Company Turns Focus to Growth with Momentum
Expected to Improve in 2024 Establishes 2024 Financial Guidance
Green Dot Corporation (NYSE: GDOT), a leading digital bank and
fintech that delivers seamless banking and payment tools for
consumers and businesses, today reported financial results for the
quarter and year ended December 31, 2023.
“2023 was a pivotal year as we completed our processor
conversion, streamlined costs and announced new partners in our
BaaS and retail channels,” said George Gresham, Chief Executive
Officer of Green Dot. “Looking forward with a more powerful and
efficient foundation and a strong business pipeline, I believe we
are poised to improve our revenue and adjusted EBITDA growth as we
move through 2024.”
Consolidated Results Summary
Three Months Ended December
31,
Year Ended December
31,
2023
2022
% Change
2023
2022
% Change
(In thousands, except per
share data and percentages)
GAAP financial results
Total operating revenues
$
366,043
$
342,432
7
%
$
1,501,328
$
1,449,566
4
%
Net (loss) income
$
(23,603
)
$
5,884
*
$
6,722
$
64,212
(90
)%
Diluted (loss) earnings per common
share
$
(0.45
)
$
0.11
*
$
0.13
$
1.19
(89
)%
Non-GAAP financial results1
Non-GAAP total operating revenues1
$
361,717
$
336,630
7
%
$
1,483,795
$
1,423,609
4
%
Adjusted EBITDA1
$
25,727
$
35,387
(27
)%
$
170,874
$
238,754
(28
)%
Adjusted EBITDA/Non-GAAP total operating
revenues (adjusted EBITDA margin)
7.1
%
10.5
%
(3.4
)%
11.5
%
16.8
%
(5.3
)%
Non-GAAP net income1
$
7,325
$
17,712
(59
)%
$
85,214
$
140,024
(39
)%
Non-GAAP diluted earnings per share1
$
0.14
$
0.34
(59
)%
$
1.62
$
2.59
(37
)%
* Change not meaningful
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.
Unencumbered cash at the holding company was approximately $55
million as of December 31, 2023.
Green Dot has received a proposed consent order from the Federal
Reserve Board relating principally to various aspects of compliance
risk management, including consumer compliance and compliance with
anti-money laundering regulations. The matters addressed in the
proposed consent order relate to activities and practices that
commenced prior to the company's Chief Executive Officer transition
in 2020. Included in the consent order are proposals for civil
money penalties related to these issues. While Green Dot is still
in discussions with the Federal Reserve Board regarding these
proposals, it has accrued as part of its GAAP financial results an
estimated liability of $20 million related to the proposed consent
order during the quarter ended December 31, 2023. Green Dot
believes the estimate of the aggregate range of reasonably possible
losses (meaning the likelihood of losses is more than remote but
less than likely) is up to $50 million as of December 31, 2023.
This estimated range of reasonably possible losses is based on
currently available information for those proceedings in which
Green Dot is involved and considers its best estimate of such
losses for those matters for which an estimate can be made.
However, there can be no assurance that its accrual is sufficient
or that losses from the consent order will not exceed the estimated
range.
“We are confident in our financial and regulatory positions and
do not expect this to impact our ability to operate and serve our
customers and partners on an ongoing basis,” Gresham continued.
“The regulatory environment is continuously evolving, and we are
committed to partnering and fully cooperating with our regulators
to ensure our products are designed and marketed in ways that put
our customers’ best interests at the forefront.”
Key Metrics
The following table shows Green Dot's quarterly key business
metrics for each of the last eight calendar quarters on a
consolidated basis and by each of its reportable segments. Please
refer to Green Dot’s latest Quarterly Report on Form 10-Q for a
description of the key business metrics, as well as additional
information regarding how Green Dot organizes its business by
segment.
