Portfolio Recovery Associates Reports Record Fourth Quarter 2010 Results

Portfolio Recovery Associates, Inc. PRAA today reported net income of $20.6 million for the quarter ended Dec. 31, 2010. Net income increased 66% from $12.4 million in the same period a year earlier. Earnings per diluted share were $1.20 in the fourth quarter of 2010, up 50% from $0.80 in the fourth quarter of 2009. In the fourth quarter of 2010, total revenue rose 38% from the year-earlier period to a record $100.8 million. Total revenue consists of cash collections reduced by amounts applied to principal on the Company's owned debt portfolios, plus fee income earned from its fee-for-service businesses. During the fourth quarter of 2010, the Company applied 41.3% of cash collections to reduce the carrying basis of its owned debt portfolios, the same as in the fourth quarter of 2009. The fourth quarter 2010 amortization rate included a $5.4 million net allowance charge against certain pools of finance receivables accounts. "Portfolio Recovery Associates concluded 2010 with record financial results, demonstrating exceptional performance across our debt purchasing business despite the still-weakened economy," said Steven D. Fredrickson, chairman, president and chief executive officer. "Our disciplined approach to underwriting together with our consistent and continued efforts to improve the efficiency of our collections operations helped drive record results in cash collections, cash receipts, revenue and earnings both in the fourth quarter and for the full year."