Company Sees Improved Momentum in BaaS with Robust Business Development Pipeline
Launches new Retail Partner PLS and Reports Strong Start to Tax Season
“We are building a vertically integrated set of capabilities that will serve as a market leading embedded finance platform with differentiated products and services and resilient compliance capabilities,” said
Consolidated Results Summary
|
Three Months Ended |
|
|
|||||||
|
2024 |
|
2023 |
|
% Change |
|||||
|
(In thousands, except per share data and percentages) |
|
|
|||||||
GAAP financial results |
|
|
|
|
|
|||||
Total operating revenues |
$ |
451,988 |
|
|
$ |
416,380 |
|
|
9 |
% |
Net income |
$ |
4,750 |
|
|
$ |
36,012 |
|
|
(87 |
)% |
Diluted earnings per common share |
$ |
0.09 |
|
|
$ |
0.69 |
|
|
(87 |
)% |
|
|
|
|
|
|
|||||
Non-GAAP financial results1 |
|
|
|
|
|
|||||
Non-GAAP total operating revenues1 |
$ |
447,423 |
|
|
$ |
412,363 |
|
|
9 |
% |
Adjusted EBITDA1 |
$ |
59,232 |
|
|
$ |
82,543 |
|
|
(28 |
)% |
Adjusted EBITDA/Non-GAAP total operating revenues (adjusted EBITDA margin) |
|
13.2 |
% |
|
|
20.0 |
% |
|
(6.8 |
)% |
Non-GAAP net income1 |
$ |
31,440 |
|
|
$ |
51,293 |
|
|
(39 |
)% |
Non-GAAP diluted earnings per share1 |
$ |
0.59 |
|
|
$ |
0.99 |
|
|
(40 |
)% |
Unencumbered cash at the holding company was approximately
1 |
Reconciliations of total operating revenues to non-GAAP total operating revenues, net income to adjusted EBITDA, net income to non-GAAP net income, and diluted earnings per share to non-GAAP diluted earnings per share, respectively, are provided in the tables immediately following the unaudited consolidated financial statements. Additional information about the Company's non-GAAP financial measures can be found under the caption “About Non-GAAP Financial Measures” below. |
Key Metrics
The following table shows Green Dot's quarterly key business metrics for each of the last five calendar quarters on a consolidated basis and by each of its reportable segments. Please refer to Green Dot’s latest Annual Report on Form 10-K for a description of the key business metrics, as well as additional information regarding how Green Dot organizes its business by segment.
|
2024 |
|
2023 |
|||||||||||
|
Q1 |
|
Q4 |
Q3 |
Q2 |
Q1 |
||||||||
|
(In millions) |
|||||||||||||
Consolidated * |
|
|
|
|
|
|
||||||||
Gross dollar volume |
$ |
30,755 |
|
$ |
26,355 |
$ |
24,836 |
$ |
24,724 |
$ |
23,289 |
|||
Number of active accounts |
|
3.51 |
|
|
3.57 |
|
3.67 |
|
3.71 |
|
3.84 |
|||
Purchase volume |
$ |
5,274 |
|
$ |
5,273 |
$ |
5,362 |
$ |
5,734 |
$ |
6,145 |
|||
Consumer Services |
|
|
|
|
|
|
||||||||
Gross dollar volume |
$ |
4,500 |
|
$ |
4,290 |
$ |
4,619 |
$ |
5,122 |
$ |
5,677 |
|||
Number of active accounts |
|
1.93 |
|
|
2.05 |
|
2.16 |
|
2.35 |
|
2.41 |
|||
Direct deposit active accounts |
|
0.46 |
|
|
0.49 |
|
0.52 |
|
0.59 |
|
0.60 |
|||
Purchase volume |
$ |
3,339 |
|
$ |
3,312 |
$ |
3,553 |
$ |
3,984 |
$ |
4,344 |
|||
B2B Services |
|
|
|
|
|
|
||||||||
Gross dollar volume |
$ |
26,255 |
|
$ |
22,065 |
$ |
20,217 |
$ |
19,602 |
$ |
17,612 |
|||
Number of active accounts |
|
1.58 |
|
|
1.52 |
|
1.51 |
|
1.36 |
|
1.43 |
|||
Purchase volume |
$ |
1,935 |
|
$ |
1,961 |
$ |
1,809 |
$ |
1,750 |
$ |
1,801 |
|||
|
|
|
|
|
|
|
||||||||
Number of cash transfers |
|
7.77 |
|
|
8.19 |
|
8.31 |
|
8.66 |
|
8.70 |
|||
Number of tax refunds processed |
|
9.28 |
|
|
0.16 |
|
0.20 |
|
3.87 |
|
9.91 |
* Represents the sum of Green Dot's Consumer Services and B2B (as defined herein) Services segments.
