PRA Group's Cash Collections Reverse After a Year of Growth

The Tip Desk · November 11, 2026 · 3 min read

Third-quarter collections were $536 million as net income attributable to PRA Group fell to $15 million, or $0.39 a share.

PRA Group, Inc. (PRAA), a global acquirer of nonperforming loans, reported third-quarter cash collections of $536 million, reversing the 4% year-over-year increase recorded in the second quarter.

Net income attributable to the company was $15 million, or $0.39 a share, compared with $58 million, or $1.51 a share, in the second quarter. The year-ago third quarter had included a $413 million non-cash goodwill impairment charge that produced a large loss; that charge did not recur.

The company said growth in U.S. legal cash collections, digital collections and Europe partially offset decreases in other areas. U.S. Core collections were $255 million, Europe Core $195 million, Europe Insolvency $18 million, U.S. Insolvency $20 million and other markets $48 million.

Portfolio income rose 5% to $271 million from $259 million a year earlier, which the company attributed to recent purchases in Europe. Total portfolio revenue decreased 8% to $285 million from $310 million a year earlier, as changes in expected recoveries fell to $14 million from $51 million. The company said the year-over-year decline in that line was driven in part by actions in recent quarters to enhance cash-collection projections, including a $349 million increase in Europe estimated remaining collections as part of a comprehensive portfolio review completed in the second quarter.

Estimated remaining collections stood at $8.8 billion, up 5% from a year earlier. Adjusted EBITDA for the twelve months ended September 30, 2026 was $1.4 billion, up 9%.

The adjusted cash efficiency ratio improved by more than 200 basis points to 63%, versus a 61% cash efficiency ratio reported for the second quarter. Operating expenses were $200 million. Adjusted operating expenses, which exclude the prior-year goodwill impairment, decreased $14 million to $200 million from $214 million a year earlier, driven primarily by lower compensation and benefits, down $8 million on workforce reductions, organizational simplification and other PRA 3.0 cost initiatives. Interest expense, net, was $64 million, relatively unchanged from a year earlier. The effective tax rate was 16%.

Portfolio purchases declined to $229 million from $297 million in the second quarter, with Europe Core purchases down to $107 million from $165 million. The company said it remained focused on opportunities meeting return requirements. At quarter-end it had $438 million of estimated forward-flow commitments over the next 12 months, comprising $175 million in Europe, $247 million in the U.S. and $16 million in other markets.

Total availability under credit facilities as of September 30, 2026 was $1 billion, comprised of $770 million based on current ERC and subject to debt covenants and $262 million of additional availability subject to borrowing base and covenants. In October 2026 the company issued $400 million of senior notes due 2033, which it said extended its debt maturity profile.

President and Chief Executive Officer Martin Sjolund said the company continued to execute against its PRA 3.0 strategy, generating cash collections, growing portfolio income, lowering operating expenses and making disciplined portfolio investments.