PRA Reports Fourth Quarter and Full Year 2012 Results

PRA Reports Fourth Quarter and Full Year 2012 Results

NORFOLK, Va., Feb. 13, 2013 (GLOBE NEWSWIRE) -- Portfolio Recovery Associates,
Inc. (PRA), a financial and business services company, today reported its
fourth quarter and full year 2012 results.

Fourth Quarter Highlights

  *Cash collections of $229.2 million, up 27% from the fourth quarter of
    2011.
  *Revenues of $154.3 million, up 31%.
  *Net income of $35.8 million, up 35%.
  *Diluted EPS of $2.10, compared with $1.54 a year ago.
  *Annualized return on average equity of 20.6%.
  *$199.1 million of portfolio purchases, up from $88.9 million in the fourth
    quarter of 2011.

For the full year 2012, net income was $126.6 million, compared with $100.8
million in 2011, an increase of 26%. Diluted earnings per share increased from
$5.85 in 2011 to $7.39 in 2012. Revenues increased from $458.9 million in 2011
to $592.8 million in 2012.

"PRA again reported record operating results in the fourth quarter and for
full year 2012, continuing a trend of strong year-over-year growth," said
Steve Fredrickson, chairman, president and chief executive officer, PRA.

"Our financial results were led by increases in cash collections from our
receivables portfolios. Cash collections were $908.7 million in 2012, up 29%
over 2011. In 2012, we received a record 8 million payments on our debt
portfolios. This includes growth in the number of recurring payment plans from
customers to eliminate their debt, which provides a low-cost, recurring
revenue stream for PRA. This record level of payments places PRA in an
excellent position to continue to prosper in 2013 and beyond," Fredrickson
said.

             FINANCIAL AND OPERATING REVIEW – FOURTH QUARTER 2012

Revenues

  *Revenues were $154.3 million for the quarter, up 31% from a year ago.This
    was driven by cash receipts of $245.4 million, up 25% from $195.7 million
    in Q4 2011.PRA defines cash receipts as the total of cash collections and
    fee income.

Finance Receivables Income and Cash Collections

  *Finance receivables income, driven by cash collections from finance
    receivables, increased 34% to $138.1 million in Q4 2012 from $102.7
    million in the year-ago period. Cash collections from finance receivables
    advanced 27% over Q4 2011, led by increases in core portfolio legal
    collections.These legal collections increased 49% in Q4 2012 from a year
    ago, due in part to PRA's expanded focus on collections from customers
    with an ability to pay back their debt, but who refuse attempts to
    collect.Bankruptcy portfolio collections and call center collections
    increased 21% and 19%, respectively.


Cash Collection Source  Q42012     Q32012     Q22012     Q12012     Q42011
($ in thousands)
Call Center & Other     $72,624  $72,394  $73,582  $79,805  $61,227
Collections
External Legal          41,521    39,913    41,464    34,852    26,316
Collections
Internal Legal          23,968    25,650    25,361    23,345    17,615
Collections
Purchased Bankruptcy    91,098    91,095    92,018    79,994    75,166
Collections
Total Cash Collections  $229,211 $229,052 $232,425 $217,996 $180,324

                                                               

  *In Q4 2012, principal amortization of finance receivables was $91.1
    million, or 39.8% of cash collections.This compares with $77.6 million,
    or 43.0% of cash collections, recorded in the year-earlier
    quarter.Principal amortization includes net allowance charges of $2.3
    million against certain pools of finance receivables accounts recorded in
    the quarter, compared with $3.1 million recorded in Q4 2011.

Fee Income

  *PRA's fee-based businesses generated Q4 2012 fee income of $16.2 million,
    compared with $15.3 million in the same period a year ago, which accounted
    for 10% of PRA's total revenues in Q4 2012 compared with 13% a year ago.
    Fee income from PRA's UK business acquired in January 2012 more than
    offset a decrease in fee income from PRA's US fee-based businesses, which
    continued to be impacted by the economic downturn. The company
    anticipates that its U.S. subsidiary, Claims Compensation Bureau, may
    generate substantially higher fee income during 2013, with a single, large
    case expected to provide $4 million to $6 million in fees during the first
    half of the year.

