Outsourcing Solutions Inc. Announces Third Quarter 2000 Results - Operating Earnings Up 37%

Business Wire, Nov 16, 2000

Business Editors

ST. LOUIS--(BUSINESS WIRE)--Nov. 16, 2000

Outsourcing Solutions Inc. (OSI), announced total revenues for the quarter ending September 30, 2000 of $133.9 million, an 8.9% increase from $123.0 million in fiscal 1999 (15.8% revenue increase adjusted for the impact of off-balance sheet portfolio purchasing activity). Operating earnings before nonrecurring expenses for the quarter were $11.4 million, up 37.3% from $8.3 million in 1999.

For the first nine months, revenues were $404.5 million, up 6.4% from $380.1 million in 1999 (10.4% increase adjusted for the impact of off-balance sheet portfolio purchasing activity). Operating earnings before nonrecurring expenses for the first nine months increased to $33.8 million from $27.4 million in 1999 - up 23.4%.

Commenting on the results for the third quarter, Timothy G. Beffa, President and Chief Executive Officer of OSI, said, "Our third quarter operating results, up 37%, reflect continued revenue growth and operational improvements throughout most of our businesses, particularly in our healthcare, government, letter series, portfolio and outsourcing services. The realignment initiatives which were implemented earlier in the year were substantially completed during this quarter. We believe this realignment will continue to show benefits, particularly in our ability to efficiently and effectively serve our customers."

OSI is a nation's leading provider of strategic receivables management services, enhancing the financial performance of America's leading companies. With industry-specific strategies and services, OSI delivers results that improve the bottom line through accelerated cash flow, lower operating costs, reduced bad debt expense and improved customer retention. OSI provides outsourcing, collection and portfolio services to a blue chip roster of Fortune 500 clients.

Headquartered in St. Louis, OSI has approximately 7,500 employees in nearly 60 locations across 25 states plus Canada, Mexico and Puerto Rico. More information about OSI can be found by visiting http://www.osi.to

Note: Certain matters discussed within this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although OSI believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. These uncertainties are more fully described in the Company's filings with the Securities and Exchange Commission.

                      Outsourcing Solutions Inc.
                     Earnings Information for the
                 Third Quarter and Year-to-Date Ending
                          September 30, 2000
                            (in thousands)

                        Third Quarter Ending       Year-to-Date Ending
                            September 30,             September 30,
                           2000       1999           2000       1999

Revenue                 $ 133,871  $ 122,987      $ 404,494  $ 380,063
Operating Expenses        107,923     97,516        325,351    299,572
Amortization and
 Depreciation              14,527     17,164         45,372     53,070
Nonrecurring expenses       1,742          -          2,929          -
Operating Costs and
 Expenses                 124,192    114,680        373,652    352,642
Operating Profit (Loss)     9,679      8,307         30,842     27,421
Other Expense                   -          -              -         76
Interest Expense           15,377     13,005         44,829     38,214
Income (Loss) before
 Taxes                     (5,698)    (4,698)       (13,987)   (10,869)
Provision for Income
 Tax                           65          -            359        375
Net Income (Loss)        $ (5,763)  $ (4,698)     $ (14,346) $ (11,244)
Earnings Before Interest,
 Taxes, Depreciation and
 Amortization (EBITDA)
 before nonrecurring
 expenses                $ 25,948   $ 25,471      $  79,143  $  80,491

SOURCE: OSI