|
(Mark One)
|
|
|
|
☑
|
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
For the quarterly period ended
|
October 31, 2019
|
|
|
OR
|
|
☐
|
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
For the transition period from to
|
Missouri
|
|
44-0607856
|
(State or other jurisdiction of
|
|
(I.R.S. Employer
|
incorporation or organization)
|
|
Identification No.)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, without par value
|
HRB
|
New York Stock Exchange
|
|
|
|
|
|
|
|
Consolidated Statements of Operations and Comprehensive Loss
|
|
|
|
Three and six months ended October 31, 2019 and 2018
|
|
|
|
|
|
Consolidated Balance Sheets
|
|
|
As of October 31, 2019, October 31, 2018 and April 30, 2019
|
|
|
|
|
|
Consolidated Statements of Cash Flows
|
|
|
Six months ended October 31, 2019 and 2018
|
|
|
|
|
|
Consolidated Statements of Stockholders' Equity
|
|
|
Three and six months ended October 31, 2019 and the fiscal year ended April 30, 2019
|
|
|
|
|
|
Notes to Consolidated Financial Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Legal Proceedings
|
||
|
|
|
Risk Factors
|
||
|
|
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
||
|
|
|
Item 3.
|
Defaults Upon Senior Securities
|
|
|
|
|
Item 4.
|
Mine Safety Disclosures
|
|
|
|
|
|
|
|
Exhibits
|
||
|
|
|
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
1
|
2
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(unaudited, in 000s)
|
|
|||||
Six months ended October 31,
|
|
2019
|
|
|
2018
|
|
||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||
Net loss
|
|
$
|
(338,246
|
)
|
|
$
|
(328,946
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
81,262
|
|
|
81,925
|
|
||
Provision for bad debt
|
|
1,890
|
|
|
2,350
|
|
||
Deferred taxes
|
|
12,595
|
|
|
17,913
|
|
||
Stock-based compensation
|
|
16,094
|
|
|
11,839
|
|
||
Changes in assets and liabilities, net of acquisitions:
|
|
|
|
|
||||
Receivables
|
|
71,859
|
|
|
74,672
|
|
||
Prepaid expenses, other current and noncurrent assets
|
|
13,889
|
|
|
(9,134
|
)
|
||
Accounts payable, accrued expenses, salaries, wages and payroll taxes
|
|
(267,257
|
)
|
|
(218,692
|
)
|
||
Deferred revenue, other current and noncurrent liabilities
|
|
(74,996
|
)
|
|
(81,014
|
)
|
||
Income tax receivables, accrued income taxes and income tax reserves
|
|
(206,278
|
)
|
|
(179,660
|
)
|
||
Other, net
|
|
(4,128
|
)
|
|
1,056
|
|
||
Net cash used in operating activities
|
|
(693,316
|
)
|
|
(627,691
|
)
|
||
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||
Capital expenditures
|
|
(42,854
|
)
|
|
(66,422
|
)
|
||
Payments made for business acquisitions, net of cash acquired
|
|
(416,925
|
)
|
|
(24,549
|
)
|
||
Franchise loans funded
|
|
(16,021
|
)
|
|
(8,915
|
)
|
||
Payments from franchisees
|
|
7,902
|
|
|
11,689
|
|
||
Other, net
|
|
50,839
|
|
|
4,993
|
|
||
Net cash used in investing activities
|
|
(417,059
|
)
|
|
(83,204
|
)
|
||
|
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||
