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spk03: Good evening and welcome to PRA Group's second quarter 2024 conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then the number one on your touchtone phone. To withdraw your questions, please press star, then the number two. Please note, this event is being recorded. I would now like to turn the call over to Mr. Najee Mustamand, Vice President, Investor Relations for PRA Group.
spk01: Please go ahead. Thank you. Good evening, everyone, and thank you for joining us.
spk06: With me today are Vick Atal, President and Chief Executive Officer, and Rakesh Sehgal, Executive Vice President and Chief Financial Officer. We will make forward-looking statements during the call which are based on management's current beliefs, projections, assumptions, and expectations. We assume no obligation to revise or update these statements. We caution listeners that these forward-looking statements are subject to risks, uncertainties, assumptions, and other factors that could cause our actual results to differ materially from our expectations. Please refer to our earnings press release issued today and our SEC filings for a detailed discussion of these factors. The earnings release, the slide presentation that we will use during today's call, and our SEC filings can all be found in the investor relations section of our website at www.pragroup.com. Additionally, a replay of this call will be available shortly after its conclusion and the replay dial-in information is included in the earnings press release. All comparisons mentioned today will be between Q2 2024 and Q2 2023, unless otherwise noted, and our America's results include Australia. During our call, we will discuss adjusted EBITDA and debt to adjusted EBITDA for the 12 months ended June 30, 2024, and December 31, 2023. Please refer to the appendix of the slide presentation used during this call for a reconciliation of the most directly comparable U.S. GAAP financial measures to these non-GAAP financial measures. And with that, I'd now like to turn the call over to Vik Atal, our President and Chief Executive Officer.
spk04: Thank you, Najeeb, and thank you, everyone, for joining us this evening. The second quarter was another important step in demonstrating the turnaround in our U.S. business, delivering against our financial and operational targets for 2024 and positioning the company for future growth. Our net income for the quarter reflects the progress we have made in executing the turnaround with speed across a broad set of initiatives. Perhaps most compelling is the fact that we delivered these results while absorbing both higher operational and funding costs to support portfolio growth. Additionally, our results reflect the increased investment we have made in our U.S. legal collections channel, which we believe positions us well for future cash generation. We invested $379 million during the quarter, with pricing remaining attractive globally. Cash collections grew 13% year-over-year, primarily reflecting higher recent purchases and the positive impact of cash generating and operational initiatives in our U.S. business, along with continued cash collections growth in our European business. With the stabilization of our U.S. business in 2023 and the demonstrated progress on our turnaround efforts, We are focused on sustaining the business momentum through the balance of the year and driving growth as we transition into 2025. In a moment, I'll provide some updates on this front. But before I do, I wanted to share that we are celebrating the 10-year anniversary of our acquisition of active capital in 2014. This transformative acquisition elevated us from primarily a U.S.-based player to a truly global enterprise with a diverse European footprint. Since then, our global presence has enabled us to shift capital across the world to respond to differing investment opportunities. It has also offered us critical geographic diversification so that we can hedge against local economic issues, consumer health, and competition. In addition to the benefits of having a global presence and diversification, the active capital acquisition provided us with incredible talent that continues to be an asset to our teams and contributes to our culture worldwide. I have had the privilege to witness firsthand the success of our European business, which has been in contrast to some of our peers who have faced sizable challenges. Our growth has been predicated on several key elements, including management stability, market diversification, deep seller relationships, investment discipline both organically and inorganically, a focus on operational execution, and a strong capital position. We expect these attributes to drive continued success for the company. Like active in Europe, for many years now, we have had a highly successful operation in Brazil. Using partnerships, both with highly experienced local operators and with a major Brazilian bank, we have been able to opportunistically invest in a significant amount