☒Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended June 30, 2019
☐Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from ________ to ________
Commission File Number: 000-50058
PRA Group, Inc.
(Exact name of registrant as specified in its charter)
Delaware
75-3078675
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
120 Corporate Boulevard
Norfolk, Virginia23502
(Address of principal executive offices)
(888) 772-7326
(Registrant's Telephone No., including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 par value per share
PRAA
NASDAQ Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yesþ No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yesþ No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filerþ Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ☐Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ
The number of shares of the registrant's common stock outstanding as of August 6, 2019 was 45,409,110.
Preferred stock, $0.01 par value, 2,000 shares authorized, no shares issued and outstanding
—
—
Common stock, $0.01 par value, 100,000 shares authorized, 45,409 shares issued and outstanding at June 30, 2019; 100,000 shares authorized, 45,304 shares issued and outstanding at December 31, 2018
454
453
Additional paid-in capital
61,705
60,303
Retained earnings
1,310,319
1,276,473
Accumulated other comprehensive loss
(252,124
)
(242,109
)
Total stockholders' equity - PRA Group, Inc.
1,120,354
1,095,120
Noncontrolling interest
30,503
28,849
Total equity
1,150,857
1,123,969
Total liabilities and equity
$
4,165,414
$
3,909,559
The accompanying notes are an integral part of these consolidated financial statements.
3
PRA Group, Inc.
Consolidated Income Statements
For the three and six months ended June 30, 2019 and 2018
(unaudited)
(Amounts in thousands, except per share amounts)
Three Months Ended June 30,
Six Months Ended June 30,
2019
2018
2019
2018
Revenues:
Income recognized on finance receivables
$
249,219
$
219,018
$
488,055
$
437,642
Fee income
2,707
2,342
9,081
7,669
Other revenue
131
158
798
315
Total revenues
252,057
221,518
497,934
445,626
Net allowance charges
(1,196
)
(2,834
)
(7,291
)
(3,759
)
Operating expenses:
Compensation and employee services
79,808
80,690
159,453
161,927
Legal collection fees
14,297
10,343
27,356
21,012
Legal collection costs
33,121
18,695
68,350
40,938
Agency fees
13,013
8,138
27,045
16,416
Outside fees and services
16,293
14,565
31,541
28,723
Communication
10,824
10,782
24,025
22,339
Rent and occupancy
4,491
4,003
8,854
8,317
Depreciation and amortization
4,723
4,525
9,295
9,454
Other operating expenses
10,926
11,628
22,511
23,812
Total operating expenses
187,496
163,369
378,430
332,938
Income from operations
63,365
55,315
112,213
108,929
Other income and (expense):
Interest expense, net
(36,027
)
(31,124
)
(70,008
)
(56,905
)
Foreign exchange
(311
)
1,690
5,953
2,983
Other
248
(400
)
(104
)
(157
)
Income before income taxes
27,275
25,481
48,054
54,850
Income tax expense
5,075
3,857
8,942
9,994
Net income
22,200
21,624
39,112
44,856
Adjustment for net income attributable to noncontrolling interests
3,581
2,036
5,266
4,162
Net income attributable to PRA Group, Inc.
$
18,619
$
19,588
$
33,846
$
40,694
Net income per common share attributable to PRA Group, Inc.:
Basic
$
0.41
$
0.43
$
0.75
$
0.90
Diluted
$
0.41
$
0.43
$
0.74
$
0.90
Weighted average number of shares outstanding:
Basic
45,387
45,283
45,363
45,257
Diluted
45,495
45,449
45,457
45,410
The accompanying notes are an integral part of these consolidated financial statements.
4
PRA Group, Inc.
Consolidated Statements of Comprehensive Income/(Loss)
For the three and six months ended June 30, 2019 and 2018
(unaudited)
(Amounts in thousands)
Three Months Ended June 30,
Six Months Ended June 30,
2019
2018
2019
2018
Net income
$
22,200
$
21,624
$
39,112
$
44,856
Less net income attributable to noncontrolling interests
3,581
2,036
5,266
4,162
Net income attributable to PRA Group, Inc.
