More debt portfolios available for sale are fueling growth at Encore Capital Group, which reported its first quarter earnings yesterday. The company’s chief executive also said the the “favorable” buying conditions will continue “for some time.”
The company had net income of $21.8 million during the first three months of 2018, down from $22.1 million a year ago. Overall, revenue for the global debt buying and collection agency was $327 million, up from $272 million during the first quarter of last year.
Encore spent $277 million buying portfolios in the first quarter — with $179 million of that spent in the U.S., compared with $219 million last year.
“The first quarter for Encore was a period of solid financial and operational performance. In the U.S., our largest market, the supply of charged-off credit card debt continues to grow and we are purchasing large amounts of receivables at the highest returns we’ve seen in several years. We’re in a strong position from a collections capacity perspective and we expect to continue to benefit from these favorable buying conditions for some time,” said Ashish Masih, President and Chief Executive Officer. “We continued investment spending to further build capacity for our U.S. business and accelerated legal spending in the quarter to benefit from consumer liquidity, which in part is a result of the new domestic tax reform. In Europe, Cabot’s liquidation improvement initiatives helped drive a record level of cash collections in the quarter.”