of receivables during those years, realizing highly attractive rates of return. Our success in Brazil reflects years of work and strategic positioning in a market that has proved difficult for others. Shifting gears, I'll now provide an update on the turnaround in our U.S. business and the areas we are most focused on to rebuild profitability, drive growth, and enhance shareholder value. As a reminder, this roadmap is supported by three pillars. First, optimizing investments, which allows us to increase ERC and portfolio returns. Second, driving operational execution, which focuses on maximizing cash collected per dollar invested. And third, managing expenses, which is geared towards optimizing our cost structures. First, optimizing investments. In the U.S., we continue to capitalize on the strong levels of portfolio supply driven by higher industry credit card balances and rising delinquency and charge-off rates. More consumers are relying on credit to manage a higher interest rate environment and cost of living increases, which, in part, has led to credit card balances growing more than 20% to $1.1 trillion, as of the latest data, up from $850 billion pre-pandemic. As the chart shows, there has been a long-term secular trend in industry credit card balance growth while charge-off rates, although up from pandemic-era lows, are now trending around a 10-year average. Portfolio supply is driven by both charge-off rates as well as the absolute level of credit card balances. Based on this, we anticipate continued growth in portfolio supply for the balance of this year. Further, as there is typically a lag between sellers charging off receivables and making portfolios available for sale, we believe the U.S. supply tailwinds will extend well into 2025. It's important to note also that the cash expected to be generated from our recent portfolio purchases is only modestly contributing to this year's results, and we expect to see more of an impact beginning next year. In Europe, we achieved a record amount of investment for any given second quarter in our history, which Rakesh will go into more detail later. Turning now to the second pillar, driving operational execution. We are fundamentally changing the way we drive collections in both existing and new portfolios. As previously noted, our new global operations officer, Steve Mackey, joined us in late April and he has hit the ground running. In our U.S. call centers, we have made critical and incremental enhancements to our operating processes during the quarter, including simplifying collector workflows and rebalancing calling intensity. Ultimately, it's a matter of increasing the number of customers we are able to reach and improving the outcomes of these conversations, and we are very encouraged by the progress thus far. Although we have now made a number of meaningful operating improvements that are driving improved cash collections and operating results, we continue to identify further opportunities to build our processes towards being state-of-the-art. As I first started talking to you about a year ago in the legal channel, we have been generating incremental cash collections by leveraging both internal resources and expanding our use of external resources. The enhancement to our U.S. legal processes is demonstrated in part by the growing number of wage garnishment filings beginning in the second half of 2023 and continuing into the current year. Post-judgment execution is just one of many areas within the legal collections channel that we have focused on optimizing for cash generation. We expect these much-needed process improvements to generate continued value over the next several quarters for our existing book of business, as well as producing incremental value to new purchases. This same phenomenon is true of our other operating improvements as well. The third pillar to our business turnaround is managing expenses, and in particular, reducing the marginal cost of doing business. The increased level of buying in the US has required an expansion of our total call center staffing by approximately 50% compared to a year ago. To counter the expense impact associated with this increase in portfolio purchases, we have focused on call center offshoring initiatives, which we initiated in the fall of 2023. We are highly encouraged that in this relatively short period of time, we have onboarded teams in two separate low-cost locations in Asia. Today, more than 25% of our collectors supporting the U.S. business are based offshore, and we expect this proportion to increase over time. In addition to the absolute level of expense savings, we expect that our outsourcing initiatives will help us enhance our calling strategies and better navigate the cyclical nature of our industry. In summary, the initiatives we shared last year are well underway and are delivering results at or above expectations, giving us a solid platform for future growth. And with that, I turn it over to Rakesh for a financial summary of our second quarter results. Thanks, Vic.
