PRA Group — Q3 2026 Earnings Summary

Financial Performance:

• Total cash collections were $536 million in Q3 2026, compared to $542 million in Q3 2025.
• Portfolio income increased 5% to $271 million in Q3 2026 from $259 million in Q3 2025.
• Total portfolio revenue decreased 8% to $285 million in Q3 2026 from $310 million in Q3 2025, driven by lower changes in expected recoveries.
• Changes in expected recoveries totaled $14 million in Q3 2026, down from $51 million in Q3 2025.
• Net income attributable to PRA Group, Inc. was $15 million ($0.39 diluted EPS) in Q3 2026, compared to a net loss of $408 million ($10.43 diluted EPS) in Q3 2025.
• Adjusted EBITDA for the twelve months ended September 30, 2026, was $1.4 billion, up 9% from the prior year.
• Operating expenses decreased to $200 million in Q3 2026 from $627 million in Q3 2025, which included a $413 million non-cash goodwill impairment charge.
• Adjusted operating expenses decreased $14 million to $200 million in Q3 2026 from $214 million in Q3 2025.
• Interest expense, net was $64 million in Q3 2026, relatively unchanged from Q3 2025.
• The effective tax rate for the quarter was 16%.
• Estimated remaining collections (ERC) increased 5% to $8.8 billion.
• Cash efficiency ratio was 63% in Q3 2026, compared to a negative 15% in Q3 2025.
• Adjusted cash efficiency ratio was 63% in Q3 2026, an improvement of over 200 basis points compared to 61% in Q3 2025.
• Return on average tangible equity (ROATE) was 6% for Q3 2026, compared to (182)% in Q3 2025.
• Adjusted ROATE was 6% for Q3 2026, compared to 9% in Q3 2025.

Guidance and Future Outlook:

• Management stated the company is on a good trajectory following the launch of the PRA 3.0 strategy.
• The company expects technology modernization and significant investments in legal to strengthen the business in the coming years.
• Forward flow commitments in place at the end of Q3 2026 totaled $438 million over the next 12 months ($175 million in Europe, $247 million in the U.S., and $16 million in other markets).

Business Segments and Product Lines:

• U.S. Core: Cash collections were $255 million in Q3 2026.
• U.S. Insolvency: Cash collections were $20 million in Q3 2026.
• Europe Core: Cash collections were $195 million in Q3 2026.
• Europe Insolvency: Cash collections were $18 million in Q3 2026.
• Other Markets: Cash collections were $48 million in Q3 2026.
• Growth in U.S. legal cash collections and digital collections, coupled with continued growth in Europe cash collections, partially offset decreases in other areas.
• A comprehensive portfolio review completed in Q2 2026 included a $349 million increase in Europe ERC.
• The company continued to invest in the legal collections channel and technology modernization efforts.

Market and Competitive Landscape:

• The company maintained a disciplined approach to capital deployment focused on attractive net returns in a healthy supply environment.
• Total portfolio purchases were $229 million in Q3 2026, reflecting continued discipline in deploying capital toward opportunities meeting targeted return thresholds.
• Purchase price multiples for the total PRA Group portfolio as of September 30, 2026, were 229% (Current) versus 205% (Original).

Risks and Challenges:

• The press release notes that actual events or results may differ materially from forward-looking statements due to various factors, including risk factors described in SEC filings.
• Forward flow purchase amounts may vary significantly due to actual delivery by sellers and foreign exchange rate fluctuations.

Management Commentary and Tone:

• Martin Sjolund, President and CEO, highlighted continued execution of the PRA 3.0 strategy, noting healthy cash collections, portfolio income growth, lowered operating expenses, and disciplined portfolio investments.
• Management expressed confidence in the operating leverage realized from cost reduction actions and PRA 3.0 initiatives.
• The tone was positive regarding the progress made since launching the PRA 3.0 strategy and the strengthening of the business foundation.

Other Key Points:

• In October 2026, shortly after the quarter ended, the company issued $400 million in aggregate principal amount of senior notes due 2033.
• The new debt issuance extended the company's debt maturity profile and enhanced funding flexibility.
• Total availability under credit facilities as of September 30, 2026, was $1 billion ($770 million based on current ERC and $262 million additional availability).
• Total portfolio purchases for the nine months ended September 30, 2026, were $646 million.
• Total cash collections for the nine months ended September 30, 2026, were $1.65 billion.
• Net income attributable to PRA Group, Inc. for the nine months ended September 30, 2026, was $101 million.
• Adjusted EBITDA for the nine months ended September 30, 2026, was $1.0 billion (calculated from LTM data provided).
• The company reported a goodwill impairment charge of $413 million in Q3 2025, which was excluded from adjusted operating expenses in Q3 2026.