PRA Group (PRAA) investor relations material

Executive summary

• Cash collections grew 11% year-over-year to $551.9 million, driven by operational initiatives and strong U.S. and European performance.

• Net income attributable to shareholders rose to $28.2 million, up over $24.6 million year-over-year, with diluted EPS at $0.73.

• Adjusted EBITDA for the last 12 months reached $1.35 billion, up 13.9% year-over-year, outpacing cash collections growth.

• PRA 3.0 strategy execution advanced, emphasizing disciplined capital allocation, technology modernization, and talent development.

• Maintained a diversified capital structure and refinanced the European revolving credit facility, extending maturity to April 2031.

Financial highlights

• Total revenues for Q1 2026 rose 17% year-over-year to $333 million, with portfolio income up 12% to $270 million.

• Cash efficiency ratio improved to 62% in Q1 2026.

• Operating expenses increased 8.3% to $211.3 million, mainly due to higher legal collection costs.

• Interest expense, net, increased to $63.5 million due to higher average debt balances.

• ERC at quarter end was $8.5 billion, up 10% year-over-year.

Outlook and guidance

• Portfolio supply expected to remain stable in the U.S. and Europe over the next 12–18 months.

• Targeting $1.0–$1.3 billion in annual portfolio purchases over the next 2–3 years, with forward flow commitments of $321.8 million.

• Net leverage targeted to decline to the mid-2x area over the next few years.

• Effective tax rate for 2026 expected in the mid-to-high 20s.

• Continued focus on technology upgrades, AI initiatives, and cost optimization.