spk05: We purchased $379 million of portfolios during the quarter, up 16% year over year. representing our third highest quarterly level, stretching back five years. In the Americas, we invested $225 million in the quarter, up 23% year over year. In the U.S., we deployed $207 million, up 42% year over year. The increase was primarily driven by higher portfolio supply as reflected in the monthly amounts purchased under our existing and renewed forward flow arrangements. This was supplemented by additional forward flow and spot purchases as we successfully expanded our seller relationships over the last 12 months. Looking at pricing during the second quarter, our 2024 America Score purchase price multiple finished the first half of the year at 2.11 times. This is consistent with the end of the first quarter and reflects the attractive pricing in the U.S. market today, along with our focus on improving net portfolio returns. Turning to Europe, we invested $154 million across every major market. Similar to the U.S., we have continued to expand seller relationships in Europe, which contributed to the robust investment volumes realized this quarter. Since Europe is primarily a spot-driven market, volumes are dependent on seller strategies and timing. In the UK, which is our largest market outside the US, we continue to benefit from our long-standing seller relationships with stable forward flow volumes. We also have a strong presence in Poland and in the Nordics. In contrast, Southern Europe remains intensely competitive, and we are being selective with our investments, which is illustrated by the fact that these markets make up less than 5% of our total ERC. Overall, we continue to exercise discipline while also keeping an eye out for new opportunities. Moving on to our financial results. Total revenues were $284 million for the quarter. Total portfolio revenue was $283 million with portfolio income of $209 million and changes in expected recoveries of $73 million. As a reminder, portfolio income is the yield component of our revenue. You can see on the chart on the left that portfolio income has grown for the fourth consecutive quarter, driven primarily by higher recent purchases and improved pricing, especially in the U.S. We expect this trend to continue over the next several quarters. Turning to the chart on the right, in addition to portfolio income, our total portfolio revenue includes changes in expected recoveries, which encompasses a combination of cash overperformance or underperformance in the current period and the net present value of changes in our ERC. Over time, as the chart shows, We have modestly overperformed our cash collection expectations, which results in both cash overperformance and, where appropriate, a change in ERC. The changes in expected recoveries this quarter reflected cash overperformance of $54 million, with strong overperformance in the U.S. and Europe. In the U.S. specifically, the overperformance was due in large part to the impact of our cash generating initiatives. While these initiatives are expected to continue generating incremental value, we expect the level of cash overperformance to moderate from the levels achieved in the second quarter. The remaining $19 million of changes in expected recoveries reflected the net present value of changes in our ERC, with the majority of this increase associated with our U.S. portfolios. During the quarter, cash collections exceeded expectations on a consolidated basis by 12%, with the Americas overperforming by 10%. and Europe overperforming by 14%. Our year-to-date cash collections versus our expectations at December 31st, 2023 experienced 10% overperformance on a consolidated basis, with the Americas overperforming by 9% and Europe overperforming by 10%. Operating expenses for the quarter were $195 million, which were up $6 million sequentially and up $31 million from the prior year period. These increases are primarily tied to the investments made in our US legal channel to drive future cash growth over a sustained period of time. Legal collection costs were up $14 million year over year, driven primarily by investments in our U.S. legal channel and to a lesser extent by increased legal collections activities in Europe. Legal collection costs largely consist of poor costs paid upfront to file lawsuits. As you can see on this slide, there is a timing lag between the initial legal investment and the resulting cash collections, which generally commence three to six months post-judgment and continue over the following two to three years. We expect the investments we are currently making in our US legal processes to drive incremental cash collections over the next several years. For 2024, We expect the level of legal collection spending to moderate in the second half of the year. While upfront legal costs may have a negative impact on cash efficiency in the short term, given the lag in cash generation, we believe it is the appropriate action for those customers who choose not to engage with us voluntarily since this delivers optimal value over the long term. Compensation and employee services expenses increased $8 million, primarily due to $6 million of atypically lower compensation accruals