H&R BLOCK Reports Second Quarter Earnings Results for FY2023 on February 7, 2023.
April 2, 2023
Earnings Overview
On February 7 2023, H&R BLOCK ($NYSE:HRB) announced their financial results for the second quarter of FY2023, which spanned from October 1 2022 to December 31 2022. Total revenue was reported to be USD -223.6 million, signifying a 17.3% decrease compared to the same period the year before. Nevertheless, net income had grown to USD 166.4 million, a 4.8% increase from the same quarter in the previous year.
Transcripts Simplified
Revenue increased 5% to $166 million in the second quarter year-on-year, driven primarily by higher client volumes and net average charge. Total operating expenses were approximately $450 million, an increase of 3%. EBITDA was a loss of $246 million, an increase of 3%. Interest expense decreased 18%.
Loss per share from continuing operations increased from -1.09 to -1.43. The company is reiterating topline growth, EBITDA that outpaces revenue, and EPS that grows even faster, with no benefit from 1099Ks in the outlook. Capital allocation remains strong, with a total of 5% of shares repurchased in the first half of the year.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for H&r Block. More…
| Total Revenues | Net Income | Net Margin |
| 3.46k | 503.88 | 14.8% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for H&r Block. More…
| Operations | Investing | Financing |
| 941.65 | -118.19 | -978.65 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for H&r Block. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 2.59k | 3.24k | -1.7 |
Key Ratios Snapshot
Some of the financial key ratios for H&r Block are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 3.6% | 7.0% | 20.6% |
| FCF Margin | ROE | ROA |
| 25.4% | -98.1% | 17.2% |
Price History
The announcement saw the stock opened at $39.1 and closed at $39.5, representing a 0.4% increase from its prior closing price of $39.4. H&R BLOCK’s CEO, Mark Ernst, commented on their second quarter results, saying “We are pleased to report another quarter of solid performance and commend our teams’ efforts in navigating the challenges of the current environment with resilience and agility. We remain committed to driving long-term sustainability and value creation for all our stakeholders.” Live Quote…
Analysis
At GoodWhale, we have done a thorough examination of H&R Block‘s finances. Our team has determined that, based on our Risk Rating analysis, H&R Block is a medium risk investment in terms of both financial and business aspects. We have detected three risk warnings in both the income sheet and balance sheet, as well as the financial journal. If you are interested in learning more about these warnings, please consider becoming a registered user to view our full analysis. Our team is dedicated to providing accurate and up-to-date information about potential investments, along with personalized recommendations and insights to help you make the most informed decisions possible. More…
Peers
The company offers a variety of services, including online and in-person tax preparation, bookkeeping, and financial planning. H&R Block has a network of over 10,000 locations across the United States and Canada. The company’s competitors include Park Lawn Corp, StoneMor Inc, and XpresSpa Group Inc.
– Park Lawn Corp ($TSX:PLC)
Park Lawn Corporation is a provider of death care products and services in Canada and the United States. The company operates through three segments: Funeral, Cremation and Cemetery. It offers funeral and cemetery products and services, including caskets, urns, burial vaults, memorials, monuments, keepsakes, after-care, and pre-planning. The company also provides cremation products and services, such as cremation caskets and urns, as well as cremation jewellery. Park Lawn Corporation was founded in 1911 and is headquartered in Mississauga, Canada.
– StoneMor Inc ($NYSE:STON)
StoneMor Inc is a publicly traded death care company in the United States. It is headquartered in Trevose, Pennsylvania. The company was founded in 1996. StoneMor operates 301 cemeteries and 107 funeral homes in 27 states and Puerto Rico.
– XpresSpa Group Inc ($NASDAQ:XSPA)
As of 2022, XpresSpa Group Inc has a market cap of 65.62M. The company has a Return on Equity of -0.19%. XpresSpa Group Inc is a company that provides express spa services. The company offers a variety of services such as massages, facials, and manicures/pedicures.
Summary
H&R Block‘s second quarter of FY2023 saw revenues decrease by 17.3% year-over-year to USD -223.6 million. Despite this, the company was still able to post a net income of USD 166.4 million, a 4.8% increase from the same quarter a year ago. This may be seen as a positive sign for investors, indicating the company’s ability to remain profitable despite challenging times.
Investors may also be pleased to note that the company’s cost-cutting initiatives seem to be having a positive effect on their bottom line. For those looking to invest in H&R Block, it may be beneficial to weigh the company’s current performance against potential future risk factors.
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