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Encore Capital Group, Inc. ECPG shares have gained 24.3% since it reported first-quarter 2025 results on May 7. The strong quarterly results benefited from rising collections and strong portfolio purchasing. However, higher expenses partially offset the upsides.
ECPG reported first-quarter 2025 adjusted earnings per share (EPS) of $1.93, which beat the Zacks Consensus Estimate by 55.7%. The bottom line reported an improvement from 95 cents per share in the prior year.
ECPG's revenues rose 19.6% year over year to $392.8 million. Also, the top line beat the consensus mark by 5.5%.
Encore Capital Group Inc Price, Consensus and EPS Surprise
Encore Capital Group Inc price-consensus-eps-surprise-chart | Encore Capital Group Inc Quote
ECPG’s Operational Update
Total debt purchasing revenues rose 20.8% year over year in the quarter under review to $366.7 million. Servicing revenues increased 10.6% in the first quarter of 2025 to $22.5 million and beat the consensus mark of $20 million.
Collections grew 18% year over year to $604.8 million and also beat the consensus mark of $583.3 million. Strong portfolio purchasing in the United States in the past couple of years and a stable collections environment in its key markets benefited the metric.
Total operating expenses of $263.4 million rose 8% year over year due to an increase in salaries and employee benefits, the cost of legal collections, general and administrative expenses and other operating expenses.
Interest expenses increased 26.5% year over year to $70.5 million in the quarter under review. Encore Capital’s net income of $46.8 million increased 101% year over year.
Global portfolio purchases of $367.9 million rose from $295.7 million a year ago. It deployed $316.4 million in the United States and the rest in Europe. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)
Financial Position (As of March 31, 2025)
Encore Capital exited the first quarter with total assets of $5 billion, higher than $4.8 billion at 2024-end. Cash and cash equivalents amounted to $187.1 million in the first quarter, lower than $199.9 million at 2024-end.
Borrowings increased to $3.8 billion from $3.7 billion as of Dec. 31, 2025. Total liabilities of $4.2 billion at the first-quarter end were higher than $4 billion at 2024-end. Total equity increased to $819.1 million from $767.3 million at 2024-end.
Net cash provided by operating activities decreased 11.2% year over year in the first quarter of 2025 to $45.3 million.
ECPG’s Share Repurchase Update
Encore Capital bought back $10 million worth of shares in the first quarter of 2025.