recorded in the prior year period. This quarter's amount was in line with the low $70 million range we have experienced over the past couple of quarters. As mentioned, we are benefiting from leveraging third parties and our offshore call centers, which have helped us absorb the costs associated with a significant increase in account volumes and customer contacts. Legal collection fees increased $4 million, driven mainly by higher external legal collections within our U.S. core portfolio. Our cash efficiency ratio was 59% for the second quarter compared to 61% in the prior year period. As mentioned, the primary driver for the year-over-year decline was legal collection costs. That interest expense for the second quarter was $55 million, an increase of $12 million, reflecting increased interest rates and higher debt balances due to increased portfolio investments. Our effective tax rate for the quarter was 26%. We expect our effective tax rate to be in the low to mid 20% range for 2024, depending on income mix and other factors. Net income attributable to PRA was $22 million, or 54 cents in diluted earnings per share. Cash collections for the quarter were $474 million, up 13% from the prior year period. America's cash collections increased 18% driven by higher collections in the U.S., which were up 20% due to higher portfolio purchases and the positive impact of our cash generating initiatives. European cash collections increased 6%, driven primarily by higher recent purchases. With respect to financial pressures on the US consumer, we believe that certain customer segments are experiencing stress from high interest rates and continued inflation, as it is generally taking longer for some of our customers to pay off their balances. However, We are seeing significant growth in the number of committed payment plans from our customer base. We also believe our cash generating initiatives can help mitigate pressure that might build as economic circumstances evolve. The European consumer environment reflects some of the same economic factors. However, we are also experiencing some positive trends with the proportion of paying customers continuing to remain stable. In addition, larger payments in the markets that were previously impacting are starting to show signs of improvement. ERC at June 30th was $6.8 billion, which was up 15%, compared to $5.9 billion at June 30th last year. On a sequential basis, ERC increased $304 million. We expect to collect $1.6 billion of our ERC balance during the next 12 months. It's important to note that this number only reflects the amount we expect to collect on our existing portfolio. It does not include the cash we expect to collect from new purchases made over the next 12 months. Based on the average purchase price multiples we recorded here today, we would need to invest approximately $831 million globally over the same timeframe to replace this runoff and maintain current ERC levels. Keep in mind that this replenishment amount decreased since last year because our multiples have improved over that time period. We expect that we can exceed this investment level and continue growing ERC during the remainder of 2024. Our debt to adjusted EBITDA was 2.92 times as of June 30th. which remains within our long-term target range of two to three times sustained leverage. Our leverage over the last few quarters reflects the higher level of portfolios we purchased during this time period. We have covenants in our revolving credit facilities that limit our leverage ratio to 3.5 times debt to adjusted EBITDA, and we are within that limit. During periods of higher portfolio investments, as we are currently witnessing, the leverage ratio would be expected to increase and then decrease over time as we start to generate cash from those portfolios. In terms of our funding capacity, we have $3.1 billion in total committed capital to draw under our credit facilities. In all three of our credit facilities, we have deep and longstanding banking relationships. Our bank lines have margins ranging from 235 to 380 basis points over benchmark that provide an attractive cost of capital. As of June 30th, we had total availability of $1.4 billion, comprised of $742 million based on current ERC and $707 million of additional availability that we can draw from, subject to borrowing base and debt covenants, including advance rates. During the quarter, we issued $400 million of our senior notes due 2030, the proceeds of which we used to repay borrowings under our North American revolving credit facility. We intend to use borrowings under that facility to redeem our $298 million senior notes due 2025 on or about September 1st of this year. We are very pleased with the success of the transaction and how it enabled us to create additional capital for portfolio purchases. As we look toward upcoming maturities, refinancing our North American and UK credit facilities due July 2026 remains a high priority. We believe the capital available under our credit facilities, the cash generated from our business, and access to capital markets in both the U.S. and Europe position us to take advantage of the continued build in portfolio supply. With that, I'll turn it back to Vic.
