Here are a few analogies to describe PRAA (The Michaels Companies, Inc.):

• A Target for arts and crafts supplies.
• The Home Depot for hobbyists and crafters.

• Debt Portfolio Acquisition: PRA Group acquires portfolios of nonperforming loans and other financial assets from banks, credit unions, and other creditors.
• Debt Collection and Recovery Services: The company manages and collects on these acquired debt portfolios, working with consumers to resolve their financial obligations through various payment solutions.

PRA Group, Inc. (symbol: PRAA) operates as a global leader in acquiring and collecting nonperforming loan (NPL) portfolios. Its business model involves purchasing these debts from original credit grantors (such as banks, credit card companies, and other financial institutions). PRA Group then generates revenue by collecting payments on these acquired debts.

Given the nature of its operations, PRA Group's "customers" are primarily the individuals or entities whose debts it has acquired and from whom it collects payments. While the company does acquire some business debts, its primary focus is on consumer NPLs, meaning it predominantly serves individuals in the sense of being the payers to the company.

Therefore, the categories of customers PRA Group serves are best described by the types of individuals from whom they collect payments:

• Individuals with Unsecured Consumer Debt: This represents the largest segment of PRA Group's portfolio. It includes consumers with outstanding credit card balances, personal loans, and other forms of unsecured credit originally issued by banks, financial institutions, and retail lenders.
• Individuals with Auto Loan Deficiencies: These are consumers who still owe a balance on an auto loan after their vehicle has been repossessed and sold, where the proceeds from the sale did not cover the full outstanding loan amount.
• Individuals with Other Types of Consumer Debt: This category encompasses a variety of other consumer obligations that PRA Group acquires, such as outstanding telecommunications bills, utility debts, and certain private (non-federal) student loan balances.

Martin Sjolund, President and Chief Executive Officer

Martin Sjolund became President and CEO of PRA Group on June 17, 2025. He has over 14 years of experience in the financial services industry and more than a decade at PRA Group. Prior to his current role, Sjolund served as President of PRA Group Europe since 2018, leading operations across 15 markets in Europe, Canada, and Australia. During his tenure, he oversaw nearly $3 billion in portfolio investments and significantly improved the profitability of the European business, leading the company's expansion into two new markets, modernizing IT infrastructure, and enhancing data and analytics. Before that, he was Chief Operating Officer of Europe from 2015 to 2018. Sjolund also served as Director of Group Strategy and Corporate Development for Aktiv Kapital from 2011 until its acquisition by PRA Group in 2014. His earlier career included leadership positions at Cisco Systems, McKinsey & Company, and Ericsson.

Rakesh Sehgal, Executive Vice President and Chief Financial Officer

Rakesh Sehgal was appointed Executive Vice President and Chief Financial Officer of PRA Group on September 15, 2023. He joined PRA Group in 2022 as Head of Corporate Development. Sehgal brings over 25 years of experience in the financial services industry. Before joining PRA Group, he served as Managing Director in the Mergers and Acquisitions Group at General Electric and GE Capital, where he was involved in closing over $50 billion of transactions. Prior to his nine years at GE, Sehgal worked in the Investment Banking Group at Barclays Capital and Lehman Brothers, where he advised specialty finance and other companies on mergers and acquisitions and leveraged finance transactions.

Steve Fredrickson, Executive Chair of the Board

Steve Fredrickson co-founded PRA Group, initially known as Portfolio Recovery Associates, LLC, in March 1996 with Kevin Stevenson. He currently serves as the Executive Chair of the Board. Before co-founding PRA Group, Fredrickson worked in collections at Household Finance. The company began with four employees and went public in November 2002.

Jan Husby, Chief Information Officer

Jan Husby serves as the Chief Information Officer of PRA Group and has been with the company for over a decade. Before his tenure at PRA Group, Husby was the CIO for Aktiv Kapital for more than seven years. In that role, he was part of the senior leadership team and credit committee, leading various projects and streamlining systems and capabilities across Aktiv Kapital's European and Canadian operations. Prior to joining Aktiv Kapital, Husby co-founded and served as Chief Technology Officer for two startup technology companies.

Steven C. Roberts, Chief Strategy and Business Development Officer

Steven C. Roberts is the Chief Strategy and Business Development Officer at PRA Group. He has more than 25 years of experience in marketing, operations, global manufacturing, and commercial banking. Roberts previously held positions as Chief Operating Officer and Chief Financial Officer at subsidiaries of publicly-held McCann Erikson and Modem Media. He also had P&L responsibilities at United Technologies' Otis Elevator and Carrier Air Conditioning units in Asia and the U.S. In 2006, he launched and served as CEO for six years of ShopText, a privately-held company specializing in mobile shopper marketing and loyalty.

