H&R Block Reports Fiscal 2022 Second Quarter Results; Reiterates Fiscal Year Financial Outlook
Second-quarter revenue grew 12%, demonstrating continued momentum across the business.
Repurchased an incremental $159 million of shares in the quarter, retiring approximately 4% of shares outstanding. In the first half of the fiscal year share repurchases have totaled $325 million, or 7% of the float.
The Company reiterates its previously given the fiscal year 2022 outlook.
The recent launch of SpruceSM, H&R Block’s new mobile banking platform, is a meaningful milestone in the Company’s strategic transformation.
“Our second-quarter results highlight ongoing momentum in the business, progress on our Block Horizons strategy, and our commitment to returning capital to shareholders,” said Jeff Jones, H&R Block’s president, and CEO. “We set an aggressive goal to bring Spruce to market in a short amount of time, and I am very pleased that we were able to deliver such a robust product out of the gate. We are continuing to execute across the business, and we feel well-positioned for tax season.”
Fiscal 2022 Second Quarter Results and Key Financial Metrics
“Our performance in the first half of 2022 has been solid, and we are reiterating our outlook,” said Tony Bowen, H&R Block’s chief financial officer. “During the quarter, we continued our trend of creating value for shareholders by returning capital and reducing shares outstanding.”
Total revenue of $159 million increased by $17 million, or 12%, to the prior year. The increase was primarily driven by strength in the Emerald Card and growth from Wave.
Total operating expenses of $436 million increased by $15 million, or 4%, driven by higher compensation, as well as banking charges because of the growth in payments processed, partially offset by lower depreciation and amortization expenses.
Pretax loss decreased by $2 million to $299 million due to higher revenues, partially offset by higher operating expenses and higher interest expenses.
Loss per share from continuing operations2 improved from $1.38 to $1.09 due to the aforementioned items and from a discrete tax benefit during the quarter. Adjusted loss per share2 from continuing operations improved from $1.28 to $1.02.
The Company’s next update related to tax season results and financial performance will be on its third-quarter earnings call in May.
The Company reported the following related to its capital structure:
Fiscal year second quarter repurchases and retirements of common stock totaled approximately 6.6 million shares at an aggregate price of $159 million, or $24.10 per share. The Company has approximately $239 million remaining on its authorization through June 2022.
As previously announced, a quarterly cash dividend of $0.27 per share was paid on January 3, 2022, to shareholders of record as of December 6, 2021. H&R Block has paid quarterly dividends consecutively since the Company became public in 1962.
Since 2016, the Company has returned over $2 billion to shareholders in the form of share repurchases and dividends.
For information on Sand Canyon, please refer to disclosures in the Company’s reports on Forms 10-K, 10-Q, and other filings with the SEC.
Discussion of the fiscal 2022 second-quarter results, outlook and a general business update will occur during the Company’s previously announced fiscal second-quarter earnings conference call for analysts, institutional investors, and shareholders. The call is scheduled for 4:30 p.m. Eastern time on February 1, 2022. To access the call, please dial the number below approximately 5 minutes prior to the scheduled starting time:
U.S./Canada (866) 987-6821or International (630) 652-5951
Conference ID: 9297549
The call, along with a presentation for viewing, will also be webcast in a listen-only format for the media and public. The webcast can be accessed directly https://investors.hrblock.com/financial-information/quarterly-results, and the presentation will be posted following the conclusion of the call.
A replay of the call will be available beginning at 7:30 p.m. Eastern time on February 1, 2022, and continuing for seven days by dialing (855) 859-2056 (U.S./Canada) or (404) 537-3406 (International). The conference ID is 9297549. The webcast will be available for replay beginning on February 2, 2022, and continuing for 90 days at https://investors.hrblock.com/financial-information/quarterly-results.