8-K

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):  February 1, 2005

Encore Capital Group, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware	000-26489	48-1090909
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S Employer Identification No.)

8875 Aero Drive
San Diego, California 92123
(Address of Principal Executive Offices) (Zip Code)

(877) 445-4581
(Registrant’s Telephone Number, Including Area Code)

Item 7.01                 Regulation FD Disclosure

        A copy of a slide presentation given by Carl C. Gregory, III, President and Chief Executive Officer, at the Brean Murray & Co. Annual Institutional Investor Conference on February 1, 2005 in New York, New York, is attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated herein solely for purposes of this Item 7.01.

        The slide presentation attached to this Current Report on Form 8-K as Exhibit 99.1 contains financial measures for net income (loss) excluding one-time benefits and charges that are not calculated in accordance with generally accepted accounting principles in the United States (“GAAP”). The Company has provided a reconciliation in Exhibit 99.2 to this Current Report on Form 8-K of the non-GAAP financial measures for net income (loss) excluding one-time benefits and charges to GAAP net income (loss).

        Management believes that the non-GAAP financial measures for net income (loss) provide useful information to investors about the Company’s results of operations because the elimination of one-time benefits and charges that are included in the GAAP financial measures results in enhanced comparability of certain key financial results between the periods presented.

        The information in this Current Report on Form 8-K, including the exhibits, is furnished pursuant to Item 7.01 and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities under that Section. Furthermore, the information in this Current Report on Form 8-K, including the exhibits, shall not be deemed to be incorporated by reference into the filings of Encore Capital Group, Inc. under the Securities Act of 1933.

Risk Factors

        The slide presentation attached to this report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). The words “believe,” “expect,” “anticipate,” “estimate,” “project,” or the negation thereof or similar expressions constitute forward-looking statements within the meaning of the Reform Act. These statements may include, but are not limited to, projections of revenues, income or loss, estimates of capital expenditures, plans for future operations, products or services, and financing needs or plans, as well as assumptions relating to these matters. For all forward-looking statements, the Company claims the protection of the safe-harbor for forward-looking statements contained in the Reform Act.

        The Company’s actual results could differ materially from those contained in the forward-looking statements due to a number of factors, some of which are beyond our control. Factors that could affect our results of operations or financial condition and cause them to differ from those contained in the forward-looking statements include:

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• Our quarterly operating results may fluctuate and cause our stock price to decrease;
• We may not be able to purchase receivables at sufficiently favorable prices or terms for us to be successful;
• We may not be successful at acquiring portfolios consisting of new types of receivables;
• We may not be able to collect sufficient amounts on our receivables portfolios to recover our costs and fund our operations;
• The statistical model we use to project remaining cash flows from our receivables portfolios may prove to be inaccurate, which could result in reduced revenues if we do not achieve the collections forecasted by our model;
• Our industry is highly competitive, and we may be unable to continue to successfully compete with businesses that may have greater resources than we have;
• Our failure to purchase sufficient quantities of receivable portfolios may necessitate workforce reductions, which may harm our business;
• High financing costs currently have an adverse effect on our earnings;
• We may be unable to meet our future liquidity requirements;
• We may not be able to continue to satisfy the restrictive covenants in our debt agreements;
• We use estimates in our accounting and our earnings will be reduced if actual results are less than estimated;
• We will be required to change how we account for under performing receivable portfolios, which will have an adverse effect on our earnings;
• Our earnings will be reduced by the payment of substantial amounts in income taxes as a result of our full utilization of our federal net operating loss carry-forward in 2003;
• We may not be successful at acquiring and collecting on portfolios consisting of new types of receivables;
• Government regulation may limit our ability to recover and enforce the collection of receivables;
• We are subject to ongoing risks of litigation, including individual or class actions under securities, consumer credit, collections, employment and other laws;
• We may make acquisitions that prove unsuccessful or strain or divert our resources;
• Our failure to satisfy requirements pertaining to internal controls could subject us to fines and other regulatory penalties, and cause investors to lose confidence in our reported financial information, which could have a material adverse effect on our stock price;
• Recent legislative actions and proposed regulations will require corporate governance initiatives, which may be difficult and expensive to implement;
• We may not be able to hire and retain enough sufficiently trained employees to support our operations, and/or we may experience high rates of personnel turnover;
• The failure of our technology and phone systems could have an adverse effect on our operations;
• We may not be able to successfully anticipate, invest in or adopt technological advances within our industry;
• We may not be able to adequately protect the intellectual property rights upon which we rely; and
• We have engaged in transactions with members of our Board of Directors, significant stockholders, and entities affiliated with them; future transactions with related parties could pose conflicts of interest.