“We are off to a solid start in 2024,” said
2024 Financial Guidance
Green Dot is reaffirming its most recent financial outlook for 2024. Green Dot’s outlook is based on a number of assumptions that management believes are reasonable at the time of this earnings release. In particular, its outlook reflects several considerations, including but not limited to the current macro-economic environment, the effect of high inflation and interest rates, the impact of previously disclosed non-renewals of certain partnerships and programs, the company's decision to wind down many of its legacy cardholder programs in support of GO2bank, negative trends within certain channels of its business, investment in strategic initiatives and compliance programs, and cost reduction initiatives. Additionally, any fines or direct losses in excess of Green Dot’s accrual for the proposed consent order previously disclosed are expressly excluded from its outlook. 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
Total Non-GAAP Operating Revenues2
Adjusted EBITDA2
Non-GAAP EPS2
The components of Green Dot's non-GAAP EPS2 guidance range are as follows:
|
Range |
||||||
|
Low |
|
High |
||||
|
(In millions, except per share data) |
||||||
Adjusted EBITDA |
$ |
170.0 |
|
|
$ |
180.0 |
|
Depreciation and amortization* |
|
(66.0 |
) |
|
|
(66.0 |
) |
Net interest expense |
|
(3.0 |
) |
|
|
(3.0 |
) |
Non-GAAP pre-tax income |
$ |
101.0 |
|
|
$ |
111.0 |
|
Tax impact** |
|
(22.7 |
) |
|
|
(25.0 |
) |
Non-GAAP net income |
$ |
78.3 |
|
|
$ |
86.0 |
|
Diluted weighted-average shares issued and outstanding |
|
54.0 |
|
|
|
54.0 |
|
Non-GAAP earnings per share |
$ |
1.45 |
|
|
$ |
1.59 |
|
* |
Excludes the impact of amortization of acquired intangible assets |
|
** |
Assumes a non-GAAP effective tax rate of approximately 22.5% for full year. |
2 |
For additional information, see reconciliations of forward-looking guidance for these non-GAAP financial measures to their respective, most directly comparable projected GAAP financial measures provided in the tables immediately following the reconciliation of Net Income to Adjusted EBITDA. |
Conference Call
Green Dot's management will host a conference call to discuss first quarter 2024 financial results today at
Forward-Looking Statements
This earnings release 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 in the quotes of Green Dot's executive officers and under the heading "2024 Financial Guidance," 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 earnings release, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from those projected include, among other things, Green Dot’s ability to achieve the expected cost savings and other benefits from its processor conversions, impacts from and changes in general economic conditions on Green Dot’s business, results of operations and financial condition, shifts in consumer behavior towards electronic payments, the timing and impact of revenue growth activities, Green Dot's dependence on revenues derived from Walmart, the timing and impact of non-renewals or terminations of agreements with other large partners, impact of competition, Green Dot's reliance on retail distributors for the promotion of its products and services, demand for Green Dot's new and existing products and services, continued and improving returns from Green Dot's investments in strategic initiatives, Green Dot's ability to operate in a highly regulated environment, including with respect to any restrictions imposed on its business, changes to governmental policies or rulemaking or enforcement priorities affecting financial institutions or to existing laws or regulations affecting Green Dot's operating methods or economics, Green Dot'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 financial services industry that impact debit card usage generally, business interruption or systems failure, economic, political and other conditions may adversely affect trends in consumer spending and Green Dot's involvement in litigation or investigations. These and other risks are discussed in greater detail in Green Dot's
About Non-GAAP Financial Measures
To supplement Green Dot's consolidated financial statements presented in accordance with accounting principles generally accepted in
About Green Dot
Green Dot offers a broad set of financial products to consumers and businesses including debit, checking, credit, prepaid, and payroll cards, as well as robust money processing services, such as tax refunds, cash deposits and disbursements. Its flagship digital banking platform GO2bank offers consumers simple and accessible mobile banking designed to help improve financial health over time. The company’s banking platform services business enables a growing list of the world’s largest and most trusted consumer and technology brands to deploy customized, seamless, value-driven money management solutions for their customers.