2023
2022
Q4
Q3
Q2
Q1
Q4
Q3
Q2
Q1
(In millions)
Consolidated *
Gross dollar volume
$
26,355
$
24,836
$
24,724
$
23,289
$
20,010
$
18,682
$
17,356
$
17,436
Number of active accounts
3.57
3.67
3.71
3.84
4.15
4.33
4.61
4.93
Purchase volume
$
5,273
$
5,362
$
5,734
$
6,145
$
6,292
$
6,443
$
6,760
$
7,192
Consumer Services
Gross dollar volume
$
4,290
$
4,619
$
5,122
$
5,677
$
5,426
$
5,495
$
5,715
$
6,621
Number of active accounts
2.05
2.16
2.35
2.41
2.37
2.51
2.78
3.04
Direct deposit active accounts
0.49
0.52
0.59
0.60
0.63
0.66
0.67
0.69
Purchase volume
$
3,312
$
3,553
$
3,984
$
4,344
$
4,229
$
4,302
$
4,588
$
5,017
B2B Services
Gross dollar volume
$
22,065
$
20,217
$
19,602
$
17,612
$
14,584
$
13,187
$
11,641
$
10,815
Number of active accounts
1.52
1.51
1.36
1.43
1.78
1.82
1.83
1.89
Purchase volume
$
1,961
$
1,809
$
1,750
$
1,801
$
2,063
$
2,141
$
2,172
$
2,175
Money Movement
Number of cash transfers
8.19
8.31
8.66
8.70
9.03
9.16
9.00
8.87
Number of tax refunds processed
0.16
0.20
3.87
9.91
0.20
0.28
4.48
9.61
* Represents the sum of Green Dot's
Consumer Services and B2B (as defined herein) Services
segments.
"Over the course of 2023, we faced numerous headwinds that
impacted our financial performance, namely higher interest rates,
client de-conversions and elevated spending on a variety of
initiatives, including our processor conversions," said Jess Unruh,
Chief Financial Officer of Green Dot. "As I look at 2024, I expect
to return to growth in the second half of the year as we lap tough
comparisons, and more fully realize the benefit of new partner
launches, expense management initiatives and other measures that we
undertook in 2023.”
2024 Financial Guidance
Green Dot has provided its 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 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 Securities and Exchange Commission.
Total Non-GAAP Operating Revenues2
- Green Dot expects its full year non-GAAP total operating
revenues2 to be between $1.55 billion and $1.60 billion, or up
approximately 6% year over year at the mid-point.
Adjusted EBITDA2
- Green Dot expects its full year adjusted EBITDA2 to be between
$170 million and $180 million, or up approximately 2% year over
year at the mid-point.
Non-GAAP EPS2
- Green Dot expects its full year non-GAAP EPS2 to be between
$1.45 and $1.59, or down 6% year over year at the mid-point.
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
Non-GAAP 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
fourth quarter and full year 2023 financial results today at 5:00
p.m. ET. The conference call can be accessed live from Green Dot's
investor relations website at http://ir.greendot.com/. Green Dot
uses this website as a tool to disclose important information about
the company to investors and comply with its disclosure obligations
under Regulation Fair Disclosure. A replay of the webcast will be
available at the same website following the call. The replay will
be available until Tuesday, March 5, 2024.
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 prepaid financial services industry
that impact prepaid 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
Securities and Exchange Commission filings, including its most
recent annual report on Form 10-K and quarterly report on Form
10-Q, which are available on Green Dot's investor relations website
at ir.greendot.com and on the SEC website at www.sec.gov. All
information provided in this release and in the attachments is as
of February 27, 2024, and Green Dot assumes no obligation to update
this information as a result of future events or developments,
except as required by law.