        Forward-looking statements speak only as of the date the statement was made. They are inherently subject to risks and uncertainties, some of which we cannot predict or quantify. Future events and actual results could differ materially from the forward-looking statements. When considering each forward-looking statement, you should keep in mind the risk factors and cautionary statements found throughout the Company’s annual report on Form 10-K as of and for the year ended December 31, 2003 filed with the Securities and Exchange Commission. We do not undertake and specifically decline any obligation to publicly release the result of any revisions to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events, whether as a result of new information, future events, or for any other reason.

        In addition, it is our policy generally not to make any specific projections as to future earnings and we do not endorse projections regarding future performance that may be made by third parties.

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SIGNATURES

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

	ENCORE CAPITAL GROUP, INC.
Date: February 1, 2005	By      /s/ Barry R. Barkley —————————————— Barry R. Barkley Executive Vice President, Chief Financial Officer and Treasurer

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EXHIBIT INDEX

Exhibit Description

99.1 Slide presentation given by Carl C. Gregory, III, President and Chief Executive Officer, at the Brean Murray & Co. Annual Institutional Investor Conference on February 1, 2005 in New York, New York.

99.2 Reconciliation of non-GAAP information pursuant to Regulation G.

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EX-99

Exhibit 99.1

NASDAQ: ECPG

Business Update

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CAUTIONARY NOTE A BOUT FORWARD - -LOOKING STATEMENTS

Certain Statements in This Presentation Constitute “Forward-looking Statements” Within the
Meaning of the Private Securities Litigation Reform Act of 1995.  Such Statements Involve Risks,
Uncertainties and Other Factors Which May Cause Actual Results, Performance or Achievements
of the Company and Its Subsidiaries to Be Materially Different From Any Future Results,
Performance or Achievements Expressed or Implied by Such Forward-looking Statements.  For a
Discussion of These Factors, We Refer You to the Company’s Annual Report on Form 10-K As of
and for the Year Ended December 31, 2003.

In Light of the Significant Uncertainties Inherent in the Forward-looking Statements Included
Herein, the Inclusion of Such Information Should Not Be Regarded As a Representation by the
Company or by Any Other Person or Entity That the Objectives and Plans of the Company Will Be
Achieved.

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ENCORE CAPITAL

50 year old purchaser and manager of consumer receivables portfolios

Unique business model

Excellent financial and operating results

Strong drivers for growth

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INVESTMENT HIGHLIGHTS

Growth Industry

High barriers to long-term success

Demonstrated ability to buy right and collect well

Process company focused on debt collection

Innovations and analysis

Multiple collection channels reduces need to acquire new portfolios & increase
outbound collection staff

New lower cost financing

Significant catalyst for pretax margin expansion and earnings growth

Highly seasoned and respected management team

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COMPELLING FUNDAMENTALS

Source:  Federal Reserve Board, December 7, 2004

$ in billions

Non-mortgage consumer debt and charge-off rates

Traditional consumer debt continues to grow

Other types of consumer receivables are beginning to be sold

Automobile deficienciesTelecom

UtilitiesMedical

Health club

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BUSINESS DRIVERS

Buy Right

Collect Well

Manage Expenses

Challenge Everything

Demand Professional and Ethical Behavior

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BUSINESS MODEL

This is how we make money…

Years

0

1

2

3

>3

Total

Investment

($100)

Collections

$114

$74

$51

$31

$270

Cumulative Multiple

of Costs Collected

1.1x

1.9x

2.4x

2.7x

Total Operating

Expense

@40%

($46)

($30)

($20)

($12)

($108)

Net cash flow stream

($100)

$68

$44

$31

$19

$162

Net

IRR

29%

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Representative Data Only; Not Actual Portfolio Results.

ACTUAL RESULTS V S. MODEL

Our returns are better than targeted

36 months

24 months

12 months

6 months

97

$3.8 Billion

$1.2 Billion

$6.9 Billion

$ 8.5 Billion

Total Face Value

41

171

205

# of Portfolios

Multiple of Purchase Price Collected

* Through September 30, 2004

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COMPETITIVE ADVANTAGES

Consumer level analytics

Multiple collection strategies

Proprietary and dynamic account management
software

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BUY RIGHT

Account level valuation provides several competitive advantages

Note:  All purchases since mid-2000 through 9/30/04.

