Christopher J. Mammone - Vice President-Investor Relations Steven W. Streit - Chairman, President & Chief Executive Officer Mark L. Shifke - Chief Financial Officer.

Sanjay Sakhrani - Keefe, Bruyette & Woods, Inc. Ramsey El-Assal - Jefferies LLC David M. Scharf - JMP Securities LLC Bob P. Napoli - William Blair & Co. LLC Mike J. Grondahl - Piper Jaffray & Co (Broker) Tien-tsin Huang - JPMorgan Securities LLC.

Good day and welcome to the Green Dot Corporation Second Quarter 2015 Earnings Conference Call. Please note that the contents of this call are being recorded. I would now like to turn the conference over Mr. Christopher Mammone, Vice President of Investor Relations for Green Dot. Please go ahead, sir..

Thank you and good afternoon everyone. On today's call, we will discuss 2015 second quarter performance and updated thoughts regarding our 2015 outlook. Following these remarks, we will open the call for questions.

For those of you that have not yet accessed the earnings press release and the slide presentation that accompanies this call and webcast, they can be found at ir.greendot.com. Additional operational data have been provided in the supplemental table within our press release.

As a reminder, our comments include forward-looking statements about, among other things, our expectations regarding future results and performance.

Please refer to the cautionary language in the earnings release and in Green Dot's filings with the Securities and Exchange Commission, including the most recent Form 10-Q we filed on May 11, 2015, for additional information concerning factors that could cause actual results to differ materially from the forward-looking statements.

During the call, we will make references to financial measures that do not conform to Generally Accepted Accounting Principles. This information may be calculated differently than similar non-GAAP data presented by other companies.

Quantitative reconciliations of our non-GAAP financial information to their most directly comparable GAAP financial information appears in today's press release and in the appendix of the presentation that accompanies this call. The contents of this call is property of Green Dot Corporation and subject to copyright protection.

Now I'd like to turn the call over to Steve..

Thanks, Chris. Green Dot posted a solid quarter with revenue growing 15% year-over-year to $171 million with that growth being driven primarily by acquisition. Adjusted EBITDA was $34.2 million, representing a margin of 20% and non-GAAP EPS was $0.28 per share.

These results exceeded our stated expectations for the quarter, and Mark Shifke will discuss the Q2 financial details during his portion of today's call. As expected, the discontinuation of MoneyPak contributed to year-over-year revenue declines in our legacy prepaid businesses.

We do see some signs that the MoneyPak associated declines described on prior calls seems to be leveling off, and so we expect to see the portfolio begin to stabilize going forward. But there is still some uncertainty to how all this will ultimately impact the top and bottom line over time.

Having said that, I am proud of the way we've navigated through the first half of the year amidst all of these headwinds, and Mark will have more details about the relevant numbers in his section. I'd like to share with you some interesting effects good and bad of MoneyPak's discontinuation thus far.

The bad is obviously the loss of revenue and to a lesser extent the loss of the associated adjusted EBITDA that we have lost many good customers who relied on MoneyPak to facilitate their legitimate use cases, but there are really some good things going on as well that I want to share with you.

First and most importantly we believe we succeeded in rooting out much of the potential for our products to be used for nefarious purposes. Second, customers who now buy and use our products appear to be of higher quality based on GDV, spend, and the various buckets of revenue generated per active customer through the first half of the year.

Today's Green Dot customer appears to be a more committed customer who uses the product as it is intended to be used, so we're seeing higher revenue and higher margins on a per card basis which has been a nice offset to the year-over-year legacy portfolio headwind.

For example on the legacy portfolio total actives were down 9% year-over-year in the period, but excluding cash transfer revenue, revenue per active card was up 14%.

Looking past the challenges in our legacy business, the prepaid card related acquisitions we made late last year and early this year have helped us more than offset the contraction of our legacy business lines resulting in a very healthy year-over-year prepaid business result overall.

For example, inclusive of the acquisitions GDV in the quarter was up 11%, interchange revenue was up 12% and revenue from fees, ATMs, and the like was up 37% with 64% of all prepaid account GDV now being delivered through direct deposit.

