PRA Group Reports Third Quarter 2024 Results

About this update from Pra Group, Inc.

Transformation in U.S. Business Clearly Visible Company On Track to Achieve Financial and Operational Targets for 2024; Announces Targets for 2025 NORFOLK, Va. , Nov. 4, 2024 /PRNewswire/ -- PRA Group, Inc. (Nasdaq: PRAA) (the "Company"), a global leader in acquiring and collecting nonperforming loans, today reported its financial results for the third quarter of 2024 ("Q3 2024"). Q3 2024 Highlights Net income attributable to PRA Group, Inc. of $27.2 million , or diluted earnings per share of $0.69 , including a tax benefit item of $7.7 million , or $0.20 per share. Total portfolio purchases of $350.0 million . Total cash collections of $477.1 million . Record estimated remaining collections (ERC)1 of $7.3 billion . Cash efficiency ratio2 of 60.1%. Adjusted EBITDA3 for the 12 months ended September 30, 2024 of $1.1 billion . 1. Refers to the sum of all future projected cash collections on the Company's nonperforming loan portfolios. 2. Calculated by dividing cash receipts less operating expenses by cash receipts. Cash receipts refers to cash collections on the Company's nonperforming loan portfolios, fees and revenue recognized from the Company's class action claims recovery services. 3. A reconciliation of net income, the most directly comparable financial measure calculated and reported in accordance with GAAP, to Adjusted EBITDA can be found at the end of this press release. Three Months Ended Sept 30 , Nine Months Ended Sept 30 , ($ in thousands, except per share amounts) 2024 2023 2024 2023 Net income/(loss) attributable to PRA Group, Inc. $ 27,154 $ (12,262) $ 52,145 $ (74,695) Diluted earnings per share $ 0.69 $ (0.31) $ 1.32 $ (1.91) "Our third quarter financial results reflected strong cash collections, robust portfolio buying, significant revenue increases and solid net income. Over the past 18 months, we have built out a highly experienced senior leadership team, capitalized on the rebound in U.S. portfolio supply, executed on our cash-generating and operational initiatives with intense focus, speed and discipline, and driven the financial and operational turnaround in our U.S. business, while continuing to differentiate ourselves in Europe at a time when certain of our competitors in that region have been under pressure," said Vikram Atal , president and chief executive officer. "We invested $350 million during the quarter, which helped us achieve record ERC of $7.3 billion . Cash collections grew 14% year-over-year, reflecting both higher portfolio purchases and the positive impact of our operational initiatives. As we enter the fourth quarter, we are on track to exceed our 2024 targets. We are also announcing 2025 targets as we continue to gain momentum in our business and focus on driving growth, profitability, and shareholder value." Cash Collections and Revenues The following table presents cash collections by quarter and by source on an as reported and constant currency-adjusted basis: Cash Collection Source 2024 2023 ($ in thousands) Q3 Q2 Q1 Q4 Q3 Americas and Australia Core $ 266,977 $ 263,828 $ 256,861 $ 220,127 $ 223,714 Americas Insolvency 26,065 26,971 25,209 24,293 27,809 Europe Core 158,242 156,739 145,933 144,361 144,402 Europe Insolvency 25,826 26,344 21,515 21,502 23,639 Total cash collections $ 477,110 $ 473,882 $ 449,518 $ 410,283 $ 419,564 Cash Collection Source - Constant Currency-Adjusted 2024 2023 ($ in thousands) Q3 Q3 Americas and Australia Core $ 266,977 $ 218,303 Americas Insolvency 26,065 27,785 Europe Core 158,242 147,597 Europe Insolvency 25,826 24,255 Total cash collections $ 477,110 $ 417,940 Total cash collections in Q3 2024 increased 13.7% to $477.1 million compared to $419.6 million in the third quarter of 2023 ("Q3 2023"). The increase was driven by higher cash collections in both the U.S. and Europe . For the nine months ended September 30, 2024 , cash collections increased $150.3 million , or 12.0%, compared to the same period last year. Total portfolio revenue in Q3 2024 increased 30.5% to $276.7 million compared to $212.1 million in Q3 2023. For the nine months ended September 30, 2024 , total portfolio revenue increased 42.9% to $813.1 million compared to $568.9 million in the same period last year. Three Months Ended Sept 30 , Nine Months Ended Sept 30 , ($ in thousands) 2024 2023 2024 2023 Portfolio income $ 216,122 $ 189,960 $ 627,468 $ 562,492 Recoveries received in excess of forecast $ 34,158 $ 18,090 $ 124,256 $ 47,276 Changes in expected future recoveries 26,456 4,066 61,352 (40,896) Changes in expected recoveries $ 60,614 $ 22,156 $ 185,608 $ 6,380 Total portfolio revenue $ 276,736 $ 212,116 $ 813,076 $ 568,872 Expenses Operating expenses in Q3 2024 increased $18.1 million , or 10.4%, to $191.5 million compared to $173.4 million in Q3 2023. Legal collection costs increased $8.0 million , primarily due to increased investments in our U.S. legal collections channel, which are expected to drive future cash collections growth. Compensation and employee services expenses increased $6.6 million , primarily due to lower compensation accruals and benefits related expenses in Q3 2023 and higher wage costs in the current year period. Legal collection fees increased $4.6 million , primarily due to higher external legal collections in our U.S. Core portfolio. For the nine months ended September 30, 2024 , operating expenses increased by $49.5 million , or 9.4%, compared to the same period last year, which included higher legal collection costs of $24.5 million related to increased investments in our U.S. legal collections channel. Interest expense, net in Q3 2024 was $61.1 million , an increase of $11.6 million , or 23.4%, compared to $49.5 million in Q3 2023, primarily reflecting higher debt balances to support portfolio investments. The effective tax rate for the nine months ended September 30, 2024 was 13.7%. Portfolio Acquisitions The Company purchased $350.0 million in portfolios of nonperforming loans in Q3 2024. At the end of Q3 2024, the Company had in place estimated forward flow commitments1 of $491.1 million over the next 12 months, comprised of $406.3 million in the Americas and Australia and $84.8 million in Europe . Portfolio Purchase Source 2024 2023 ($ in thousands) Q3 Q2 Q1 Q4 Q3 Americas & Australia Core $ 263,613 $ 198,761 $ 174,660 $ 143,052 $ 187,554 Americas Insolvency 10,162 26,627 22,156 18,608 44,279 Europe Core 71,507 127,991 43,997 110,780 60,628 Europe Insolvency 4,696 25,990 5,004 12,476 18,722 Total portfolio acquisitions $ 349,978 $ 379,369 $ 245,817 $ 284,916 $ 311,183 Credit Availability Total availability under the Company's credit facilities as of September 30, 2024 was $1 .0 billion, comprised of $412 .7 million based on current ERC and subject to debt covenants, and $585 .9 million of additional availability subject to borrowing base and debt covenants, including advance rates. Financial and Operational Targets for 2024 and 2025 The Company is on track to achieve the following financial and operational targets for full year 2024: Strong portfolio investment levels Double-digit cash collections growth ~60% cash efficiency ratio 8%+ return on average tangible equity2 (up from 6% - 8% previously) In addition, the Company announces the following financial and operational targets for full year 2025: Portfolio investment levels to exceed $1.0 billion Cash collections growth of 