Month Since

Charge

-

off

Face Value

($ in Billions)

% of Total

Face Purch.

0

-

6

$

2.1

21%

7

-

12

$

1.0

10%

13

-

18

$

2.0

20%

19

-

24

$

0.8

8%

25

-

36

$

1.9

19%

37+

$

2.2

22%

Total

$

10.0

100%

10

Increases our flexibility to buy throughout
the universe of defaulted receivables

Provides ability to create
positively selected deals

Expands universe of sources to
include our competition

Applies to alternative paper
types

Strong Collection Growth

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COLLECT WELL -UNIQUE LIQUIDATION STRATEGIES

Continuous innovation is driving our collection growth

12

COLLECT WELL -RESULTS

Collection innovation drives our performance improvement

($ in Thousands)

(Employees)

13

STRONG FINANCIAL R ESULTS & MOMENTUM

*Excludes one-time items.

14

*Pretax Income excludes one-time benefit and charges.

STRONG FINANCIAL R ESULTS & MOMENTUM

The real earnings power not yet realized

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STRONG FINANCIAL RESULTS & MOMENTUM -
BALANCE SHEET IMPROVEMENT

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Our Average Monthly Collections per Employee are very favorable.

ECPG¹

$27,300

Monthly Collections
per Avg. Total
Employees

$181,301

2004 YTD Gross
Collections (in thousands)

737

Average # of

Total Employees

COMPETITIVE COMPARISON

¹  Data from 10-Q filings for the period ending September 30, 2004 (9-month period).

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Strong Collections and Judicious Portfolio Buys Create Strong Turnover

ECPG¹

1.45

Annualized Portfolio
Turnover

$241,735

Annualized Gross
Collections (in thousands)

$166,695

Total Inventory

(in thousands)

$76,328

Annualized Purchases

(in thousands)

$90,367

Portfolio BOY

(in thousands)

COMPETITIVE COMPARISON

¹  Data from 10-Q filings for the period ending September 30, 2004 (9-month period).

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$334,400

Implied Gross Collections to
Realize Book Value

(in thousands)

$20,144

Avg. Monthly Collections 2004

(in thousands)

ECPG¹

16.6

Months Remaining to Amortize
Book

27%

YTD Amortization Rate

$90,367

Portfolio January 1, 2004

(in thousands)

COMPETITIVE COMPARISON

¹  Data from 10-Q filings for the period ending September 30, 2004 (9-month period).

We Are Amortizing Our Portfolio Quickly

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COMPETITIVE COMPARISON

Recent Vintages Are Consistently Strong

Ratio of Total Collections to Purchase Price by Year of Origin

¹  Data from 10-Q filings for the period ending September 30, 2004 (9-month period).

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EXPERIENCED MANAGEMENT TEAM

Former CFO of Stellcom, Inc.; Former EVP and CFO of Telespectrum Worldwide Inc.; Former Partner
of M&A Services at Deloitte and Touche

Paul Grinberg

SVP Finance

Former Director of Service Strategy at Gateway, Inc.

Anna Hansen

SVP Collection Operations

Former VP of Decision Science for Associates Home Equity Division

Eric Von Dohlen                              
VP & Chief Credit Risk Officer  
                                

Former VP & CIO of West Capital; Former VP & CIO for Frederick’s of Hollywood and The Welk Group

John Treiman   
SVP & CIO

Former VP and General Counsel of West Capital and Comstream Corp.

Robin R. Pruitt 
SVP, General Counsel and Secretary
                                         

Former Director of Human Resources at Gateway, Inc.

Alison James    
SVP, Human Resources

Former SVP of Operations of West Capital and First Data Resources; Former VP/Risk Operations of
Capital One

J. Brandon Black                            
President & COO

Former CFO of West Capital; Former CFO and Board Member of Bank One, Texas, N.A; Former
Controller of Great Western Financial Corp.

Barry R. Barkley                              
EVP & CFO

Former Chairman, President and CEO of West Capital; Former Chairman, President and CEO of MIP
Properties, Inc., a publicly traded REIT

Carl C. Gregory, III                         
Vice Chairman & CEO

Experience

Name/Position

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Future Prospects

Growth Opportunities

Innovations and analysis

Significant reduction in effective interest
rate driven by new financing

Strong cash position for acquisitions

Continued penetration of alternative
asset classes

Challenges

Higher prices for purchased
receivables

Implementation of SOP 2003-03

Managing SOX 404 requirements

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