Debt buyer Asset Acceptance Capital Corp. spent a record $65.3 million in the second quarter ended June 30 to buy charged-off consumer-debt portfolios with a face value of $1.9 billion. By comparison, the company spent $37.6 million to purchase portfolios with a $1.1 billion face value during the same period last year. Asset Acceptance, the third-largest debt buyer in the United States, primarily purchases credit card accounts, according to Collections & Credit Risk, a CardLine sister publication. The Warren, Mich.-based company does not specify the percentage of debt purchases that involve credit cards. "The supply side of the business continues to improve as charge-offs rise in response to more difficult economic times," says Brad Bradley, Asset Acceptance chairman, president and CEO. The company reported cash collections of $95.2 million for the second quarter, down slightly from $95.4 million during the same period last year. During the first six months of the year, cash collections of $195.5 million increased 2.2% compared with $191.3 million during the same period in 2007. Total second-quarter revenues declined 14.3%, to $56.5 million from $65.9 million a year earlier. Revenues from purchased receivables totaled $56.2 million, down 14.2% from $65.5 million. Second-quarter net income fell 75%, to $2.1 million from $8.3 million. Last month, Jefferies & Co. analyst Richard Shane downgraded the company's stock to "underperform" (CardLine, 7/10). In a research note, Shane wrote that Asset Acceptance's price-to-earnings ratio is about 50% higher than that of two publicly traded debt-buying peers–Encore Capital Group and Portfolio Recovery Associates. Further, any positive impact from lower debt-portfolio prices will be overshadowed in the next few quarters by a difficult collections environment and by a "drag from lower returning 2006 and 2007 vintage performances," Shane wrote.