In addition to acquisitions another reason for our positive year-over-year revenue result is the success we continue to enjoy in the FSC or check cashing channel.

Our FSC team led by Diane Piccolo signed or launched another 416 check cashing store locations in Q2 alone bringing our total FSC channel distribution footprint to approximately 3,800 locations and growing from zero just two years ago.

Looking at our processing business line, our tax refund processing business TPG generated $12.7 million in revenue for the quarter. Now I'll like to provide an update on GoBank our mobile checking account product.

Although GoBank's revenue is still small relative to all of Green Dot we're pleased to report that all key account metrics are up triple digits year-over-year in the quarter and 60% of all GoBank customers more than 60 days old are now enrolled in direct deposit.

Perhaps most importantly is that revenue per GoBank account is up 35% on a year-over-year basis indicating that once a customer opens a GoBank account they like it more over time and deposit more money into the account over time which generates more revenue primarily through interchange and the monthly membership fee.

We have great hopes for GoBank and we're currently working on deploying some important GoBank distribution partnerships that we should be able to share details about later in the year. So the summary for the quarter is that we are encouraged to finish ahead of plan; we're not pleased with the legacy portfolio contraction.

We know we have work to do to turn that around once all the MoneyPak dust settles and we're implementing specific plans to do just that.

With a total active customer base approaching five million prepaid customers as of the end of the quarter, over $5 billion in deposits, nearly 10 million reload sales on behalf of more than 100 programs processed through our network in the quarter, more than 10 million tax refund transactions processed in the first half, one of the fastest growing and most honored technology-forward checking accounts in banking, and nearly 100,000 retail locations, the Internet and the leading App stores distributing our products and services, Green Dot has become a large technology-centric and increasingly diversified branchless bank with a loyal, sticky and increasingly high quality customer base.

So we feel good about where we are as a company and we feel optimistic about the long term prospects for our business. With that, I'll turn the call over to Mark Shifke.

Mark?.

We expect non-GAAP total operating revenue of around $148 million, adjusted EBITDA of around $18 million, and non-GAAP EPS of about $0.07 per share. First half margins came in at 29%.

You will notice that second half implied margins are approximately 17 percentage points lower than our first half result, and that on a year-over-year basis our forecast implies second half margins this year to be about seven percentage points lower than second half last year. Here is why.

First, our second half margins are typically lower than first half on a seasonal basis. Given the large TPG contribution in Q1, that first half second half margin difference in our model now and going forward will be even more pronounced.

Second, this year we are absorbing six full months of TPG's SG&A in second half, whereas last year we closed in late October and absorbed only a little over two months worth of that expense.

And third, the second half this year will contain six full months of the new Walmart commission rates versus only two months worth in the first half of this year and nothing in the second half of last year.

So the additional expenses associated with TPG and Walmart combined with the usual seasonality of our business model are the reasons for the second half implied adjusted EBITDA margin of only 12%, yielding a full year implied adjusted EBITDA margin of nearly 22% at the midpoint which is still a bit better than our original full year margin forecast communicated in January.

With that, we will open the phones for Q&A.

Operator?.

Thank you. We will now begin the question-and-answer session. . Our first question comes from Sanjay Sakhrani of KBW. Please go ahead..

Thank you. Good afternoon. I was wondering if you could just break down kind of what the $20 million lower end revenue's coming from. Is it all – is it mainly related to MoneyPak, or is the – how much of it is related to MoneyPak versus the deferral of that -- the marketing of the new product? Thanks..

The $20 million, Sanjay, revenue in the guidance, the lower guidance, so we didn't know if you were talking about first half. Mark could address that. It's really just the new calculations as we input them into the model based on our run-rate, and Mark, you can tell then about the metrics you're looking at and what we're seeing that are causing that..

Yeah, that's exactly right. So what we've done is been looking at a combination of the cash trends for revenues themselves and then the impact on our card portfolio. And I think recently we've been seeing trends stabilizing.

So for the last – for July for example the early reads are cash trends for revenue is coming in pretty much where we thought it would and consistent with where we saw things in May and June.