Operating Expenses and Income

  *Q4 2012 operating expenses were $94.3 million, up $22.1 million or 31%
    from the year-earlier quarter.The increase was due in large part to costs
    associated with business growth, including a $9.1 million increase in
    personnel-related expenses, an $8.1 million increase in legal costs and
    fees related to PRA's expanded focus on legal collections, and the
    inclusion of operating expenses of PRA's U.K. business acquired in January
    2012.
    
  *Q4 2012 operating income was $60.0 million, compared with $46.0 million in
    Q4 2011, an increase of 31%.The operating margin was 38.9% in both
    quarterly periods.

Balance Sheet and Purchasing

  *During the fourth quarter of 2012, PRA invested $199.1 million in
    portfolio purchases, compared with $88.9 million in the fourth quarter of
    2011.Fourth quarter 2012 domestic purchasing volume was $196.5 million,
    and was comprised of $111.0 million in bankruptcy portfolio purchases and
    $85.5 million in core portfolio purchases.Fourth quarter 2012 bankruptcy
    portfolio investment included the acquisition of portfolios from National
    Capital Management, LLC announced on December 21, 2012.Domestic
    receivables purchased during the quarter were acquired in 94 portfolios
    from 15 different sellers.
    
  *Cash balances were $32.7 million as of December 31, 2012.
    
  *As of December 31, 2012, long-term debt was $200.5 million and revolving
    debt was $127.0 million.Remaining borrowing availability, subject to
    normal borrowing and collateral provisions, under PRA's credit facility
    was $273.0 million.

Conference Call Information

PRA will hold a conference call today with investors at 6:15 p.m. ET to
discuss its Q4 2012 results.Investors may access the call by calling
888-695-7639 in the U.S. or 970-315-0482 outside the U.S. The conference ID is
92957383. A replay will be available approximately one hour after the call
ends and will remain available until February 20, 2013. Investors may access
the replay of the call by calling 855-859-2056 in the U.S. or 404-537-3406
outside the U.S. To access the replay, use the conference ID
92957383.Investors also may listen to the conference call via webcast, both
live and archived, at http://ir.PortfolioRecovery.com/events.cfm.

About PRA

Portfolio Recovery Associates, Inc. (Nasdaq:PRAA) is a financial and business
services company operating in the U.S. and the U.K.As a leader in the U.S.
debt buying industry, PRA returns capital to banks and other creditors that
helps expand financial services for consumers.PRA collaborates with its
customers to create affordable, realistic debt repayment plans in compliance
with consumer protection laws.The company also provides a broad range of
fee-based services to local governments and law enforcement, U.S. businesses,
institutional investors, global hedge funds, and U.K. banks and creditors.

PRA was recognized as one ofFortune's100 Fastest Growing Companies in 2012.
The company also was named to Forbes'Top 25 Best Small Companies in America
in 2012, and has been annually ranked as one of Forbes' 100 Best Small
Companies since 2007. For more information, visit www.PortfolioRecovery.com.

The Portfolio Recovery Associates logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=13727