spk04: Thanks, Rakesh. As seen by our financial and operational results in the first half of this year, we are continuing to push the ball forward with our initiatives remaining well on track. We are highly encouraged by the overall progress thus far, recognizing that it will take some time to see the full fruition of our efforts. Looking ahead, our 2024 targets are outlined on this slide with the following additional commentary. First, We continue to expect portfolio investments to remain strong through the balance of this year. Cash collections in the first half of this year have already grown double digits compared to the prior year period, and we expect to sustain this level for the full year. We are also expecting cash efficiency to be closer to the 60% mark for the full year. This reflects improved strategies and processes driving operational effectiveness, as well as the increased investment in legal collection spend through the year to drive future cash growth. And lastly, we continue to expect ROATE to range between 6% to 8% for the full year. While it is still too early for us to precisely forecast how this metric will evolve through an entire business cycle, We expect to see additional uplift beyond this range as we move into 2025. In closing, I am really proud of our team and how we have been able to accomplish so much in such a short amount of time. We are working hard to drive positive momentum in our U.S. business, continue to benefit from the strength of our European and Brazil business, and achieve greater profitability as we move into the future. Thank you, as always, for your continued support.
spk01: And with that, we are now ready for questions.
spk03: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the number one on your touchtone phone. You will hear a prompt that your hand has been raised. Could you wish to decline from the polling process? Please press star followed by the number two. If you're using a speakerphone, please lift the headset before pressing any keys. Your first question comes from the line of David Scharf from Citizens JMP. Your line is now open.
spk08: Thank you. Good afternoon, and thanks for taking my questions. Hey, notwithstanding what was clearly some very strong collection performance, and obviously you exceeded expectations, I'm kind of obligated to focus on the state of the U.S. consumer just based on kind of market sentiment right now. First off, Rakesh, I just wanted to clarify your qualifier regarding some stress from inflation and high rates on the U.S. consumer. Was that a new comment? Was this something incremental? I can't recall, because obviously we've been hearing that from lenders we cover for the better part of the last year. Was that incremental versus Q1, or is that just kind of a reiteration and a cautionary disclosure?
spk05: Yeah, look, David, good to hear your voice again. It is a reiteration of what we mentioned previously. So what we're seeing is... that we have different strategies to counter any stress that consumers may be facing and you know there's a cumulative impact of the inflation that's been building up over time we believe that the cash generating initiatives that we've been undertaking both in the call center as well as on the legal channel those are strategies that we can employ to counter and mitigate some of the pressures that the consumer may be impacted by. What we are also very encouraged by in the US in particular, I mentioned in my comments is that we're seeing that the number of payment plans are increasing and that is a positive from our perspective. And if I just switch to Europe for a second, we're starting to see some positive news in the past i'd always said that um that the proportion of paying customers has remained stable and we continue to see that but one of the positive trends that we've seen um in this past quarter was that the larger payments that had previously been impacted uh was starting to show uh signs of improvement so you know overall what i would say is uh that the data that's come out in the market, you're seeing it real time as we are. You know, it's just a few data points in the last few days here. But overall, we're taking a much longer-term view. You know, we'll continue to monitor the new data that's come out, just like you with David. But overall, sitting here today, you know, we've seen some positive impact in Europe with our consumers and in the U.S. You know, we're taking... advantage of all the cash generating activities to mitigate any pressure. But at the end of the day, we take a very long-term view in terms of our cash collections. As you know, it goes out over 10 plus, 15 years, perhaps in certain countries in Europe even longer.
spk08: Got it. No, no, that's very helpful, Rakesh. I mean, it sounds like you're not really signaling that you've seen any leading indicators of increased stress yet in the U.S. Maybe as a follow-up, switching to the expense side and specifically collector productivity, it's a pretty remarkable statistic now that over a quarter of U.S. collections are being serviced offshore. Is there any way you can help quantify or at least frame for us on a relative basis what the cost is to collect a dollar from your offshore sites versus what it is in the U.S., as well as what your plans are ultimately for what percentage of your U.S. collections will come from overseas collectors.
