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Bill Cobb, H&R BlockH&R Block reported that the total number of returns prepared in its stores and via its digital products grew by 5.1 percent for tax season through February 28, compared to the same period in the 2011 tax year. The growth in the number of online returns continued to dramatically outpace retail growth with the online figures up 20 percent while retail returns prepared rose by 1.5 percent.

The total number of digital returns - including software and online-- rose by 13 percent. Block also reported that the number of Emerald Prepaid Master Cards hit 2.6 million, up 22 percent from the year-earlier figures. And management was pleased with results.

"It is clear that we are gaining share in all digital categories: online, software and the Free File Alliance," CEO William Cobb said in this week's earnings webcast. Cobb said he was pleased with the progress in attracting and retaining customers who file form 1040EZ, many of whom are young wage earners that the company wants to keep as long-term purchasers. Block also improved retail client retention and customer satisfaction with its Net Promoter scores increasing.

Cobb also claimed that his company gained ground on Intuit this year. He said that Block had achieved its primary object for the season, which was "to outpace TurboTax in total digital category growth, based on Intuit's volume release through February 18."

Meanwhile, the company reported a loss of $3.6 million from continuing operations for the third quarter ended January 31, compared to $11 million in red ink a year earlier. Revenue for the most recently ended quarter was $663.3 million, a drop of 2.5 percent from last year's corresponding quarter.

While tax-preparation fees and related revenue increased to about $49 million, up 10 percent for the quarter that was offset by a decline of about $70 million in financial products. That included $16 million from the refund anticipation loan program that was reported last year. However, Block has no RAL program this year.

And despite the increase in the number of Emerald cards, that revenue dropped by $16 million as the company tightened underwriting criteria related to the Emerald Advance product. However, associated credit losses dropped by $36.6 million.

Bob Scott
Bob Scott has provided information to the tax and accounting community since 1991, first as technology editor of Accounting Today, and from 1997 through 2009 as editor of its sister publication, Accounting Technology. He is known throughout the industry for his depth of knowledge and for his high journalistic standards.  Scott has made frequent appearances as a speaker, moderator and panelist and events serving tax and accounting professionals. He  has a strong background in computer journalism as an editor with two former trade publications, Computer+Software News and MIS Week and spent several years with weekly and daily newspapers in Morris County New Jersey prior to that.  A graduate of Indiana University with a degree in journalism, Bob is a native of Madison, Ind
Last modified on Sunday, 02 June 2013
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