Asset Acceptance Capital Corp. (NASDAQ: AACC), a leading purchaser and collector of charged-off consumer debt, today reported results for the quarter and fiscal year ended December 31, 2010.
Fourth Quarter 2010 Financial Highlights
Cash collections for the fourth quarter of 2010 increased 2.3% compared to the prior year period, to $76.5 million. Excluding healthcare portfolios, which were sold in the third quarter 2010, cash collections increased 4.3% to $76.4 million.
Fourth quarter revenues were $47.5 million, an increase of 153.3% from the same period of the prior year. The Company reported net impairment reversals of $0.7 million on purchased receivables versus net impairment charges of $32.4 million in the prior year period. The Company also reported $0.4 million, or $0.01 per fully diluted share, in gain on sale of its healthcare portfolios.Operating expenses were $54.2 million, or 70.8% of cash collections, for the fourth quarter of 2010, an increase of $5.7 million when compared to the year earlier period. Operating expenses for the quarter included several items that impact comparability to prior periods. The Company incurred a charge of $5.3 million, or $0.11 per fully diluted share, net of income taxes, resulting from the termination for performance of a relationship with a third party provider. The charge relates to a cash settlement payment to reimburse the third party for court costs incurred on the Company’s behalf that the third party would otherwise have recovered through commissions in future periods. In addition, the Company incurred $3.0 million, or $0.06 per fully diluted share, net of income taxes, of restructuring charges related to the closing of the Chicago, IL and Cleveland, OH collection offices, The Company also recorded $1.7 million of charges, or $0.05 per fully diluted share, net of income taxes, related to the ongoing FTC matter. The Company reported a net loss of $7.0 million, or $0.23 per diluted share, during the fourth quarter of 2010, compared to a loss of $20.2 million, or $0.66 per fully diluted share, in the fourth quarter of 2009.