spk04: I'll take that, David, to Zig. I think taking the second half of your question, we're building up our overseas and our offshore collections. The general learning in the industry is that it takes between six and 12 months, maybe nine to 12 months for a collector to get seasoned. So none of the collectors that we have in our offshore locations have had you know nine months of experience right so we're gonna we're gonna you know watch and track um you know effectiveness and full performance and stability of that of those relationships um over certainly the balance of this year uh before we decide you know how much further to ramp uh that up uh directionally though i think we would uh like to see um you know continued build in our overseas proportions over time. You know, TBD has to as well and normalize it out. In terms of the cost differential, we don't disclose that, but I would say to you it's a meaningful differential, which is, you know, which is what led us to evaluating this alternative, right?
spk02: Got it. Understood. Thanks so much.
spk01: Your next question comes from the line of Marquis from Truist. Your line is now open. Yeah, thanks. Good afternoon. Hey, Mark. Hello. When we think about pricing here, can you hear me?
spk04: Yeah, sure. I'm up.
spk07: Excellent. Very good. When you think about pricing, the collections multiple in the U.S. was steady Q1 to Q2 at the 2.11 times. Are we at kind of a stable point, do you think, in terms of pricing? Or if supply continues to increase for the balance of the year, and I think you described into next year, then do you think that pricing has the opportunity to improve?
spk04: You know, I think it's difficult for us to opine on forward pricing. Obviously, in the U.S., we have, as you know, a finite or up to now a finite set of, you know, buyers, right, with significant access to capital, right? So in that regard, if there's a, you know, if there's a further, you know, change in the supply demand equation you know that might naturally lead to uh improve pricing but at this point in time you know it depends really on uh what files are coming to market you know the age of the file the mix of the files so you know i think it's we you know, I would be hesitant to project changes in the in the multiples or signal that changes in the multiple would be part of our equation going forward till we see it happening.
spk05: And Mark, what I would just add is, look, we're winning our fair share of the deals. You know, it's a function of supply demand. As Vic mentioned, it's also a mix that comes into play. But look, we're very encouraged if you just look at the trend last couple of years, we've gone from a multiple of 1.75 times in 22 to 1.97 at the end of 23. And we're continuing to build on that. So more to come as we see the supply story unfold in the second half of this year.
spk07: Understood. And then just the overall level of supply in Europe, I think you talked about your expanded seller relationships. It's more spot-driven. But did you comment on kind of what you're seeing in terms of just the volume of deals that are out there?
spk04: Look, I think that, you know, as we've said, and you're, I'm sure, very familiar with this, Mark, right? You know, we have better visibility to the ongoing supply trends in the U.S. than we have in Europe just because of the very high propensity of europe to be spot driven um and that's what really drove um you know a um a meaningful uptick in um in volumes coming to market in the second quarter versus what we've seen uh i think rakesh was a much softer number in the in the first quarter right um so i uh and and rakesh are not uh have got you know uh limited visibility to being able to predict what's going to happen in the spot market in the third quarter and even less in terms of what's going to happen in the fourth quarter.
spk05: I agree with you, Vic. If I can just add to the point around Q1, we were at $49 million versus $154 million this quarter. Again, it depends on seller strategies also. We know it's a spot-driven market, but Mark, where we get always encouraged is we know that We're in a dozen-plus countries in Europe. There are so many moving pieces. Our goal is to ensure we are engaging with all the sellers and ensuring that we're winning the fair share of deals coming to market.
spk07: Yeah, yeah. And then your guidance on the efficiency ratio, I think last quarter you talked about 60 plus and I think here you're talking about approximately 60%. It was pretty striking that you increased your spending in the legal channel and definitely understand that there's a delay on that on the cash collections. Is the change in the efficiency outlook and is that essentially stepped up investment versus what you had previously anticipated? Is that the right way to look at it?