Proceeds from line of credit borrowings
|
|
135,000
|
|
|
—
|
|
||
Dividends paid
|
|
(104,063
|
)
|
|
(103,484
|
)
|
||
Repurchase of common stock, including shares surrendered
|
|
(190,369
|
)
|
|
(102,096
|
)
|
||
Proceeds from exercise of stock options
|
|
1,215
|
|
|
1,746
|
|
||
Other, net
|
|
(18,544
|
)
|
|
(22,434
|
)
|
||
Net cash used in financing activities
|
|
(176,761
|
)
|
|
(226,268
|
)
|
||
|
|
|
|
|
||||
Effects of exchange rate changes on cash
|
|
1,053
|
|
|
(3,209
|
)
|
||
|
|
|
|
|
||||
Net decrease in cash and cash equivalents, including restricted balances
|
|
(1,286,083
|
)
|
|
(940,372
|
)
|
||
Cash, cash equivalents and restricted cash, beginning of period
|
|
1,707,727
|
|
|
1,663,678
|
|
||
Cash, cash equivalents and restricted cash, end of period
|
|
$
|
421,644
|
|
|
$
|
723,306
|
|
|
|
|
|
|
||||
SUPPLEMENTARY CASH FLOW DATA:
|
|
|
|
|
||||
Income taxes paid, net of refunds received
|
|
$
|
54,109
|
|
|
$
|
50,197
|
|
Interest paid on borrowings
|
|
39,952
|
|
|
39,902
|
|
||
Accrued additions to property and equipment
|
|
3,409
|
|
|
4,765
|
|
||
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
3
|
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
|
|
(amounts in 000s, except per share amounts)
|
|
|||||||||||||||||||||||||||
|
|
Common Stock
|
|
Additional
Paid-in Capital |
|
|
Accumulated Other
Comprehensive Income (Loss) |
|
|
Retained
Earnings (Deficit) |
|
|
Treasury Stock
|
|
Total
Stockholders’ Equity (Deficiency) |
|
||||||||||||||
|
|
Shares
|
|
|
Amount
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
||||||||||||||
Balances as of May 1, 2019
|
|
238,337
|
|
|
$
|
2,383
|
|
|
$
|
767,636
|
|
|
$
|
(20,416
|
)
|
|
$
|
499,386
|
|
|
(36,377
|
)
|
|
$
|
(707,462
|
)
|
|
$
|
541,527
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(150,247
|
)
|
|
—
|
|
|
—
|
|
|
(150,247
|
)
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,320
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,320
|
)
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
6,557
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,557
|
|
||||||
Stock-based awards exercised or vested
|
|
—
|
|
|
—
|
|
|
(13,789
|
)
|
|
—
|
|
|
(2,786
|
)
|
|
906
|
|
|
17,631
|
|
|
1,056
|
|
||||||
Acquisition of treasury shares
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(314
|
)
|
|
(9,185
|
)
|
|
(9,185
|
)
|
||||||
Repurchase and retirement of common shares
|
|
(1,593
|
)
|
|
(16
|
)
|
|
(955
|
)
|
|
—
|
|
|
(43,101
|
)
|
|
—
|
|
|
—
|
|
|
(44,072
|
)
|
||||||
Cash dividends declared - $0.26 per share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(52,512
|
)
|
|
—
|
|
|
—
|
|
|
(52,512
|
)
|
||||||
Balances as of July 31, 2019
|
|
236,744
|
|
|
$
|
2,367
|
|
|
$
|
759,449
|
|
|
$
|
(22,736
|
)
|
|
$
|
250,740
|
|
|
(35,785
|
)
|
|
$
|
(699,016
|
)
|
|
$
|
290,804
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(187,999
|
)
|
|
—
|
|
|
—
|
|
|
(187,999
|
)
|
||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
