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GREEN DOT CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended
December 31, 2010
Five Months Ended
December 31, 2009 2009 2008
Year Ended July 31,
(In thousands)
Operating activities
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 42,232 $ 13,663 $ 37,163 $ 17,335
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization . . . . . . . . . . . . . . . . . 7,588 2,254 4,593 4,407
Provision for uncollectible overdrawn accounts . . . . . . 46,093 11,218 22,548 16,135
Employee stock-based compensation . . . . . . . . . . . . 7,256 6,782 2,468 1,240
Stock-based retailer incentive compensation . . . . . . . 13,369 ———
Provision (benefit) for uncollectible trade receivables. . (13) 60 61 50
Impairment of capitalized software . . . . . . . . . . . . . . 409 77 405 —
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . (704) 3,530 (1,731) 40
Excess tax benefits from exercise of options . . . . . . . (24,842) (1,866) — (524)
Changes in operating assets and liabilities:
Settlement assets . . . . . . . . . . . . . . . . . . . . . . . 22,601 (6,999) (18,125) (2,033)
Accounts receivable, net . . . . . . . . . . . . . . . . . . . (51,754) (20,241) (29,853) (24,717)
Prepaid expenses and other assets. . . . . . . . . . . . (1,042) (919) (903) (2,263)
Deferred expenses . . . . . . . . . . . . . . . . . . . . . . . (1,304) (5,548) 2,297 (2,750)
Accounts payable and accrued liabilities . . . . . . . . 16,042 8,135 3,170 4,665
Settlement obligations. . . . . . . . . . . . . . . . . . . . . (22,601) 6,999 18,125 4,529
Amounts due issuing bank for overdrawn
accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,646 5,153 (5,309) 10,785
Deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . 2,113 7,603 (978) 4,394
Income tax payable/receivable . . . . . . . . . . . . . . . 16,414 (3,780) 1,366 3,713
Net cash provided by operating activities . . . . . . . . . . . 83,503 26,121 35,297 35,006
Investing activities
Decrease (increase) in restricted cash . . . . . . . . . . . . . 10,246 (14) (13,039) (43)
Payments for acquisition of property and equipment. . . . (13,459) (5,049) (6,361) (5,120)
Net cash used in investing activities . . . . . . . . . . . . . . (3,213) (5,063) (19,400) (5,163)
Financing activities
Principal payments on short-term debt. . . . . . . . . . . . . — — — (2,446)
Repayments on line of credit . . . . . . . . . . . . . . . . . . . — — (12,404) (76,961)
Borrowings from line of credit . . . . . . . . . . . . . . . . . . . — — 12,404 74,465
Proceeds from exercise of warrants and options . . . . . . 6,068 946 110 1,154
Excess tax benefits from exercise of options . . . . . . . . . 24,842 1,866 — 524
Exercise of call option on warrant . . . . . . . . . . . . . . . . — — (1,958) —
Issuance of preferred shares and freestanding warrant . . — — 13,000 —
Redemption of preferred and common shares. . . . . . . . — — (39,770) —
Proceeds from the repayment of related party notes
receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 5,869 — —
Net cash provided by (used in) financing activities . . . . . 30,910 8,681 (28,618) (3,264)
Net increase (decrease) in unrestricted cash and cash
equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111,200 29,739 (12,721) 26,579
Unrestricted cash and cash equivalents, beginning of
year.................................. 56,303 26,564 39,285 12,706
Unrestricted cash and cash equivalents, end of year . . . $167,503 $ 56,303 $ 26,564 $ 39,285
Cash paid for interest . . . . . . . . . . . . . . . . . . . . . . . . $42 $ — $ 1 $ 100
Cash paid for income taxes . . . . . . . . . . . . . . . . . . . . $ 14,282 $ 10,032 $ 27,403 $ 8,104
See notes to consolidated financial statements
59