Encore Capital Group, Inc. (NASDAQ:ECPG) reported second-quarter 2016 adjusted net income of $1.29 per share, which beat the Zacks Consensus Estimate by 7.5%. Also, the bottom line improved 6.6% year over year on higher revenues.
Including one-time items, the company posted net income of $1.14 per share, up 17.5% from the year-ago quarter.
Second-Quarter Operational Update
Total revenue at Encore Capital grew 2.4% year over year to $289.4 million. The year-over-year increase was fueled by significant improvement in other revenues. However, the top line missed the Zacks Consensus Estimate by 2.6%.
Gross collections dipped 1% year over year to $434 million compared with $437 million in the prior-year quarter.
Total operating expenses of $197.7 million decreased 0.3% year over year. The decline in expenses was attributable to lower cost of legal collections as well as lesser general and administrative expenses in the quarter.
Encore Capital’s second-quarter adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) increased 2% year over year to a record $279 million.
Financial Update
As of Jun 30, 2016, total assets of Encore Capital was $3.8 billion, down 9.7% from the 2015-end level.
As of Jun 30, 2016, Encore Capital had cash and cash equivalents of $139.0 million, up 12.1% from year-end 2015.
Investment in Receivable portfolio totaled $2.5 billion as of Jun 30, 2016, up 1.2% from year-end 2015.
Total debt amounted to $2.8 billion, down 3.2% from the 2015-end level.
As of Jun 30, 2016, total shareholders’ equity was $619.4 million, up 3.9% from year-end 2015.
Encore Capital’s cash from operations increased 3.5% year over year to $49.1 million in the first six months of 2016.
ENCORE CAP GRP Price, Consensus and EPS Surprise
ENCORE CAP GRP Price, Consensus and EPS Surprise | ENCORE CAP GRP Quote
Zacks Rank and Performance of Other Stocks
Encore Capital carries a Zacks Rank #3 (Hold). Among other players from the finance sector that have reported their second-quarter results so far, the bottom line at American Express Company (NYSE:AXP) , Alliance Data Systems Corporation (NYSE:ADS) and Total System Services, Inc. (NYSE:TSS) beat their respective Zacks Consensus Estimate.
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