Founded in 1999, Green Dot has served more than 33 million customers directly and many millions more through its partners. The Green Dot Network of more than 90,000 retail distribution locations nationwide, more than all remaining bank branches in the
CONSOLIDATED BALANCE SHEETS |
|||||||
|
|
|
|
||||
|
(unaudited) |
|
|
||||
Assets |
(In thousands, except par value) |
||||||
Current assets: |
|
|
|
||||
Unrestricted cash and cash equivalents |
$ |
1,118,804 |
|
|
$ |
682,263 |
|
Restricted cash |
|
226 |
|
|
|
4,239 |
|
Investment securities available-for-sale, at fair value |
|
60,117 |
|
|
|
33,859 |
|
Settlement assets |
|
876,101 |
|
|
|
737,989 |
|
Accounts receivable, net |
|
89,325 |
|
|
|
110,141 |
|
Prepaid expenses and other assets |
|
79,853 |
|
|
|
69,419 |
|
Total current assets |
|
2,224,426 |
|
|
|
1,637,910 |
|
Investment securities available-for-sale, at fair value |
|
2,118,855 |
|
|
|
2,203,142 |
|
Loans to bank customers, net of allowance for credit losses of |
|
39,629 |
|
|
|
30,534 |
|
Prepaid expenses and other assets |
|
213,590 |
|
|
|
221,656 |
|
Property, equipment, and internal-use software, net |
|
175,125 |
|
|
|
179,376 |
|
Operating lease right-of-use assets |
|
4,614 |
|
|
|
5,342 |
|
Deferred expenses |
|
1,404 |
|
|
|
1,546 |
|
Net deferred tax assets |
|
129,314 |
|
|
|
117,139 |
|
|
|
414,067 |
|
|
|
420,477 |
|
Total assets |
$ |
5,321,024 |
|
|
$ |
4,817,122 |
|
Liabilities and Stockholders’ Equity |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
107,826 |
|
|
$ |
119,870 |
|
Deposits |
|
3,743,301 |
|
|
|
3,293,603 |
|
Obligations to customers |
|
356,529 |
|
|
|
314,278 |
|
Settlement obligations |
|
66,178 |
|
|
|
57,001 |
|
Amounts due to card issuing banks for overdrawn accounts |
|
111 |
|
|
|
225 |
|
Other accrued liabilities |
|
110,405 |
|
|
|
91,239 |
|
Operating lease liabilities |
|
3,388 |
|
|
|
3,369 |
|
Deferred revenue |
|
5,628 |
|
|
|
6,343 |
|
Line of credit |
|
45,000 |
|
|
|
61,000 |
|
Income tax payable |
|
8,509 |
|
|
|
6,262 |
|
Total current liabilities |
|
4,446,875 |
|
|
|
3,953,190 |
|
Other accrued liabilities |
|
1,682 |
|
|
|
1,895 |
|
Operating lease liabilities |
|
1,821 |
|
|
|
2,687 |
|
Total liabilities |
|
4,450,378 |
|
|
|
3,957,772 |
|
|
|
|
|
||||
Stockholders’ equity: |
|
|
|
||||
Class A common stock, |
|
53 |
|
|
|
53 |
|
Additional paid-in capital |
|
383,205 |
|
|
|
375,980 |
|
Retained earnings |
|
775,054 |
|
|
|
770,304 |
|
Accumulated other comprehensive loss |
|
(287,666 |
) |
|
|
(286,987 |
) |
Total stockholders’ equity |
|
870,646 |
|
|
|
859,350 |
|
Total liabilities and stockholders’ equity |
$ |
5,321,024 |
|
|
$ |
4,817,122 |
|
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
|||||||
|
Three Months Ended |
||||||
|
2024 |
|
2023 |
||||
|
(In thousands, except per share data) |
||||||
Operating revenues: |
|
|
|
||||
Card revenues and other fees |
$ |
281,503 |
|
|
$ |
239,866 |
|
Cash processing revenues |
|
106,806 |
|
|
|
101,823 |
|
Interchange revenues |
|
50,968 |
|
|
|
64,015 |
|
Interest income, net |
|
12,711 |
|
|
|
10,676 |
|
Total operating revenues |
|
451,988 |