About Forward-Looking Statements

Statements herein which are not historical, including Portfolio Recovery
Associates' or management's intentions, hopes, beliefs, expectations,
representations, projections, plans or predictions of the future, including
future revenue and earnings growth, statements with respect to future
contributions of its subsidiaries to earnings and future portfolio-purchase
opportunities, 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.Forward-looking statements
include references to Portfolio Recovery Associates' presentations and web
casts. The forward-looking statements in this press release are based upon
management's beliefs, assumptions and expectations of the Company's future
operations and economic performance, taking into account currently available
information. These statements are not statements of historical
fact.Forward-looking statements involve risks and uncertainties, some of
which are not currently known to us. Actual events or results may differ from
those expressed or implied in any such forward-looking statements as a result
of various factors, including the risk factors and other risks that are
described from time to time in the Company's filings with the Securities and
Exchange Commission including but not limited to its annual reports on Form
10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K,
filed with the Securities and Exchange Commission and available through the
Company's website, which contain a more detailed discussion of the Company's
business, including risks and uncertainties that may affect future results.
Due to such uncertainties and risks, readers are cautioned not to place undue
reliance on such forward-looking statements, which speak only as of the date
hereof.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.
The Company expressly disclaims any obligation or undertaking to release
publicly any updates or revisions to any forward-looking statements contained
herein to reflect any change in the Company'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.

Portfolio Recovery Associates, Inc.
Unaudited Consolidated Income Statements
(in thousands, except per share amounts)
                                                              
                          Three Months Three Months Year         Year
                          Ended        Ended        Ended        Ended
                          December 31, December 31, December 31, December 31,
                          2012         2011         2012         2011
                                                              
Revenues:                                                      
Income recognized on       $138,068    $102,743    $530,635    $401,895
finance receivables, net
Fee income                 16,183       15,344       62,166       57,040
                                                              
Total revenues             154,251      118,087      592,801      458,935
                                                              
Operating expenses:                                            
Compensation and employee  44,849       35,759       168,356      138,202
services
Legal collection fees      9,153        5,940        34,393       23,621
Legal collection costs     14,619       9,710        72,325       38,659
Agent fees                 1,411        1,647        5,906        7,653
Outside fees and services  7,292        5,607        28,867       19,310
Communications             7,073        5,487        29,110       23,372
Rent and occupancy         1,728        1,539        6,781        5,891
Depreciation and           3,681        3,188        14,515       12,943
amortization
Other operating expenses   4,456        3,255        16,484       12,416
                                                              
Total operating expenses   94,262       72,132       376,737      282,067
                                                              
Gain on sale of property   --           --           --           1,157
                                                              
Income from operations     59,989       45,955       216,064      178,025
                                                              
Other income and                                               
(expense):
Interest income            2            --           10           7
Interest expense           (1,818)      (2,512)      (9,041)      (10,569)
                                                              
Income before income taxes 58,173       43,443       207,033      167,463
                                                              
Provision for income taxes 22,441       16,776       80,934       66,319
                                                              
Net income                 $35,732     $26,667     $126,099    $101,144
                                                              
Adjustment for
(loss)/income attributable (70)         77           (494)        353
to redeemable
noncontrolling interest
                                                              
Net income attributable to
Portfolio Recovery         $35,802     $26,590     $126,593    $100,791
Associates, Inc.
                                                              
                                                              
Net income per common
share attributable to                                          
Portfolio Recovery
Associates, Inc.:
Basic                      $2.12      $1.55      $7.45      $5.89
Diluted                    $2.10      $1.54      $7.39      $5.85
                                                              
Weighted average number of                                     
shares outstanding:
Basic                      16,883       17,121       16,997       17,110
Diluted                    17,072       17,269       17,123       17,230
                                                              

Portfolio Recovery Associates, Inc.
Unaudited Condensed Consolidated Balance Sheets
(in thousands, except per share amounts)
                                                                
                                                    December 31, December 31,
ASSETS                                               2012         2011
                                                                
Cash and cash equivalents                            $32,687     $26,697
Finance receivables, net                             1,078,951    926,734
Accounts receivable, net                             10,486       7,862
Property and equipment, net                          25,312       25,727
Goodwill                                             114,688      61,678
Intangible assets, net                               20,364       14,596
Other assets                                         11,668       7,829
                                                                
Total assets                                         $1,294,156  $1,071,123
                                                                
LIABILITIES AND EQUITY                                           
                                                                
Liabilities:                                                     
Accounts payable and accrued liabilities             $52,237     $42,660
Net deferred tax liability                           185,277      193,898
Line of credit                                       127,000      220,000
Long-term debt                                       200,542      1,246
                                                                
