For 2014, Green Dot now expects the following1:
“Our adjusted EBITDA guidance for Green Dot’s core business remains
unchanged at
“As it relates to our expected revenue results for the full year, we are making good progress in executing initiatives that we believe can help generate higher revenue in the remaining months of the year. We also expect to soon announce the launch of a major new program that we believe can have a positive impact on our performance in the remainder of 2014, and a more material positive impact in future years. Nevertheless, given that we’re now in mid-September, we do not think all of these expected improvements will be enough to offset the year-to-date revenue pacing relative to our internal plan that we talked about in our Q2 earnings call. Therefore, while we’re optimistic about what we can accomplish in the remainder of the year, we think it is best to adjust our revenue guidance now to reflect the most likely range of outcomes based on current trends,” concluded Ms. Wang.
Green Dot's updated outlook is based on a number of assumptions that
Green Dot believes are reasonable at the time of this earnings release.
Information regarding potential risks that could cause the actual
results to differ from these forward-looking statements is set forth
below and in Green Dot's filings with the
1 | Reconciliations of forward-looking guidance for the following non-GAAP financial measures to their respective, most directly comparable projected GAAP financial measures are provided in the tables below. |
Forward-Looking Statements
This announcement contains forward-looking statements, which are subject
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. These statements include, among other things,
statements regarding the Company's full-year 2014 guidance contained in
the bulleted text and in the quotes of our Chief Financial Officer, the
expected impact of the TPG acquisition on the Company’s operating
expenses for 2014 and other future events that involve risks and
uncertainties. Actual results may differ materially from those contained
in the forward-looking statements contained in this announcement. The
potential risks and uncertainties that could cause actual results to
differ from those projected include, among other things, the businesses
of the Company and TPG may not be combined successfully, or such
combination may take longer, be more difficult, time-consuming or costly
to accomplish than expected; the risk that the acquisition of TPG may
not occur; customer losses and business disruption following the
acquisition, including adverse effects on relationships with former
employees of TPG, may be greater than expected; and the risk that the
Company may incur unanticipated or unknown losses or liabilities if it
completes the acquisition of TPG. Additional factors that could cause
actual results to differ materially from those expressed in the
forward-looking statements include the impact of the Company’s supply
chain management efforts on its revenue growth, the timing and impact of
revenue growth activities, the Company's dependence on revenues derived
from Walmart and three other retail distributors, impact of competition,
the Company's reliance on retail distributors for the promotion of its
products and services, demand for the Company's new and existing
products and services, continued and improving returns from the
Company's investments in new growth initiatives, potential difficulties
in integrating operations of acquired entities and acquired
technologies, the Company's ability to operate in a highly regulated
environment, changes to existing laws or regulations affecting the
Company's operating methods or economics, the Company's reliance on
third-party vendors, changes in credit card association or other network
rules or standards, changes in card association and debit network fees
or products or interchange rates, instances of fraud developments in the
prepaid financial services industry that impact prepaid debit card usage
generally, business interruption or systems failure, and the Company's
involvement in litigation or investigations. These and other risks are
discussed in greater detail in the Company's
About Non-GAAP Financial Measures
To supplement the Company's consolidated financial statements presented
in accordance with accounting principles generally accepted in
About Green Dot
GREEN DOT CORPORATION
Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to Projected GAAP Total Operating Revenue (1)
(Unaudited)
Range | ||||||
Low | High | |||||
(In millions) | ||||||
Total operating revenues | $ | 602 | $ | 612 | ||
Stock-based retailer incentive compensation (2)* | 8 | 8 | ||||
Non-GAAP total operating revenues | $ | 610 | $ | 620 |