18,619
19,588
33,846
40,694
Other comprehensive income/(loss), net of tax:
Currency translation adjustments
4,740
(60,697
)
3,567
(30,756
)
Cash flow hedges
(8,002
)
—
(13,717
)
—
Debt securities available-for-sale
37
—
82
—
Other comprehensive (loss)
(3,225
)
(60,697
)
(10,068
)
(30,756
)
Less other comprehensive income/(loss) attributable to noncontrolling interests
378
(7,217
)
(53
)
(196
)
Other comprehensive (loss) attributable to PRA Group, Inc.
(3,603
)
(53,480
)
(10,015
)
(30,560
)
Comprehensive income/(loss) attributable to PRA Group, Inc.
$
15,016
$
(33,892
)
$
23,831
$
10,134
The accompanying notes are an integral part of these consolidated financial statements.
5
PRA Group, Inc.
Consolidated Statement of Changes in Equity
For the three and six months endedJune 30, 2019 and 2018
(unaudited)
(Amounts in thousands)
Common Stock
Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive (Loss)
Noncontrolling Interest
Total Equity
Shares
Amount
Balance at December 31, 2018
45,304
$
453
$
60,303
$
1,276,473
$
(242,109
)
$
28,849
$
1,123,969
Components of comprehensive income, net of tax:
Net income
—
—
—
15,227
—
1,685
16,912
Currency translation adjustments
—
—
—
—
(742
)
(431
)
(1,173
)
Cash flow hedges
—
—
—
—
(5,715
)
—
(5,715
)
Debt securities available-for-sale
—
—
—
—
45
—
45
Distributions to noncontrolling interest
—
—
—
—
—
(6,877
)
(6,877
)
Contributions from noncontrolling interest
—
—
—
—
—
89
89
Vesting of restricted stock
80
1
(1
)
—
—
—
—
Share-based compensation expense
—
—
2,314
—
—
—
2,314
Employee stock relinquished for payment of taxes
—
—
(1,437
)
—
—
—
(1,437
)
Other
—
—
(2,088
)
—
—
—
(2,088
)
Balance at March 31, 2019
45,384
$
454
$
59,091
$
1,291,700
$
(248,521
)
$
23,315
$
1,126,039
Components of comprehensive income, net of tax:
Net income
—
—
—
18,619
—
3,581
22,200
Currency translation adjustments
—
—
—
—
4,362
378
4,740
Cash flow hedges
—
—
—
—
(8,002
)
—
(8,002
)
Debt securities available-for-sale
—
—
—
—
37
—
37
Contributions from noncontrolling interest
—
—
—
—
—
3,229
3,229
Vesting of restricted stock
25
—
—
—
—
—
—
Share-based compensation expense
—
—
2,620
—
—
—
2,620
Employee stock relinquished for payment of taxes
—
—
(6
)
—
—
—
(6
)
Balance at June 30, 2019
45,409
$
454
$
61,705
$
1,310,319
$
(252,124
)
$
30,503
$
1,150,857
Balance at December 31, 2017
45,189
$
452
$
53,870
$
1,214,840
$
(178,607
)
$
50,162
$
1,140,717
Cumulative effect of change in accounting principle - equity securities (1)
—
—
—
(3,930
)
—
—
(3,930
)
Balance at January 1, 2018
45,189
452
53,870
1,210,910
(178,607
)
50,162
1,136,787
Components of comprehensive income, net of tax:
Net income
—
—
—
21,106
—
2,126
23,232
Currency translation adjustments
—
—
—
—
22,920
7,021
29,941
Distributions to noncontrolling interest
—
—
—
—
—
(11,807
)
(11,807
)
Vesting of restricted stock
86
1
(1
)
—
—
—
—
Share-based compensation expense
—
—
2,415
—
—
—
2,415
Employee stock relinquished for payment of taxes
—
—
(2,013
)
—
—
—
(2,013
)
Balance at March 31, 2018
45,275
$
453
$
54,271
$
1,232,016
$
(155,687
)
$
47,502
$
1,178,555
Components of comprehensive income, net of tax:
Net income
—
—
—
19,588
—
2,036
21,624
Currency translation adjustments
—
—
—
—
(53,480
)
(7,217
)
(60,697
)
Distributions to noncontrolling interest
—
—
—
—
—
(928
)
(928
)
Vesting of restricted stock
25
—
—
—
—
—
Share-based compensation expense
2,146
—
—
2,146
Employee stock relinquished for payment of taxes
(7
)
—
—
(7
)
Balance at June 30, 2018
45,300
$
453
$
56,410
$
1,251,604
$
(209,167
)
$
41,393
$
1,140,693
(1) Relates to the adoption of FASB ASU 2016-01, "Financial Instruments - Overall: Recognition and Measurement of Financial Assets and Financial Liabilities" ("ASU 2016-01"). Refer to Note 3 for further detail.