|
|
|
416,380 |
|
Operating expenses: |
|
|
|
||||
Sales and marketing expenses |
|
62,375 |
|
|
|
75,212 |
|
Compensation and benefits expenses |
|
66,824 |
|
|
|
68,781 |
|
Processing expenses |
|
195,666 |
|
|
|
145,054 |
|
Other general and administrative expenses |
|
116,569 |
|
|
|
76,338 |
|
Total operating expenses |
|
441,434 |
|
|
|
365,385 |
|
Operating income |
|
10,554 |
|
|
|
50,995 |
|
Interest expense, net |
|
1,457 |
|
|
|
1,644 |
|
Other expense, net |
|
(1,810 |
) |
|
|
(3,024 |
) |
Income before income taxes |
|
7,287 |
|
|
|
46,327 |
|
Income tax expense |
|
2,537 |
|
|
|
10,315 |
|
Net income |
$ |
4,750 |
|
|
$ |
36,012 |
|
|
|
|
|
||||
Basic earnings per common share: |
$ |
0.09 |
|
|
$ |
0.70 |
|
Diluted earnings per common share |
$ |
0.09 |
|
|
$ |
0.69 |
|
Basic weighted-average common shares issued and outstanding: |
|
52,942 |
|
|
|
51,813 |
|
Diluted weighted-average common shares issued and outstanding: |
|
53,270 |
|
|
|
52,021 |
|
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
|||||||
|
Three Months Ended |
||||||
|
2024 |
|
2023 |
||||
|
(In thousands) |
||||||
Operating activities |
|
|
|
||||
Net income |
$ |
4,750 |
|
|
$ |
36,012 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization of property, equipment and internal-use software |
|
16,432 |
|
|
|
13,701 |
|
Amortization of intangible assets |
|
5,664 |
|
|
|
5,664 |
|
Provision for uncollectible overdrawn accounts from purchase transactions |
|
7,623 |
|
|
|
1,188 |
|
Provision for loan losses |
|
4,788 |
|
|
|
10,252 |
|
Stock-based compensation |
|
8,625 |
|
|
|
9,182 |
|
Losses in equity method investments |
|
2,656 |
|
|
|
4,068 |
|
Amortization of discount on available-for-sale investment securities |
|
(563 |
) |
|
|
(556 |
) |
Impairment of long-lived assets |
|
2,821 |
|
|
|
— |
|
Other |
|
(808 |
) |
|
|
(1,008 |
) |
Changes in operating assets and liabilities: |
|
|
|
||||
Accounts receivable, net |
|
13,193 |
|
|
|
16,015 |
|
Prepaid expenses and other assets |
|
17,033 |
|
|
|
9,392 |
|
Deferred expenses |
|
142 |
|
|
|
7,208 |
|
Accounts payable and other accrued liabilities |
|
5,786 |
|
|
|
(10,415 |
) |
Deferred revenue |
|
(928 |
) |
|
|
(9,945 |
) |
Income tax receivable/payable |
|
2,198 |
|
|
|
9,880 |
|
Other, net |
|
(235 |
) |
|
|
(106 |
) |
Net cash provided by operating activities |
|
89,177 |
|
|
|
100,532 |
|
|
|
|
|
||||
Investing activities |
|
|
|
||||
Proceeds from maturities of available-for-sale securities |
|
45,776 |
|
|
|
37,070 |
|
Proceeds from sales and calls of available-for-sale securities |
|
95 |
|
|
|
55 |
|
Payments for property, equipment and internal-use software |
|
(14,495 |
) |
|
|
(19,533 |
) |
Net changes in loans and advances |
|
(39,939 |
) |
|
|
(15,069 |
) |
Investment in |
|
(35,000 |
) |
|
|
(35,000 |
) |
Proceeds from other investments |
|
39,118 |
|
|
|
— |
|
Other investing activities |
|
(81 |
) |
|
|
(243 |
) |
Net cash used in investing activities |
|
(4,526 |
) |
|
|
(32,720 |
) |
|
|
|
|
||||
Financing activities |
|
|
|
||||
Borrowings on revolving line of credit |
|
64,000 |
|
|
|
83,000 |
|
