Debt buyer Asta Funding Inc. today reported net income of $1.48 million for the fiscal third quarter ended June 30, a 39.3% decrease from $2.44 million for the same period a year earlier.
The third quarter marks a return to profitability for the Englewood Cliffs, N.J.-based company after posting net losses of $7.8 million and $5.2 million in the first and second quarters, respectively.
"Achieving profitability this quarter is an important milestone that reflects our continued cautious approach in the face of the ongoing challenges in today's economic environment," Gary Stern, Asta's chairman and CEO, said in a statement.
"Effective implementation against several strategic objectives led to this positive progress," Stern said. "We have aggressively lowered our debt obligations and [we] are engaged in productive, continuing discussions with our lenders to secure an ongoing, longer-term credit facility."
Asta reported third-quarter total revenue of $17.24 million, a 26.9% decrease from $23.57 million a year earlier. Asta ranks as the No. 7 debt buyer in Collection & Credit Risk's 2009 industry rankings with nearly $115.3 million in revenue from purchased debt in 2008.
Net cash collections of consumer receivables acquired for liquidation totaled $37.6 million in the third quarter, down 23.3% from $49 million, according to the company.
Asta purchased debt with a face value of $335.6 million for $13.8 million during the third quarter, compared with a total expenditure of $2.7 million during the first two quarters of the year, combined.