Encore Capital Group Announces Fourth Quarter and Full-Year 2024 Financial Results

Core Insights - Encore Capital Group experienced significant growth in 2024, with global portfolio purchases increasing by 26% to a record $1.35 billion and global collections rising by 16% to $2.16 billion compared to 2023 [2][4][3] - The U.S. market provided a favorable environment for non-performing loan portfolios, leading to a 23% increase in U.S. portfolio purchases for Encore's largest business, MCM, totaling $1 billion [2][5] - The Cabot business in the U.K. and Europe saw a 36% increase in portfolio purchases, but faced challenges due to a competitive environment and macroeconomic factors, resulting in a restructuring that included exiting underperforming markets [2][4][3] Financial Performance - For the full year 2024, Encore reported collections of $2,162,478, an increase of 16% from $1,862,567 in 2023, and revenues of $1,316,361, up 8% from $1,222,680 [3][4] - The estimated remaining collections (ERC) rose by 4% to $8,501,370 from $8,191,913 in 2023, while operating expenses decreased by 4% to $1,159,031 [3][4] - The company reported a GAAP net loss of $139,244, or ($5.83) per share, compared to a loss of $206,492, or ($8.72) per share in 2023 [3][4] Fourth Quarter Highlights - In Q4 2024, collections reached $554,595, a 21% increase from $458,350 in Q4 2023, while revenues decreased by 4% to $265,619 [6][4] - Portfolio purchases surged by 69% to $495,144 compared to $292,497 in Q4 2023, and operating expenses fell by 19% to $399,809 [6][4] - The GAAP net loss for Q4 was $225,307, or ($9.42) per share, an improvement from a loss of $270,762, or ($11.40) per share in the same quarter of the previous year [6][4] Strategic Outlook - The company anticipates global portfolio purchases in 2025 to exceed the $1.35 billion made in 2024 and expects global collections to increase by 11% to $2.4 billion [2][4] - Encore plans to resume share repurchases in 2025, reflecting confidence in cash generation and improving leverage [2][4] - The company remains committed to its role in the consumer credit ecosystem, focusing on helping consumers restore their financial health [2][4]