The accompanying notes are an integral part of these consolidated financial statements.
6
PRA Group, Inc.
Consolidated Statements of Cash Flows
For the six months endedJune 30, 2019 and 2018
(unaudited)
(Amounts in thousands)
Six Months Ended June 30,
2019
2018
Cash flows from operating activities:
Net income
$
39,112
$
44,856
Adjustments to reconcile net income to net cash provided by/(used in) operating activities:
Share-based compensation expense
4,934
4,561
Depreciation and amortization
9,295
9,454
Amortization of debt discount and issuance costs
11,403
10,866
Deferred income taxes
(25,287
)
(32,805
)
Net unrealized foreign currency transactions
(7,437
)
455
Fair value in earnings for equity securities
(1,448
)
(2,781
)
Net allowance charges
7,291
3,759
Changes in operating assets and liabilities:
Other assets
1,863
(1,685
)
Other receivables, net
2,978
1,073
Accounts payable
(2,956
)
145
Income taxes payable, net
(8,766
)
(857
)
Accrued expenses
(1,979
)
(5,767
)
Other liabilities
1,799
(438
)
Other, net
146
—
Net cash provided by operating activities
30,948
30,836
Cash flows from investing activities:
Purchases of property and equipment
(5,646
)
(11,303
)
Acquisition of finance receivables
(549,377
)
(385,823
)
Collections applied to principal on finance receivables
443,390
395,572
Business acquisition, net of cash acquired
(57,610
)
—
Proceeds from sale of subsidiaries, net
31,177
—
Purchase of investments
(82,648
)
(15,171
)
Proceeds from sales and maturities of investments
43,011
3,519
Net cash used in investing activities
(177,703
)
(13,206
)
Cash flows from financing activities:
Proceeds from lines of credit
769,021
236,015
Principal payments on lines of credit
(324,103
)
(258,857
)
Tax withholdings related to share-based payments
(1,443
)
(2,020
)
Distributions paid to noncontrolling interest
(6,877
)
(13,392
)
Purchase of noncontrolling interest
(1,166
)
—
Principal payments on notes payable and long-term debt
(308,165
)
(5,000
)
Payments of origination costs and fees
—
(404
)
Net increase/(decrease) in interest-bearing deposits
28,429
(8,314
)
Other
1,141
—
Net cash provided by/(used in) financing activities
156,837
(51,972
)
Effect of exchange rate on cash
(3,281
)
(14,604
)
Net increase/(decrease) in cash and cash equivalents
6,801
(48,946
)
Cash and cash equivalents, beginning of period
98,695
120,516
Cash and cash equivalents, end of period
$
105,496
$
71,570
Supplemental disclosure of cash flow information:
Cash paid for interest
$
54,973
$
46,897
Cash paid for income taxes
42,172
48,522
The accompanying notes are an integral part of these consolidated financial statements.
7
PRA Group, Inc.
Notes to Consolidated Financial Statements
1. Organization and Business:
As used herein, the terms "PRA Group," "the Company," or similar terms refer to PRA Group, Inc. and its subsidiaries.
