H&R Block earnings dip 4.7 percent in fourth quarter
Kansas City-based H&R Block Inc. said it earned $658.6 million, or $2.14 a share, during the last three months of its fiscal year.
The profit was 4.7 percent lower than its $690.8 million profit a year earlier. Earnings per share were lower at year ago, at $2.10, because Block had more shares outstanding.
Block’s recent profit came during the busiest months of the tax season and more than offset losses incurred in other parts of the year.
New CEO William C. Cobb hailed the quarter as a success in attracting new and young customers from whom Block hopes to earn greater revenues as their tax lives become more complex.
“We achieved our highest level of U.S. client growth since 2001 and maintained strong earnings results despite a number of special items,” Cobb said in the company’s announcement. “We also reversed years of market share declines and have built a solid pipeline of new and younger clients. All of this positions us well for the future.”
For all of its fiscal 2011 year, Block earned $406.1 million, or $1.31 a share, down 15 percent from a $479.2 million profit, or $1.43, in the previous year.
The company said earnings apart from some one-time charges were $470.6 million, or roughly flat with the similarly adjusted number a year earlier.
It has been a busy spring for Block.
In April, the company named a new chairman and appointed Cobb, a former eBay executive, as its CEO. It saw its biggest rival in traditional tax services, Jackson Hewitt Tax Services Inc., seek bankruptcy protection from its creditors in May.
Block, however, also ran into federal opposition to its plans to buy TaxACT to boost its digital tax preparation offerings for do-it-yourself customers. The U.S. Department of Justice sued to prevent the merger that it said would create a “virtual duopoly” in the digital market, with Intuit Inc.’s TurboTax capturing 62.2 percent of the market.
Block said its revenues in the fourth quarter dipped less than 1 percent to $2.3 billion. For the full year, revenues fell 2.5 percent to $3.8 billion.
Management will discuss the results during a conference call with analysts at 3:30 Central. Dial 877-809-6980 and use conference ID 70449405 to listen. A replay will be available from the investor relations page at the company’s website later.