8% - 10% 60%+ cash efficiency ratio Double-digit return on average tangible equity2 1. Contractual agreements with sellers of nonperforming loans that allow for the purchase of nonperforming portfolios at pre-established prices. These amounts represent our estimated forward flow purchases over the next 12 months under the agreements in place, based on projections and other factors, including sellers' estimates of future flow sales, and are dependent on actual delivery by the sellers. Accordingly, amounts purchased under these agreements may vary significantly. 2. A reconciliation of total stockholders' equity – PRA Group, Inc. , the most directly comparable financial measure calculated and reported in accordance with GAAP, to average tangible equity can be found at the end of this press release. Conference Call Information PRA Group, Inc. will hold a conference call today at 5:00 p.m. ET to discuss its financial and operational results. To listen to a webcast of the call and view the accompanying slides, visit https://ir.pragroup.com/events-and-presentations . To listen by phone, call 646-357-8785 in the U.S. or 1-800-836-8184 outside the U.S. and ask for the PRA Group conference call. To listen to a replay of the call, either visit the same website until November 4, 2025 , or call 646-517-4150 in the U.S. or 1-888-660-6345 outside the U.S. and use access code 29879# until November 11, 2024 . About PRA Group, Inc. As a global leader in acquiring and collecting nonperforming loans, PRA Group, Inc. returns capital to banks and other creditors to help expand financial services for consumers in the Americas , Europe , and Australia . With thousands of employees worldwide, PRA Group, Inc. companies collaborate with customers to help them resolve their debt. For more information, please visit www.pragroup.com . About Forward Looking Statements Statements made herein that are not historical in nature, including PRA Group, Inc.'s or its management's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements in this press release are based upon management's current beliefs, estimates, assumptions and expectations of PRA Group, Inc.'s future operations and financial and economic performance, taking into account currently available information. These statements are not statements of historical fact or guarantees of future performance, and there can be no assurance that anticipated events will transpire or that the Company's expectations will prove to be correct. Forward-looking statements involve risks and uncertainties, some of which are not currently known to PRA Group, Inc. Actual events or results may differ materially from those expressed or implied in any such forward-looking statements as a result of various factors, including risk factors and other risks that are described from time to time in PRA Group, Inc.'s filings with the Securities and Exchange Commission , including PRA Group, Inc.'s annual reports on Form 10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K, which are available through PRA Group, Inc.'s website and contain a detailed discussion of PRA Group, Inc.'s business, including risks and uncertainties that may affect future results. Due to such uncertainties and risks, you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of today. Information in this press release may be superseded by more recent information or statements, which may be disclosed in later press releases, subsequent filings with the Securities and Exchange Commission or otherwise. Except as required by law, PRA Group, Inc. assumes no obligation to publicly update or revise its forward-looking statements contained herein to reflect any change in PRA Group, Inc.'s expectations with regard