Repayments on revolving line of credit |
|
(80,000 |
) |
|
|
(118,000 |
) |
Proceeds from exercise of options and ESPP purchases |
|
— |
|
|
|
144 |
|
Taxes paid related to net share settlement of equity awards |
|
(1,400 |
) |
|
|
(2,516 |
) |
Net changes in deposits |
|
451,961 |
|
|
|
(104,412 |
) |
Net changes in settlement assets and obligations to customers |
|
(86,684 |
) |
|
|
(19,864 |
) |
Net cash provided by (used in) financing activities |
|
347,877 |
|
|
|
(161,648 |
) |
|
|
|
|
||||
Net increase (decrease) in unrestricted cash, cash equivalents and restricted cash |
|
432,528 |
|
|
|
(93,836 |
) |
Unrestricted cash, cash equivalents and restricted cash, beginning of period |
|
686,502 |
|
|
|
819,845 |
|
Unrestricted cash, cash equivalents and restricted cash, end of period |
$ |
1,119,030 |
|
|
$ |
726,009 |
|
|
|
|
|
||||
Cash paid for interest |
$ |
3,320 |
|
|
$ |
2,016 |
|
Cash paid for income taxes |
$ |
202 |
|
|
$ |
509 |
|
|
|
|
|
||||
Reconciliation of unrestricted cash, cash equivalents and restricted cash at end of period: |
|
|
|
||||
Unrestricted cash and cash equivalents |
$ |
1,118,804 |
|
|
$ |
722,003 |
|
Restricted cash |
|
226 |
|
|
|
4,006 |
|
Total unrestricted cash, cash equivalents and restricted cash, end of period |
$ |
1,119,030 |
|
|
$ |
726,009 |
|
REPORTABLE SEGMENTS (UNAUDITED) |
|||||||
|
Three Months Ended |
||||||
|
2024 |
|
2023 |
||||
Segment Revenue |
(In thousands) |
||||||
Consumer Services |
$ |
100,612 |
|
|
$ |
139,833 |
|
B2B Services |
|
241,200 |
|
|
|
171,292 |
|
Money Movement Services |
|
103,150 |
|
|
|
98,241 |
|
Corporate and Other |
|
2,461 |
|
|
|
2,997 |
|
Total segment revenues |
|
447,423 |
|
|
|
412,363 |
|
BaaS commissions and processing expenses (8) |
|
5,100 |
|
|
|
4,760 |
|
Other income (9) |
|
(535 |
) |
|
|
(743 |
) |
Total operating revenues |
$ |
451,988 |
|
|
$ |
416,380 |
|
|
Three Months Ended |
||||||
|
2024 |
|
2023 |
||||
Segment Profit |
(In thousands) |
||||||
Consumer Services |
$ |
33,259 |
|
|
$ |
52,752 |
|
B2B Services |
|
18,283 |
|
|
|
22,219 |
|
Money Movement Services |
|
65,847 |
|
|
|
61,026 |
|
Corporate and Other |
|
(58,157 |
) |
|
|
(53,454 |
) |
Total segment profit * |
|
59,232 |
|
|
|
82,543 |
|
Reconciliation to income before income taxes |
|
|
|
||||
Depreciation and amortization of property, equipment and internal-use software |
|
16,432 |
|
|
|
13,701 |
|
Stock based compensation and related employer taxes |
|
8,706 |
|
|
|
9,549 |
|
Amortization of acquired intangible assets |
|
5,664 |
|
|
|
5,664 |
|
Impairment charges |
|
6,405 |
|
|
|
— |
|
Legal settlements and related expenses |
|
5,880 |
|
|
|
100 |
|
Other expense |
|
5,591 |
|
|
|
2,534 |
|
Operating income |
|
10,554 |
|
|
|
50,995 |
|
Interest expense, net |
|
1,457 |
|
|
|
1,644 |
|
Other expense, net |
|
(1,810 |
) |
|
|
(3,024 |
) |
Income before income taxes |
$ |
7,287 |
|
|
$ |
46,327 |
|
* Total segment profit is also referred to herein as adjusted EBITDA in its non-GAAP measures. Additional information about the Company's non-GAAP financial measures can be found under the caption “About Non-GAAP Financial Measures."
