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RSM McGladrey Pre-Tax Income Plunges

Thursday, Dec 10 2009
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RSM McGladreyPre-tax income for RSM McGladrey dropped sharply to $174,000 in the second quarter ended October 30, down from $13.1 million in last year's corresponding period as the H&R Block subsidiary saw drops in revenue in its tax services, business consulting, accounting services and capital markets operating areas.

Revenue dropped to $206.6 million in the most recently ended period, down 11.5 percent a year ago. The sharpest decline came in the small capital markets business, which reported revenue of just over $1 million, down from just under $5 million in the second quarter of fiscal 2009. The numbers were reported as H&R Block filed its form 10-Q with the SEC.

The unit's largest income producer, tax services, saw revenue fell to $100.7 million, a decline of 8.9 percent from $110.6 million. Block attributed that to fewer chargeable hours and a decline in hourly rates

RSM had business consulting revenue of $61.2 million in the most recently ended period, off 16.1 percent from $73.2 million.  Accounting services revenue was $12.5 million a decrease of 6.7 percent from $13.4 million a year ago.

The company cut operating expenses to $206.4 million, down 6.2 percent from just under $220 million. The greatest savings came in compensation and benefit expense, which fell to $149.3 million, down from $161.4 million a year ago.

 

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