Total liabilities                                    565,056      457,804
                                                                
Redeemable noncontrolling Interest                   20,673       17,831
                                                                
Stockholders' equity:                                            
Preferred stock, par value $0.01, authorized shares, --           --
2,000,issued and outstanding shares - 0
Common stock, par value $0.01, 60,000 authorized
shares, 16,909 issued and outstanding shares at      169          171
December 31, 2012, and 17,134 issued and outstanding
shares at December 31, 2011
Additional paid-in capital                           151,216      167,719
Retained earnings                                    554,191      427,598
Accumulated other comprehensive income               2,851        --
Total stockholders' equity                           708,427      595,488
                                                                
Total liabilities and equity                         $1,294,156  $1,071,123
                                                                

Portfolio Recovery Associates, Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
(in thousands)
                                                                
                                                    Year         Year
                                                    Ended        Ended
                                                    December 31, December 31,
                                                    2012         2011
Cash flows from operating activities:                            
Net income                                           $126,099    $101,144
Adjustments to reconcile net income to net                       
cashprovided by operating activities:
Amortization of share-based compensation             11,282       7,759
Depreciation and amortization                        14,515       12,943
Deferred tax (benefit)/expense                       (8,634)      28,927
Gain on sale of property                             --           (1,157)
Changes in operating assets and liabilities:                     
Other assets                                         2,073        (54)
Accounts receivable                                  (474)        1,070
Accounts payable and accrued liabilities             (13,444)     22,393
                                                                
Net cash provided by operating activities            131,417      173,025
                                                                
Cash flows from investing activities:                            
Purchases of property and equipment                  (7,115)      (9,634)
Proceeds from sale of property                       --           1,267
Acquisition of finance receivables, net of buybacks  (457,068)    (398,999)
Collections applied to principal on finance          378,049      303,595
receivables
Business acquisitions, net of cash acquired          (148,995)    (985)
Proceeds from due from seller                        29,548       --
                                                                
Net cash used in investing activities                (205,581)    (104,756)
                                                                
Cash flows from financing activities:                            
Proceeds from exercise of options                    --           150
Income tax benefit from share-based compensation     2,138        641
Proceeds from line of credit                         294,000      32,000
Principal payments on line of credit                 (187,000)    (112,000)
Repurchases of common stock                          (22,735)     --
Payments of line of credit origination costs and     (4,994)      --
fees
Distributions paid to noncontrolling interest        --           (2,307)
Principal payments on long-term debt                 (704)        (1,150)
                                                                
Net cash provided by/(used in) financing activities  80,705       (82,666)
                                                                
Effect of exchange rate on cash                      (551)        --
                                                                
Net increase/(decrease) in cash and cash equivalents 5,990        (14,397)
                                                                
Cash and cash equivalents, beginning of year         26,697       41,094
                                                                
Cash and cash equivalents, end of year               $32,687     $26,697
                                                                
Supplemental disclosure of cash flow information:                
Cash paid for interest                               $9,566      $10,280
Cash paid for income taxes                           98,738      23,641
                                                                
Noncash investing and financing activities:                      
Adjustment of the noncontrolling interest            $(3,597)    $(4,112)
measurement amount
Distributions payable relating to noncontrolling     261         67
interest
Employee stock relinquished for payment of taxes     (3,593)     (257)
Conversion of revolving line of credit to long-term  200,000     --
debt
                                                                