thereto or to reflect any change in events, conditions or circumstances on which any such forward-looking statements are based, in whole or in part. PRA Group, Inc. Unaudited Consolidated Income Statements (Amounts in thousands, except per share amounts) Three Months Ended September 30 , Nine Months Ended September 30 , 2024 2023 2024 2023 Revenues: Portfolio income $ 216,122 $ 189,960 $ 627,468 $ 562,492 Changes in expected recoveries 60,614 22,156 185,608 6,380 Total portfolio revenue 276,736 212,116 813,076 568,872 Other revenue 4,741 4,314 8,216 12,264 Total revenues 281,477 216,430 821,292 581,136 Operating expenses: Compensation and employee services 76,106 69,517 223,944 217,708 Legal collection fees 14,479 9,839 40,353 28,228 Legal collection costs 28,781 20,761 90,746 66,228 Agency fees 21,020 19,436 61,751 54,491 Outside fees and services 20,452 18,858 63,626 62,064 Communication 10,048 9,881 34,203 30,525 Rent and occupancy 4,175 4,426 12,455 13,193 Depreciation and amortization 2,469 3,273 7,826 10,344 Impairment of real estate — 5,037 — 5,037 Other operating expenses 13,969 12,356 40,792 38,355 Total operating expenses 191,499 173,384 575,696 526,173 Income from operations 89,978 43,046 245,596 54,963 Other income and (expense): Interest expense, net (61,062) (49,473) (168,693) (130,778) Foreign exchange gain, net 10 564 138 984 Other (676) (500) (836) (1,380) Income/(loss) before income taxes 28,250 (6,363) 76,205 (76,211) Income tax expense/(benefit) (672) 1,788 10,416 (15,317) Net income/(loss) 28,922 (8,151) 65,789 (60,894) Adjustment for net income attributable to noncontrolling interests 1,768 4,111 13,644 13,801 Net income/(loss) attributable to PRA Group, Inc. $ 27,154 $ (12,262) $ 52,145 $ (74,695) Net income/(loss) per common share attributable to PRA Group, Inc. : Basic $ 0.69 $ (0.31) $ 1.33 $ (1.91) Diluted $ 0.69 $ (0.31) $ 1.32 $ (1.91) Weighted average number of shares outstanding: Basic 39,421 39,242 39,353 39,155 Diluted 39,492 39,242 39,495 39,155 PRA Group, Inc. Consolidated Balance Sheets (Amounts in thousands) (unaudited) September 30 , 2024 December 31 , 2023 Assets Cash and cash equivalents $ 141,135 $ 112,528 Investments 61,322 72,404 Finance receivables, net 4,064,467 3,656,598 Income taxes receivable 33,368 27,713 Deferred tax assets, net 88,260 74,694 Right-of-use assets 40,831 45,877 Property and equipment, net 31,835 36,450 Goodwill 423,011 431,564 Other assets 51,841 67,526 Total assets $ 4,936,070 $ 4,525,354 Liabilities and Equity Liabilities: Accounts payable $ 8,176 $ 6,325 Accrued expenses 108,926 131,893 Income taxes payable 27,501 17,912 Deferred tax liabilities, net 19,881 17,051 Lease liabilities 45,222 50,300 Interest-bearing deposits 128,594 115,589 Borrowings 3,296,172 2,914,270 Other liabilities 19,806 32,638 Total liabilities 3,654,278 3,285,978 Equity: Preferred stock, $0.01 par value, 2,000 shares authorized, no shares issued and outstanding — — Common stock, $0.01 par value, 100,000 shares authorized, 39,426 shares issued and outstanding as of September 30, 2024 ; 100,000 shares authorized, 39,247 shares issued and outstanding as of December 31, 2023 394 392 Additional paid-in capital 15,415 7,071 Retained earnings 1,541,693 1,489,548 Accumulated other comprehensive loss (338,620) (329,899) Total stockholders' equity - PRA Group, Inc. 1,218,882 1,167,112 Noncontrolling interests 62,910 72,264 Total equity 1,281,792 1,239,376 Total liabilities and equity $ 4,936,070 $ 4,525,354 Select Expenses (Income) Amounts in thousands, pre-tax Three Months Ended September 30 , 2024 June 30 , 2024 March 31 , 2024 December 31 , 2023 September 30 , 2023 June 30 , 2023 March 31 , 2023 December 31 , 2022 Noncash interest expense - amortization of debt issuance costs $ 3,795 $ 2,331 $ 2,200 $ 2,177 $ 2,220 $ 2,384 $ 2,441 $ 2,444 Change in fair value of derivatives (5,706) (5,628) (5,930) (6,734) (6,545) (6,960) (5,470) (3,309) Amortization of intangibles 60 58 60 69 69 68 66 73 Impairment of real estate — — — 202 5,037 — — — Stock-based compensation expense 3,251 3,555 3,327 2,952 1,629 2,715 3,799 2,206 Purchase Price Multiples as of September 30, 2024 Amounts in thousands Purchase Period Purchase Price (1)(2) Total Estimated Collections (3) Estimated Remaining Collections (4) Current PurchasePrice Multiple Original Purchase Price Multiple (5) Americas and Australia Core 1996-2013 $ 1,932,722 $ 5,754,451 $ 54,564 298 % 233 % 2014 404,117 899,280 30,956 223 % 204 % 2015 443,114 921,016 43,600 208 % 205 % 2016 455,767 1,094,043 60,873 240 % 201 % 2017 532,851 1,218,849 92,454 229 % 193 % 2018 653,975 1,520,429 128,845 232 % 202 % 2019 581,476 1,311,448 134,279 226 % 206 % 2020 435,668 956,953 150,536 220 % 213 % 2021 435,846 736,409 261,863 169 % 191 % 2022 406,082 708,712 334,578 175 % 179 % 2023 622,583 1,222,835 877,849 196 % 197 % 2024 638,147 1,339,929 1,261,602 210 % 210 % Subtotal 7,542,348 17,684,354 3,431,999 Americas Insolvency 1996-2013 1,266,056 2,503,285 6 198 % 159 % 2014 148,420 218,963 30 148 % 124 % 2015 63,170 88,112 23 139 % 125 % 2016 91,442 118,378 188 129 % 123 % 2017 275,257 358,774 950 130 % 125 % 2018 97,879 136,385 692 139 % 127 % 2019 123,077 167,548 4,005 136 % 128 % 2020 62,130 91,718 16,018 148 % 136 % 2021 55,187 74,453 22,486 135 % 136 % 2022 33,442 47,352 26,688 142 % 139 % 2023 91,282 119,692 91,017 131 % 135 % 2024 58,945 87,085 79,949 148 % 148 % Subtotal 2,366,287 4,011,745 242,052 Total Americas and Australia 9,908,635 21,696,099 3,674,051 Europe Core 2012-2013 40,742 72,994 1 179 % 153 % 2014 773,811 2,584,292 423,498 334 % 208 % 2015 411,340 756,321 134,898 184 % 160 % 2016 333,090 581,121 156,172 174 % 167 % 2017 252,174 369,927 102,638 147 % 144 % 2018 341,775 559,571 187,631 164 % 148 % 2019 518,610 852,264 323,682 164 % 152 % 2020 324,119 574,755 242,053 177 % 172 % 2021 412,411 707,823 390,545 172 % 170 % 2022 359,447 586,297 445,461 163 % 162 % 2023 410,593 693,472 574,464 169 % 169 % 2024 251,874 453,608 430,252 180 % 180 % Subtotal 4,429,986 8,792,445 3,411,295 Europe Insolvency 2014 10,876 19,038 — 175 % 129 % 2015 18,973 29,429 — 155 % 139 % 2016 39,338 57,983 598 147 % 130 % 2017 39,235 52,046 841 133 % 128 % 2018 44,908 52,881 2,335 118 % 123 % 2019 77,218 113,945 12,563 148 % 130 % 2020 105,440 159,030 26,032 151 % 129 % 2021 53,230 74,452 24,736 140 % 134 % 2022 44,604 62,450 38,756 140 % 137 % 2023 46,558 64,602 53,683 139 % 138 % 2024 37,783 54,855 48,388 145 % 145 % Subtotal 518,163 740,711 207,932 Total Europe 4,948,149 9,533,156 3,619,227 Total PRA Group $ 14,856,784 $ 31,229,255 $ 7,293,278 (1) Includes the acquisition date finance receivables portfolios that were acquired through our business acquisitions. (2) Non- U.S. amounts are presented at the exchange rate at the end of the year in which the portfolio was purchased. In addition, any purchase price adjustments that occur throughout the life of the portfolio are presented at the year-end exchange rate for the respective year of purchase. (3) Non- U.S. amounts are presented at the year-end exchange rate for the respective year of purchase. (4) Non- U.S. amounts are presented at the September 30, 2024 exchange rate. (5) The Original Purchase Price Multiple represents the purchase price multiple at the end of the year of acquisition. Portfolio Financial Information (1) Amounts in thousands September 30, 2024 (year-to-date) As of September 30, 2024 Purchase Period Cash Collections (2) Portfolio