v3.26.3
Borrowings
 9 Months Ended
Sep. 30, 2026
Debt Disclosure [Abstract]  
Borrowings Borrowings
The Company is in compliance in all material respects with all covenants under its financing arrangements as of September 30, 2026. The components of the Company’s consolidated borrowings were as follows (in thousands):
September 30,
2026		December 31,
2025
Global senior secured revolving credit facility$974,763 $631,998 
Senior secured notes2,449,878 2,324,335 
Convertible senior notes
— 230,000 
Cabot securitisation senior facility338,247 343,539 
U.S. facility
450,000 450,000 
Other54,714 52,926 
Finance lease liabilities379 596 
4,267,981 4,033,394 
Less: debt discount and issuance costs, net of amortization(30,181)(32,101)
Total$4,237,800 $4,001,293 
Encore is the parent of the restricted group for the Global Senior Facility and the Senior Secured Notes, both of which are guaranteed by the same group of material Encore subsidiaries and secured by the same collateral, which represents substantially all of the assets of those subsidiaries.
Global Senior Secured Revolving Credit Facility
In September 2020, the Company entered into a multi-currency senior secured revolving credit facility agreement (as amended and restated, the “Global Senior Facility”). As of September 30, 2026, the Global Senior Facility provided for a total committed facility of $1,485.0 million that matures in September 2029, except for a $69.5 million tranche that terminates in September 2028, and included the following key provisions:
•Interest at Term SOFR (or EURIBOR for any loan drawn in Euro or a rate based on SONIA for any loan drawn in British Pounds), with a Term SOFR (or EURIBOR or SONIA) floor of 0.00%, plus a margin of 2.25%, plus in the case of Term SOFR borrowings, a credit adjustment spread of 0.10%;
•An unused commitment fee of 0.40% per annum, payable quarterly in arrears;
•A restrictive covenant that limits the LTV Ratio (defined in the Global Senior Facility) to 0.75 in the event that the Global Senior Facility is more than 20% utilized;
•A restrictive covenant that limits the SSRCF LTV Ratio (defined in the Global Senior Facility) to 0.275;
•A restrictive covenant that requires the Company to maintain a Fixed Charge Coverage Ratio (as defined in the Global Senior Facility) of at least 2.0;
•Additional restrictions and covenants which limit, among other things, the payment of dividends and the incurrence of additional indebtedness and liens; and
•Standard events of default which, upon occurrence, may permit the lenders to terminate the Global Senior Facility and declare all amounts outstanding to be immediately due and payable.
The Global Senior Facility is secured by substantially all of the assets of the Company and the guarantors. Pursuant to the terms of an intercreditor agreement entered into with respect to the relative positions of (1) the Global Senior Facility and any super priority hedging liabilities (collectively, “Super Senior Liabilities”) and (2) the Senior Secured Notes, Super Senior Liabilities that are secured by assets that also secure the Senior Secured Notes will receive priority with respect to any proceeds received upon any enforcement action over any such assets.
As of September 30, 2026, the outstanding borrowings under the Global Senior Facility were $974.8 million. The weighted average interest rate of the Global Senior Facility was 5.58% and 6.44% for the three months ended September 30, 2026 and 2025, respectively, and 5.57% and 6.49% for the nine months ended September 30, 2026 and 2025, respectively. Available capacity under the Global Senior Facility, after taking into account applicable debt covenants, was approximately $510.2 million as of September 30, 2026.
Senior Secured Notes
The following table provides a summary of the Company’s senior secured notes (the “Senior Secured Notes”) ($ in thousands):
September 30,
2026		December 31,
2025		Issue
Currency		Maturity DateInterest Payment DatesInterest Rate
Encore 2028 Notes
$331,615 $336,803 GBPJun 1, 2028Jun 1, Dec 14.250 %
Encore 2028 Floating Rate Notes
— 487,532 EURJan 15, 2028Jan 15, Apr 15, Jul 15, Oct 15
EURIBOR +4.250%(1)
Encore 2029 Notes
— 500,000 
USD
Apr 1, 2029
Apr 1, Oct 1
9.250 %
Encore 2030 Notes
500,000 500,000 USDMay 15, 2030
May 15, Nov 15
8.500 %
Encore 2031 Notes
500,000 500,000 USDApr 15, 2031Apr 15, Oct 156.625 %
Encore 2032 Notes750,000 — USDJun 1, 2032Jun 1, Dec 16.625 %
Encore 2033 Floating Rate Notes368,263 — EURJul 15, 2033Jan 15, Apr 15, Jul 15, Oct 15
EURIBOR +3.250%(2)
$2,449,878 $2,324,335 
_______________________
(1)Interest rate was based on three-month EURIBOR (subject to a 0% floor) plus 4.250% per annum, that reset quarterly.