Purchase Price Multiples at December 31, 2012, Entire Domestic Portfolio
($ in thousands)
                                             Actual Cash             
                     Total        Net Finance  Collections  Estimated   Total
                                                                          Estimated
Purchase  Purchase     Estimated    Receivables  Including    Remaining  Collections
                                                 Cash                     to
Period    Price        Collections  Balance      Sales        Collections Purchase
                                                                          Price
1996      $3,080     $10,222    $--       $10,183    $39       332%
1997      7,685       25,590      --         25,422      168        333%
1998      11,089      37,582      --         37,178      404        339%
1999      18,898      69,947      --         68,872      1,075      370%
2000      25,020      117,808     --         115,316     2,492      471%
2001      33,481      177,086     --         173,568     3,518      529%
2002      42,325      201,365     --         195,044     6,321      476%
2003      61,448      272,359     --         259,874     12,485     443%
2004      59,176      205,011     --         193,754     11,257     346%
2005      143,168     315,867     8,298       301,186     14,681     221%
2006      107,674     214,994     9,170       199,716     15,278     200%
2007      258,397     507,936     33,314      449,362     58,574     197%
2008      275,165     522,112     55,112      430,738     91,374     190%
2009      281,456     851,686     73,461      599,137     252,549    303%
2010      358,143     942,234     137,577     539,508     402,726    263%
2011      394,198     874,241     255,488     318,030     556,211    222%
2012      518,333     937,983     492,013     74,289      863,694    181%
Total     $2,598,736 $6,284,023 $1,064,433 $3,991,177 $          242%
                                                              2,292,846
                                                                    
Purchase Price Multiples at December 31, 2012, Purchased Bankruptcy Portfolio
($ in thousands)
                                             Actual Cash             
                     Total        Net Finance  Collections  Estimated   Total
                                                                          Estimated
Purchase  Purchase     Estimated    Receivables  Including    Remaining  Collections
                                                 Cash                     to
Period    Price        Collections  Balance      Sales        Collections Purchase
                                                                          Price
1996-2003 $--       $--       $--       $--       $--      0%
2004      7,468       14,501      --         14,402      99         194%
2005      29,301      43,569      56          43,472      97         149%
2006      17,630      31,486      110         31,146      340        179%
2007      78,544      104,796     1,531       102,925     1,871      133%
2008      108,607     175,892     18,488      152,538     23,354     162%
2009      156,053     442,700     44,090      309,083     133,617    284%
2010      209,224     471,459     87,294      269,005     202,454    225%
2011      182,175     290,933     140,044     81,597      209,336    160%
2012      258,317     351,356     251,445     17,388      333,968    136%
Total     $1,047,319 $1,926,692 $543,058   $1,021,556 $905,136  184%
                                                                    
Purchase Price Multiples at December 31, 2012, Core Portfolio
($ in thousands)
                                             Actual Cash             
                     Total        Net Finance  Collections  Estimated   Total
                                                                          Estimated
Purchase  Purchase     Estimated    Receivables  Including    Remaining  Collections
                                                 Cash                     to
Period    Price        Collections  Balance      Sales        Collections Purchase
                                                                          Price
1996      $3,080     $10,222    $--       $10,183    $39       332%
1997      7,685       25,590      --         25,422      168        333%
1998      11,089      37,582      --         37,178      404        339%
1999      18,898      69,947      --         68,872      1,075      370%
2000      25,020      117,808     --         115,316     2,492      471%
2001      33,481      177,086     --         173,568     3,518      529%
2002      42,325      201,365     --         195,044     6,321      476%
2003      61,448      272,359     --         259,874     12,485     443%
2004      51,708      190,510     --         179,352     11,158     368%
2005      113,867     272,298     8,242       257,714     14,584     239%
2006      90,044      183,508     9,060       168,570     14,938     204%
2007      179,853     403,140     31,783      346,437     56,703     224%
2008      166,558     346,220     36,624      278,200     68,020     208%
2009      125,403     408,986     29,371      290,054     118,932    326%
2010      148,919     470,775     50,283      270,503     200,272    316%
2011      212,023     583,308     115,444     236,433     346,875    275%
2012      260,016     586,627     240,568     56,901      529,726    226%
Total     $1,551,417 $4,357,331 $521,375   $2,969,621 $          281%
                                                              1,387,710
                                                                    