919
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
919
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
9,331
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,331
|
|
||||||
Stock-based awards exercised or vested
|
|
—
|
|
|
—
|
|
|
(127
|
)
|
|
—
|
|
|
(276
|
)
|
|
13
|
|
|
264
|
|
|
(139
|
)
|
||||||
Acquisition of treasury shares
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(173
|
)
|
|
(173
|
)
|
||||||
Repurchase and retirement of common shares
|
|
(5,720
|
)
|
|
(57
|
)
|
|
(3,433
|
)
|
|
—
|
|
|
(133,449
|
)
|
|
—
|
|
|
—
|
|
|
(136,939
|
)
|
||||||
Cash dividends declared - $0.26 per share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(51,551
|
)
|
|
—
|
|
|
—
|
|
|
(51,551
|
)
|
||||||
Balances as of October 31, 2019
|
|
231,024
|
|
|
$
|
2,310
|
|
|
$
|
765,220
|
|
|
$
|
(21,817
|
)
|
|
$
|
(122,535
|
)
|
|
(35,778
|
)
|
|
$
|
(698,925
|
)
|
|
$
|
(75,747
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
|
|
(amounts in 000s, except per share amounts)
|
|
|||||||||||||||||||||||||||
|
|
Common Stock
|
|
Additional
Paid-in Capital |
|
|
Accumulated
Other Comprehensive Income (Loss) |
|
|
Retained
Earnings (Deficit) |
|
|
Treasury Stock
|
|
Total
Stockholders’ Equity (Deficiency) |
|
||||||||||||||
|
|
Shares
|
|
|
Amount
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
||||||||||||||
Balances as of May 1, 2018
|
|
246,199
|
|
|
$
|
2,462
|
|
|
$
|
760,250
|
|
|
$
|
(14,303
|
)
|
|
$
|
362,980
|
|
|
(36,945
|
)
|
|
$
|
(717,678
|
)
|
|
$
|
393,711
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(152,670
|
)
|
|
—
|
|
|
—
|
|
|
(152,670
|
)
|
||||||
Cumulative effect of ASU 2016-16 (1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
100,950
|
|
|
—
|
|
|
—
|
|
|
100,950
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,731
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,731
|
)
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
4,307
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,307
|
|
||||||
Stock-based awards exercised or vested
|
|
—
|
|
|
—
|
|
|
(9,945
|
)
|
|
—
|
|
|
(1,029
|
)
|
|
627
|
|
|
12,185
|
|
|
1,211
|
|
||||||
Acquisition of treasury shares
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(200
|
)
|
|
(4,560
|
)
|
|
(4,560
|
)
|
||||||
Repurchase and retirement of common shares
|
|
(4,173
|
)
|
|
(42
|
)
|
|
(2,503
|
)
|
|
—
|
|
|
(94,560
|
)
|
|
—
|
|
|
—
|
|
|
(97,105
|
)
|
||||||
Cash dividends declared - $0.25 per share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(52,104
|
)
|
|
—
|
|
|
—
|
|
|
(52,104
|
)
|
||||||
Balances as of July 31, 2018
|
|
242,026
|
|
|
$
|
2,420
|
|
|
$
|
752,109
|
|
|
$
|
(16,034
|
)
|
|
$
|
163,567
|
|
|
(36,518
|
)
|
|
$
|
(710,053
|
)
|
|
$
|
192,009
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(176,276
|
)
|
|
—
|
|
|
—
|
|
|
(176,276
|
)
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,846
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,846
|
)
