H&R Block, Inc. · NYSE:HRB
H&R Block — Q2 FY2004 Earnings Presentation
11 slides from H&R Block's earnings presentation, Nov 25, 2003
Slide 1: Second Quarter FY2004 Earnings
Second Quarter FY2004 Earnings November 25, 2003
Slide 2: Safe Harbor Statement
Safe Harbor Statement Various comments we may make about future expectations, guidance, targets, estimates, assumptions, plans and prospects for the company constitute forward-looking statements within the meaning of the federal securities laws and are based on current information and expectations.
Slide 3: Second Quarter 2004 Financial Summary
Second Quarter 2004 Financial Summary ($ in millions, except per share data) (1) 2Q 04 2Q 03% Chg 1Q 04 Revenue $580$471 23% $506 Net Income (Loss) $10 $(37) * $5 Diluted EPS $0.06 $(0.21) * $0.03 (1) Results for the quarter ended July 31, 2003 have been restated for the adoption of Emerging Issues
Slide 4: U.S. Tax Operations
U.S. Tax Operations ($ in thousands) % Better 2Q 04 2Q 03 (Worse) Tax preparation and related fees 12,792 13,370 (4.3%) Royalties 1,651 1,402 17.8% RAL waiver fees 1,446 - * Software sales 933 560 66.6% Online 430 242 77.7% Peace of Mind 17,658 6,775 160.6% Other 12,279 11,080 10.8% Total revenues $
Slide 5: International Tax Operations
International Tax Operations ($ in thousands) % Better 2Q 04 2Q 03 (Worse) Canada $ 3,025 $ 2,529 19.6% Australia 15,657 12,345 26.8% United Kingdom 305 329 (7.3)% Overseas 108 123 (12.2)% Total revenues $ 19,095 $ 15,326 (24.6)% Canada $ (4,858) $ (4,260) (14.0)% Australia 6,297 5,030 25.2% United
Slide 6: Investment Services
Investment Services ($ in thousands) % Better % Better 2Q 04 1Q 04 (Worse) 2Q 03 (Worse) Transactional revenue $ 23,162 $ 25,985 (10.9)% $ 22,906 1.1% Annuitized revenue 13,689 12,476 9.7% 8,029 70.5% Total production revenue 36,851 38,461 (4.2)% 30,935 19.1% Other revenue 7,795 9,996 (22.0)% 9,334
Slide 7: Mortgage Operations
Mortgage Operations ($ in thousands) % Better % Better 2Q 04 1Q 04 (Worse) 2Q 03 (Worse) Gain on sale of mortgage loans: Gain on loan sales $ 220,652 $ 203,382 8.5% $ 155,079 42.3% Impairment of residual interests (363) (10,743) 96.6% (3,702) 90.2% Total gain on sale 220,289 192,639 14.4% 151,377 45
Slide 8: Mortgage Operations
Mortgage Operations ($ in billions) 2Q 04 1Q 04% Chg 2Q 03 % Chg Option One Servicing Portfolio$40 $34 18% $27 50% Loan Production $6.3 $5.3 19% $3.9 64% Net gain on sale 3.9% 4.4% * 4.8% * Weighted average interest rate 7.5% 7.5% * 8.2% * 8
Slide 9: Business Services
Business Services ($ in thousands) % Better 2Q 04 2Q 03 (Worse) Traditional accounting $ 54,441 $ 51,195 6.3% Business consulting 21,174 21,755 (2.7)% Capital markets 17,870 10,563 69.2% Other 15,539 14,370 8.1% Total revenues 109,024 97,883 11.4% Compensation & benefits 75,397 65,654 (14.8)% Occupa
Slide 10: Key Balance Sheet Items
Key Balance Sheet Items ($ in millions) July 31, 2003October 31, 2003 Cash and cash equivalents $675 $261 Restricted Cash $528 $571 Prepaid Expenses $472 $648 Residual Interests in Securitizations $291 $318 Shares Outstanding 179 million 178 million 10
Slide 11: FY 2004 Guidance
FY 2004 Guidance Revenue Growth 10 - 15% GAAP EPS $3.65 - 3.85 11