FINANCIAL HIGHLIGHTS
              Three Months Ended              Twelve Months Ended       
              December 31,              %      December 31,              %
              2012         2011         Change 2012         2011         Change
EARNINGS (in                                                         
thousands)
Income
recognized on
finance        $138,068   $102,743   34%    $530,635   $401,895   32%
receivables,
net
Fee income     16,183      15,344      5%     62,166      57,040      9%
Total revenues 154,251     118,087     31%    592,801     458,935     29%
Operating      94,262      72,134      31%    376,737     282,067     34%
expenses
Income from    59,989      45,953      31%    216,064     178,025     21%
operations
Net interest   1,816       2,512       -28%   9,031       10,562      -15%
expense
Net income     35,732      26,666      34%    126,099     101,144     25%
Net income
attributable
to Portfolio   35,802      26,590      35%    126,593     100,791     26%
Recovery
Associates,
Inc.
                                                                    
PERIOD-END
BALANCES (in                                                         
thousands)
Cash and cash  $32,687    $26,697    22%    $32,687    $26,697    22%
equivalents
Finance
receivables,   1,078,951   926,734     16%    1,078,951   926,734     16%
net
Goodwill and
intangible     135,052     76,274      77%    135,052     76,274      77%
assets, net
Total assets   1,294,156   1,071,123   21%    1,294,156   1,071,123   21%
Line of credit
and long-term  327,542     221,246     48%    327,542     221,246     48%
debt
Total          565,056     457,804     23%    565,056     457,804     23%
liabilities
Total equity   708,427     595,488     19%    708,427     595,488     19%
                                                                    
FINANCE
RECEIVABLE
COLLECTIONS                                                          
(dollars in
thousands)
Cash           $229,211   $180,324   27%    $908,684   $705,490   29%
collections
Principal
amortization
without        88,851      74,481      19%    371,497     293,431     27%
allowance
charges
Principal
amortization   91,142      77,581      17%    378,049     303,595     25%
with allowance
charges
Principal
amortization
w/ allowance                                                         
charges as %
of cash
collections:
Including
fully          39.8%        43.0%        -8%    41.6%        43.0%        -3%
amortized
pools
Excluding
fully          40.9%        44.9%        -9%    43.0%        45.4%        -5%
amortized
pools
                                                                    
ALLOWANCE FOR
FINANCE
RECEIVABLES                                                          
(dollars in
thousands)
Balance at     $93,123    $86,571    8%     $93,123    $86,571    8%
period-end
Allowance      2,291       3,100       -26%   6,552       10,164      -36%
charge
Allowance
charge to
period-end net 0.21%        0.33%        -37%   0.61%        1.10%        -45%
finance
receivables
Allowance
charge to net
finance        1.66%        3.02%        -45%   1.23%        2.53%        -51%
receivable
income
Allowance
charge to cash 1.00%        1.72%        -42%   0.72%        1.44%        -50%
collections
                                                                    
PURCHASES OF
FINANCE
RECEIVABLES                                                          
(1) (dollars
in thousands)
Purchase price $85,476    $42,532    101%   $259,795   $213,389   22%
- core
Face value -   901,512     829,232     9%     3,581,246   7,900,761   -55%
core
Purchase price 111,001     46,360      139%   262,630     195,019     35%
- bankruptcy
Face value -   946,927     376,094     152%   2,104,977   1,891,595   11%
bankruptcy
Purchase price 196,477     88,892      121%   522,425     408,408     28%
- total
Face value -   1,848,439   1,205,326   53%    5,686,223   9,792,356   -42%
total
Number of
portfolios -   94           83           13%    376          333          13%
total
                                                                    
ESTIMATED
REMAINING
COLLECTIONS                                                          
(1) (in
thousands)
Estimated
remaining      $1,387,711 $1,159,086 20%    $1,387,711 $1,159,086 20%
collections -
core
Estimated
remaining      905,136     794,262     14%    905,136     794,262     14%
collections -
bankruptcy
Estimated
remaining      2,292,847   1,953,348   17%    2,292,847   1,953,348   17%
collections -
total
                                                                    
