Asta Funding, Inc. Announces Financial Results for Second Quarter and Six Months of Fiscal 2010

ENGLEWOOD CLIFFS, N.J., May 6 /PRNewswire-FirstCall/ -- Asta Funding, Inc. (Nasdaq: ASFI) (the "Company"), a consumer receivable asset management and liquidation company, today announced results for the second quarter and six months of its 2010 fiscal year, the period ended March 31, 2010.

The Company reported net income of $2,875,000 for the three month period ended March 31, 2010, or $0.20 per diluted share as compared to a net loss for the three months ended March 31, 2009 of $5,168,000, or $0.36 per share. Revenues for the three month period ended March 31, 2010 were $11,204,000 as compared to $18,126,000 for the three month period ended March 31, 2009.

Net income for the six months ended March 31, 2010 was $5,350,000, or $0.37 per diluted share as compared to a net loss of $13,005,000, or $0.91 per share for the six months ended March 31, 2009. Revenues for the six months ended March 31, 2010 were $22,211,000 as compared to $36,574,000 for the same period in the prior year.  

Net cash collections from collection of consumer receivables acquired for liquidation, including net cash collections represented by account sales were $25.7 million for the second quarter of fiscal year 2010, as compared to $36.9 million in the second quarter of fiscal year 2009, a 30.4% decrease from the prior year. Net cash collections from collection of consumer receivables acquired for liquidation, including net cash collections represented by account sales were $55.1 million for the six months ended March 31, 2010, compared to $79.0 million in the six month period ended March 31, 2009, a 30.3% decrease from the prior year. Net cash collections represented by account sales were $2.7 million or 4.9% of net cash collections in the six month period ended March 31, 2010, compared to $6.6 million, or 8.4% in the same comparative period of the prior year.

Income from fully amortized portfolios (zero basis revenue) was $8.3 million for the three month period ended March 31, 2010, compared to $10.5 million for the three month period ended March 31, 2009. Income from fully amortized portfolios was $16.4 million for the six month period ended March 31, 2010, compared to $20.6 million for the six month period ended March 31, 2009. There were no impairments recorded during the three and six month periods ended March 31, 2010, as compared to $18.4 million and $39.8 million, respectively, recorded during the three and six month periods ended March 31, 2009.

The Company has reduced amounts outstanding on its $6 million senior line of credit at Bank Leumi to zero at March 31, 2010. Aggregate debt level, excluding the subordinated debt – related party, at March 31, 2010 was $96.5 million, down approximately $26.1 million from September 30, 2009 and approximately $63.6 million from a year ago. The subordinated debt – related party balance was $4.4 million at March 31, 2010, down almost $4 million from September 30, 2009. Cash and cash equivalents at March 31, 2010 were $12.6 million.

"We continued our progress in strengthening our balance sheet and increasing our cash position through the six month period ended March 31, 2010 – both to weather the current economic environment and to be selective buyers of attractive portfolios," commented Gary Stern, Chairman and CEO of the Company.  "Exclusive of the non-recourse debt, we are currently funding our business through our cash flow from operations without the need for borrowing on our senior facility. Although our portfolio purchase volume increased slightly during the first six months of fiscal year 2010 as compared to the same period in the prior year, from $2.7 million in the first six months of fiscal year 2009 to $3.3 million in the first six months of 2010, this is substantially below our historical levels of purchases over the past several years. Our reduced collections and finance income are a reflection of the reduced level of portfolio purchases.  However, our strong balance sheet puts us in a good position to fund portfolio purchases that fit our strict investment criteria and other investment opportunities that will deliver returns we feel fit our investment model."

A conference call to discuss the results of the second quarter and first six months of fiscal year 2010 will be held on Thursday, May 6, 2010 at 10:30AM, EDT

Toll-free dial in number (US and Canada):

(877) 407-8037

International dial-in number:

(201) 689-8037

Based in Englewood Cliffs, NJ, Asta Funding, Inc., is a leading consumer receivable asset management company that specializes in the purchase, management and liquidation of performing and non-performing consumer receivables.  For additional information, please visit our website at http://www.astafunding.com.

Except for historical information contained herein, the matters set forth in this news release are "forward-looking" statements (as defined in the Private Securities Litigation Reform Act of 1995.)  Although Asta Funding, Inc. believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, there can be no assurance that its expectations will be realized.  Forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from Asta Funding, Inc.'s expectations.  Factors that could contribute to such differences include those identified in Asta Funding, Inc.'s Form 10-K and Form 10-K/A for the fiscal year ended September 30, 2009, Form 10-Q for the quarter ended December 31, 2009 and those described from time to time in Asta Funding, Inc.'s other filings with the Securities and Exchange Commission, news releases and other communications. Asta Funding, Inc.'s reports with the Securities and Exchange Commission are available free of charge through its website at http://www.astafunding.com.

- Financial Tables Follow

SOURCE Asta Funding, Inc.