So as we look forward, we're now projecting where our cash transfer revenue will be and where we think a combination of both our legacy and acquired businesses will play out, and that's giving us comfort of being in that $700 million to $720 million range.

But the loss of revenue is really on a combination of lost revenue from card sales, from a smaller portfolio, from cash transfers..

It's all about MoneyPak and so we track it to the middle of range at $710 million, and so we could do better than that. But we're trying to give ourselves enough room here because sizing the revenue has been extraordinarily difficult and we literally look at trends, Sanjay, week-over-week to see if we see stabilization.

So the good news is we're now seeing stabilization. That doesn't mean that something can't go haywire here going forward. But we've seen enough weeks now we're saying, okay.

Given that we delayed a particular initiative until Q1 and that benefit's gone and that we're now running raw, where do you think we'll likely end up? And the answer was 1% or 2% below where we were on the previous guidance that we thought it's safe to bring it down to something that we knew we could hit..

Okay, so that initiative that you're mentioning -- that had – you had assumed some kind of revenue benefit related to that initiative or was that a cost?.

Not a cost. It would have been all upside, and so that will be delayed. It's still there, just not going to hit in time to benefit Q4..

Okay, and then when we think about -- you guys had mentioned the regulatory approval around the repurchase program in the Walmart announcement; could you just talk about where you guys are with that in the regulatory process?.

Yeah, we're in good shape in terms of having submitted the documentation required and the right procedural processes if you will, and the regulators are taking a look at all that and we hope to hear something shortly, but I hate to predict with any kind of certainty the regulatory process, but our regulators have the information they need.

We've had a number of conversations about it and we hope to hear something shortly..

Okay; great. Thank you..

You bet..

The next question comes from Ramsey El-Assal of Jefferies. Please go ahead..

Sure. So I hate to beat a dead horse, but I'm trying to better understand. So on your June call you saw sort of better than expected MoneyPak results. You beat on the quarter, but you're sort of anticipating some further deterioration.

Is the deterioration directly related to sort of – is it sort of second derivative kind of impacts from fewer MoneyPak customers or – I'm trying to kind of reconcile the deterioration you're seeing.

Has it shown up recently or why are you expecting things to come in worse later than they have in the past three months?.

Well, we did the re-forecast on the Q1 call. We talked about the fact that we're doing much better than we thought and we had a fabulous quarter. We had good quarter in Q2, but that – our belief is that the back-end impacts -- the ripple effects or we had a better word for it, the ecosystem, thank you, I knew there was a better word than ripple.

The ecosystem effects could come up and rear their ugly heads because we started seeing decays in active card counts which you don't see the revenue for right away, but come later in the year.

So the comment that I made is, listen, we've being more cautious now on lowering guidance, because we think in the second half there could be another wave of pain to be had based on what we're seeing in the ecosystem effects. And so that's what happened.

We thought the bottom would be $720 million, maybe now it's closer to $710 million, so we moved the range down for an implied middle of $710 million, so we were close.

But as we've seen the numbers now stabilize for a few weeks in a row, three or four weeks in a row, and in some cases couple months in a row now, what we're saying the good news is it doesn't seem to be getting worse, the bad news is it doesn't seem to be getting better.

If you take that other revenue initiative unrelated to MoneyPak, if you just take and move it now up to Q1, where does that leave us? And the answer is one or two points below the low end of the range and that's why you're seeing the top line being adjusted down, but EBITDA staying where it is..

And just further to Steve's point what we said is in Q2 year-over-year, our organic portfolio was down roughly 10% and that behavior is what we're anticipating for the remainder of the year rather than a continuing decline..

Yeah it's really in retrospect, lot of what we could have done much better because nobody's ever taken the product like away and it's been with us since we've been with the company. But the cast transfer revenue we overestimated and then we underestimated if you will sort of the ecosystem impacts.

And -- but the good news is that those have stabilized, so we think we have it right, but no question revenue's been difficult.

EBITDA better because with all the noise around MoneyPak as we predicted when we got rid of the product, the EBITDA has actually been fairly easy to digest because you're saving so much money on all the noise that it was generating, but the revenue has been difficult to size, no question about that..