SHARE DATA
(share amounts                                                       
in thousands)
Net income per
common share - $2.10      $1.54      36%    $7.39      $5.85      26%
diluted
Weighted
average number
of shares      17,072      17,269      -1%    17,123      17,230      -1%
outstanding -
diluted
Shares         0.1          --          100%   332         --          100%
repurchased
Average price
paid per share
repurchased    $93.02     --          100%   $68.57     --          100%
(including
acquisitions
costs)
Closing market $106.86    $67.52     58%    $106.86    $67.52     58%
price
                                                                    
RATIOS AND
OTHER DATA                                                           
(dollars in
thousands)
Return on
average equity 20.6%        18.2%        14%    19.6%        18.5%        6%
(2)
Return on      23.2%        22.6%        3%     21.3%        22.0%        -3%
revenue (3)
Operating      38.9%        38.9%        0%     36.4%        38.8%        -6%
margin (4)
Operating
expense to     38.4%        36.9%        4%     38.8%        37.0%        5%
cash receipts
(5)
Debt to equity 46.2%        37.2%        24%    46.2%        37.2%        24%
(6)
Number of      2,153        1,658        30%    2,153        1,658        30%
collectors
Number of
full-time      3,221        2,641        22%    3,221        2,641        22%
equivalent
employees
Cash receipts  $245,394   $195,668   25%    $970,850   $762,530   27%
(5)
Line of credit
- unused       273,000     187,500     46%    273,000     187,500     46%
portion at
period end
(1)Domestic                                                         
portfolio only
(2)Calculated as
annualized net income                                                 
divided by average equity
for the period
(3)Calculated
as net income                                                        
divided by
total revenues
(4)Calculated
as income from
operations                                                           
divided by
total revenues
(5)"Cash
receipts" is
defined as
cash                                                                 
collections
plus fee
income
(6)For purposes of this
ratio, "debt" equals the                                              
line of credit balance plus
long-term debt
                                                                    

FINANCIAL HIGHLIGHTS
              For the Quarter Ended
              December 31, September    June 30,     March 31,    December 31,
                            30,
              2012         2012         2012         2012         2011
EARNINGS (in                                                   
thousands)
Income
recognized on
finance        $138,068   $135,754   $132,587   $124,226   $102,743
receivables,
net
Fee income     16,183      14,765      15,298      15,920      15,344
Total revenues 154,251     150,519     147,885     140,146     118,087
Operating      94,262      93,461      93,289      95,725      72,134
expenses
Income from    59,989      57,058      54,596      44,421      45,953
operations
Net interest   1,816       2,189       2,374       2,652       2,512
expense
Net income     35,732      33,127      32,051      25,189      26,666
Net income
attributable
to Portfolio   35,802      33,314      32,015      25,462      26,590
Recovery
Associates,
Inc.
                                                              
PERIOD-END
BALANCES (in                                                   
thousands)
Cash and cash  $32,687    $31,488    $42,621    $28,068    $26,697
equivalents
Finance
receivables,   1,078,951   973,594     966,508     945,242     926,734
net
Goodwill and
intangible     135,052     121,623     121,748     124,659     76,274
assets, net
Total assets   1,294,156   1,169,698   1,173,738   1,142,026   1,071,123
Line of credit
and long-term  327,542     250,675     292,850     265,936     221,246
debt
Total          565,056     479,211     520,911     502,531     457,804
liabilities
Total equity   708,427     670,489     633,446     620,712     595,488
                                                              
FINANCE
RECEIVABLE
COLLECTIONS                                                    
(dollars in
thousands)
Cash           $229,211   $229,053   $232,425   $217,996   $180,324
collections
Principal
amortization
without        88,851      91,736      97,634      93,276      74,481
allowance
charges
Principal
amortization   91,142      93,299      99,838      93,770      77,581
with allowance
charges
Principal
amortization
w/ allowance                                                   
charges as %
of cash
collections:
Including
fully          39.8%        40.7%        43.0%        43.0%        43.0%
amortized
pools
Excluding
fully          40.9%        42.0%        44.4%        44.8%        44.9%
amortized
pools
                                                              