About Non-GAAP Financial Measures
To supplement Green Dot's consolidated financial statements
presented in accordance with accounting principles generally
accepted in the United States of America (GAAP), Green Dot uses
measures of operating results that are adjusted for, among other
things, non-operating net interest income and expense; other
non-interest investment income earned by its bank; income tax
benefit and expense; depreciation and amortization, including
amortization of acquired intangibles; certain legal settlement
gains and charges; stock-based compensation and related employer
payroll taxes; changes in the fair value of contingent
consideration; transaction costs from acquisitions; amortization
attributable to deferred financing costs, impairment charges;
extraordinary severance expenses; earnings or losses from equity
method investments; changes in the fair value of loans held for
sale; commissions and certain processing-related costs associated
with Banking as a Service ("BaaS") products and services where
Green Dot does not control customer acquisition; realized gains on
investment securities; other charges and income not reflective of
ongoing operating results; and income tax effects. This earnings
release includes non-GAAP total operating revenues, adjusted
EBITDA, non-GAAP net income, and non-GAAP diluted earnings per
share. These non-GAAP financial measures are not calculated or
presented in accordance with, and are not alternatives or
substitutes for, financial measures prepared in accordance with
GAAP, and should be read only in conjunction with Green Dot's
financial measures prepared in accordance with GAAP. Green Dot's
non-GAAP financial measures may be different from similarly-titled
non-GAAP financial measures used by other companies. Green Dot
believes that the presentation of non-GAAP financial measures
provides useful information to management and investors regarding
underlying trends in its consolidated financial condition and
results of operations. Green Dot's management regularly uses these
supplemental non-GAAP financial measures internally to understand,
manage and evaluate Green Dot's business and make operating
decisions. For additional information regarding Green Dot's use of
non-GAAP financial measures and the items excluded by Green Dot
from one or more of its historic and projected non-GAAP financial
measures, investors are encouraged to review the reconciliations of
Green Dot's historic and projected non-GAAP financial measures to
the comparable GAAP financial measures, which are attached to this
earnings release, and which can be found by clicking on “Financial
Information” in the Investor Relations section of Green Dot's
website at http://ir.greendot.com/.
About Green Dot
Green Dot Corporation (NYSE: GDOT) is a financial technology and
registered bank holding company committed to giving all people the
power to bank seamlessly, affordably, and with confidence. Green
Dot’s technology platform enables it to build products and features
that address the most pressing financial challenges of consumers
and businesses, transforming the way they manage and move money and
making financial empowerment more accessible for all.
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 U.S.
combined, enables it to operate primarily as a “branchless bank.”
Green Dot Bank is a subsidiary of Green Dot Corporation and member
of the FDIC. For more information about Green Dot’s products and
services, please visit www.greendot.com.
GREEN DOT CORPORATION
CONSOLIDATED BALANCE
SHEETS
December 31, 2023
December 31, 2022
(unaudited)
Assets
(In thousands, except par
value)
Current assets:
Unrestricted cash and cash equivalents
$
682,263
$
813,945
Restricted cash
4,239
5,900
Investment securities available-for-sale,
at fair value
33,859
—
Settlement assets
737,989
493,395
Accounts receivable, net
110,141
74,437
Prepaid expenses and other assets
69,419
78,155
Total current assets
1,637,910
1,465,832
Investment securities available-for-sale,
at fair value
2,203,142
2,363,687
Loans to bank customers, net of allowance
for credit losses of $11,383 and $9,078 as of December 31, 2023 and
December 31, 2022, respectively
30,534
21,421
Prepaid expenses and other assets
221,656
192,901
Property, equipment, and internal-use
software, net
179,376
160,222
Operating lease right-of-use assets
5,342
8,316
Deferred expenses
1,546
14,547
Net deferred tax assets
117,139
117,167
Goodwill and intangible assets
420,477
445,083
Total assets
$
4,817,122
$
4,789,176
