Asta Funding Announces Flat Earnings and Revenue in Latest Quarter

Debt buyer Asta Funding reported earnings Tuesday for the second quarter of its 2011 fiscal year marked by flat net income and revenue, but increased spending on portfolios.

Englewood Cliffs, N.J.-based Asta Funding, Inc. (Nasdaq: ASFI) reported net income of $2.85 million for the three month period ended March 31, 2011, or $0.19 per share, as compared to net income of $2,9 million for the three months ended March 31, 2010, or $0.20 per share.

Asta reported $11.2 million in total revenue in the most recent quarter, nearly identical to the amount it reported in the same period of 2010. Cash collections, however, fell 14.7 percent to $21.9 million.

“We are pleased with the results of the second quarter and six month period ended March 31, 2011 as we continue to generate strong cash flow and improve our liquidity position,” commented Gary Stern, Chairman and CEO of the Company. “We are also pleased with the quality of the legacy portfolio as we reported an increase in zero basis revenue of 8.7% to $17.8 million in the first six months of fiscal year 2011 from $16.4 million during the same period of the prior year. Also, exclusive of the non-recourse debt, we are funding our business through our cash flow from operations without the need for borrowing.”

Asta said that it ramped up portfolio purchasing activity in the quarter, spending $2.1 million on new portfolios compared to just $971,000 a year ago. The company also noted that it had invested more on performing portfolios, including a semi-performing litigation-related medical accounts portfolio.

The company will be holding a conference call Tuesday afternoon with investors to discuss results. Interested parties can call in at 4pm Eastern at (800) 668-4132 or (224) 357-2196 (international) and enter Conference ID: 65231649.