H&R Block’s new CEO Jeff Jones targeted increasing customer counts over price increases in the upcoming tax season as he outlined the company’s strategy Wednesday.
Jones, in his first quarterly conference call with analysts since joining Block in October, said the Kansas City-based tax preparer strives to improve on the rebound in client totals it enjoyed last tax season.
Two years ago, Block suffered badly in what then-CEO Bill Cobb had said was an unacceptable season.
Jones promoted actions that he said were part of a multiyear strategy to build up Block’s customer base by attracting new clients and keeping their business from year to year.
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“We aren’t as relevant as we need to be to today’s consumer,” Jones said. “We cannot continue to focus only on the upcoming tax season.”
For the upcoming season, H&R Block more than doubled the maximum available through Refund Advance loans to $3,000, announced free 1040EZ tax filings, cut a deal so Walmart will sell only H&R Block’s do-it-yourself tax software and announced an H&R Block Tax Pro Go product for filers who need help but can’t make it to a Block store.
Jones said the company also would focus more marketing attention this year on its DIY tax products, saying some consumers still don’t think of Block as offering service beyond its network of retail outlets.
Such ads also would target the growing segment of tax help, as Block expects its retail store-assisted filings to remain flat to only modestly increased from a year ago.
With that focus on growth, H&R Block clients shouldn’t see much higher bills.
“We can’t be too aggressive on price,” chief financial officer Tony Bowen said during the call.
Shares of H&R Block jumped more than 10 percent Wednesday, gaining $2.70 to close at $28.99.
Separately, H&R Block said its revenues increased 7.5 percent during August, September and October. The company posted a loss in the quarter, which is typical during those seasonally slow months. The loss was about 5 percent greater than a year earlier.
H&R Block said it lost $153.6 million, or 74 cents a share, on revenues of $140.85 million. A year earlier, its loss equaled $146.2 million, or 68 cents a share, on revenues of $131.33 million.
The three-month period represents the second quarter of Block’s fiscal year, which ends April 30 after the tax season has provided the bulk of the company’s revenues and profits for the year.