Okay. So the lower number of active cards at quarter end versus last quarter is primarily a ecosystem related impact of MoneyPak, or is there anything else in there that's more tax business from TPG or....

No, the difference in the modeling is exclusively on the card portfolio and mostly for that matter on the Green Dot card portfolio with the loss of MoneyPak. And the reason is, is that MoneyPak was a way to load cards, but they are also legitimate use cases in MoneyPak where you'd buy the money card, in other words the actual Green Dot prepaid card.

Small businesses would use them. Let's say you sold Tupperware. You would have a Green Dot card and people would put MoneyPaks on and if they were paying their fees to the head of the multilevel marketer. They are all kinds of uses -- sending money to a kid in a college -- that is part of that legitimate use case.

There was also -- that's where all the nefarious use lived as well. In other words that was the whole use case that you really couldn't tell what was real and what was not real or what was legitimate and illegitimate. And so that part was harder to size for sure.

So yeah, the loss of MoneyPak clearly affects cash transfer revenue; that's may be the easier part to calculate.

What's less easy is customer behavior; will people learn how to swipe, especially if you have been using the MoneyPak for a decade? Will retail cashiers known how to swipe or will they will send the person away? And then you also have people leaving the brand who frankly were using it for things that the product wasn't designed for.

And so you're seeing all that settle out, and that's been I think the hardest part for us to really predict and understand..

All right; great; thanks..

Sure..

The next question comes from David Scharf of JMP. Please go ahead..

Hi, thanks for taking my questions. Maybe staying on the active account topic. Wanted to make sure I heard correctly.

Was inherent in the kind of second half expectations when you kind of re-ran the model for the latest MoneyPak degradation -- is the 10% year-over-year decline in active accounts what I heard you suggest similar to the Q2 fall0off?.

Yeah so the active card count on the legacy portfolio is 9% year-over-year. And that is a – and revenues were down 10% when you include the MoneyPak cash transfer revenues in there.

So the part that is maybe a bit worse is that we thought it would settle out to a negative 5% or negative 6% or something in active cards and we settled out at negative 9%. So that's had incremental $10 million below what we thought our low was and that's why we're bringing the middle of the range down to $710 million.

So that's the part that we thought had settled down but hadn't, and that's sort of the new information. And we're not seeing that get worse and we're not seeing that get worse now for some time, so that's why we believe that's the new normal if you will, and that that pain has now been given..

Got it. So just I understand the calculations correctly, I guess if I take the legacy portfolio down about 10% from last year's second half, that gets me to about 4.2 million active.

Can you remind me what the count was on the acquired business since then? It sounds like second half we're going to be looking at something like 4.2 million legacy plus....

That sounds about right. Total consolidated card count in the quarter was -- I want to say – what was it, guys? -- was almost five million. It's 4.9 something. 4.8 million in the quarter and that includes -- that's consolidated so that's Green Dot, Walmart and the acquisitions which were not huge, but all that....

Can you tell me, can you just remind us what the acquisitions were roughly, the card count? I'm just trying to get a sense for how much I should add to about 10% down to legacy last year..

Not huge, but I'm trying to see.

Have we disclosed that, guys, previously?.

We disclosed revenues for the year, but not....

Not active?.

Not active to the....

It was not -- I can tell you, Dave, it wasn't a material number. The vast majority of our active cards are from the Green Dot and Walmart portfolios. The acquisitions were clearly helpful, but not material, and I don't know if it's a big deal disclosing so maybe we can – can you figure it out from there? I don't know.

We're looking at internal piece of data. The answer is not huge and not a big story, but let us figure out what we can disclose or not. I don't want do it on the fly because everyone is looking at me with different facial expressions..

Got it..

But the answer is that the acquired companies as you know were fairly small and the total active cards together would be I'm going to guess less than 10% of Green Dot and Walmart combined; that gives you some guidance..

Got it, that's helpful. Okay, there was an impairment charge in the quarter, around $5 million..

There is, yeah, that was for a software.

