Green Dot 2014 Annual Report Download - page 47

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Income Tax Expense
The following table presents a breakdown of our effective tax rate among federal, state and other:
Year Ended December 31,
2014 2013
U.S. federal statutory tax rate 35.0%35.0%
State income taxes, net of federal benefit 1.1 (0.2)
General business credits (1.3)(2.3)
Employee stock-based compensation 0.7 1.4
Non-deductible transaction costs 1.8 —
Other 0.7 1.2
Effective tax rate 38.0%35.1%
Our income tax expense increased by $7.8 million to $26.2 million in the year ended December„31, 2014 from the
comparable period in 2013 due to an increase in income before income taxes and an increase in our effective rate
rate by 2.9 percentage points from 35.1% to 38.0%. The increase in the effective tax rate for the year ended December
31, 2014 as compared to the year ended December 31, 2013 is primarily attributable to certain non-deductible
transaction costs incurred during the year and fewer general business credits. We recognized a discrete benefit in the
first quarter of 2013 related to the reinstatement of 2012 general business credits.
39
Comparison of Years Ended December€31, 2013 and 2012
Operating Revenues
The following table presents a breakdown of our operating revenues among card revenues and other fees, cash
transfer revenues and interchange revenues as well as contra-revenue items:
Year Ended December 31,
2013 2012
Amount
% of Total
Operating Revenues Amount
% of Total
Operating Revenues
(In thousands, except percentages)
Operating revenues:
Card revenues and other fees . . . . . . . . . . . . . . . $227,227 39.6%$224,745 41.1%
Cash transfer revenues . . . . . . . . . . . . . . . . . . . . 183,359 32.0 165,232 30.2
Interchange revenues . . . . . . . . . . . . . . . . . . . . . . 171,757 29.9 164,559 30.2
Stock-based retailer incentive compensation . . . . (8,722)(1.5)(8,251)(1.5)
Total operating revenues . . . . . . . . . . . . . . . . . . . . . $573,621 100.0%$546,285 100.0%
Card Revenues and Other Fees — Card revenues and other fees totaled $227.2 million for the year ended
December„31, 2013, an increase of $2.5 million, or 1%, from the comparable period in 2012. The increase was primarily
the result of period-over-period growth in our gift card program. This increase was partially offset by declines in monthly
maintenance fees due to an increase in fee waivers earned by cardholders, declines in new card fees as a result of
a period-over-period decline in new cards activated due to enhanced risk controls and a decline in ATM fees as a result
of higher usage of our fee-free ATM network.
Cash Transfer Revenues — Cash transfer revenues totaled $183.4 million for the year ended December„31, 2013,
an increase of $18.2 million, or 11%, from the comparable period in 2012. The increase was primarily the result of
period-over-period growth of 9% in the number of cash transfers sold. The increase in cash transfer volume was driven
primarily by growth in cash transfer volume from third-party programs participating in our network. The proportion of
total cash transfer revenues represented by third party programs increased by approximately four percentage points
as compared to the comparable period in 2012.
Interchange Revenues — Interchange revenues totaled $171.8 million for the year ended December„31, 2013,
an increase of $7.2 million, or 4%, from the comparable period in 2012. The increase was primarily the result of period-
over-period growth of 6% in purchase volume, partially offset by a slight decline in the effective interchange rate we
earn on purchase volume. This rate decline was the result of a shift in the mix of payment networks and payment
types.