Income (2) Change in Expected Recoveries (2) Total Portfolio Revenue (2) Net Finance Receivables (3) Americas and Australia Core 1996-2013 $ 26,786 $ 10,656 $ 17,243 $ 27,899 $ 16,771 2014 10,691 4,303 8,039 12,342 12,019 2015 13,258 5,305 11,778 17,083 18,918 2016 18,506 9,782 8,634 18,416 21,833 2017 30,470 13,521 11,941 25,462 38,195 2018 60,243 21,259 25,535 46,794 70,664 2019 62,311 24,744 13,609 38,353 75,355 2020 70,086 27,464 6,632 34,096 85,017 2021 79,282 39,444 (10,559) 28,885 136,930 2022 116,142 49,024 (5,628) 43,396 202,091 2023 221,800 126,913 7,595 134,508 494,772 2024 78,091 60,269 11,125 71,394 630,678 Subtotal 787,666 392,684 105,944 498,628 1,803,243 Americas Insolvency 1996-2013 756 85 672 757 — 2014 216 68 151 219 — 2015 153 24 103 127 13 2016 458 31 363 394 163 2017 2,105 153 1,800 1,953 854 2018 2,102 98 802 900 653 2019 13,129 825 (1,169) (344) 3,827 2020 13,236 1,961 1,014 2,975 14,760 2021 11,963 2,352 679 3,031 19,901 2022 8,314 2,370 542 2,912 22,440 2023 18,678 8,407 (983) 7,424 72,108 2024 7,134 4,419 189 4,608 55,878 Subtotal 78,244 20,793 4,163 24,956 190,597 Total Americas and Australia 865,910 413,477 110,107 523,584 1,993,840 Europe Core 2012-2013 789 — 789 789 — 2014 75,739 46,494 22,135 68,629 95,353 2015 23,089 10,203 4,535 14,738 66,317 2016 20,460 9,757 3,067 12,824 88,047 2017 13,600 5,048 1,309 6,357 68,268 2018 28,500 10,315 4,879 15,194 120,450 2019 51,635 16,799 8,537 25,336 218,471 2020 38,069 14,275 6,685 20,960 148,879 2021 50,687 21,458 5,636 27,094 236,349 2022 57,408 22,884 2,696 25,580 280,574 2023 78,264 32,685 2,517 35,202 340,067 2024 22,674 9,521 2,574 12,095 240,351 Subtotal 460,914 199,439 65,359 264,798 1,903,126 Europe Insolvency 2014 138 — 138 138 — 2015 141 2 113 115 — 2016 659 87 306 393 164 2017 1,246 97 44 141 669 2018 2,839 207 217 424 2,087 2019 10,653 1,083 1,620 2,703 10,971 2020 20,081 2,174 2,681 4,855 23,842 2021 11,540 2,041 1,546 3,587 21,779 2022 11,129 2,907 1,983 4,890 31,794 2023 9,057 3,827 449 4,276 42,090 2024 6,203 2,127 1,045 3,172 34,105 Subtotal 73,686 14,552 10,142 24,694 167,501 Total Europe 534,600 213,991 75,501 289,492 2,070,627 Total PRA Group $ 1,400,510 $ 627,468 $ 185,608 $ 813,076 $ 4,064,467 (1) Includes the nonperforming loan portfolios that were acquired through our business acquisitions. (2) Non- U.S. amounts are presented using the average exchange rates during the current reporting period. (3) Non- U.S. amounts are presented at the September 30, 2024 exchange rate. Cash Collections by Year, By Year of Purchase (1) as of September 30, 2024 Amounts in millions Cash Collections Purchase Period Purchase Price (2)(3) 1996-2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Total Americas and Australia Core 1996-2013 $ 1,932.7 $ 3,618.9 $ 660.3 $ 474.4 $ 299.7 $ 197.0 $ 140.3 $ 99.7 $ 64.7 $ 46.5 $ 36.0 $ 28.4 $ 26.8 $ 5,692.7 2014 404.1 — 92.7 253.4 170.3 114.2 82.2 55.3 31.9 22.3 15.0 11.8 10.7 859.8 2015 443.1 — — 117.0 228.4 185.9 126.6 83.6 57.2 34.9 19.5 14.1 13.3 880.5 2016 455.8 — — — 138.7 256.5 194.6 140.6 105.9 74.2 38.4 24.9 18.5 992.3 2017 532.9 — — — — 107.3 278.7 256.5 192.5 130.0 76.3 43.8 30.5 1115.6 2018 654.0 — — — — — 122.7 361.9 337.7 239.9 146.1 92.9 60.2 1361.4 2019 581.5 — — — — — — 143.8 349.0 289.8 177.7 110.3 62.3 1132.9 2020 435.7 — — — — — — — 132.9 284.3 192.0 125.8 70.1 805.1 2021 435.8 — — — — — — — — 85.0 177.3 136.8 79.3 478.4 2022 406.1 — — — — — — — — — 67.7 195.4 116.1 379.2 2023 622.5 — — — — — — — — — — 108.5 221.8 330.3 2024 638.1 — — — — — — — — — — — 78.1 78.1 Subtotal 7,542.3 3,618.9 753.0 844.8 837.1 860.9 945.1 1,141.4 1,271.8 1,206.9 946.0 892.7 787.7 14,106.3 Americas Insolvency 1996-2013 1,266.1 1,491.4 421.4 289.9 168.7 85.5 