That part of it was for software developed for large retail partner that ultimately did not get rolled out and part of it, the majority of it was for software that was built for process for integration internally that no longer became needed when we decided go to MasterCard IPS for our processing solution we announced previously, and so that software won't be needed..

Okay, was that part of the development to ultimately bring the TCS processing in-house?.

Yeah, that's a good way to phrase it. Not exactly, but close enough, yeah..

Okay, got it. And Steve, you know, on the MoneyPak transition, where are you now in terms of third-party reloads? I believe, you know, in the old days you got up to about a third of reload volume were actually coming from you know users of non-Green Dot cards.

I mean, is the money – is getting rid of MoneyPak pretty much gotten rid of that entire segment of business?.

No, no, it has cut it somewhat, so 20% now comes from third parties and prior it used to 31%, so about a third of it is gone away, but again that's also the use case where 100% of the nefarious use lived. So you just don't know if you got rid of a – so here's sort of how it went, David.

As Green Dot as an issuer, we have two sides of the business, let say, on the card business, you are an issuer and then you had a reload network that serves everybody in the industry.

And as Green Dot tightened its risk controls -- as you remember we started doing that in 2013 -- bad guys may have stopped buying our cards but still bought the MoneyPaks to go to other brands of cards that use the MoneyPak and we had a lot of programs, 100 and some odd programs; we still do.

So when you see that drop off from 31% to 20% for third party, 100% of that 20% now swipes, right. So 100% of that is good quality straightforward honest business of somebody loading money to their bank account.

It doesn't mean that the 11% or the 30% we lost, the 11 points, were all crooks, but part of them clearly were and that's the whole ecosystem that we've cleaned up..

Got it.

So you know when we look at sort of the patterns of the remaining card holders, this lower smaller portfolio, I think you said when you ex out cash transfers just based on interchange in card revs, it was up sort of mid teens maybe in revenue?.

Yeah, it's really amazing when you look at the quality of the customer, not so much that the customers themselves are of higher quality, it's just when you get rid of the people who are coming in and out of the system for not real uses, it's just that you have real customers left.

So if before we had -- if we've lost 9% of our active base in the quarter – what were we last year, guys – four point -what were we in the quarter for actives?.

4.8 this quarter...

4.8 this quarter but I am saying last year same time? Chris will find out. So let's say we lost....

We were up 2%, yeah, 4.6, 4.6....

Okay, we will the number for you again, let's say we lost about 300,000 to 400,000 customers in terms of active cards last year to this year, oaky? But if you look at the percentage of behavior, total revenue is up 14% on our legacy portfolio.

Card revenues per active up 17%, interchange up 10%, purchase volume up 5% per active, GDV from direct deposit up to 58%. And so you're seeing sort of all those quality metrics really pick up dramatically because what you're left behind with are customers who are using the product as their bank account, which is why it exists.

What you're not seeing are the people coming in and doing one-and-done things, closing accounts, opening accounts and all that wacky behavior that I described as the white noise of MoneyPak. So it is a slightly tighter portfolio by about 9%, but on such a large portfolio those kinds of increases are fairly material..

Right. So when we think about the second half it sounds like around a 10% attrition year-over-year in the legacy portfolio.

When you run your metrics through your revised model, I mean what kind of non-cash transfer growth per card are you assuming? Are you assuming in the second half you maintain this 14% to 15% kind of organic revenue rise?.

Yeah, we're not continuing to grow that on top of each other, but what we're saying is that the real metrics as they are in real life today is what we're using to run through the end of the year, so we're not saying to get better or worse, we're saying they stay the same.

And that's what we've done, which is why we sort of – what am I trying to say? -- we cut more than we should have cut in the first half in the first half, so that's why we performed better because we didn't assume we would have these kinds of revenue improvements on a per card basis, and we did. That was a nice offset to some of the losses..

Got it. Thank you..

Yep..

The next question comes from Bob Napoli of William Blair. Please go ahead..

Hi, good afternoon..

Hi, Bob, hi..

Good afternoon, Steve, how are you?.

Very well, thank you..

