8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED)
MAY 19, 2008

ASTA FUNDING, INC.

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation)

0-26906	22-3388607
(Commission File Number)	(IRS Employer Identification No.)

210 Sylvan Avenue, Englewood Cliffs, New Jersey	07632
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: 201-567-5648

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below): N/A

o Written communications pursuant to Rule 425 under the Securities Act

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On May 19, 2008, Asta Funding, Inc. (the “Company”) issued a press release regarding results for the three and six months ended March 31, 2008. A copy of this press release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K.

In accordance with General Instruction B.2 of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1 shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(c)	Exhibits
99.1	Press release dated May 19, 2008.

SIGNATURE

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	ASTA FUNDING, INC.
Date: May 20, 2008	By:	/s/ Mitchell Cohen
		Mitchell Cohen
		Chief Financial Officer

EX-99.1

     

Exhibit 99.1

Nasdaq: ASFI

          FOR IMMEDIATE RELEASE

     CONTACT:

	Stephen D. Axelrod, CFA
Mitchell Cohen, CFO	Alisa D. Steinberg (Media)
Asta Funding, Inc.	Wolfe Axelrod Weinberger Assoc.LLC
(201) 567-5648	(212) 370-4500; (212) 370-4505
(Fax)
	steve@wolfeaxelrod.com
	alisa@wolfeaxelrod.com

ASTA FUNDING REPORTS SECOND QUARTER AND
SIX MONTHS FISCAL 2008 RESULTS

ENGLEWOOD CLIFFS, NJ, May 19, 2008 — Asta Funding, Inc., (NASDAQ: ASFI), a consumer receivable asset management and liquidation company, today reported results for the three and six months ended March 31, 2008.

Revenues for the three months ended March 31, 2008, were $33,882,000, an increase of 4% compared to revenues of $32,608,000 a year ago. The Company reported a net loss for the three months ended March 31, 2008 of $7,707,000, or $0.54 per diluted share, compared to net income of $12,552,000, or $0.85 per diluted share, in the same prior year period.

Revenues for the six months ended March 31, 2008 were $68,157,000, an increase of 18% compared to revenues for the six months ended March 31, 2007 of $57,753,000. Net income for the six months ended March 31, 2008 was $5,607,000 or $0.38 per diluted share, versus $23,878,000, or $1.63 per diluted share, for the same period a year earlier.

Net cash collections from collection of consumer receivables acquired for liquidation was $44.9 million for the second quarter, versus $62.2 million in the prior year’s quarter. Net cash collections from collection of consumer receivables acquired for liquidation was $95.0 million for the six months ended March 31, 2008, compared to $104.1 million in the prior year’s period. Net cash collections represented by account sales of consumer receivables acquired for liquidation was $4.9 million or 9.8% of net cash collections in the quarter, compared to 18.3% in the second quarter of fiscal 2007.

Gary Stern, President and Chief Executive Officer, said, “With regard to our large portfolio purchase, consummated a little over a year ago, our actual collections were slower than our original expectations and we incurred a significant impairment of

approximately $30.3 million. This is a result of a variety of factors, including the effects of the economic downturn.”

Mr. Stern added, “Our total bank debt was approximately $293.9 million at March 31, 2008 and as of today stands at approximately $269.0 million. Our business structure remains solid with stockholders’ equity at $17.21 per share at the end of the second quarter and we will work diligently to improve shareholder value.”

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210 Sylvan Avenue, Englewood Cliffs, NJ 07632
(201) 567-5648, (201) 567-2203 fax

Mr. Stern concluded, “We plan on having an investor day and hope to announce a date and details in the near future.”

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, 2007, Form 10-Q for the quarter ended December 31, 2007 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, including that the portfolio purchase described in this press release may not be consistent with Asta’s initial valuation analysis, that the terms of the new financing obtained, or the anticipated benefits of the portfolio purchase may not meet Asta’s expectations, that Asta may experience operational difficulties in acquiring a portfolio of this size, that Asta received only limited representations and warranties with respect to the quality, quantity and characteristics of the portfolio and that there are other risks associated with the portfolio. 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 -

ASTA FUNDING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS — DATA
(Unaudited)

	Three Months			Three Months		Six Months			Six Months
	Ended			Ended		Ended			Ended
	March 31, 2008			March 31, 2007		March 31, 2008			March 31, 2007
Revenues:
Finance income, net	$	33,878,000		$	32,353,000	$	68,013,000		$	57,294,000
Other income		4,000			255,000		144,000			459,000
		33,882,000			32,608,000		68,157,000			57,753,000
Expenses:
General and administrative		7,124,000			5,790,000		12,929,000			10,878,000
Interest		4,711,000			3,779,000		10,652,000			5,298,000
Impairments		35,000,000			2,412,000		35,000,000			2,412,000
		46,835,000			11,981,000		58,581,000			18,588,000
Income before equity (loss) in earnings of venture and income tax		(12,953,000	)		20,627,000		9,576,000			39,165,000
Equity in (loss) earnings of venture		(1,000	)		475,000		(78,000	)		975,000
Income tax (benefit) expense		(5,247,000	)		8,550,000		3,891,000			16,262,000
Net(loss) Income		($7,707,000	)	$	12,552,000	$	5,607,000		$	23,878,000
Net(loss) income per share:
Basic		($0.54	)	$	0.91	$	0.40		$	1.73
Diluted		($0.54	)	$	0.85	$	0.38		$	1.63
Weighted average number of common shares outstanding:
Basic		14,201,674			13,848,194		14,059,142			13,772,538
Diluted		14,201,674			14,744,499		14,742,549			14,647,556

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ASTA FUNDING, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS — DATA

	March 31,		September 30,
	2008		2007
	(Unaudited)
ASSETS
Cash	$	3,589,000	$	4,525,000
Restricted cash		5,048,000		5,694,000
Consumer receivables acquired for liquidation (at net realizable value)		512,256,000		545,623,000
Due from third party collection agencies and attorneys		5,211,000		4,909,000
Investment in venture		1,162,000		2,040,000
Furniture and equipment, net		797,000		793,000
Deferred income taxes		22,465,000		12,349,000
Other assets and investments		4,285,000		4,323,000
Total assets	$	554,813,000	$	580,256,000
LIABILITIES AND Stockholders’ Equity
Liabilities
Debt	$	293,857,000	$	326,466,000
Other liabilities		3,558,000		7,537,000
Dividends payable		571,000		557,000
Income taxes payable		11,397,000		8,161,000
Total liabilities		309,383,000		342,721,000
Stockholders’ Equity
Preferred stock, $.01 par value; authorized 5,000,000 shares; issued and outstanding — none
Common stock, $.01 par value; authorized 30,000,000 shares; issued and outstanding — 14,276,158 at March 31, 2008 and 13,918,158 at September 30, 2007		143,000		139,000
Additional paid-in capital		68,442,000		65,030,000
Retained earnings		176,845,000		172,366,000
Total stockholders’ equity		245,637,000		237,535,000
Total liabilities and stockholders’ equity	$	554,813,000	$	580,256,000

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