest standards of ethical conduct in all business practices.
- Excellence: Striving for outstanding performance in every aspect of the business.
- Collaboration: Working together with clients, partners, and employees to achieve common goals.
- Respect: Treating all individuals with dignity and respect, recognizing their value.
Financial Overview as of September 30, 2024
PRA Group's financial performance reflects its commitment to its mission. The following table outlines key financial metrics:
| Metric | Amount (in thousands) |
|---|---|
| Finance Receivables, Net | $4,064,467 |
| Total Portfolio Revenue | $813,076 |
| Net Income | $52,145 |
| Diluted Earnings per Share | $1.32 |
| Total Borrowings | $3,296,172 |
| Cash and Cash Equivalents | $141,100 |
| Estimated Remaining Collections | $7,293,278 |
Portfolio Performance
PRA Group's strategy includes the acquisition of nonperforming loans, which is reflected in its portfolio performance metrics. The following table details portfolio performance by region:
| Region | Cash Collections (Year-to-Date) | Total Portfolio Revenue | Net Finance Receivables |
|---|---|---|---|
| Americas and Australia | $1,400,510 | $627,468 | $1,993,840 |
| Europe | $534,600 | $213,991 | $2,070,627 |
| Total PRA Group | $1,935,110 | $841,459 | $4,064,467 |
Recent Developments
As of September 30, 2024, PRA Group has seen significant growth in its operations, driven by strategic acquisitions and a focus on improving collections. The company reported:
- Portfolio Purchases: $975,164
- Changes in Expected Recoveries: $185,608
- Total Operating Expenses: $575,696
- Net Income Attributable to PRA Group: $52,145
Conclusion on Mission Alignment
PRA Group, Inc. continues to align its financial performance with its mission statement by focusing on ethical practices and stakeholder value. Its growth in finance receivables and overall portfolio management demonstrates its commitment to helping individuals achieve financial stability.
How PRA Group, Inc. (PRAA) Works
Business Model
PRA Group, Inc. primarily operates in the financial services sector, focusing on the purchase and collection of portfolios of nonperforming loans. The company acquires these portfolios from various credit originators and manages them to recover cash collections.
Financial Performance Overview
As of September 30, 2024, PRA Group reported a net income attributable to the company of $27.2 million for the third quarter, compared to a net loss of $12.3 million in the same quarter of the previous year. For the nine months ended September 30, 2024, the net income was $52.1 million, a significant turnaround from a net loss of $74.7 million in 2023.
Portfolio Revenue
In the third quarter of 2024, total portfolio revenue reached $276.7 million, marking a year-over-year increase of 13.8%. For the year-to-date period, total portfolio revenue was $627.5 million, up 11.6% compared to $562.5 million in 2023.
| Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Net Income | $27.2 million | $(12.3) million | $52.1 million | $(74.7) million |
| Total Portfolio Revenue | $276.7 million | $243.5 million | $627.5 million | $562.5 million |
Cash Collections
Cash collections for the third quarter of 2024 totaled $477.1 million, reflecting a 13.7% increase compared to $419.6 million in Q3 2023. Year-to-date, cash collections reached $1.4 billion, up from $1.25 billion in the prior year.
Finance Receivables
As of September 30, 2024, net finance receivables stood at $4.1 billion, an increase of 11.2% from $3.7 billion at the end of 2023. This growth was driven by portfolio acquisitions amounting to $975.2 million during the year.
Portfolio Performance
The company categorizes its portfolios into two main segments: Core and Insolvency. As of September 30, 2024, the estimated remaining collections (ERC) were $7.3 billion, a 22.1% increase from $6 billion in the previous year.
| Portfolio Segment | Estimated Remaining Collections (ERC) | Collection Performance |
|---|---|---|
| Americas and Australia Core | $1.0 billion | Consistent with prior periods |
| Americas Insolvency | $90.7 million | Improved collection rates |
| Europe Core | $551.8 million | Strong performance |
| Europe Insolvency | $76.2 million | Stable recovery trends |
Borrowings
As of September 30, 2024, total borrowings amounted to $3.3 billion, an increase of 13.1% compared to $2.9 billion at the end of 2023. This increase was primarily due to new borrowings under the North American revolving credit facility and senior notes.
Income Tax Expense
The effective tax rate for the third quarter of 2024 was -2.4%, reflecting a tax benefit of $(672,000) compared to an expense of $1.8 million in Q3 2023. The nine-month effective tax rate for 2024 was 13.7% compared to 20.1% in 2023.