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
7,352
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,352
|
|
||||||
Stock-based awards exercised or vested
|
|
—
|
|
|
—
|
|
|
(226
|
)
|
|
—
|
|
|
(202
|
)
|
|
35
|
|
|
675
|
|
|
247
|
|
||||||
Acquisition of treasury shares
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16
|
)
|
|
(431
|
)
|
|
(431
|
)
|
||||||
Cash dividends declared - $0.25 per share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(51,380
|
)
|
|
—
|
|
|
—
|
|
|
(51,380
|
)
|
||||||
Balances as of October 31, 2018
|
|
242,026
|
|
|
$
|
2,420
|
|
|
$
|
759,235
|
|
|
$
|
(18,880
|
)
|
|
$
|
(64,291
|
)
|
|
(36,499
|
)
|
|
$
|
(709,809
|
)
|
|
$
|
(31,325
|
)
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(126,454
|
)
|
|
—
|
|
|
—
|
|
|
(126,454
|
)
|
||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,238
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,238
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
6,067
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,067
|
|
||||||
Stock-based awards exercised or vested
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(169
|
)
|
|
41
|
|
|
796
|
|
|
622
|
|
||||||
Acquisition of treasury shares
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(56
|
)
|
|
(56
|
)
|
||||||
Repurchase and retirement of common shares
|
|
(525
|
)
|
|
(5
|
)
|
|
(315
|
)
|
|
—
|
|
|
(11,981
|
)
|
|
—
|
|
|
—
|
|
|
(12,301
|
)
|
||||||
Cash dividends declared - $0.25 per share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(51,382
|
)
|
|
—
|
|
|
—
|
|
|
(51,382
|
)
|
||||||
Balances as of January 31, 2019
|
|
241,501
|
|
|
$
|
2,415
|
|
|
$
|
764,982
|
|
|
$
|
(17,642
|
)
|
|
$
|
(254,277
|
)
|
|
(36,460
|
)
|
|
$
|
(709,069
|
)
|
|
$
|
(213,591
|
)
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
877,909
|
|
|
—
|
|
|
—
|
|
|
877,909
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,774
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,774
|
)
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
5,784
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,784
|
|
||||||
Stock-based awards exercised or vested
|
|
—
|
|
|
—
|
|
|
(1,231
|
)
|
|
—
|
|
|
(150
|
)
|
|
84
|
|
|
1,634
|
|
|
253
|
|
||||||
Acquisition of treasury shares
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(27
|
)
|
|
(27
|
)
|
||||||
Repurchase and retirement of common shares
|
|
(3,164
|
)
|
|
(32
|
)
|
|
(1,899
|
)
|
|
—
|
|
|
(73,501
|
)
|
|
—
|
|
|
—
|
|
|
(75,432
|
)
|
||||||
Cash dividends declared - $0.25 per share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(50,595
|
)
|
|
—
|
|
|
—
|
|
|
(50,595
|
)
|
||||||
Balances as of April 30, 2019
|
|
238,337
|
|
|
$
|
2,383
|
|
|
$
|
767,636
|
|
|
$
|
(20,416
|
)
|
|
$
|
499,386
|
|
|
(36,377
|
)
|
|
$
|
(707,462
|
)
|
|
$
|
541,527
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