1. Ability to Acquire and Collect Nonperforming Loans Profitably: PRA Group's principal business involves purchasing and collecting nonperforming loans. A significant risk to the business is the potential inability to acquire these loan portfolios at prices that generate an appropriate return on investment, or to collect sufficient amounts to fund operations. Factors influencing this risk include consumer debt levels, the supply of nonperforming loan portfolios from credit originators, and competitive pressures among purchasers of such loans. If the company cannot effectively manage these aspects, its profitability could be substantially reduced.
2. Regulatory and Legal Compliance Risks: The company operates under strict regulatory frameworks in both the U.S. and Europe, making it highly susceptible to regulatory and legal challenges. Risks include investigations, reviews, or enforcement actions by governmental authorities, such as the Consumer Financial Protection Bureau (CFPB), and the inability to comply with data privacy regulations like the General Data Protection Regulation (GDPR). Adverse outcomes in litigation or administrative proceedings, and increasing legal costs, could also negatively impact the business, financial condition, and results of operations.
3. Risks Associated with International Operations: A significant portion of PRA Group's operations is conducted outside the United States, particularly in Europe. This exposure subjects the company to various international risks, including adverse economic, industry, and political conditions in different countries. Such conditions can negatively impact the company's ability to manage existing operations, affecting its business, results of operations, and overall financial condition.

The increasing adoption of advanced analytics and artificial intelligence by primary lenders (banks, credit card companies) to improve credit risk assessment, enhance early intervention strategies for struggling borrowers, and optimize internal collection processes. This trend directly threatens PRA Group by potentially reducing the volume and attractiveness of non-performing loan portfolios available for acquisition, as more debt is either prevented from becoming non-performing or is collected by the original creditor before being sold.

PRA Group (PRAA) operates primarily in the acquisition and collection of non-performing loans (NPLs) and related debt recovery services globally, with a strong presence in North America and Europe.

Addressable Markets:

• Global Non-Performing Loan (NPL) Management Market: The global NPL management market was estimated at approximately USD 109.45 billion in 2024. This market encompasses services and solutions for managing and resolving loans in default, including loan restructuring, asset recovery, debt collection, and the sale of NPL portfolios.
  • North America NPL Management Market: This region held a significant share, with a market size of approximately USD 43.78 billion in 2024.
  • Asia Pacific NPL Management Market: This region accounted for a market size of approximately USD 25.17 billion in 2024.
• Global Debt Collection Services Market: The global debt collection services market is projected to be approximately USD 30.52 billion in 2025, with other estimates placing it at USD 30.61 billion in 2024 and expected to reach USD 41.43 billion by 2033 at a compound annual growth rate (CAGR) of 2.7%. Another report estimates the global debt collection agencies market size to grow from USD 29.35 billion in 2024 to USD 30.19 billion in 2025 at a CAGR of 2.9%, reaching USD 34.31 billion in 2029 at a CAGR of 3.3%.
  • North America Debt Collection Services Market: North America held a major market share, estimated at over 40% of global revenue, with a market size of approximately USD 12.21 billion in 2025.
  • U.S. Debt Collection Services Market: The U.S. market size for debt collection services was approximately USD 9.63 billion in 2025. U.S. collection agency revenues are forecast to reach USD 16.7 billion by 2025.
  • Europe Debt Collection Market: The debt collection market size in Europe is valued at approximately €19.6 billion (about USD 21.04 billion) in 2024. The European debt recovery services market was valued at approximately USD 7.90 billion in 2024 and is anticipated to reach USD 9.76 billion by 2032. Europe accounted for over 30% of the global revenue for debt collection services, with a market size of approximately USD 9.16 billion in 2025.
• Claims Compensation Bureau (Purchasing and filing of securities and antitrust class action claims): null

Share Repurchases

• On February 25, 2022, PRA Group's Board of Directors authorized a share repurchase program for up to $150.0 million of its outstanding common stock.
• As of September 30, 2025, $57.7 million remained authorized for share repurchases under the program.
• There were no share repurchases made during the third quarter of 2025.

Share Issuance

• As of September 30, 2025, PRA Group had 39,083,000 shares issued and outstanding.
• As of December 31, 2024, there were 39,510,000 shares issued and outstanding.
• As of March 31, 2025, 39,652,000 shares were issued and outstanding.

Outbound Investments

• PRA Group's primary business involves the purchase of nonperforming loan portfolios.
• In 2024, the company deployed $1.4 billion in portfolio purchases, representing its highest annual deployment since 2017.
• For 2025, PRA Group has reaffirmed a portfolio purchase target of $1.2 billion.
• Total portfolio purchases were $291.7 million in Q1 2025, an 18.7% increase year-over-year. Purchases in Q2 2025 were $346.5 million, and in Q3 2025 they were $255.5 million.

Capital Expenditures

• The company's property and equipment, net, was approximately $27.0 million as of March 31, 2025.