Green Dot 2012 Annual Report Download - page 49

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39
Card Revenues and Other Fees — Card revenues and other fees totaled $209.5 million for the year ended
December 31, 2011, an increase of $42.1 million, or 25%, from the comparable period in 2010. The increase was
primarily the result of period-over-period growth of 27% in the number of GPR cards activated and 24% in the number
of active cards in our portfolio. This growth was driven by a variety of factors including growth in the number of our
cards sold through our established distribution channels and expansion through our online distribution channel.
Cash Transfer Revenues — Cash transfer revenues totaled $134.1 million for the year ended December 31, 2011,
an increase of $32.6 million, or 32%, from the comparable period in 2010. The increase was primarily the result of
period-over-period growth of 29% in the number of cash transfers sold. The increase in cash transfer volume was
driven both by growth in our active card base and growth in cash transfer volume from third-party programs participating
in our network. Third party programs participating in our network contributed approximately 17% of total cash transfer
revenues for the year ended December 31, 2011, versus 13% of total cash transfer revenues for the year ended
December 31, 2010.
Interchange Revenues — Interchange revenues totaled $141.1 million for the year ended December 31, 2011, an
increase of $32.7 million, or 30%, from the comparable period in 2010. The increase was primarily the result of period-
over-period growth of 24% in the number of active cards in our portfolio, an increase in the average transactional
volume of the active cards in our portfolio and a 55% increase in gross dollar volume, which was driven by the factors
discussed above under “Card Revenues and Other Fees.” During the first three quarters of 2011, our interchange
revenues benefited from a large number of taxpayers who elected to receive their tax refunds via direct deposit on our
cards and using those funds for purchase transactions.
Stock-based retailer incentive compensation — Our right to repurchase lapsed as to 441,720 shares issued to
Walmart during the year ended December 31, 2011. We recognized the fair value of the shares using the then-current
fair market value of our Class A common stock, resulting in $17.3 million of stock-based retailer incentive compensation,
an increase of $3.9 million, or 29%, from the comparable period in 2010. While our stock price was generally lower in
2011 than it was in 2010, the increase in stock-based retailer incentive compensation reflected the fact that we recorded
four fewer months of this expense in 2010 than we did in 2011 as we first issued the shares subject to repurchase in
May 2010 in connection with entering into our amended prepaid card agreement with Walmart and GE Capital Retail
Bank in May 2010.
Operating Expenses
The following table presents a breakdown of our operating expenses among sales and marketing, compensation
and benefits, processing, and other general and administrative expenses:
Years Ended December 31,
2011 2010
Amount
% of Total
Operating
Revenues Amount
% of Total
Operating
Revenues
(In thousands, except percentages)
Operating expenses:
Sales and marketing expenses $ 168,747 36.1% $ 122,890 33.8%
Compensation and benefits expenses 87,671 18.8 70,102 19.3
Processing expenses 70,953 15.2 56,978 15.7
Other general and administrative expenses 56,578 12.0 44,599 12.2
Total operating expenses $ 383,949 82.1% $ 294,569 81.0%
Sales and Marketing Expenses — Sales and marketing expenses totaled $168.7 million for the year ended
December 31, 2011, an increase of $45.8 million, or 37%, from the comparable period in 2010. The increase was
primarily the result of increased numbers of GPR cards and cash transfers sold, compared with the corresponding
period in 2010, and an increase in sales commissions due largely to increased sales commissions paid to Walmart as
a result of entering into our amended prepaid card agreement with Walmart and GE Capital Retail Bank in May 2010.
Compensation and Benefits Expenses — Compensation and benefits expenses totaled $87.7 million for the year
ended December 31, 2011, an increase of $17.6 million, or 25%, from the comparable period in 2010. This increase
was primarily the result of a $15.1 million increase in employee compensation and benefits, which included a $2.3
million increase in employee stock-based compensation. The period-over-period growth in employee compensation
and benefits is due to additional employee headcount as we continued to expand our operations to support key growth
initiatives, new product development and new sales efforts, and growth in our IT infrastructure and risk operations.