Performant Financial Corp. yesterday reported net income in the third quarter of $2 million, compared with a loss of $8.1 million during the same period a year ago. Revenue during the third quarter was $36.2 million, up from $35.9 million during the third quarter of 2019. During a conference call yesterday discussing the financial results, Performant Chief Executive Lisa Im said that the company has been allowed to restart “the majority” of its collection operations after they were halted at the request of creditors when the coronavirus pandemic hit the United States this Spring.
Im also stated that the company has submitted a bid to continue collecting on behalf of the Internal Revenue Service and they expect the tax collection agency to make an announcement about new contract awards in February 2021. “At the end of the day, it is the continued hard work and dedication of our team that has driven our stronger operational results in the midst of considerable uncertainty and disruption resulting from COVID-19,” Im said, according to a transcript of the call.
Within the company’s recovery operation, revenue was $15.4 million a 26% drop from the third quarter of 2019 and 4% less than what the company brought in during the second quarter of 2020.
Earnings, especially in the company’s student loan recovery operation, could take a “significant” hit during the fourth quarter, given that the Department of Education is still not collecting on outstanding student loans and the money Performant earns for its role in facilitating rehabilitation agreements will stop coming it, said Rohit Ramchandani, the company’s vice president of finance and strategy.