Asta Funding Reports Rise in Revenue and Income

Asta Funding, Inc., (Nasdaq: ASFI), a leading consumer receivable asset management and liquidation company, today reported results for the three and six months ended March 31, 2006.

Net income for the three months ended March 31, 2006 increased 52% to $11,103,000, or $0.76 per diluted share, compared to $7,281,000, or $0.51 per diluted share, in the same prior year period. Revenues for the three months ended March 31, 2006, were $24,829,000, an increase of 49% compared to revenues of $16,662,000 a year ago. Net income for the six months ended March 31, 2006 increased 52% to $20,415,000 or $1.40 per diluted share, from $13,456,000, or $0.94 per diluted share, for the same period a year earlier. Revenues for the six months ended March 31, 2006 were $45,089,000, an increase of 48% compared to revenues for the six months ended March 31, 2005 of $30,492,000.

Net collections from consumer receivables acquired for liquidation was $55.6 million for the second quarter, up 32% from $42.2 million in the prior year’s quarter. Net collections from consumer receivables acquired for liquidation was $101.8 million for the six months ended March 31, 2006, up 29% from $79.0 million in the prior year’s period. Cash collections represented by account sales were 22% of net cash collections in the quarter, down from 23% in the second quarter of fiscal 2005 and down from 30% in the first quarter of fiscal 2006.

Gary Stern, President and Chief Executive Officer, said, “The second quarter was a very rewarding one for Asta. We showed record results on the top and bottom lines, which can be attributed to our very strong book of business and strong cash collections during the quarter.” Mr. Stern added, “I am also pleased with the Company’s portfolio purchases for the fiscal year to date, which, including purchases for the first few weeks of our third fiscal quarter totaling $3.6 billion of face value receivables for a purchase price of $145.5 million. Asta’s purchases for the quarter amounted to $351.2 million of face value receivables for a purchase price of $18.8 million. We are off to a great start with our fiscal third quarter purchases, which total $1.1 billion of face value receivables for a purchase price of $24.3 million. We are particularly proud that our purchases during the second quarter and for the first few weeks of our third fiscal quarter include portfolio purchases from new relationships.”

Mr. Stern concluded, “Our business structure remains solid. We believe Asta still has a lot of capacity for future growth and operating efficiencies as its expenses continue to be relatively fixed. The company’s balance sheet continued to strengthen as stockholders’ equity grew 27.9% to $12.10 per share at the end of the second quarter, up from a book value of $9.46 per share the same time last year.”