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
119,870
$
113,891
Deposits
3,293,603
3,450,105
Obligations to customers
314,278
218,239
Settlement obligations
57,001
40,691
Amounts due to card issuing banks for
overdrawn accounts
225
328
Other accrued liabilities
91,239
98,580
Operating lease liabilities
3,369
3,167
Deferred revenue
6,343
25,029
Line of credit
61,000
—
Income tax payable
6,262
11,641
Total current liabilities
3,953,190
3,961,671
Other accrued liabilities
1,895
5,777
Operating lease liabilities
2,687
5,247
Line of credit
—
35,000
Total liabilities
3,957,772
4,007,695
Stockholders’ equity:
Class A common stock, $0.001 par value;
100,000 shares authorized as of December 31, 2023 and December 31,
2022; 52,816 and 51,674 shares issued and outstanding as of
December 31, 2023 and December 31, 2022, respectively
53
52
Additional paid-in capital
375,980
340,575
Retained earnings
770,304
763,582
Accumulated other comprehensive loss
(286,987
)
(322,728
)
Total stockholders’ equity
859,350
781,481
Total liabilities and stockholders’
equity
$
4,817,122
$
4,789,176
GREEN DOT CORPORATION
CONSOLIDATED STATEMENTS OF
OPERATIONS
(UNAUDITED)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
(In thousands, except per
share data)
Operating revenues:
Card revenues and other fees
$
272,185
$
225,339
$
1,007,565
$
876,318
Cash processing revenues
33,491
36,632
225,416
235,445
Interchange revenues
52,053
69,345
231,003
295,646
Interest income, net
8,314
11,116
37,344
42,157
Total operating revenues
366,043
342,432
1,501,328
1,449,566
Operating expenses:
Sales and marketing expenses
50,795
70,002
245,325
297,900
Compensation and benefits expenses
45,594
58,196
238,528
243,939
Processing expenses
178,673
131,719
639,228
481,460
Other general and administrative
expenses
117,253
74,436
355,577
331,892
Total operating expenses
392,315
334,353
1,478,658
1,355,191
Operating (loss) income
(26,272
)
8,079
22,670
94,375
Interest expense, net
906
112
3,027
255
Other income (expense), net
1,040
(1,142
)
(5,010
)
(10,199
)
(Loss) income before income taxes
(26,138
)
6,825
14,633
83,921
Income tax (benefit) expense
(2,535
)
941
7,911
19,709
Net (loss) income
$
(23,603
)
$
5,884
$
6,722
$
64,212
Basic (loss) earnings per common
share:
$
(0.45
)
$
0.11
$
0.13
$
1.20
Diluted (loss) earnings per common
share
$
(0.45
)
$
0.11
$
0.13
$
1.19
Basic weighted-average common shares
issued and outstanding:
52,622
51,901
52,251
53,351
Diluted weighted-average common shares
issued and outstanding:
52,622
52,299
52,510
53,871
GREEN DOT CORPORATION
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(UNAUDITED)
Year Ended December
31,
2023
2022
(In thousands)
Operating activities
Net income
$
6,722
$
64,212
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization of property,
equipment and internal-use software
58,714
57,101
Amortization of intangible assets
24,257
23,509
Provision for uncollectible overdrawn
accounts from purchase transactions
24,771
13,771
Provision for loan losses
26,311
32,352
Stock-based compensation
33,744
34,812
Losses in equity method investments
9,310
15,648
Amortization of discount on
available-for-sale investment securities
(2,276
)
(1,434
)
Impairment of long-lived assets
—
4,264
Deferred income tax benefit
(11,867
)
(6,674
)
Other
(4,100
)
(4,666
)
Changes in operating assets and
liabilities:
Accounts receivable, net
(60,475
)
(7,807
)
Prepaid expenses and other assets
3,354
5,417
Deferred expenses
13,001
2,308
Accounts payable and other accrued
liabilities
690
41,098
Deferred revenue
(19,539
)
(3,694
)
Income tax receivable/payable
(5,613
)
11,716
Other, net
515
(4,247
)
Net cash provided by operating
activities
97,519
277,686
Investing activities
Purchases of available-for-sale investment
securities
—
(931,549
)
Proceeds from maturities of
available-for-sale securities
176,665
293,748
Proceeds from sales and calls of
available-for-sale securities
186
3,488
Payments for property, equipment and
internal-use software
(75,942
)
(84,326
)
Net changes in loans
(28,970
)
(32,057
)
Investment in TailFin Labs, LLC
(35,000
)
(35,000
)
Purchases of other investments
—
(31,934
)
Other investing activities
(3,782
)
(2,558
)
Net cash provided by (used in) investing
activities
33,157
(820,188
)
Financing activities
Borrowings on revolving line of credit
282,000
100,000
Repayments on revolving line of credit
(256,000
)
(65,000
)
Proceeds from exercise of options and ESPP
purchases
5,565
6,177
Taxes paid related to net share settlement
of equity awards
(3,903
)
(5,947
)
Net changes in deposits
(159,436
