MINNEAPOLIS, Nov. 12 — Jefferson Capital, Inc. (Nasdaq: JCAP) reported a 22.9% year-over-year rise in third-quarter revenue to $185.5 million as portfolio purchases more than doubled.
Net income for the quarter ended Sept. 30 reached $46.9 million, compared with $38.4 million a year earlier. Diluted earnings per share were $0.76, up from $0.59. Collections from purchased receivables rose 34.8% to $319.2 million, and portfolio purchases totaled $318 million, up 110.6%. Estimated remaining collections reached $3.61 billion at quarter-end, 23.3% above the year-earlier level. Jefferson Capital said revenue growth mainly reflected portfolios acquired in prior periods.
Higher servicing costs accompanied the growth. Operating expenses increased 22.7% to $98.4 million. Within the rise, court costs were $6.3 million higher and agency and legal commissions were $8.5 million higher. Jefferson Capital tied $3.1 million of the commission expense to its Bluestem portfolio purchase.
The company’s leverage ratio stood at 1.73x on Sept. 30, compared with 1.59x a year earlier. Jefferson Capital linked the increase chiefly to financing for portfolio purchases and business expansion; it had drawn $554 million on its revolving credit facility at quarter-end. The company classifies the ratio as a non-GAAP measure and cautions that it may not be comparable with similarly labeled measures at other companies.
Jefferson Capital acquires and manages consumer accounts that are charged off, in insolvency or still active. Its Chairman and CEO David Burton described the quarter’s deployments as “the largest third-quarter deployments in the company’s history.”
The company announced the results in a release furnished as Exhibit 99.1 to a Form 8-K filed Nov. 12 with the Securities and Exchange Commission. The filing says the release was furnished and is not treated as filed for Section 18 purposes. The board declared a quarterly dividend of $0.24 per share, payable Dec. 3 to shareholders of record at the close of business Nov. 24.