* | Assumes the Company's right to repurchase lapses on 36,810 shares per month during 2014 of the Company's Class A common stock at $18.46 per share, our market price on September 16, 2014. A $1.00 change in the Company's Class A common stock price represents an annual change of $441,720 in stock-based retailer incentive compensation. |
Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to Projected Adjusted EBITDA (1)
(Unaudited)
Range | |||||||
Low | High | ||||||
(In millions) | |||||||
Net income | $ | 39 | $ | 41 | |||
Adjustments (3) | 83 | 85 | |||||
Adjusted EBITDA | $ | 122 | $ | 126 | |||
Non-GAAP total operating revenues | $ | 620 | $ | 610 | |||
Adjusted EBITDA / Non-GAAP total operating revenues (Adjusted EBITDA margin) | 20 | % | 21 | % |
Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to Projected GAAP Net Income (1)
(Unaudited)
Range | ||||||
Low | High | |||||
(In millions, except per share data) | ||||||
Net income | $ | 39 | $ | 41 | ||
Adjustments (3) | 21 | 21 | ||||
Non-GAAP net income | $ | 60 | $ | 62 | ||
Diluted earnings per share* | ||||||
GAAP | $ | 0.81 | $ | 0.85 | ||
Non-GAAP | $ | 1.25 | $ | 1.29 | ||
Diluted weighted-average shares issued and outstanding | ||||||
GAAP | 42 | 42 | ||||
Non-GAAP | 48 | 48 |
* | Reconciliations between GAAP and non-GAAP diluted weighted-average shares issued and outstanding are provided in the next table. |
GREEN DOT CORPORATION
Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to
Projected GAAP Diluted Weighted-Average Shares Issued and Outstanding (1)
(Unaudited)
Range | ||||
Low | High | |||
(In millions) | ||||
Diluted weighted-average shares issued and outstanding* | 42 | 42 | ||
Assumed conversion of weighted-average shares of preferred stock | 6 | 6 | ||
Weighted-average shares subject to repurchase | — | — | ||
Non-GAAP diluted weighted-average shares issued and outstanding | 48 | 48 |
* | Assumes the Company will issue 6.133 million shares of Class A common stock on October 1, 2014 in conjunction with its acquisition of TPG. Accordingly, the diluted weighted-average shares issued and outstanding reflects these shares as outstanding for only three months of 2014. |
(1) To supplement the Company’s consolidated financial statements presented in accordance with GAAP, the Company uses measures of operating results that are adjusted to exclude various, primarily non-cash, expenses and charges. These financial measures are not calculated or presented in accordance with GAAP and should not be considered as alternatives to or substitutes for operating revenues, operating income, net income or any other measure of financial performance calculated and presented in accordance with GAAP. These financial measures may not be comparable to similarly-titled measures of other organizations because other organizations may not calculate their measures in the same manner as we do. These financial measures are adjusted to eliminate the impact of items that the Company does not consider indicative of its core operating performance. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate.
The Company believes that the non-GAAP financial measures it presents are useful to investors in evaluating the Company’s operating performance for the following reasons:
The Company’s management uses the non-GAAP financial measures:
The Company understands that, although adjusted EBITDA and other non-GAAP financial measures are frequently used by investors and securities analysts in their evaluations of companies, these measures have limitations as an analytical tool, and you should not consider them in isolation or as substitutes for analysis of the Company’s results of operations as reported under GAAP. Some of these limitations are:
(2) This expense consists of the recorded fair value of the shares of
Class A common stock for which the Company’s right to repurchase has
lapsed pursuant to the terms of the
(3) These amounts represent estimated adjustments for net interest income, income taxes, depreciation and amortization, employee stock-based compensation expense, stock-based retailer incentive compensation expense, and the amortization attributable to the Company's acquired intangible assets. Employee stock-based compensation expense and stock-based retailer incentive compensation expense include assumptions about the future fair market value of the Company’s Class A common stock (which is influenced by external factors like the volatility of public markets and the financial performance of the Company’s peers).
Source:
Investor Relations:
Green Dot Corporation
Christopher
Mammone, 626-765-2427
IR@greendot.com
or
Media
Relations
ICR
Brian Ruby, 203-682-8286
Brian.Ruby@icrinc.com