PRAA
#I want to make sure that, number one, we get the transition right between <UNK> and I.
Although, talking about a transition between two guys who have work together as long as we have, I think we both feel pretty confident about that.
Also I want to be around to support <UNK>'s new administration, as it were, especially around this concept of business development and strategy.
<UNK> and I foresee that this is a certain position over the next year to 18 months and, after that, we'll play it by ear.
There's not a hard drop-dead in it, but if at the end of the day, <UNK> doesn't feel like it's a value-added, then I'll find my way onto the Board.
But as long as I can add value, and as long as <UNK> sees it as, indeed, value-added, I'm ready, willing, and able to continue to pay that row.
I think it's somewhat less than a full-time role, but it's a pretty significant role and far from a part timer.
I probably wouldn't couch it in exactly those terms, but what I'd say is that over the course of the year, as we went through the year, we gained better understanding of what it was that was really driving our collection shortfalls and the amount of the forecast miss that we had in the fourth quarter caused us too really dig into that more deeply.
As I highlighted in my prepared remarks, we made some significant assumptions around 2015 and prior vintages regarding whether or not to consider recouping those cash flows and based on we sit now, we've assumed we do not have any recouping of prior cash shortfalls on a go-forward basis.
The main thing that drove the bigger allowance charges in the fourth quarter, with regards to the outlook on a go-forward basis, I would say based on that assumption that we've made, barring something really significant that we haven't foreseen at this point, I wouldn't expect any sizable allowances in the US core portfolios on a go-forward basis.
It was $0.15; hang on.
Just give me one second.
Fee income was $14 million, roughly, of the $21 million that we reported for the quarter and, call it, $43 million of the $77 million we reported for the full year.
That's right, <UNK>.
<UNK>, I'd say that, as we said in the script, it appears to us as though we're seeing some signals, some body language, in some cases, some movement by existing sellers to offer, perhaps, a bit more volume than we might have anticipated at this point in time.
We are believing that it might be appropriate to extrapolate some of those moves, both throughout the year and perhaps to other sellers as well.
We'll see if that, indeed, comes down the pike, but we've seen some, from our perspective, a positive movement, albeit subtle, thus far in Q1.
It's still a small business for us, <UNK>, although, obviously, coming from nothing, it's growing substantially.
It's safe to say we believe very strongly that it's an interesting market for us to be in long term.
We couldn't be more pleased with the local partners that we are in business with.
They're really smart guys, and the deals that we've purchased thus far are performing at or better, or in some cases much better than expectation.
So for us it's so far, so good, but it's a new geography and so we don't want to get overly excited.
Obviously, there's also a volatile currency down there.
All of those things play into how comfortable we're going to be growing that business.
But thus far, as you observed, it's been a good place for us to invest.
Yes, I would agree with your thesis around both availability of capital, as well as significant amount of cash generation by the business on a normal basis.
We're always in discussions with our banks and we're always connected with the capital markets and thinking about different alternatives for raising capital and we'll be ready when the opportunity arises.
The thing to keep in mind that it's not going to be a light switch on/off, that's going to catch us off guard.
We'll have advance warning before significant volumes are coming to market.
No, <UNK>, I don't think so.
It is tough to exclude the media impact, by the way.
That's a big deal for us.
But from our perspective, we're just dealing with mostly the shortage of reps and how we're working through that process.
But the consumer themselves seem to be not changing a lot.
I would say, we are booking on payment plans at record rates, actually.
It all feels pretty good from a health perspective.
No, I didn't give a target.
What we're doing is we're layering on reps, we are analyzing call quality and looking at some other call metrics that we add folks, so I didn't provide an update, other than we do have 2,200 seats and about 1,700 FTEs and we can always part time shift work folks if we ever got to that level.
Remember, they collect cash too.
I don't have any of that data with me, but I anticipated a question like that.
Just keep in mind that when you add these folks, it does take a while to ramp them up.
They are revenue-producing people and incremental to the overall Company.
Just keep those things in mind as you're modeling.
That's a great question.
No, I think I'm actually generally very, very pleased with the reps we've been sourcing.
There's also ---+ I had something in my script and took it out, but I'm going to say it anyway.
It's actually changed the tenor on the floor.
We're buying a lot of new accounts.
We're hiring a lot of people.
We've had some Management changes and there is a real, real interesting vibe going on the floor as well.
It's a bit of a contagion, so to speak, but back to your question, the reps we're hiring on, I'm very pleased with.
They're ramping up as we might expect.
Hi there, <UNK>.
This is <UNK> <UNK>.
I think generally the market in Europe, whilst it remains strong in terms of supply, remains competitive in most of the markets now.
One of the things that <UNK> referred to was consolidation in Europe and what we're seeing is a handful of competitors expanding internationally across those markets and looking to grow rapidly.
It's difficult to say there are some markets where the returns our different to others.
What we are doing is we're finding opportunities with vendors that like our proposition.
That's enabling us to still continue to invest at what we think are decent levels.
The UK market has been competitive for quite a while now.
I'm not sure that, that ---+ I'm not sure which one you're referring to but there have been a number of acquisitions of UK platforms by these handful of competitors over the last few years.
We've continued to invest decent numbers in the UK.
I expect it to continue as it has been, I'll be honest with you.
In fact, we see a decent supply as we go into the first half in the U K.
The answer is, yes, <UNK>.
I'm looking at a chart in front of me.
Just for the sake of everyone on the call in case they're not familiar with it, there was this Path Act there where the IRS was holding refunds for two weeks anyone who'd claimed an earned income credit or a childcare credit.
If you look at the charts, between what we've experienced so far in the quarter versus what we experienced in the last two years, you can see it very, very plainly, very plainly, and over the last handful of days, it has just leapt off of the page and coming back in line.
It's definitely there and whatever you read is accurate.
There's a lot of money flowing at this point.
Yes, I feel comfortable saying we're seen pricing improving, probably since the second half-ish of 2016.
We've been monitoring some of those same things related to our European funding structures, changes in the UK and other jurisdictions.
I'd say probably for 2017, we're thinking somewhere in the 34% to 37% effective tax rate, and possibly towards the higher end of that, the higher end of that range.
There's some legislative changes that'll go into effect with regards to interest rate deductions in the UK this year.
We're anticipating that will have some impact on taxes related to UK, in particular.
But again, we operate in quite a number of different jurisdictions in Europe as well as having a big America's business.
We're a global Company, so we can get lots of put and takes in the effective tax rate.
<UNK>, I expect to see them in court in May.
As best as I can tell you, everything is still scheduled and we're going through the process and most of the stuff is out there in the public.
You can read it.
I would expect us to (technical difficulty) in May.
Thank you, operator.
Thank you all once again, for joining our Q4 2016 earnings call.
We look forward to speaking with you again next quarter.
Good night.