ASU 2016-16 was effective on May 1, 2018 and we adopted using the modified retrospective transition method. We recognized a $101.0 million cumulative effect adjustment to increase the opening balance of retained earnings and increase deferred tax assets resulting from intra-entity transfers of intellectual property in fiscal year 2018.
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
5
|
6
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
($ in 000s)
|
||||||
|
|
Amount Acquired
|
|
|
Weighted-Average Life (in years)
|
|
Assets acquired and liabilities assumed, net
|
|
$
|
6,870
|
|
|
|
Purchased technology
|
|
68,000
|
|
|
10
|
|
Customer relationships
|
|
23,000
|
|
|
5
|
|
Noncompete agreements
|
|
7,070
|
|
|
5
|
|
Trade name
|
|
5,800
|
|
|
10
|
|
Total identifiable net assets
|
|
110,740
|
|
|
|
|
Goodwill
|
|
289,492
|
|
|
|
|
Total identifiable assets and goodwill
|
|
$
|
400,232
|
|
|
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
7
|
|
|
|
|
|
|
|
|
(in 000s)
|
|
|||||||
|
|
Three months ended October 31,
|
|
Six months ended October 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
U.S. assisted tax preparation
|
|
$
|
41,226
|
|
|
$
|
41,652
|
|
|
$
|
74,218
|
|
|
$
|
72,756
|
|
U.S. royalties
|
|
7,820
|
|
|
8,062
|
|
|
14,679
|
|
|
15,633
|
|
||||
U.S. DIY tax preparation
|
|
4,541
|
|
|
2,994
|
|
|
7,951
|
|
|
5,775
|
|
||||
International
|
|
44,926
|
|
|
45,497
|
|
|
85,507
|
|
|
84,676
|
|
||||
Refund Transfers
|
|
791
|
|
|
560
|
|
|
2,300
|
|
|
1,984
|
|
||||
Emerald Card®
|
|
8,616
|
|
|
9,478
|
|
|
22,471
|
|
|
23,724
|
|
||||
Peace of Mind® Extended Service Plan
|
|
25,660
|
|
|
24,318
|
|
|
58,497
|
|
|
60,895
|
|
||||
Tax Identity Shield®
|
|
4,648
|
|
|
5,243
|
|
|
9,170
|
|
|
9,984
|
|
||||
Interest and fee income on Emerald AdvanceTM
|
|
485
|
|
|
397
|
|
|
1,039
|
|
|
844
|
|
||||
Wave
|
|
10,902
|
|
|
—
|
|
|
14,527
|
|
|
—
|
|
||||
Other
|
|
11,186
|
|
|
10,670
|
|
|
20,804
|
|
|
17,783
|
|
||||
Total revenues
|
|
$
|
160,801
|
|
|
$
|
148,871
|
|
|
$
|
311,163
|
|
|
$
|
294,054
|
|
|
|
|
|
|
|
|
|
|
8
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
(in 000s, except per share amounts)
|
|
|||||||||||||||
|
|
Three months ended October 31,
|
|
Six months ended October 31,
|
||||||||||||
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
||||
Net loss from continuing operations attributable to shareholders
|
|
$
|
(183,554
|
)
|
|
$
|
(170,937
|
)
|
|
$
|
(329,278
|
)
|
|
$
|
(319,734
|
)
|
Amounts allocated to participating securities
|
|
(150
|
)
|
|
(144
|
)
|
|
(299
|
)
|
|
(286
|
)
|
||||
Net loss from continuing operations attributable to common shareholders
|
|
$
|
(183,704
|
)
|
|
$
|
(171,081
|
)
|
|
$
|
(329,577
|
)
|
|
$
|
(320,020
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Basic weighted average common shares
|
|
198,079
|
|
|
205,520
|
|
|
200,058
|
|
|
206,596
|
|
||||
Potential dilutive shares
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Dilutive weighted average common shares
|
|
198,079
|
|
|
205,520
|
|
|
200,058
|
|
|
206,596
