Exhibit 99.1
NASDAQ: ECPG
JPMorgan
Small Cap Conference
March 10, 2005
1
CAUTIONARY NOTE A BOUT FORWARD - -LOOKING STATEMENTS
Certain Statements in This Presentation Constitute “Forward-looking Statements” Within the
Meaning of the Private Securities Litigation Reform Act of 1995. Such Statements Involve
Risks, Uncertainties and Other Factors Which May Cause Actual Results, Performance or
Achievements of the Company and Its Subsidiaries to Be Materially Different From Any Future
Results, Performance or Achievements Expressed or Implied by Such Forward-looking
Statements. For a Discussion of These Factors, We Refer You to the Company’s Annual
Report on Form 10-K As of and for the Year Ended December 31, 2004.
In Light of the Significant Uncertainties Inherent in the Forward-looking Statements Included
Herein, the Inclusion of Such Information Should Not Be Regarded As a Representation by the
Company or by Any Other Person or Entity That the Objectives and Plans of the Company Will
Be Achieved.
2
ENCORE CAPITAL
50 year old purchaser and manager of consumer receivables portfolios
Unique business model
Excellent financial and operating results
Strong drivers for growth
3
INVESTMENT HIGHLIGHTS
Growth Industry
No barriers to entry - high barriers to long-term success
Demonstrated ability to buy right and collect well
Process company focused on debt collection
Innovations and analysis
Multiple collection channels reduces need to acquire new portfolios & increase
outbound collection staff
New lower cost financing
Significant catalyst for pretax margin expansion and earnings growth
Highly seasoned and respected management team
4
COMPELLING FUNDAMENTALS
Source: Federal Reserve Board, February 7, 2005 for Consumer Credit
Federal Reserve Board, February 23, 2005 for Charge-Off Rates
$ in billions
Non-mortgage consumer debt and charge-off rates
Traditional consumer debt continues to grow
Other types of consumer receivables are beginning to be sold
Automobile deficiencies Telecom
Utilities Medical
Health Club
5
BUSINESS DRIVERS
Buy Right
Collect Well
Manage Expenses
Challenge Everything
Demand Professional and Ethical Behavior
6
Encore’s COMPETITIVE ADVANTAGES
Consumer level analytics
Multiple collection strategies
Proprietary and dynamic account management
software
7
Account level valuation provides several competitive advantages
Buy Right
Note: All purchases since mid-2000 through 12/31/04.
Provides ability to create
positively selected deals
Expands universe of sources to
include our competition
Applies to alternative paper types
Increases our flexibility to buy throughout
the universe of defaulted receivables
8
Month Since
Charge
-
off
Face Value
($ in Billions)
% of Total
Face Purch.
0
-
6
$
2.2
18%
7
-
12
$
1.0
9%
13
-
18
$
2.1
19%
19
-
24
$
0.8
8%
25
-
36
$
2.7
25%
37+
$
2.3
21%
Total
$
11.1
100%
Strong Collection Growth
* 1Q ’04 total includes $4 million sale of rewrite business
9
COLLECT WELL - UNIQUE LIQUIDATION STRATEGIES
Continuous innovation is driving our collection growth
10
COLLECT WELL - RESULTS
Collection innovation drives our performance improvement
($ in Thousands)
(Employees)
11
STRONG FINANCIAL R ESULTS & MOMENTUM
*Excludes one-time items.
12
*Pretax Income excludes one-time benefit and charges.
STRONG FINANCIAL R ESULTS & MOMENTUM
The real earnings power not yet realized
13
STRONG FINANCIAL RESULTS & MOMENTUM -
BALANCE SHEET IMPROVEMENT
14
ACTUAL RESULTS
Our returns are consistently strong.
36 months
24 months
12 months
6 months
106
$4.3 Billion
$1.9 Billion
$7.6 Billion
$ 9.7 Billion
Total Face Value
57
189
226
# of Portfolios
0.8x
1.4x
2.5x
3.4x
15
Our Average Monthly Collections per Employee are very favorable.
ECPG1
$26,863
Monthly Collections
per Avg. Total
Employees
$234,676
2004 YTD Gross
Collections (in thousands)
728
Average # of
Total Employees
Key Metric
1 Data from 10-K filing for the period ending December 31, 2004 (12-month period).
16
Strong Collections and Judicious Portfolio Buys Create Strong Turnover
ECPG1
1.21
Annualized Portfolio
Turnover
$234,676
Annualized Gross
Collections (in thousands)
$193,741
Total Inventory
(in thousands)
$103,374
Annualized Purchases
(in thousands)
$90,367
Portfolio BOY
(in thousands)
Key Metric
1 Data from 10-K filing for the period ending December 31, 2004 (12-month period).
17
$376,500
Implied Gross Collections to
Realize Book Value
(in thousands)
$19,556
Avg. Monthly Collections 2004
(in thousands)
ECPG1
19.3
Months Remaining to Amortize
Book
24%
YTD Amortization Rate
$90,367
Portfolio January 1, 2004
(in thousands)
Key Metric
1 Data from 10-K filing for the period ending December 31, 2004 (12-month period).
We Are Amortizing Our Portfolio Quickly
18
COMPETITIVE COMPARISON
Recent Vintages Are Consistently Strong
Ratio of Total Collections to Purchase Price by Year of Origin
1 Data from 10-K filings for the period ending December 31, 2004 (12-month period).
19
EXPERIENCED MANAGEMENT TEAM
Former CFO of Stellcom, Inc.; Former EVP and CFO of Telespectrum Worldwide Inc.; Former Partner
of M&A Services at Deloitte and Touche
Paul Grinberg
SVP Finance
Former Director of Service Strategy at Gateway, Inc.
Anna Hansen
SVP Collection Operations
Former VP of Decision Science for Associates Home Equity Division
Eric Von Dohlen
VP & Chief Credit Risk Officer
Former VP & CIO of West Capital; Former VP & CIO for Frederick’s of Hollywood and The Welk Group
John Treiman
SVP & CIO
Former VP and General Counsel of West Capital and Comstream Corp.
Robin R. Pruitt
SVP, General Counsel and Secretary
Former Director of Human Resources at Gateway, Inc.
Alison James
SVP, Human Resources
Former SVP of Operations of West Capital and First Data Resources; Former VP/Risk Operations of
Capital One
J. Brandon Black
President & COO
Former CFO of West Capital; Former CFO and Board Member of Bank One, Texas, N.A; Former
Controller of Great Western Financial Corp.
Barry R. Barkley
EVP & CFO
Former Chairman, President and CEO of West Capital; Former Chairman, President and CEO of MIP
Properties, Inc., a publicly traded REIT
Carl C. Gregory, III
Vice Chairman & CEO
Experience
Name/Position
20
Future Prospects
Growth Opportunities
Innovations and analysis
Significant reduction in effective
interest rate driven by new financing
Continued penetration of alternative
asset classes
Ample liquidity for complementary
acquisitions.
Challenges
Higher prices for purchased
receivables
Implementation of SOP 2003-03
Managing SOX 404 requirements
21
NASDAQ: ECPG
JP Morgan
Small Cap Conference
March 10, 2005
22