PRA Group, Inc., a Delaware corporation, is a global financial and business services company with operations in the Americas and Europe. The Company's primary business is the purchase, collection and management of portfolios of nonperforming loans. The Company also provides fee-based services on class action claims recoveries and by servicing consumer bankruptcy accounts in the United States ("U.S.").
The consolidated financial statements of the Company are prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and include the accounts of all of its subsidiaries. All significant intercompany accounts and transactions have been eliminated.
Under the guidance of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 280 "Segment Reporting" ("ASC 280"), the Company has determined that it has several operating segments that meet the aggregation criteria of ASC 280, and, therefore, it has one reportable segment, accounts receivable management. This conclusion is based on similarities among the operating units, including economic characteristics, the nature of the products and services, the nature of the production processes, the types or class of customer for their products and services, the methods used to distribute their products and services and the nature of the regulatory environment.
The following table shows the amount of revenue generated for the three and six months ended June 30, 2019 and 2018, respectively, and long-lived assets held at June 30, 2019 and 2018, respectively, both for the U.S., the Company's country of domicile, and outside of the U.S. (amounts in thousands):
As of and for the
As of and for the
Three Months Ended June 30, 2019
Three Months Ended June 30, 2018
Revenues
Long-Lived Assets
Revenues
Long-Lived Assets
United States
$
167,923
$
110,323
$
150,937
$
46,757
United Kingdom
28,292
3,917
24,829
1,817
Other (1)
55,842
10,061
45,752
4,790
Total
$
252,057
$
124,301
$
221,518
$
53,364
As of and for the
As of and for the
Six Months Ended June 30, 2019
Six Months Ended June 30, 2018
Revenues
Long-Lived Assets
Revenues
Long-Lived Assets
United States
$
335,499
$
110,323
$
304,339
$
46,757
United Kingdom
58,048
3,917
49,555
1,817
Other (1)
104,387
10,061
91,732
4,790
Total
$
497,934
$
124,301
$
445,626
$
53,364
(1) None of the countries included in "Other" comprise greater than 10% of the Company's consolidated revenues or long-lived assets.
Revenues are attributed to countries based on the location of the related operations. Long-lived assets consist of net property and equipment and right-of-use assets. The Company reports revenues earned from nonperforming loan purchasing and collection activities, fee-based services and its investments. For additional information on the Company's investments see Note 3. It is impracticable for the Company to report further breakdowns of revenues from external customers by product or service.
The accompanying interim financial statements have been prepared in accordance with the instructions for Quarterly Reports on Form 10-Q and, therefore, do not include all information and notes to the consolidated financial statements necessary for a complete presentation of financial position, results of operations, comprehensive income/(loss) and cash flows in conformity with GAAP. In the opinion of management, all adjustments, consisting of normal and recurring items, necessary for the fair presentation of the Company's consolidated balance sheet as of June 30, 2019, its consolidated income statements and statements of comprehensive income/(loss) for the three and six months ended June 30, 2019 and 2018, its consolidated statement of changes in equity for the three and six months endedJune 30, 2019 and 2018, and its consolidated statements of cash flows for the six months endedJune 30, 2019 and 2018, have been included. The consolidated income statements of the Company for the three and six months ended June 30, 2019 may not be indicative of future results. Certain prior period amounts have been reclassified for consistency with the current period presentation.
8
PRA Group, Inc.
Notes to Consolidated Financial Statements
These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2018 (the "2018 Form 10-K").