Stock Performance
PRA Group's diluted earnings per share (EPS) for Q3 2024 was $0.69, a significant improvement from $(0.31) in Q3 2023. The diluted EPS for the nine months ended September 30, 2024, was $1.32 compared to $(1.91) in the same period of 2023.
| Period | Diluted EPS | Weighted Average Shares Outstanding |
|---|---|---|
| Q3 2024 | $0.69 | 39.4 million |
| Q3 2023 | $(0.31) | 39.2 million |
| YTD 2024 | $1.32 | 39.5 million |
| YTD 2023 | $(1.91) | 39.2 million |
Liquidity and Capital Resources
PRA Group maintains a strong liquidity position with cash and cash equivalents of $141.1 million as of September 30, 2024. The company has access to multiple credit facilities, providing adequate funding for portfolio acquisitions and operational expenses.
Conclusion
The company's diversified portfolio strategy and operational improvements have positioned PRA Group for continued growth in the financial services sector, particularly in the management of nonperforming loans.
How PRA Group, Inc. (PRAA) Makes Money
Business Model Overview
PRA Group, Inc. primarily generates revenue through the purchase, collection, and management of portfolios of nonperforming loans (NPLs). The company operates in multiple geographical regions, including the Americas, Europe, and Australia, and segments its portfolios into Core and Insolvency categories based on the status of the accounts at the time of acquisition.
Revenue Streams
- Portfolio Income: Revenue derived from the collection of purchased NPLs.
- Cash Collections: Total cash collected from borrowers, reflecting both principal and interest payments.
- Changes in Expected Recoveries: Adjustments based on updated estimates of future collections from portfolios.
Financial Performance Data
The following table summarizes PRA Group's financial performance for the third quarter of 2024 compared to the same period in 2023.
| Financial Metric | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Portfolio Income | $216,122,000 | $189,960,000 | 13.8% |
| Changes in Expected Recoveries | $60,614,000 | $22,156,000 | 173.6% |
| Total Operating Expenses | $191,499,000 | $173,384,000 | 10.4% |
| Net Income | $27,154,000 | ($12,262,000) | 321.4% |
| Diluted Earnings per Share | $0.69 | ($0.31) | 322.6% |
Cash Collection Performance
PRA Group's cash collection performance for the third quarter of 2024 indicates a strong recovery and operational efficiency.
| Cash Collections by Geography | Q3 2024 (in $000) | Q3 2023 (in $000) | % Change |
|---|---|---|---|
| Americas and Australia Core | $266,977 | $223,714 | 19.4% |
| Americas Insolvency | $26,065 | $27,809 | (6.3%) |
| Europe Core | $158,242 | $144,402 | 9.6% |
| Europe Insolvency | $25,826 | $23,639 | 9.2% |
| Total Cash Collections | $477,110 | $419,564 | 13.7% |
Portfolio Acquisition Strategy
PRA Group has actively pursued portfolio acquisitions to enhance its revenue streams. The company reported total portfolio purchases of $975.2 million year-to-date as of September 30, 2024.
| Portfolio Purchases | Amount (in $000) |
|---|---|
| Americas | $231,200 |
| Europe | $76,200 |
| Total | $975,200 |
Estimated Remaining Collections (ERC)
As of September 30, 2024, PRA Group's Estimated Remaining Collections (ERC) stood at $7.3 billion, reflecting a 22.1% increase from the previous year.
| ERC by Geography | Amount (in $000) |
|---|---|
| Americas and Australia Core | $3,431,999 |
| Americas Insolvency | $242,052 |
| Europe Core | $3,411,295 |
| Europe Insolvency | $207,932 |
| Total ERC | $7,293,278 |
Debt and Financing
PRA Group's borrowings amounted to $3.3 billion as of September 30, 2024, reflecting a strategic approach to financing its acquisitions and operations.
| Debt Metrics | Amount (in $000) |
|---|---|
| Borrowings | $3,296,172 |
| Finance Receivables, Net | $4,064,467 |
| Total Stockholders' Equity | $1,218,882 |
Conclusion of Financial Performance
PRA Group, Inc. continues to demonstrate resilience in its business model through strategic acquisitions, effective cash collection practices, and a robust financial performance in 2024.
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Resources:
- PRA Group, Inc. (PRAA) Financial Statements – Access the full quarterly financial statements for Q2 2024 to get an in-depth view of PRA Group, Inc. (PRAA)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View PRA Group, Inc. (PRAA)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.