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Loss per share from continuing operations attributable to common shareholders:
|
||||||||||||||||
Basic
|
|
$
|
(0.93
|
)
|
|
$
|
(0.83
|
)
|
|
$
|
(1.65
|
)
|
|
$
|
(1.55
|
)
|
Diluted
|
|
(0.93
|
)
|
|
(0.83
|
)
|
|
(1.65
|
)
|
|
(1.55
|
)
|
||||
|
|
|
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
9
|
(in 000s)
|
|
|||||||||||||||||||||||
As of
|
|
October 31, 2019
|
|
October 31, 2018
|
|
April 30, 2019
|
||||||||||||||||||
|
|
Short-term
|
|
Long-term
|
|
Short-term
|
|
Long-term
|
|
Short-term
|
|
Long-term
|
||||||||||||
Loans to franchisees
|
|
$
|
23,554
|
|
|
$
|
43,322
|
|
|
$
|
26,964
|
|
|
$
|
38,489
|
|
|
$
|
22,427
|
|
|
$
|
35,325
|
|
Receivables for U.S. assisted and DIY tax preparation and related fees
|
|
18,531
|
|
|
3,716
|
|
|
6,033
|
|
|
5,503
|
|
|
34,284
|
|
|
3,716
|
|
||||||
H&R Block Instant RefundTM receivables
|
|
530
|
|
|
695
|
|
|
—
|
|
|
2,008
|
|
|
37,319
|
|
|
1,701
|
|
||||||
H&R Block Emerald AdvanceTM lines of credit
|
|
8,073
|
|
|
9,201
|
|
|
7,418
|
|
|
10,988
|
|
|
8,546
|
|
|
12,418
|
|
||||||
Software receivables from retailers
|
|
970
|
|
|
—
|
|
|
552
|
|
|
—
|
|
|
9,354
|
|
|
—
|
|
||||||
Royalties and other receivables from franchisees
|
|
8,094
|
|
|
147
|
|
|
9,103
|
|
|
710
|
|
|
11,888
|
|
|
97
|
|
||||||
Wave payment processing receivables
|
|
3,041
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other
|
|
11,917
|
|
|
2,165
|
|
|
11,216
|
|
|
2,831
|
|
|
15,147
|
|
|
2,382
|
|
||||||
Total
|
|
$
|
74,710
|
|
|
$
|
59,246
|
|
|
$
|
61,286
|
|
|
$
|
60,529
|
|
|
$
|
138,965
|
|
|
$
|
55,639
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in 000s)
|
|
|||
Year of Origination
|
|
Current Balance
|
|
Non-Accrual
|
||||
|
|
|
|
|
||||
2019
|
|
$
|
3,051
|
|
|
$
|
2,663
|
|
2018 and prior
|
|
441
|
|
|
441
|
|
||
|
|
3,492
|
|
|
$
|
3,104
|
|
|
Allowance
|
|
(2,267
|
)
|
|
|
|||
Net balance
|
|
$
|
1,225
|
|
|
|
||
|
|
|
|
|
10
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
(in 000s)
|
|
|||||||
Year of origination:
|
|
Balance
|
|
|
Non-Accrual
|
|
||
2019
|
|
$
|
23,812
|
|
|
$
|
23,812
|
|
2018 and prior
|
|
6,718
|
|
|
6,718
|
|
||
Revolving loans
|
|
14,279
|
|
|
12,437
|
|
||
|
|
44,809
|
|
|
$
|
42,967
|
|
|
Allowance
|
|
(27,535
|
)
|
|
|
|||
Net balance
|
|
$
|
17,274
|
|
|
|
||
|
|
|
|
|
(in 000s)
|
|
|||||||||||
|
|
Goodwill
|
|
|
Accumulated Impairment Losses
|
|
|
Net
|
|
|||
Balances as of April 30, 2019
|
|
$
|
552,234
|
|
|
$
|
(32,297
|
)
|
|
$
|
519,937
|
|
Acquisition of Wave
|
|
289,492
|
|
|
—
|
|
|
289,492
|
|
|||
Other Acquisitions
|
|
8,491
|
|
|
—
|
|
|
8,491
|
|
|||
Disposals and foreign currency changes, net
|
|
(2,589
|
)
|
|
—
|
|
|
(2,589
|
)
|
|||
Impairments
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balances as of October 31, 2019
|
|
$
|
847,628
|
|
|
$
|
(32,297
|
)
|
|
$
|
815,331
|
|
|
|
|
|
|
|
|
||||||
Balances as of April 30, 2018
|
|
$
|
540,168
|
|
|
$
|
(32,297
|
)
|
|
$
|
507,871
|
|
Acquisitions
|
|
624
