PRA GROUP INCPRAA

PRA GROUP INC Goodwill & Intangibles Disclosure

10-KFiled Mar 2, 20262 min read
Goodwill
Changes in goodwill for the years ended December 31, 2025 and 2024, were as follows (in thousands):
20252024
Balance as of beginning of year
Goodwill$396,357 $431,564 
Accumulated impairment loss— — 
396,357 431,564 
Activity during the year
Goodwill impairment(412,611)— 
Foreign currency translation43,125 (35,207)
Net change in goodwill(369,486)(35,207)
Balance as of end of year
Goodwill439,482 396,357 
Accumulated impairment loss(412,611)— 
Balance as of end of year$26,871 $396,357 
The Company performs an annual impairment test of goodwill as of October 1 of each year, or more frequently if indicators of impairment exist. As part of the Company’s September 30, 2025 interim impairment assessment, based on a sustained decrease in its stock price and market capitalization, the Company determined there to be an indicator of potential goodwill impairment in its Debt Buying and Collection (“DBC”) reporting unit. As a result, the Company performed a quantitative impairment test using the income approach and also compared the estimated fair value of the reporting unit to the Company’s market capitalization.
The Company estimated the fair value of the DBC reporting unit based on the present value of estimated future cash flows and a residual terminal value. Forecasted financial results were developed considering several inputs and assumptions, including portfolio purchasing volume, purchase price multiples, ERC growth rate, terminal value and operating expenses. Based on the quantitative impairment test performed, driven in large part by the comparison of estimated fair value to market capitalization and the impact on fair value of a decrease in the terminal value assumption and an increase in the discount rate assumption since the most recent annual impairment test, the Company determined that the goodwill in its DBC reporting unit was fully impaired. This resulted in a goodwill impairment charge of $412.6 million in the Consolidated Income Statement for the year ended December 31, 2025.
As of December 31, 2025, the remaining goodwill balance of $26.9 million was related to the Company's class action claims recoveries reporting unit.

Historical Timeline

Fiscal YearFiled
2025Mar 2, 2026Showing above
2024Feb 27, 2025
2023Feb 29, 2024
2022Feb 28, 2023
2021Mar 1, 2022
2020Feb 26, 2021
2019Mar 2, 2020
2018Mar 12, 2019
2017Feb 28, 2018
2016Mar 1, 2017
2015Feb 26, 2016

About Goodwill & Intangibles Disclosures

Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.

Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.

Other Available Disclosures

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