30.3 6.8 3.6 2.2 1.6 1.1 0.8 2,503.3 2014 148.4 — 37.0 50.9 44.3 37.4 28.8 15.8 2.2 1.1 0.7 0.4 0.2 218.8 2015 63.2 — — 3.4 17.9 20.1 19.8 16.7 7.9 1.3 0.6 0.3 0.2 88.2 2016 91.4 — — — 18.9 30.4 25.0 19.9 14.4 7.4 1.8 0.9 0.5 119.2 2017 275.3 — — — — 49.1 97.3 80.9 58.8 44.0 20.8 4.9 2.1 357.9 2018 97.9 — — — — — 6.7 27.4 30.5 31.6 24.6 12.7 2.1 135.6 2019 123.1 — — — — — — 13.4 31.4 39.1 37.8 28.7 13.1 163.5 2020 62.1 — — — — — — — 6.5 16.1 20.4 19.5 13.2 75.7 2021 55.2 — — — — — — — — 4.6 17.9 17.5 12.0 52.0 2022 33.4 — — — — — — — — — 3.2 9.2 8.3 20.7 2023 91.2 — — — — — — — — — — 9.0 18.7 27.7 2024 59.0 — — — — — — — — — — — 7.0 7.0 Subtotal 2,366.3 1,491.4 458.4 344.2 249.8 222.5 207.9 180.9 155.3 147.4 129.4 104.2 78.2 3,769.6 Total Americas and Australia 9,908.6 5,110.3 1,211.4 1,189.0 1,086.9 1,083.4 1,153.0 1,322.3 1,427.1 1,354.3 1,075.4 996.9 865.9 17,875.9 Europe Core 2012-2013 40.7 27.7 14.2 5.5 3.5 3.3 3.3 2.4 1.9 1.8 1.4 1.0 0.8 66.8 2014 773.8 — 153.2 292.0 246.4 220.8 206.3 172.9 149.8 149.2 122.2 107.6 75.7 1,896.1 2015 411.3 — — 45.8 100.3 86.2 80.9 66.1 54.3 51.4 40.7 33.8 23.1 582.6 2016 333.1 — — — 40.4 78.9 72.6 58.0 48.3 46.7 36.9 29.7 20.5 432.0 2017 252.2 — — — — 17.9 56.0 44.1 36.1 34.8 25.2 20.2 13.6 247.9 2018 341.8 — — — — — 24.3 88.7 71.3 69.1 50.7 41.6 28.5 374.2 2019 518.6 — — — — — — 48.0 125.7 121.4 89.8 75.1 51.6 511.6 2020 324.1 — — — — — — — 32.3 91.7 69.0 56.1 38.1 287.2 2021 412.4 — — — — — — — — 48.5 89.9 73.0 50.7 262.1 2022 359.4 — — — — — — — — — 33.9 83.8 57.4 175.1 2023 410.6 — — — — — — — — — — 50.2 78.3 128.5 2024 252.0 — — — — — — — — — — — 22.6 22.6 Subtotal 4,430.0 27.7 167.4 343.3 390.6 407.1 443.4 480.2 519.7 614.6 559.7 572.1 460.9 4,986.7 Europe Insolvency 2014 10.9 — — 4.3 3.9 3.2 2.6 1.5 0.8 0.3 0.2 0.2 0.1 17.1 2015 19.0 — — 3.0 4.4 5.0 4.8 3.9 2.9 1.6 0.6 0.4 0.1 26.7 2016 39.3 — — — 6.2 12.7 12.9 10.7 7.9 6.0 2.7 1.3 0.7 61.1 2017 39.2 — — — — 1.2 7.9 9.2 9.8 9.4 6.5 3.8 1.2 49.0 2018 44.9 — — — — — 0.6 8.4 10.3 11.7 9.8 7.2 2.8 50.8 2019 77.2 — — — — — — 5.0 21.1 23.9 21.0 17.5 10.7 99.2 2020 105.4 — — — — — — — 6.0 34.6 34.1 29.7 20.1 124.5 2021 53.2 — — — — — — — — 5.5 14.4 14.7 11.5 46.1 2022 44.6 — — — — — — — — — 4.5 12.4 11.1 28.0 2023 46.7 — — — — — — — — — — 4.2 9.1 13.3 2024 37.8 — — — — — — — — — — — 6.3 6.3 Subtotal 518.2 — — 7.3 14.5 22.1 28.8 38.7 58.8 93.0 93.8 91.4 73.7 522.1 Total Europe 4,948.2 27.7 167.4 350.6 405.1 429.2 472.2 518.9 578.5 707.6 653.5 663.5 534.6 5,508.8 Total PRA Group $ 14,856.8 $ 5,138.0 $ 1,378.8 $ 1,539.6 $ 1,492.0 $ 1,512.6 $ 1,625.2 $ 1,841.2 $ 2,005.6 $ 2,061.9 $ 1,728.9 $ 1,660.4 $ 1,400.5 $ 23,384.7 (1) Non- U.S. amounts are presented using the average exchange rates during the cash collection period. (2) Includes the acquisition date finance receivables portfolios acquired through our business acquisitions. (3) Non- U.S. amounts are presented at the exchange rate at the end of the year in which the portfolio was purchased. In addition, any purchase price adjustments that occur throughout the life of the pool are presented at the year-end exchange rate for the respective year of purchase. Use of Non-GAAP Financial Measures The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management uses certain non-GAAP financial measures, including Adjusted EBITDA, internally to evaluate the Company's performance and to set performance goals. Adjusted EBITDA is calculated as net income (or loss) attributable to PRA Group, Inc. plus income tax expense (or less income tax benefit); plus foreign exchange loss (or less foreign exchange gain); plus interest expense, net; plus other expense (or less other income); plus depreciation and amortization; plus impairment of real estate; plus