)
157,140
Net changes in settlement assets and
obligations to customers
(132,245
)
(53,991
)
Contingent consideration payments
—
(1,647
)
Repurchase of Class A common stock
—
(95,525
)
Other financing activities
—
(4,500
)
Net cash (used in) provided by financing
activities
(264,019
)
36,707
Net decrease in unrestricted cash, cash
equivalents and restricted cash
(133,343
)
(505,795
)
Unrestricted cash, cash equivalents and
restricted cash, beginning of period
819,845
1,325,640
Unrestricted cash, cash equivalents and
restricted cash, end of period
$
686,502
$
819,845
Cash paid for interest
$
5,923
$
627
Cash paid for income taxes
$
24,351
$
12,966
Reconciliation of unrestricted cash,
cash equivalents and restricted cash at end of period:
Unrestricted cash and cash equivalents
$
682,263
$
813,945
Restricted cash
4,239
5,900
Total unrestricted cash, cash equivalents
and restricted cash, end of period
$
686,502
$
819,845
GREEN DOT CORPORATION
REPORTABLE SEGMENTS
(UNAUDITED)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
Segment Revenue
(In thousands)
Consumer Services
$
111,489
$
141,319
$
498,617
$
586,798
B2B Services
221,841
158,830
772,991
594,468
Money Movement Services
29,370
33,062
209,674
222,192
Corporate and Other
(983
)
3,419
2,513
20,151
Total segment revenues
361,717
336,630
1,483,795
1,423,609
BaaS commissions and processing expenses
(8)
5,103
6,576
20,449
28,831
Other income (9)
(777
)
(774
)
(2,916
)
(2,874
)
Total operating revenues
$
366,043
$
342,432
$
1,501,328
$
1,449,566
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
Segment Profit
(In thousands)
Consumer Services
$
37,740
$
53,543
$
177,190
$
222,148
B2B Services
18,495
18,937
77,303
86,372
Money Movement Services
9,526
11,550
113,176
117,830
Corporate and Other
(40,034
)
(48,643
)
(196,795
)
(187,596
)
Total segment profit *
25,727
35,387
170,874
238,754
Reconciliation to (loss) income before
income taxes
Depreciation and amortization of property,
equipment and internal-use software
16,408
14,220
58,715
57,101
Stock based compensation and related
employer taxes
6,033
3,604
34,288
35,414
Amortization of acquired intangible
assets
5,664
5,664
24,257
23,509
Impairment charges
—
130
—
4,264
Legal settlements and related expenses
21,650
(338
)
23,614
16,021
Other expense
2,244
4,028
7,330
8,070
Operating (loss) income
(26,272
)
8,079
22,670
94,375
Interest expense, net
906
112
3,027
255
Other income (expense), net
1,040
(1,142
)
(5,010
)
(10,199
)
(Loss) income before income taxes
$
(26,138
)
$
6,825
$
14,633
$
83,921
* 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.
GREEN DOT CORPORATION
Reconciliation of Total
Operating Revenues to Non-GAAP Total Operating Revenues (1)
(Unaudited)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
(In thousands)
Total operating revenues
$
366,043
$
342,432
$
1,501,328
$
1,449,566
BaaS commissions and processing expenses
(8)
(5,103
)
(6,576
)
(20,449
)
(28,831
)
Other income (9)
777
774
2,916
2,874
Non-GAAP total operating revenues
$
361,717
$
336,630
$
1,483,795
$
1,423,609
Reconciliation of Net Income
(Loss) to Non-GAAP Net Income (1)
(Unaudited)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
(In thousands, except per
share data)
Net (loss) income
$
(23,603
)
$
5,884
$
6,722
$
64,212
Stock-based compensation and related
employer payroll taxes (3)
6,033
3,604
34,288
35,414
Amortization of acquired intangible assets
(4)
5,664
5,664
24,257
23,509
Change in fair value of contingent
consideration (4)
—
—
—
300
Transaction and related acquisition costs
(4)
—
6
(3
)
739
Amortization of deferred financing costs
(5)
36
36
144
144
Impairment charges (5)
—
130
—
4,264
Legal settlements and related expenses
(5)
21,650
(338
)
23,614
16,021
Losses in equity method investments
(5)
24
3,770
9,310
15,648
Change in fair value of loans held for
sale (5)
(264
)
(1,736
)
(1,365
)
(2,622
)
Realized gain on sale of investments
(5)
—
(135
)
—
(135
)
Extraordinary severance expenses (6)
1,326
2,948
4,741
3,499
Other expense (income), net (5)
118
317
(343
)
840
Income tax effect (7)
(3,659
)
(2,438
)
(16,151
)
(21,809
)
Non-GAAP net income
$
7,325
$
17,712
$
85,214
$
140,024
Diluted (loss) earnings per common
share
GAAP
$
(0.45
)
$
0.11
$
0.13
$
1.19
Non-GAAP
$
0.14
$
0.34
$
1.62
$
2.59
Diluted weighted-average common shares
issued and outstanding
GAAP
52,622
52,299
52,510
53,871
Non-GAAP
52,852
52,326
52,510
54,019
Reconciliation of GAAP to
Non-GAAP Diluted Weighted-Average
Shares Issued and
Outstanding
(Unaudited)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