(2)Interest rate is based on three-month EURIBOR (subject to a 0% floor) plus 3.250% per annum, resets quarterly.
The Senior Secured Notes are secured by the same collateral as the Global Senior Facility. The guarantees provided in respect of the Senior Secured Notes are pari passu with the guarantee given in respect of the Global Senior Facility. Subject to the intercreditor agreement described above under the section “Global Senior Secured Revolving Credit Facility,” Super Senior Liabilities that are secured by assets that also secure the Senior Secured Notes will receive priority with respect to any proceeds received upon any enforcement action over any such assets.
On May 22, 2026, the Company issued $750.0 million in aggregate principal amount of 6.625% Senior Secured Notes due June 2032 at an issue price of 100.000% (the “Encore 2032 Notes”). Interest on the Encore 2032 Notes is payable semi-annually, in arrears, on June 1 and December 1 of each year, commencing on December 1, 2026. The Company used a portion of the proceeds from this offering to redeem in full the $500.0 million principal outstanding under the Encore 2029 Notes, and to pay certain transaction fees and expenses incurred in connection with the offering of the Encore 2032 Notes. In connection with the redemption of the Encore 2029 Notes, the Company recognized a total loss on extinguishment of debt of $28.0 million, which included a $23.1 million make-whole premium for the early redemption and the write-off of the related unamortized issuance costs, during the nine months ended September 30, 2026.
On May 28, 2026, the Company issued €325.0 million (approximately $368.3 million based on an exchange rate of $1.00 to €0.88, the exchange rate as of September 30, 2026) in aggregate principal amount of senior secured floating rate Notes due July 2033 at an issue price of 100.000% (the “Encore 2033 Floating Rate Notes”). The Encore 2033 Floating Rate Notes bear interest at a rate equal to the sum of (i) three-month EURIBOR (subject to a 0% floor) plus (ii) 3.250% per annum, reset quarterly. Interest on the Encore 2033 Floating Rate Notes is payable quarterly, in arrears, on January 15, April 15, July 15, and October 15 of each year, commencing on July 15, 2026. The Company used the proceeds from this offering, together with
drawings under its Global Senior Facility, to redeem in full the €415.0 million principal outstanding under the Encore 2028 Floating Rate Notes, and to pay certain transaction fees and expenses incurred in connection with the offering of the Encore 2033 Floating Rate Notes. In connection with the redemption of the Encore 2028 Floating Rate Notes, the Company recognized a loss on extinguishment of debt of $2.5 million, which consisted of the write-off of the related unamortized debt discount and issuance costs, during the nine months ended September 30, 2026.
As discussed above, the Encore 2028 Floating Rate Notes were redeemed in full on May 28, 2026. During 2026 and through the redemption date, the weighted average interest rate for the Encore 2028 Floating Rate Notes was 6.32%. The weighted average interest rates for the Encore 2028 Floating Rate Notes were 6.32% and 6.68% for the three and nine months ended September 30, 2025, respectively.
The Encore 2033 Floating Rate Notes had a weighted average interest rate of 5.64% for the three months ended September 30, 2026, and 5.59% during the period from the issuance date on May 28, 2026 to September 30, 2026.
Convertible Notes
The following table provides a summary of the principal balance, maturity date and interest rate for the Company’s convertible senior notes (the “Convertible Notes”) ($ in thousands):
September 30,
2026		December 31,
2025		Maturity DateInterest Payment DatesInterest Rate
2029 Convertible Notes$— $230,000 Mar 15, 2029Mar 15, Sep 154.000 %
On July 22, 2026, in accordance with the redemption rights set forth in the indenture for the 2029 Convertible Notes, the Company called all $230.0 million aggregate principal amount of its outstanding 2029 Convertible Notes for redemption (the “Redemption”) on September 24, 2026 (the “Redemption Date”).