Green Dot's segment reporting is based on how its Chief Operating Decision Maker (“CODM”) manages its businesses, including resource allocation and performance assessment. Its CODM (who is the Chief Executive Officer) organizes and manages the businesses primarily on the basis of the channels in which its product and services are offered and uses net revenue and segment profit to assess profitability. Segment profit reflects each segment's net revenue less direct costs, such as sales and marketing expenses, processing expenses, third-party call center support and transaction losses. Green Dot’s operations are aggregated amongst three reportable segments: 1) Consumer Services, 2) Business to Business ("B2B") Services and 3) Money Movement Services.
The Corporate and Other segment primarily consists of net interest income, certain other investment income earned by Green Dot's bank, interest profit sharing arrangements with certain BaaS partners (a reduction of revenue), eliminations of inter-segment revenues and expenses, and unallocated corporate expenses, which include Green Dot's fixed expenses, such as salaries, wages and related benefits for its employees, professional services fees, software licenses, telephone and communication costs, rent, utilities, and insurance that are not considered when Green Dot's CODM evaluates segment performance. Non-cash expenses such as stock-based compensation, depreciation and amortization of long-lived assets, impairment charges and other non-recurring expenses that are not considered by Green Dot's CODM when it is evaluating overall consolidated financial results are excluded from its unallocated corporate expenses. Green Dot does not evaluate performance or allocate resources based on segment asset data, and therefore such information is not presented.
Reconciliation of Total Operating Revenues to Non-GAAP Total Operating Revenues (1) (Unaudited) |
|||||||
|
Three Months Ended |
||||||
|
2024 |
|
2023 |
||||
|
(In thousands) |
||||||
Total operating revenues |
$ |
451,988 |
|
|
$ |
416,380 |
|
BaaS commissions and processing expenses (8) |
|
(5,100 |
) |
|
|
(4,760 |
) |
Other income (9) |
|
535 |
|
|
|
743 |
|
Non-GAAP total operating revenues |
$ |
447,423 |
|
|
$ |
412,363 |
|
Reconciliation of Net Income to Non-GAAP Net Income (1) (Unaudited) |
|||||||
|
Three Months Ended |
||||||
|
2024 |
|
2023 |
||||
|
(In thousands, except per share data) |
||||||
Net income |
$ |
4,750 |
|
|
$ |
36,012 |
|
Stock-based compensation and related employer payroll taxes (3) |
|
8,706 |
|
|
|
9,549 |
|
Amortization of acquired intangible assets (4) |
|
5,664 |
|
|
|
5,664 |
|
Transaction and related acquisition costs (4) |
|
— |
|
|
|
(3 |
) |
Amortization of deferred financing costs (5) |
|
36 |
|
|
|
36 |
|
Impairment charges (5) |
|
6,405 |
|
|
|
— |
|
Legal settlements and related expenses (5) |
|
5,880 |
|
|
|
100 |
|
Losses in equity method investments (5) |
|
2,656 |
|
|
|
4,068 |
|
Change in fair value of loans held for sale (5) |
|
(225 |
) |
|
|
(240 |
) |
Extraordinary severance expenses (6) |
|
5,020 |
|
|
|
1,769 |
|
Other income, net (5) |
|
(50 |
) |
|
|
(36 |
) |
Income tax effect (7) |
|
(7,402 |
) |
|
|
(5,626 |
) |
Non-GAAP net income |
$ |
31,440 |
|
|
$ |
51,293 |
|
Diluted earnings per common share |
|
|
|
||||
GAAP |
$ |
0.09 |
|
|
$ |
0.69 |
|
Non-GAAP |
$ |
0.59 |
|
|
$ |
0.99 |
|
|
|
|
|
||||
Diluted weighted-average common shares issued and outstanding |
|
|
|
||||
GAAP |
|
53,270 |
|
|
|
52,021 |
|
Supplemental Detail on Diluted Weighted-Average Common Shares Issued and Outstanding (Unaudited) |
|||||
|
Three Months Ended |
||||
|
2024 |
|
2023 |
||
|
(In thousands) |
||||
Class A common stock outstanding as of |
53,158 |
|
|
51,994 |
|
Weighting adjustment |
(216 |
) |
|
(181 |
) |
Dilutive potential shares: |
|
|
|
||
Service based restricted stock units |
259 |
|
|
109 |
|
Performance-based restricted stock units |
4 |
|
|
68 |
|
Employee stock purchase plan |
65 |
|
|
31 |
|
Diluted weighted-average shares issued and outstanding |
53,270 |
|
|
52,021 |
|
Reconciliation of Net Income to Adjusted EBITDA (1) (Unaudited) |
|||||||
|
Three Months Ended |
||||||
|
2024 |
|
2023 |
||||
|
(In thousands) |
||||||
Net income |
$ |
4,750 |
|
|
$ |
36,012 |
|
Interest expense, net (2) |
|
1,457 |
|
|
|
1,644 |
|
Income tax expense |
|
2,537 |
|
|
|