ALLOWANCE FOR
FINANCE
RECEIVABLES                                                    
(dollars in
thousands)
Balance at     $93,123    $90,832    $89,269    $87,065    $86,571
period-end
Allowance      2,291       1,563       2,204       494         3,100
charge
Allowance
charge to
period-end net 0.21%        0.16%        0.23%        0.05%        0.33%
finance
receivables
Allowance
charge to net
finance        1.66%        1.15%        1.66%        0.40%        3.02%
receivable
income
Allowance
charge to cash 1.00%        0.68%        0.95%        0.23%        1.72%
collections
                                                              
PURCHASES OF
FINANCE
RECEIVABLES                                                    
(1) (dollars
in thousands)
Purchase price $85,476    $52,703    $69,512    $52,104    $42,532
- core
Face value -   901,512     674,135     1,033,331   972,268     829,232
core
Purchase price 111,001     41,277      53,460      56,892      46,360
- bankruptcy
Face value -   946,927     341,359     448,244     368,447     376,094
bankruptcy
Purchase price 196,477     93,980      122,972     108,996     88,892
- total
Face value -   1,848,439   1,015,494   1,481,575   1,340,715   1,205,326
total
Number of
portfolios -   94           95           105          82           83
total
                                                              
ESTIMATED
REMAINING
COLLECTIONS                                                    
(1) (in
thousands)
Estimated
remaining      $1,387,711 $1,323,134 $1,305,641 $1,226,292 $1,159,086
collections -
core
Estimated
remaining      905,136     791,018     802,353     796,161     794,262
collections -
bankruptcy
Estimated
remaining      2,292,847   2,114,152   2,107,994   2,022,453   1,953,348
collections -
total
                                                              
SHARE DATA
(share amounts                                                 
in thousands)
Net income per
common share - $2.10      $1.96      $1.87      $1.47      $1.54
diluted
Weighted
average number
of shares      17,072      17,022      17,133      17,267      17,269
outstanding -
diluted
Shares         0           --          300,849     30,600      --
repurchased
Average price
paid per share
repurchased    $93.02     $--       $68.62     $68.02     --
(including
acquisitions
costs)
Closing market $106.86    $104.43    $91.26     $71.72     $67.52
price
                                                              
RATIOS AND
OTHER DATA                                                     
(dollars in
thousands)
Return on
average equity 20.64%       20.29%       20.34%       16.70%       18.18%
(2)
Return on      23.16%       22.01%       21.67%       17.97%       22.58%
revenue (3)
Operating      38.89%       37.91%       36.92%       31.70%       38.91%
margin (4)
Operating
expense to     38.41%       38.33%       37.66%       40.92%       36.87%
cash receipts
(5)
Debt to equity 46.24%       37.39%       46.33%       42.84%       37.15%
(6)
Number of      2,153        1,992        1,952        1,934        1,658
collectors
Number of
full-time      3,221        3,103        3,032        3,014        2,641
equivalent
employees
Cash receipts  $245,394   $243,818   $247,723   $233,916   $195,668
(5)
Line of credit
- unused       273,000     214,450     166,450     142,500     187,500
portion at
period end
(1)Domestic                                                   
portfolio only
(2)Calculated as
annualized net income                                                       
divided by average equity
for the period
(3)Calculated
as net income                                                  
divided by
total revenues
(4)Calculated
as income from
operations                                                     
divided by
total revenues
(5)"Cash
receipts" is
defined as
cash                                                           
collections
plus fee
income
(6)For purposes of this
ratio, "debt" equals the                                                    
line of credit balance plus
long-term debt
                                                              

CONTACT: Rick Goulart
         Vice President, Corporate Communications
         757-961-3525
         RickGoulart@PortfolioRecovery.com

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