spk04: Yes, I think in general it is linked to, you know, principally to the larger volume of investment we've made in our legal channel. and that's not due to any change in strategy with regard to what we have determined qualifies for legal. It's really a function of the volume of accounts that have flowed into a channel, the speed at which we are managing the accounts through all of the different stages of the legal funnel, so to speak, as well as relative to our prior projections, uh the mix of accounts that we believe qualify for legal placement in terms of you know our legal placement strategy um is higher than we had originally projected that's just a function of the mix of what we have happened to abort uh so all of those have put a um uh you know i have been followed in to our uh to our view with regard to where the uh efficiency metric will uh will net out for this year. But I think as we point out, that's a function of spending now for tangible cash collections to come in the future.
spk05: Yeah, Mark, all these investments that we're making, right, they have to meet our internal return threshold. So we're obviously taking that into account. And just for context, also, as you think about the targets and the metrics that we have, you know, the six to eight on ROAT that takes into account these expenses, we haven't changed that. And when you look at the 60 plus versus 60 target, you know, when you look at just our cash collections annualized on first half, it's about 900 million. You annualize that 1.8, you know, 1% change in cash efficiency, you know, would have like an 18 million impact. and that's the investment that we're making into our legal channel. So at the end of the day, and we mentioned this previously, the cash efficiency is really an output of all the investments that we're making, and we think that it's the appropriate action for us to invest in the legal channel given the value that we get from those investments.
spk02: Understood. Thank you.
spk03: As a reminder, if you have a question, please press star 1 on your telephone keypad. Your next question comes from the line of Sean Paul Adams from Raymond James. Your line is now open.
spk00: Hey, guys. Good evening. Circling back to Europe, I know you guys mentioned that a lot of the supply is kind of driven by the spot market. But last quarter, you kind of talked about a little bit about stage two loan levels on bank balance sheets. If you could share a little bit of color on that for this quarter, as well as the level of competition related to the pricing, what kind of value you guys are getting in relation to the pricing. I know you guys said that it was a very competitive market in Europe.
spk05: Yeah, look, we obviously monitor the stage two level loans. But at the end of the day, though, the sellers have to focus on what they think is appropriate for them to bring to market. We obviously are still encouraged by what we saw this quarter. We continue to engage with them, but at the end of the day, it's their decision when they bring to market. So our goal is to ultimately ensure that we are pricing deals that come to market appropriately We know that from a competition perspective, competition continues to be pretty healthy, notwithstanding some of the pressures that we are seeing some of our peers under, we continue to see a pretty healthy competitive environment. And Vic, if you want to add something to that.
spk04: No, I think, you know, from a, From a forward flow standpoint, I think you mentioned, Rakesh, in your remarks, right, that the forward flow volumes remain, you know, pretty stable, right? So, you know, I think we're not seeing any change in strategy from our perspective or from the competition, and, you know, we just got to wait and see when the supply comes to market.
spk00: Got it. Thank you. That's very helpful. Can you share any additional color on cash collection characteristics between the individual portfolio vintages in the US market? And has there been a decline in proportions of customers voluntarily repaying debt, specifically between individual vintages?
spk01: I don't think we've disclosed that, and we haven't talked about it.
spk04: I think you can There is information that you can see in our materials, right, about the cash trends on different vintages.
spk05: Yeah, I think, yeah, you look at what I would just say, Shankar, is just focus on a couple of things. You know, we mentioned around our older vintages. We've been seeing, you know, significant overperformance in our older vintages, which leads us to believe that our cash initiatives are bearing fruit. So, you know, that's one piece. And then the other piece that I mentioned, you know, just in my comments is that we're seeing customers pay over a longer period of time. That's not vintage specific. But our view is that's more a timing issue, just that the payments are coming in over a longer period of time.
spk00: Got it. Thank you so much. Yeah, I've seen that there's been differences in the income for consumers, the income brackets, and issues regarding repayment among the different income brackets. So that was the source of the question. Thank you very much for the call.
spk01: Thank you. There are no further questions at this time.
spk03: I will now turn the call over to Mr. Vic Atal for final comments.
spk04: Thank you, everybody, for joining us today. And obviously, thank you for your support and a lot more to look forward to in the second half of this year. Thank you.
spk03: Thank you. Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.
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