Aug. 06--Portfolio Recovery Associates Inc., the debt-buying and -collecting company based in Norfolk, announced Tuesday that its profit fell 13.6 percent in the second quarter because of costs associated with its acquisition of a Norwegian company in the same business.
Portfolio Recovery's net income fell to $37.5 million, or 74 cents per share, in the quarter that ended June 30. The company attributed $4.1 million in costs from its purchase of Aktiv Kapital AS, with operations in 14 European countries and Canada, and another $6.2 million in related losses in foreign currency exchange. Those same expenses amounted to a reduction of 13 cents from Portfolio Recovery's earnings per share.
Now marketing itself as PRA Group to indicate its global status, the company reported that revenue rose 7.9 percent to $197.3 million. The bulk of its revenue comes from the money it collects from debtors whose delinquent accounts it buys from banks and other lenders.
PRA noted increased costs related to its growing legal activity, as it pursues more debtors in court. Within the company's cash collections, those pursued through legal channels grew 24 percent from the same quarter in 2013 -- the biggest jump in all its collection categories.
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