2. Finance Receivables, net:
Changes in finance receivables, net for the three and six months ended June 30, 2019 and 2018 were as follows (amounts in thousands):
Three Months Ended June 30,
Six Months Ended June 30,
2019
2018
2019
2018
Balance at beginning of period
$
3,177,229
$
2,771,408
$
3,084,777
$
2,776,199
Acquisitions of finance receivables (1)
284,448
219,631
597,894
384,651
Foreign currency translation adjustment
(8,477
)
(65,916
)
(1,041
)
(26,846
)
Cash collections
(470,274
)
(406,634
)
(931,445
)
(833,214
)
Income recognized on finance receivables
249,219
219,018
488,055
437,642
Net allowance charges
(1,196
)
(2,834
)
(7,291
)
(3,759
)
Balance at end of period
$
3,230,949
$
2,734,673
$
3,230,949
$
2,734,673
(1)
Acquisitions of finance receivables are portfolio purchases that are net of buybacks and include certain capitalized acquisition related costs. They also include the finance receivable portfolios that are acquired in connection with certain business acquisitions. The buybacks and capitalized acquisition costs are netted against the acquisition of finance receivables when paid and may relate to portfolios purchased in prior periods.
During the three months ended June 30, 2019, the Company acquired finance receivables portfolios with a face value of $1.8 billion for $289.2 million. During the three months ended June 30, 2018, the Company acquired finance receivables portfolios with a face value of $2.2 billion for $221.4 million. During the six months ended June 30, 2019, the Company acquired finance receivables portfolios with a face value of $6.6 billion for $608.0 million. During the six months ended June 30, 2018, the Company acquired finance receivables portfolios with a face value of $3.7 billion for $389.7 million. At June 30, 2019, the estimated remaining collections ("ERC") on the receivables acquired during the three months ended June 30, 2019 and 2018 were $513.0 million and $311.3 million, respectively. At June 30, 2019, the ERC on the receivables acquired during the six months ended June 30, 2019 and 2018 were $1.02 billion and $523.2 million, respectively.
At the time of acquisition and each quarter thereafter, the life of each quarterly accounting pool is estimated based on projected amounts and timing of future cash collections using the proprietary models of the Company. Based upon current projections, cash collections expected to be applied to principal are estimated to be as follows for the twelve-month periods ending June 30, (amounts in thousands):
2020
$
845,437
2021
694,169
2022
531,004
2023
393,087
2024
281,166
2025
173,283
2026
101,570
2027
77,943
2028
51,868
2029
35,070
Thereafter
46,352
Total ERC expected to be applied to principal
$
3,230,949
At June 30, 2019, the Company had aggregate net finance receivables balances in pools accounted for under the cost recovery method of $39.4 million; at December 31, 2018, the amount was $48.0 million.
Accretable yield represents the amount of income on finance receivables the Company can expect to recognize over the remaining life of its existing portfolios based on estimated future cash flows as of the balance sheet date. Additions represent the original expected accretable yield on portfolios purchased during the period to be earned by the Company based on its proprietary
9
PRA Group, Inc.
Notes to Consolidated Financial Statements
analytical models. Net reclassifications from nonaccretable difference to accretable yield primarily result from the increase in the Company's estimate of future cash flows. When applicable, net reclassifications to nonaccretable difference from accretable yield result from the decrease in the Company's estimates of future cash flows and allowance charges that together exceed the increase in the Company's estimate of future cash flows.
Changes in accretable yield for the three and six months ended June 30, 2019 and 2018 were as follows (amounts in thousands):
Three Months Ended June 30,
Six Months Ended June 30,
2019
2018
2019
2018
Balance at beginning of period
$
3,080,168
$
3,006,268
$
3,058,445
$
2,927,866
Income recognized on finance receivables
(249,219
)
(219,018
)
(488,055
)
(437,642
)
Net allowance charges
1,196
2,834
7,291
3,759
Additions from portfolio purchases (1)
228,796
197,453
464,610
344,285
Reclassifications from nonaccretable difference
112,901
90,046
132,062
202,074
Foreign currency translation adjustment
(829
)
(83,262
)
(1,340
)
(46,021
)
Balance at end of period
$
3,173,013
$
2,994,321
$
3,173,013
$
2,994,321
(1) Also includes accretable yield additions resulting from certain business acquisitions.