10,315 |
|
Depreciation and amortization of property, equipment and internal-use software (2) |
|
16,432 |
|
|
|
13,701 |
|
Stock-based compensation and related employer payroll taxes (2)(3) |
|
8,706 |
|
|
|
9,549 |
|
Amortization of acquired intangible assets (2)(4) |
|
5,664 |
|
|
|
5,664 |
|
Transaction and related acquisition costs (2)(4) |
|
— |
|
|
|
(3 |
) |
Impairment charges (2)(5) |
|
6,405 |
|
|
|
— |
|
Legal settlements and related expenses (2)(5) |
|
5,880 |
|
|
|
100 |
|
Losses in equity method investments (2)(5) |
|
2,656 |
|
|
|
4,068 |
|
Change in fair value of loans held for sale (2)(5) |
|
(225 |
) |
|
|
(240 |
) |
Extraordinary severance expenses (2)(6) |
|
5,020 |
|
|
|
1,769 |
|
Other income, net (2)(5) |
|
(50 |
) |
|
|
(36 |
) |
Adjusted EBITDA |
$ |
59,232 |
|
|
$ |
82,543 |
|
|
|
|
|
||||
Non-GAAP total operating revenues |
$ |
447,423 |
|
|
$ |
412,363 |
|
Adjusted EBITDA/Non-GAAP total operating revenues (adjusted EBITDA margin) |
|
13.2 |
% |
|
|
20.0 |
% |
Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to Projected GAAP Total Operating Revenues (1) (Unaudited) |
|||||||
|
FY 2024 |
||||||
|
Range |
||||||
|
Low |
|
High |
||||
|
(In millions) |
||||||
Total operating revenues |
$ |
1,567 |
|
|
$ |
1,617 |
|
Adjustments (8)(9) |
|
(17 |
) |
|
|
(17 |
) |
Non-GAAP total operating revenues |
$ |
1,550 |
|
|
$ |
1,600 |
|
Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to Projected GAAP Net Income (1) (Unaudited) |
|||||||
|
FY 2024 |
||||||
|
Range |
||||||
|
Low |
|
High |
||||
|
(In millions) |
||||||
Net income |
$ |
6.5 |
|
|
$ |
15.0 |
|
Adjustments (10) |
|
163.5 |
|
|
|
165.0 |
|
Adjusted EBITDA |
$ |
170.0 |
|
|
$ |
180.0 |
|
|
|
|
|
||||
Non-GAAP total operating revenues |
$ |
1,600 |
|
|
$ |
1,550 |
|
Adjusted EBITDA/Non-GAAP total operating revenues (adjusted EBITDA margin) |
|
10.6 |
% |
|
|
11.6 |
% |
Reconciliation of Forward Looking Guidance for Non-GAAP Financial Measures to Projected GAAP Net Income (1) (Unaudited) |
|||||
|
FY 2024 |
||||
|
Range |
||||
|
Low |
|
High |
||
|
(In millions, except per share data) |
||||
Net income |
$ |
6.5 |
|
$ |
15.0 |
Adjustments (10) |
|
71.8 |
|
|
71.1 |
Non-GAAP net income |
$ |
78.3 |
|
$ |
86.0 |
Diluted earnings per share |
|
|
|
||
GAAP |
$ |
0.12 |
|
$ |
0.28 |
Non-GAAP |
$ |
1.45 |
|
$ |
1.59 |
|
|
|
|
||
Diluted weighted-average shares issued and outstanding |
|
|
|
||
GAAP |
|
54.0 |
|
|
54.0 |
(1) |
To supplement Green Dot’s consolidated financial statements presented in accordance with GAAP, Green Dot 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 Green Dot does. These financial measures are adjusted to eliminate the impact of items that Green Dot does not consider indicative of its core operating performance. You are encouraged to evaluate these adjustments and the reasons Green Dot considers them appropriate. |
Green Dot believes that the non-GAAP financial measures it presents are useful to investors in evaluating Green Dot’s operating performance for the following reasons:
Green Dot’s management uses the non-GAAP financial measures:
Green Dot 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 an analysis of Green Dot’s results of operations as reported under GAAP. Some of these limitations are:
(2) |
Green Dot does not include any income tax impact of the associated non-GAAP adjustment to adjusted EBITDA, as the case may be, because each of these adjustments to the non-GAAP financial measure is provided before income tax expense. |
|
(3) |
This expense consists primarily of expenses for restricted stock units (including performance-based restricted stock units) and related employer payroll taxes. Stock-based compensation expense is not comparable from period to period due to changes in the fair market value of Green Dot’s Class A common stock (which is influenced by external factors like the volatility of public markets and the financial performance of Green Dot’s peers) and is not a key measure of Green Dot’s operations. Green Dot excludes stock-based compensation expense from its non-GAAP financial measures primarily because it consists of non-cash expenses that Green Dot does not believe are reflective of ongoing operating results. Green Dot also believes that it is not useful to investors to understand the impact of stock-based compensation to its results of operations. Further, the related employer payroll taxes are dependent upon volatility in Green Dot's stock price, as well as the timing and size of option exercises and vesting of restricted stock units, over which Green Dot has limited to no control. This expense is included as a component of compensation and benefits expenses on Green Dot's consolidated statements of operations. |