(In thousands)
Diluted weighted-average shares issued and
outstanding
52,622
52,299
52,510
53,871
Weighted-average unvested Walmart
restricted shares (10)
—
27
—
148
Anti-dilutive shares due to GAAP net
loss
230
—
—
—
Non-GAAP diluted weighted-average shares
issued and outstanding
52,852
52,326
52,510
54,019
GREEN DOT CORPORATION
Supplemental Detail on
Non-GAAP Diluted Weighted-Average Common Shares Issued and
Outstanding
(Unaudited)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
(In thousands)
Class A common stock outstanding as of
December 31:
52,816
51,674
52,816
51,674
Weighting adjustment
(194
)
254
(565
)
1,825
Dilutive potential shares:
Stock options
—
2
—
29
Service based restricted stock units
165
145
138
160
Performance-based restricted stock
units
24
229
52
295
Employee stock purchase plan
41
22
69
36
Non-GAAP diluted weighted-average shares
issued and outstanding
52,852
52,326
52,510
54,019
Reconciliation of Net Income
(Loss) to Adjusted EBITDA (1)
(Unaudited)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
(In thousands)
Net (loss) income
$
(23,603
)
$
5,884
$
6,722
$
64,212
Interest expense, net (2)
906
112
3,027
255
Income tax (benefit) expense
(2,535
)
941
7,911
19,709
Depreciation and amortization of property,
equipment and internal-use software (2)
16,408
14,220
58,715
57,101
Stock-based compensation and related
employer payroll taxes (2)(3)
6,033
3,604
34,288
35,414
Amortization of acquired intangible assets
(2)(4)
5,664
5,664
24,257
23,509
Change in fair value of contingent
consideration (2)(4)
—
—
—
300
Transaction and related acquisition costs
(2)(4)
—
6
(3
)
739
Impairment charges (2)(5)
—
130
—
4,264
Legal settlements and related expenses
(2)(5)
21,650
(338
)
23,614
16,021
Losses in equity method investments
(2)(5)
24
3,770
9,310
15,648
Change in fair value of loans held for
sale (2)(5)
(264
)
(1,736
)
(1,365
)
(2,622
)
Realized gain on sale of investments
(2)(5)
—
(135
)
—
(135
)
Extraordinary severance expenses
(2)(6)
1,326
2,948
4,741
3,499
Other expense (income), net (2)(5)
118
317
(343
)
840
Adjusted EBITDA
$
25,727
$
35,387
$
170,874
$
238,754
Non-GAAP total operating revenues
$
361,717
$
336,630
$
1,483,795
$
1,423,609
Adjusted EBITDA/Non-GAAP total operating
revenues (adjusted EBITDA margin)
7.1
%
10.5
%
11.5
%
16.8
%
GREEN DOT CORPORATION
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
$
12.4
$
20.0
Adjustments (11)
157.6
160.0
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 and
GAAP Diluted Weighted-Average Shares Issued and Outstanding
(1)
(Unaudited)
FY 2024
Range
Low
High
(In millions, except per share
data)
Net income
$
12.4
$
20.0
Adjustments (11)
65.9
66.0
Non-GAAP net income
$
78.3
$
86.0
Diluted earnings per share
GAAP
$
0.23
$
0.37
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:
- adjusted EBITDA is widely used by investors to measure a
company’s operating performance without regard to items, such as
non-operating net interest income and expense, income tax benefit
and expense, depreciation and amortization, stock-based
compensation and related employer payroll taxes, changes in the
fair value of contingent consideration, transaction costs,
impairment charges, extraordinary severance expenses, certain legal
settlement and related expenses, earnings or losses from equity
method investments, changes in the fair value of loans held for
sale, and other charges and income that can vary substantially from
company to company depending upon their respective financing
structures and accounting policies, the book values of their
assets, their capital structures and the methods by which their
assets were acquired;
- securities analysts use adjusted EBITDA as a supplemental
measure to evaluate the overall operating performance of companies;
and
- Green Dot records stock-based compensation from period to
period, and recorded stock-based compensation expenses and related
employer payroll taxes, net of forfeitures, of approximately $6.0
million and $3.6 million for the three months ended December 31,
2023 and 2022, respectively. By comparing Green Dot’s adjusted
EBITDA, non-GAAP net income and non-GAAP diluted earnings per share
in different historical periods, investors can evaluate Green Dot’s
operating results without the additional variations caused by
stock-based compensation expense and related employer payroll
taxes, which may not be 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 the public markets and the financial performance of Green Dot’s
peers) and is not a key measure of Green Dot’s operations.