Prior to the Redemption Date, the Company received conversion notices representing the full $230.0 million aggregate principal amount of the 2029 Convertible Notes. On September 24, 2026, the Company settled in full its $230.0 million aggregate principal amount of 2029 Convertible Notes in cash for $367.9 million. The settlement of the 2029 Convertible Notes was accounted for as a debt conversion, rather than an induced conversion or extinguishment as it occurred under the preexisting terms of the indenture. The $137.9 million conversion spread, representing the excess over the principal amount, together with the unamortized debt issuance costs of $2.7 million, was recognized as a reduction to equity in the Company’s condensed consolidated financial statements during the three and nine months ended September 30, 2026. The settlement was funded by borrowings under the Company’s Global Senior Facility.
In connection with the issuance of the 2029 Convertible Notes in 2023, the Company entered into privately negotiated capped call transactions that effectively raised the conversion price of the 2029 Convertible Notes from $65.89 to $82.69. These hedging instruments were determined to be indexed to the Company’s own stock and met the criteria for equity classification. The Company recorded the initial cost of the hedge instruments as a reduction in additional paid-in capital, and did not recognize subsequent changes in fair value of these financial instruments in its condensed consolidated financial statements.
Upon the conversion of the 2029 Convertible Notes, the capped call transactions were unwound and terminated in full, and the Company received aggregate cash proceeds of $31.8 million, which was recorded as an increase to additional paid-in capital in the Company’s condensed consolidated financial statements during the three and nine months ended September 30, 2026.
Prior to the Redemption Date, the Company’s 2029 Convertible Notes were carried as a single liability, which reflected the principal amount of the convertible notes. Interest expense related to the Company’s Convertible Notes was $1.9 million and $3.1 million during the three months ended September 30, 2026 and 2025, respectively, and $6.5 million and $9.4 million for the nine months ended September 30, 2026 and 2025, respectively.
Cabot Securitisation Senior Facility
Cabot Securitisation UK Ltd (“Cabot Securitisation”), an indirect subsidiary of Encore, has a senior facility for a committed amount of £255.0 million (as amended, the “Cabot Securitisation Senior Facility”). Funds drawn under the Cabot Securitisation Senior Facility bear interest at a rate per annum equal to SONIA plus a margin of 3.00% plus, for periods after January 18, 2029, a step up margin ranging from zero to 1.00%. The Cabot Securitisation Senior Facility matures in January 2031.
As of September 30, 2026, the outstanding borrowings under the Cabot Securitisation Senior Facility were £255.0 million (approximately $338.2 million based on an exchange rate of $1.00 to £0.75, the exchange rate as of September 30, 2026). The
obligations of Cabot Securitisation under the Cabot Securitisation Senior Facility are secured by first ranking security interests over all of Cabot Securitisation’s property, assets and rights (including receivables purchased from Cabot Financial UK from time to time), the book value of which was £275.1 million (approximately $365.0 million based on an exchange rate of $1.00 to £0.75, the exchange rate as of September 30, 2026) as of September 30, 2026. The weighted average interest rate of the Cabot Securitisation Senior Facility was 6.74% and 7.29% for the three months ended September 30, 2026 and 2025, respectively, and 6.79% and 7.54% for the nine months ended September 30, 2026 and 2025, respectively.
Cabot Securitisation is a securitized financing vehicle and is a VIE for consolidation purposes. Refer to “Note 8: Variable Interest Entities” for further details.
U.S. Facility
An indirect subsidiary of Encore (“U.S. Financing Subsidiary”) has a facility for a committed amount of $450.0 million (as amended, the “U.S. Facility”). The Company amended the U.S. Facility, effective August 17, 2026, to extend its maturity from October 2028 to October 2029 and to reduce the margin on borrowings under the U.S. Facility from 3.50% to 3.00%. The amendment was accounted for as a debt modification. Following the amendment, funds drawn under the U.S. Facility bear interest at a rate per annum equal to Term SOFR plus a margin of 3.00%.
As of September 30, 2026, the outstanding borrowings under the U.S. Facility were $450.0 million. The obligations under the U.S. Facility are secured by first ranking security interests over all of U.S. Financing Subsidiary’s assets and rights. As of September 30, 2026, this included receivables acquired from MCM, the book value of which was $913.1 million. The weighted average interest rate of the U.S. Facility was 6.95% and 7.81% for the three months ended September 30, 2026 and 2025, respectively, and 7.09% and 7.82% for the nine months ended September 30, 2026 and 2025, respectively.
The U.S. Facility is a securitized financing vehicle and is a VIE for consolidation purposes. Refer to “Note 8: Variable Interest Entities” for further details.