I guess, I think the – I think it was announced that NetSpend, just they said on their call, the tsys (30:36) call, that they were just put into the money centers at Walmart.

Are you seeing that have an effect on your business or where they in there -- did you see that effect in the second quarter? Was that part of the decline?.

No, our understanding has been Green Dot, Walmart and the MoneyCard have been in the money center I thought for some time, and we checked that out with the Walmart team and we didn't think that was a new development, but it may have been.

But in our world that's been for some time and it's a strip that's in some certain money centers, so I don't think that's material good, better or indifferent for us or NetSpend, but I could be wrong, but we're not seeing that as a driver either way, good or bad..

Okay, and then, I mean your marketing spend was down year-over-year.

Just I mean, even though you had higher commission rates with Walmart or what do you expect out of marketing in the back half of the year? Have you pulled back as you're going through the MoneyPak issue and have you pulled back on the marketing side of the business until you get a better handle on the run-rate?.

There has been no specific pull back in marketing. We're not generally a huge spender of marketing. We do what we do very well and then we rely on the brands that appear on the racks to drive our sales and that's worked well for us for a long time. So we still do all the national TV which you may see.

Steve Harvey of course is our national brand ambassador and we do a lot on Family Feud and the Steve Harvey talk show and we're still doing all those normal things, but that's sort of the normal course. So we have not cut back in marketing, but we haven't stepped up.

There's no reason to step up and we're generally pleased with the continued preference for the brand and the retail acquisition. But there is no question of the MoneyPak noise is real and so we've got to get through that to get sort of a normalized rate and go from there..

(32:22) I'm sorry..

I was just going to add. It was actually lower supply chain costs that were driving the lower sales and marketing number..

Great.

On the active accounts, I mean it looks like if your organic is down 9%, then the acquisitions would have about 500,000 accounts?.

Yes..

And I just wondered if they were growing....

That could be right yeah, I guessed about 10% of the Walmart Green Dots, and that'd be about right. And yeah, the acquisitions continue to perform as we hoped they would and no surprises there; they have been highly accretive, really great acquisitions for us and we glad we did them for sure. Without the acquisitions it would have been an ugly story.

Say it again..

Are they driving up the revenue per active account? Are those acquisitions driving up that revenue per account?.

Both, so the acquisitions are driving up, for example if you, I gave the active card revenues per active on the organic legacy portfolio was up 17% year-over-year. If you throw in the consolidated, we were up 35% year-over-year.

So the answer is we are up either way but they are generally higher fees on the portfolios we acquired so that helps drive it up even higher. So we're up and up more but we are up either way..

Then how confident are you that those fees are sustainable?.

Highly confident, yeah I mean Green Dot has for years been one of the lowest price cards on the rack and we are one of the lowest prices in the industry, but that doesn't mean that there aren't other higher price products out there that do different things or have different segments, and we have no intention of adjusting those pricing schedules.

Consumers like them; they get value of out of them. None of our products including those that we bought, AccountNow and the others, have overdraft fees. So it's in line with what our policies and procedures are, and so we think they're very sustainable pricing schedules..

on GoBank how many accounts do you have in GoBank and what's -- I mean your goal I think was to get to one million accounts by the end of the year and have you the account number?.

So what I said was I wanted to get to a run-rate of 1 million accounts by the end of the year, which'd be about 90,000 new accounts per month. And I think with some of the new partnerships we have we can get there.

We're not there today, which I indicated on the last call in simply the retail distribution, so we haven't given an active account number for GoBank but it is going very nicely and people who get it love it, but we need to issue more; that's the best way to say it.

It doesn't sell as the same rate of our prepaid cards, it retains about 10 times longer than our prepaid cards in terms of the number of dollars spent in usage and all that.

But we need to get more accounts out the door and we're working to better define the value proposition to the customer so they understand it's a checking account, which is a new concept to sell off the rack. And then we're going to rely on some of our new partnerships to drive the acquisition rate.

So not sure if we'll get to the 90,000 a month by the end of the year, but we have a number of initiatives to help push us towards that direction..

Thank you..

You bet; thank you..