|
|
|
—
|
|
|
624
|
|
|||
Disposals and foreign currency changes, net
|
|
(1,304
|
)
|
|
—
|
|
|
(1,304
|
)
|
|||
Impairments
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balances as of October 31, 2018
|
|
$
|
539,488
|
|
|
$
|
(32,297
|
)
|
|
$
|
507,191
|
|
|
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
11
|
(in 000s)
|
|
|||||||||||
|
|
Gross
Carrying
Amount
|
|
|
Accumulated
Amortization
|
|
|
Net
|
|
|||
As of October 31, 2019:
|
|
|
|
|
|
|
||||||
Reacquired franchise rights
|
|
$
|
355,116
|
|
|
$
|
(147,313
|
)
|
|
$
|
207,803
|
|
Customer relationships
|
|
299,245
|
|
|
(211,681
|
)
|
|
87,564
|
|
|||
Internally-developed software
|
|
149,644
|
|
|
(113,863
|
)
|
|
35,781
|
|
|||
Noncompete agreements
|
|
40,636
|
|
|
(32,620
|
)
|
|
8,016
|
|
|||
Franchise agreements
|
|
19,201
|
|
|
(13,974
|
)
|
|
5,227
|
|
|||
Purchased technology
|
|
122,700
|
|
|
(49,503
|
)
|
|
73,197
|
|
|||
Trade name
|
|
5,800
|
|
|
(192
|
)
|
|
5,608
|
|
|||
Acquired assets pending final allocation (1)
|
|
2,181
|
|
|
—
|
|
|
2,181
|
|
|||
|
|
$
|
994,523
|
|
|
$
|
(569,146
|
)
|
|
$
|
425,377
|
|
As of October 31, 2018:
|
|
|
|
|
|
|
||||||
Reacquired franchise rights
|
|
$
|
339,719
|
|
|
$
|
(124,733
|
)
|
|
$
|
214,986
|
|
Customer relationships
|
|
256,739
|
|
|
(179,011
|
)
|
|
77,728
|
|
|||
Internally-developed software
|
|
142,147
|
|
|
(117,060
|
)
|
|
25,087
|
|
|||
Noncompete agreements
|
|
32,879
|
|
|
(30,596
|
)
|
|
2,283
|
|
|||
Franchise agreements
|
|
19,201
|
|
|
(12,694
|
)
|
|
6,507
|
|
|||
Purchased technology
|
|
54,700
|
|
|
(40,646
|
)
|
|
14,054
|
|
|||
Acquired assets pending final allocation (1)
|
|
23,879
|
|
|
—
|
|
|
23,879
|
|
|||
|
|
$
|
869,264
|
|
|
$
|
(504,740
|
)
|
|
$
|
364,524
|
|
As of April 30, 2019:
|
|
|
|
|
|
|
||||||
Reacquired franchise rights
|
|
$
|
350,410
|
|
|
$
|
(136,345
|
)
|
|
$
|
214,065
|
|
Customer relationships
|
|
274,838
|
|
|
(195,174
|
)
|
|
79,664
|
|
|||
Internally-developed software
|
|
139,239
|
|
|
(109,885
|
)
|
|
29,354
|
|
|||
Noncompete agreements
|
|
33,376
|
|
|
(31,446
|
)
|
|
1,930
|
|
|||
Franchise agreements
|
|
19,201
|
|
|
(13,334
|
)
|
|
5,867
|
|
|||
Purchased technology
|
|
54,700
|
|
|
(43,518
|
)
|
|
11,182
|
|
|||
Acquired assets pending final allocation (1)
|
|
431
|
|
|
—
|
|
|
431
|
|
|||
|
|
$
|
872,195
|
|
|
$
|
(529,702
|
)
|
|
$
|
342,493
|
|
|
|
|
|
|
|
|
12
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
|
|
|
|
|
|
(in 000s)
|
|
|||||
As of
|
|
October 31, 2019
|
|
|
October 31, 2018
|
|
|
April 30, 2019
|
|
|||
Senior Notes, 4.125%, due October 2020
|
|
$
|
650,000
|
|
|
$
|
650,000
|
|
|
$
|
650,000
|
|
Senior Notes, 5.500%, due November 2022
|
|
500,000
|
|
|
500,000
|
|
|
500,000
|
|
|||
Senior Notes, 5.250%, due October 2025
|
|
350,000
|
|
|
350,000
|
|
|
350,000
|
|
|||
Committed line of credit borrowings
|
|
135,000
|
|
|
—
|
|
|
—
|
|
|||
Debt issuance costs and discounts
|
|
(6,050
|
)
|
|
(8,672
|
)
|
|
(7,371
|
)
|
