Financial Results Q2 2015

August 13, 2015

Time: 8:30am MTN

Domestic: (877) 201-0168

International: (647) 788-4901

Confirmation Code: 67941700

Safe Harbor Provisions

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Certain statements made in this presentation are forward-looking statements under the Private Securities

Litigation Reform Act of 1995. These can be identified by words such as "intend," "believe," and "expect," and phrases

using those or similar terms. Specifically, statements relating to projections of future proceeds, revenue, income,

profitability, cash flow, non-GAAP financial measures such as Adjusted EBITDA and Estimated Remaining Proceeds, also

known as “ERP”, and our ability to expand and utilize flexibility under our credit facility are forward-looking statements.

These forward‐looking statements are not guarantees of our future performance and are subject to risks and

uncertainties that could cause actual results to differ materially from the results contemplated by the forward‐looking

statements. Factors that could affect our results and cause them to materially differ from those contained in the forward

looking statements include those that we discuss in “Risk Factors” or comparable headings in our most recent Annual

Report on Form 10-K.

Adjusted EBITDA and ERP, as presented today and in our earnings release we issued this morning, are

supplemental measures of our performance and purchased debt asset value, respectively, that are not required by, or

presented in accordance with, accounting principles generally accepted in the U.S., also known as “GAAP.” They are not

measurements of our financial performance or asset value under GAAP and should not be considered as alternatives to

net income, asset value, or any other performance measures derived in accordance with GAAP, or as alternatives to cash

flows from operating activities or a measure of our liquidity.

We believe adjusted EBITDA is representative of our cash flow generation that can be used to purchase charged-

off receivables, pay down or service debt, pay income taxes, and for other uses. ERP represents the expected cash

proceeds of our then-current purchased debt portfolios over a nine year period. You are, however, cautioned not to place

undue reliance on adjusted EBITDA and ERP.

Our Strategy

Paul A. Larkins, Chief Executive Officer

Key Strategic Goals

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Our People

• Inspire a culture of leadership by living our core values

Our Services • Pursue systemic operational and compliance excellence

Our Channels • Create an outstanding network of call centers and exclusive

branch offices

Our Customers • Deliver the Fair Square Promise

Our Financials • Deliver solid financial results

Second Quarter Highlights

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• Significant Improvement in Costs to Collect

• Customer Connection Strategy Drives Results

• Continued Expansion of Valuable Fin-Tech Relationships

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SquareTwo and the Market Evolving Debt Sales:

-------------------------------------------------------------------------------------

Ret

urn

to

Mar

ket

Charge-Off Growth

Money

Center Banks

Fin-Tech Commercial

Regional Banks

Canada

Financial Results

John D. Lowe, Chief Financial Officer

ERP and Adjusted EBITDA

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• Consolidated ERP of $600M

• Adjusted EBITDA of $43M

Q2 2014 Q2 2015 Q2 2014 Q2 2015

59.8% 73.3% 1.69x 2.52x

Company Debt as a %

of Consolidated ERP

Company Debt ÷ TTM

Adjusted EBITDA

732681

655612 600

100

200

300

400

500

600

700

800

Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015

Consolidated ERP Trending($ millions)

Canada US

5448

42 42 43

0

10

20

30

40

50

60

Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015

Adjusted EBITDA Trending($ millions)

Returns by Purchase Year

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• Active Portfolio Returns Maintain Strength

• 2015 Returns Improve

1.9x

1.2x

0.7x

0.2x

2.1x

0.4x

0.6x

0.9x 1.6x

0.00x

0.50x

1.00x

1.50x

2.00x

2.50x

Active Portfolio 2012 2013 2014 YTD 2015

Consolidated Return on Investment Purchase Years 2012 through YTD 2015

Actual Returns Estimated Returns

Purchasing

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• Discipline Purchasing Maintained

• Commercial Purchases Up Significantly

2015 2014 $ Variance % Variance

Credit Card/Consumer

Loan - Fresh*Face $110,949 $246,781 ($135,832) (55.0%)Price 12,427 36,882 (24,455) (66.3%)Price (%) 11.2% 14.9%

Credit Card/Consumer

Loan - Non-Fresh*Face 96,826 40,006 56,820 142.0%Price 5,398 2,735 2,663 97.4%Price (%) 5.6% 6.8%

Other**Face 69,371 54,020 15,351 28.4%Price 13,886 2,435 11,451 NMPrice (%) 20.0% 4.5%

TOTALFace $277,146 $340,807 ($63,661) (18.7%)Price 31,711 42,052 (10,341) (24.6%)Price (%) 11.4% 12.3%

* Includes both Domestic and Canadian purchases.

** Other includes primarly commercial and student loan purchased debt assets.NM Not meaningful.

Purchasing (in thousands)

Quarter Ended June 30,

Proceeds

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• Mix of Legal as % of Total Collections Increased from 51% to 55%

• Commercial Proceeds Increase Significantly

Cash Proceeds (in thousands) 2015 2014 $ Variance % Variance

Credit Card/Consumer Loan Collections

Non-Legal Collections $33,908 $50,658 ($16,750) (33.1%)

Legal Collections 47,370 54,388 (7,018) (12.9%)

Other Collections* 8,195 4,965 3,230 65.1%

Total Collections 89,473 110,011 (20,538) (18.7%)

Sales, Recourse & Bankruptcy 2,134 1,893 241 12.7%

Total Cash Proceeds on Purchased Debt $91,607 $111,904 ($20,297) (18.1%)

Quarter Ended June 30,

*Other includes non-legal collections, legal collections and court cost recoveries on

commercial, student loan, and other accounts

Unadjusted Results

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• Purchased Debt Revenues, Net:

›$49 million, 27% decrease from $67 million in Q2 2014

• Costs to Collect as % of Purchased Debt Collections:

›Including Gross Court Costs: 41.8%; -332bps from Q1 2015

›Excluding Gross Court Costs: 33.5%; -348bps from Q1 2015

›Non-Legal/Legal Mix: 46%/54% (Q1’15), 45%/55% (Q2’15)

• GAAP EBITDA:

› -$0.4 million, decrease of $8 million from Q2 2014

• Net Loss:

› $14 million net loss, increase of $7 million from Q2 2014

Liquidity Update

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• Investment Strategy + Cost Reduction = Net Returns+

• Consolidated ERP of $600 million

• Liquidity = $50 million

Q & A