The following is a summary of activity within the Company's valuation allowance account, all of which relates to acquired nonperforming loans, for the three and six months ended June 30, 2019 and 2018 (amounts in thousands):
Three Months Ended June 30,
Six Months Ended June 30,
2019
2018
2019
2018
Beginning balance
$
263,324
$
226,975
$
257,148
$
225,555
Allowance charges
5,532
7,395
13,509
14,228
Reversal of previously recorded allowance charges
(4,336
)
(4,561
)
(6,218
)
(10,469
)
Net allowance charges
1,196
2,834
7,291
3,759
Foreign currency translation adjustment
71
(1,526
)
152
(1,031
)
Ending balance
$
264,591
$
228,283
$
264,591
$
228,283
3. Investments:
Investments consisted of the following at June 30, 2019 and December 31, 2018 (amounts in thousands):
June 30, 2019
December 31, 2018
Debt securities
Available-for-sale
$
5,201
$
5,077
Equity securities
Private equity funds
7,486
7,973
Mutual funds
62,678
21,753
Equity method investments
10,546
10,370
Total investments
$
85,911
$
45,173
10
PRA Group, Inc.
Notes to Consolidated Financial Statements
Debt Securities
Available-for-sale
Government bonds:The Company's investments in government bonds are classified as available-for-sale and are stated at fair value. Fair value is determined using quoted market prices. Unrealized gains and losses are included in comprehensive income and reported in equity.
The amortized cost and estimated fair value of investments in debt securities at June 30, 2019 and December 31, 2018 were as follows (amounts in thousands):
June 30, 2019
Amortized Cost
Gross Unrealized Gains
Gross Unrealized Losses
Aggregate Fair Value
Available-for-sale
Government bonds
$
5,202
$
—
$
1
$
5,201
December 31, 2018
Amortized Cost
Gross Unrealized Gains
Gross Unrealized Losses
Aggregate Fair Value
Available-for-sale
Government bonds
$
5,160
$
—
$
83
$
5,077
Equity Securities
Investments in private equity funds: Investments in private equity funds represent limited partnerships in which the Company has less than a 3% interest. In the first quarter of 2018, the Company adopted ASU 2016-01, "Financial Instruments - Overall: Recognition and Measurement of Financial Assets and Financial Liabilities" ("ASU 2016-01"), which requires that investments in equity securities be measured at fair value with changes in unrealized gains and losses reported in earnings. Upon adoption of ASU 2016-01, the investments are carried at the fair value reported by the Fund manager. The Company recorded a cumulative effect adjustment of $3.9 million, net of tax, to beginning retained earnings for the unrealized loss on the investments. Prior to 2018, the investments were carried at cost with income recognized in Other Revenue in the consolidated income statements when distributions, up to reported income, were received from the partnerships.
Mutual funds: The Company invests certain excess funds held in Brazil in a Brazilian real denominated mutual fund benchmarked to the US dollar that invests principally in Brazilian fixed income securities. The investments are carried at fair value based on quoted market prices.
Unrealized gains and losses: Net unrealized (losses)/gains were $(0.7) million and $1.4 million for the three and six months ended June 30, 2019, respectively, on its equity securities. Net unrealized gains were $2.4 million and $2.8 million for the three and six months ended June 30, 2018, respectively, on its equity securities.
Equity Method Investments
Effective December 20, 2018, the Company has an 11.7% interest in RCB Investimentos S.A. ("RCB"), a servicing platform for nonperforming loans in Brazil. This investment is accounted for on the equity method because the Company exercises significant influence over RCB’s operating and financial activities. Accordingly, the Company’s investment in RCB is adjusted for the Company’s proportionate share of RCB’s earnings or losses.
4. Goodwill and Intangible Assets, net:
In connection with the Company's business acquisitions, the Company acquired certain tangible and intangible assets. Intangible assets resulting from these acquisitions include client and customer relationships, non-compete agreements, trademarks and technology. The Company performs a review of goodwill as of October 1 of each year or more frequently if indicators of impairment exist.
11
PRA Group, Inc.
Notes to Consolidated Financial Statements
The following table represents the changes in goodwill for the three and six months ended June 30, 2019 and 2018 (amounts in thousands):