The next question comes from Mike Grondahl of Piper Jaffray. Please go ahead..

Hi, Mike..

Hi, Steve. Say, on the expense side or operating expenses in general, you've been making some progress.

If we're looking at a baseball game, what inning are you in getting those expenses in to where you want them to be?.

What a great question. I'll let you all in the room opine. I'm going to say we're in the sixth inning. And the reason I say that is we've rolled out the new call center stuff, which saves a lot. The supply chain is getting better. Risk has gotten way, way better, with all the new technology there.

But we still have a lot of the integration to go on the acquisitions and there is a lot of meat on the bone there. And we also have our new processing system that will kick in. It's already being migrated now and that will kick in fully by the middle of next year and that's a fairly material save.

And so I think between processing and the integration of our acquisitions, I am going to say we are in the sixth inning..

Okay. And then....

Yeah..

And then.

On the initiative that was delayed into the first quarter of 2016, what was the reason for the delay?.

We wanted some more consumer research and some better data. And we wanted to give our technology and product teams a little bit longer to make it just so. And we didn't feel that it was urgent to run it out, rush it out and then have it wrong.

But it's a good initiative and material one, so we feel good about it, but there is no reason to rush it into Q4..

does it relate to the secured card offering or can you say what it relates to?.

No, I would rather not because our competitors are listening to the call as well as everybody else, but it's -- no, but it's a good one and we have a number of cool things for 2016 and that's all shaping up nicely and that was one of them, but given that it's definitely not going to be in the year, we took it out of the guidance..

Got it; okay..

. The next question comes from Tien-tsin Huang of JP Morgan. Please go ahead..

Thanks; good afternoon. On the Walmart side it seems like it is stabilized a little bit.

Has that bottomed out and how did that come in versus plan and how do you feel about the outlook?.

Yeah, the Walmart side of the house is doing better. It was about 48% of our revenue including all of our products that we sell at Walmart, but against a larger revenue base in the quarter.

And if we see where we were down in terms of revenue it was about a 1% switch and that's quite a good result based on how that portfolio had been tumbling there for a while. So we think we've hit a stable run-rate and we hope that's it.

And also now that we've been able to get that contract signed, we're actually able to work with our partners at Walmart to grow the category and to come up with things that we want to do and need to do to make the product some more appealing and to make the racks easy to look at and to please customers the way we all want to do.

So we have a lot of good opportunities to increase those numbers and get them back to the directions of the past and we're excited to get that started and already have..

Okay, okay, so better life there. And just my follow-up. Just I know lot of questions and discussion on MoneyPak, but when all said and done, what's the full year expected hit? I think it was $40 million. It seems like it is now sort of in the $60 million zone.

Is that -- did I hear that right or calculate that right?.

I don't know.

Paul (38:38) where are we at? It was $55 million, you're saying?.

$55 million yeah is what we're projecting..

So $55 million is what Paul's -- Paul Farina (38:49) who runs our FP&A is where we're at the current run-rate. And certainly a way more material number than we thought it would have been on the revenue side. I think what's amazing to us is that the EBITDA has performed so well despite that.

That's a lot of gravy coming off the top without seeing a massive impact to the bottom line, and I think all the cost saves as part of MoneyPak, the packaging, the risk expenses, the customer refunds help to even that out somewhat. So we' got lucky on the EBITDA ,which we thought would happen.

We thought that white noise effect would pay off and that we were right on, but we clearly underestimated initially the impact of that leaving the ecosystem..

Thanks a lot, I just had one correction. On the last call or update on MoneyPak was a total impact of $60 million to $65 million and Paul (39:26) is saying we're actually still in that range, $60 to $65 million..

$65 million; I'm sorry. Yeah, I misunderstood. Okay very good thank you for that, Chris..

$65 million. Got it thanks..

This concludes our question and answer session. I would like to turn the conference back over to Mr. Steve Streit for any closing remarks..

Okay, thank you, operator. Thank you all for listening and we will back with you again. Have a great day, everybody..

Your conference is now concluded. Thank you for attending today's presentation. You may now disconnect..