Green Dot reported higher first-quarter earnings Thursday, thanks partly to the revenue generated by a recently acquired tax refund processing business.
But the Pasadena, Calif., company, which is best known for its prepaid cards, also warned investors that it now expects to generate less revenue in 2015 than it previously projected.
Green Dot reported net income of $40.8 million in the first three months of the year, which was up from $15.3 million a year earlier. Total operating revenues rose 43% to $227.2 million.
"These positive results represent our first full quarter of the new, consolidated Green Dot," Chief Executive Officer Steve Streit said in a news release.
In the last eight months, Green Dot has acquired Santa Barbara Tax Products Group, which offers tax refund processing services through partnerships with tax preparers, as well as two prepaid card companies, Achieve Financial Services and AccountNow.
The acquisitions are part of Green Dot's strategy to lessen its reliance on Walmart stores, which are easily its largest distribution channel.
In the first quarter, Green Dot processed 8.52 million tax refunds, the company stated, up from zero a year earlier.
But Green Dot also said that quarterly revenues from the tax refund processing business were $7 million below the company's forecast.
In addition, Green Dot said that the discontinuation of its MoneyPak reload cards, which have been targeted by scammers, will cost the company $20 million-$25 million more than the $40 million in lost revenue for 2015 that it originally projected.
Still, Green Dot said that the revenue losses are expected to be more than offset by cost savings that have led to higher gross margins.
Green Dot also announced Thursday that the firm's chief financial officer, Grace Wang, has moved into a new role as senior vice president of corporate finance and business intelligence.
Another senior executive at Green Dot, Mark Shifke, has become acting chief financial officer while the company conducts a search for a new CFO.