|
(4) |
Green Dot excludes certain income and expenses that are the result of acquisitions. These acquisition-related adjustments include items such as transaction costs, the amortization of acquired intangible assets, changes in the fair value of contingent consideration, settlements of contingencies established at time of acquisition and other acquisition related charges, such as integration charges and professional and legal fees, which result in Green Dot recording expenses or fair value adjustments in its GAAP financial statements. Green Dot analyzes the performance of its operations without regard to these adjustments. In determining whether any acquisition-related adjustment is appropriate, Green Dot takes into consideration, among other things, how such adjustments would or would not aid in the understanding of the performance of its operations. These items are included as a component of other general and administrative expenses on Green Dot's consolidated statements of operations, as applicable for the periods presented. |
|
(5) |
Green Dot excludes certain income and expenses that are not reflective of ongoing operating results. It is difficult to estimate the amount or timing of these items in advance. Although these events are reflected in Green Dot's GAAP financial statements, Green Dot excludes them in its non-GAAP financial measures because Green Dot believes these items may limit the comparability of ongoing operations with prior and future periods. These adjustments include items such as amortization attributable to deferred financing costs, impairment charges related to long-lived assets, earnings or losses from equity method investments, legal settlements and related expenses, changes in the fair value of loans held for sale, realized gains on investment securities and other income and expenses, as applicable for the periods presented. In determining whether any such adjustment is appropriate, Green Dot takes into consideration, among other things, how such adjustments would or would not aid in the understanding of the performance of its operations. Each of these adjustments, except for amortization of deferred financing costs, earnings and losses from equity method investments, fair value changes on loans held for sale, and realized gains on investment securities, which are all included below operating income, are included within other general and administrative expenses on Green Dot's consolidated statements of operations. |
|
(6) |
During the three months ended |
|
(7) |
Represents the tax effect for the related non-GAAP measure adjustments using Green Dot's year to date non-GAAP effective tax rate. It also excludes both the impact of excess tax benefits related to stock-based compensation and the IRC §162(m) limitation that applies to performance-based restricted stock units expense as of |
|
(8) |
Represents commissions and certain processing-related costs associated with BaaS products and services where Green Dot does not control customer acquisition. This adjustment is netted against Green Dot's B2B Services revenues when evaluating segment performance. |
|
(9) |
Represents other non-interest investment income earned by |
|
(10) |
These amounts represent estimated adjustments for items such as income taxes, depreciation and amortization, employee stock-based compensation and related employer taxes, amortization attributable to deferred financing costs, impairment charges, extraordinary severance expenses, earnings and losses from equity method investments, changes in the fair value of loans held for sale, legal settlements and related expenses and other income and expenses. Employee stock-based compensation expense includes assumptions about the future fair 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). |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240509164227/en/
Investor Relations: IR@greendot.com
Media Relations: PR@greendotcorp.com
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