net income attributable to noncontrolling interests; and plus recoveries applied to negative allowance less changes in expected recoveries. Adjusted EBITDA is a supplemental measure of performance that is not required by, or presented in accordance with, GAAP. The Company presents Adjusted EBITDA because the Company considers it an important supplemental measure of its operational and financial performance. Management believes Adjusted EBITDA helps provide enhanced period-to-period comparability of the Company's operational and financial performance and is useful to investors as other companies in the industry report similar financial measures. Adjusted EBITDA should not be considered as an alternative to net income determined in accordance with GAAP. Set forth below is a reconciliation of net income, the most directly comparable financial measure calculated and reported in accordance with GAAP, to Adjusted EBITDA for the last twelve months (LTM) ended September 30, 2024 and for the year ended December 31, 2023 . The calculation of Adjusted EBITDA below may not be comparable to the calculation of similarly titled measures reported by other companies. Reconciliation of Non-GAAP Financial Measures LTM For the Year Ended Adjusted EBITDA for PRA Group ($ in millions) September 30, 2024 December 31, 2023 Net income/(loss) attributable to PRA Group, Inc. $ 43 $ (83) Adjustments: Income tax expense/(benefit) 10 (16) Foreign exchange loss 1 — Interest expense, net 220 181 Other expense 1 2 Depreciation and amortization 11 13 Impairment of real estate — 5 Net income attributable to noncontrolling interests 17 17 Recoveries applied to negative allowance less changes in expected recoveries 797 888 Adjusted EBITDA $ 1,100 $ 1,007 In addition, the Company uses return on average tangible equity (ROATE), which is a supplemental measure of performance that is not required by, or presented in accordance with, GAAP, to monitor and evaluate operating performance relative to the Company's equity. Management believes ROATE is a useful financial measure for investors in evaluating the effective use of equity, and is an important component of its long-term shareholder return. Average tangible equity (ATE) is defined as average Total stockholders' equity - PRA Group, Inc. less average goodwill and average other intangible assets. ROATE is calculated by dividing annualized Net income/(loss) attributable to PRA Group, Inc. by ATE. The following table displays the Company's ROATE and provides a reconciliation of Total stockholders' equity - PRA Group, Inc. as reported in accordance with GAAP to ATE for the periods indicated (amounts in thousands, except for ratio data): Average Balance Balance as of Period End Third Quarter Year-to-Date September 30, 2024 September 30, 2023 2024 2023 2024 2023 Total stockholders' equity - PRA Group, Inc. $ 1,218,882 $ 1,115,590 $ 1,182,173 $ 1,140,558 $ 1,165,196 $ 1,166,780 Less: Goodwill 423,011 412,513 419,329 413,709 420,517 420,997 Less: Other intangible assets 1,620 1,670 1,609 1,753 1,656 1,797 Average tangible equity $ 761,235 $ 725,096 $ 743,023 $ 743,986 Net income/(loss) attributable to PRA Group, Inc. $ 27,154 $ (12,262) $ 52,145 $ (74,695) Return on average tangible equity (1) 14.3 % (6.8) % 9.4 % (13.4) % Investor Contact: Najim Mostamand , CFAVice President, Investor Relations757-431-7913 [email protected] News Media Contact: Elizabeth Kersey Senior Vice President, Communications and Public Policy(757) 641-0558 [email protected] View original content to download multimedia: https://www.prnewswire.com/news-releases/pra-group-reports-third-quarter-2024-results-302295784.html SOURCE PRA Group, Inc.

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