H & R Block Inc (NYSE: HRB) shares fell, on reporting better-than-expected earnings and raised its quarterly dividend from $0.24 per share to $0.25 per share.
The Kansas City-based tax preparer released its financial results for the fiscal year ended April 30, 2018. Revenues increased 4%, driven by improved client volumes and net average charge in its U.S. tax businesses.
Earnings per share from continuing operations increased 52%, to $2.98, primarily driven by the company's lower effective tax rate, as well as improved pretax earnings.
For fiscal 2018, approximately 20 million returns were prepared by or through H&R Block in the U.S., a 2.5% increase over fiscal 2017. Client trajectory improved in the company's U.S. Assisted business as a result of stronger client retention, with a 0.6% decline in returns compared to a 2.5% decline in fiscal 2017.
Growth in online U.S. DIY returns outpaced the industry at 10.3% due to product enhancements and more effective marketing. Additionally, the company reported increases in net average charge in both Assisted and DIY.
"We achieved our goal of improving the client trajectory and delivered positive financial results for the fiscal year," said Jeff Jones, H&R Block's president and chief executive officer.
"We're also making progress on our multi-year strategic framework. As we look ahead to fiscal 2019, we will make strategic investments to enhance the relevance of our brand, strengthen technology platforms, and improve the fundamental value clients receive from H&R Block."
Shares plummeted $5.67, or 19.2%, to $23.93.
