H&R Block Inc. (NYSE:HRB) reported that its earnings fell 5.2% in the latest quarter, but the tax-preparation company's results beat expectations and it raised its dividend 10%, sending shares higher.
The Kansas City, Mo., company's shares, down 35% this year, rose 6.8% to $23 in recent after-hours trading.
The company's quarterly dividend was increased to 22 cents a share, up 2 cents a share, to yield 4.1%. The dividend is payable to shareholders of record as of June 20.
The company finalized its tally of U.S. tax return volume for the latest tax season, with total H&R returns down 4.5%, including a 5.8% drop in assisted returns and a 2.6% decline in returns prepared with its software. H&R had previewed the tax season results in April.
Chief Executive Bill Cobb said in prepared remarks on Thursday, "as I said in April, this season's results are not acceptable."
H&R Block said it is investing in initiatives aimed at attracting more customers during the current year, but didn't give details except to say they will be funded through its previously announced cost-cutting efforts. During April, H&R Block unveiled plans to restructure its operations, including reducing its workforce by nearly 13%, in the wake of the disappointing tax season.
For the period ended April 30, H&R Block reported a profit of $700.7 million, or $3.13 a share, down from $738.8 million, or $2.66 a share, a year earlier. Excluding items, adjusted per-share earnings rose to $3.16 from $2.68. Revenue edged down 0.2% to $2.3 billion.
Analysts polled by Thomson Reuters expected per-share profit of $3.15 and revenue of $2.28 billion.
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