Green Dot’s management uses the non-GAAP financial measures:
- as measures of operating performance, because they exclude the
impact of items not directly resulting from Green Dot’s core
operations;
- for planning purposes, including the preparation of Green Dot’s
annual operating budget;
- to allocate resources to enhance the financial performance of
Green Dot’s business;
- to evaluate the effectiveness of Green Dot’s business
strategies;
- to establish metrics for variable compensation; and
- in communications with Green Dot’s board of directors
concerning Green Dot’s financial performance.
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:
- that these measures do not reflect Green Dot’s capital
expenditures or future requirements for capital expenditures or
other contractual commitments;
- that these measures do not reflect changes in, or cash
requirements for, Green Dot’s working capital needs;
- that these measures do not reflect non-operating interest
expense or interest income;
- that these measures do not reflect cash requirements for income
taxes;
- that, although depreciation and amortization are non-cash
charges, the assets being depreciated or amortized will often have
to be replaced in the future, and these measures do not reflect any
cash requirements for these replacements; and
- that other companies in Green Dot’s industry may calculate
these measures differently than Green Dot does, limiting their
usefulness as comparative measures.
(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),
performance-based stock options 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.
During the three months ended December 31, 2023, Green Dot
accrued an estimated liability of $20 million related to a proposed
consent order it received from the Federal Reserve Board relating
principally to various aspects of compliance risk management,
including consumer compliance, as well as compliance with
anti-money laundering regulations. The accrual is included within
legal settlements and related expenses, a component of other
general and administrative expenses as discussed above.
(6)
During the three and twelve months ended December 31, 2023,
Green Dot recorded charges of $1.3 million and $4.7 million,
respectively, related to extraordinary severance expenses, which
were paid out in connection with reductions in force and other
extraordinary involuntary terminations of employment. Although
severance expenses may arise throughout the fiscal year, Green Dot
believes the nature of these extraordinary costs are not indicative
of its core operating performance. This expense is included as a
component of compensation and benefits expenses on Green Dot's
consolidated statements of operations.
(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 and stock
options expense as of December 31, 2023.
(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 Green
Dot Bank. This amount is included along with operating interest
income in Green Dot's Corporate and Other segment since the yield
earned on these investments are generated on a recurring basis and
earned similarly to its investment securities available for
sale.
(10)
Represents the weighted average of the unvested balance of
restricted shares issued to Walmart in January 2020. Walmart is
entitled to voting rights and participate in any dividends paid on
the unvested balance and therefore, the shares are included in the
computation of non-GAAP diluted earnings per share.
(11)
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, extraordinary severance expenses, and
earnings and losses from equity method investments. 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/20240227170657/en/
Investor Relations: IR@greendot.com Media
Relations: PR@greendotcorp.com
Grafico Azioni Green Dot (NYSE:GDOT)
Storico
Da Dic 2024 a Gen 2025
Grafico Azioni Green Dot (NYSE:GDOT)
Storico
Da Gen 2024 a Gen 2025