|||
|
|
1,628,950
|
|
|
1,491,328
|
|
|
1,492,629
|
|
|||
Less: Current portion
|
|
(648,651
|
)
|
|
—
|
|
|
—
|
|
|||
|
|
$
|
980,299
|
|
|
$
|
1,491,328
|
|
|
$
|
1,492,629
|
|
|
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
13
|
(in 000s)
|
|
|||||||||||||||
|
|
Three months ended October 31,
|
|
Six months ended October 31,
|
||||||||||||
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
||||
Interest income
|
|
$
|
2,225
|
|
|
$
|
4,505
|
|
|
$
|
10,251
|
|
|
$
|
9,002
|
|
Foreign currency gains (losses), net
|
|
105
|
|
|
(124
|
)
|
|
114
|
|
|
(127
|
)
|
||||
Other, net
|
|
409
|
|
|
83
|
|
|
1,497
|
|
|
131
|
|
||||
|
|
$
|
2,739
|
|
|
$
|
4,464
|
|
|
$
|
11,862
|
|
|
$
|
9,006
|
|
|
|
|
|
|
|
|
|
|
14
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
15
|
|
|
($ in 000s)
|
|
|
Cash paid for operating lease costs
|
|
$
|
99,146
|
|
Operating lease right of use assets obtained in exchange for operating lease liabilities (1)
|
|
$
|
204,962
|
|
Weighted-average remaining operating lease term (years)
|
|
3
|
|
|
Weighted-average operating lease discount rate
|
|
3.5
|
%
|
|
|
|
|
16
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
17
|
18
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
19
|
20
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
|
|
(in 000s)
|
|
|||||||||||||||||
Three months ended October 31, 2019
|
|
H&R Block, Inc.
(Guarantor) |
|
|
Block Financial
(Issuer) |
|
|
Other
Subsidiaries |
|
|
Eliminations
|
|
|
Consolidated
H&R Block |
|
|||||
Total revenues
|
|
$
|
—
|
|
|
$
|
11,750
|
|
|
$
|
152,781
|
|
|
$
|
(3,730
|
)
|
|
$
|
160,801
|
|
Cost of revenues
|
|
—
|
|
|
4,866
|
|
|
248,513
|
|
|
(173
|
)
|
|
253,206
|
|
|||||
Selling, general and administrative
|
|
1,538
|
|
|
5,290
|
|
|
147,063
|
|
|
(3,557
|
)
|
|
150,334
|
|
|||||
Total operating expenses
|
|
1,538
|
|
|
10,156
|
|
|
395,576
|
|
|
(3,730
|
)
|
|
403,540
|
|
|||||
Other income (expense), net
|
|
(188,397
|
)
|
|
9,995
|
|
|
1,209
|
|
|
179,932
|
|
|
2,739
|
|
|||||
Interest expense on external borrowings
|
|
—
|
|
|
(21,300
|
)
|
|
(6
|
)
|
|
—
|
|
|
(21,306
|
)
|
|||||
Loss from continuing operations before income tax benefit
|
|
(189,935
|
)
|
|
(9,711
|
)
|
|
(241,592
|
)
|
|
179,932
|
|
|
(261,306
|
)
|
|||||
Income tax benefit
|
|
(1,936
|
)
|
|
(2,832
|
)
|
|
(72,984
|
)
|
|
—
|
|
|
(77,752
|
)
|
|||||
Net loss from continuing operations
|
|
(187,999
|
)
|
|
(6,879
|
)
|
|
(168,608
|
)
|
|
179,932
|
|
|
(183,554
|
)
|
|||||
Net loss from discontinued operations
|
|
—
|
|
|
(4,445
|
)
|
|
—
|
|
|
—
|
|
|
(4,445
|
)
|
|||||
Net loss
|
|
(187,999
|
)
|
|
(11,324
|
)
|
|
(168,608
|
)
|
|
179,932
|
|
|
(187,999
|
)
|
|||||
Other comprehensive income
|
|
919
|
|
|
—
|
|
|
919
|
|
|
(919
|
)
|
|
919
|
|
|||||
Comprehensive loss
|
|
$
|
(187,080
|
)
|
|
$
|
(11,324
|
)
|
|
$
|
(167,689
|
)
|
|
$
|
179,013
|
|
|
$
|
(187,080
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in 000s)
|
|
|||||||||||||||||
Three months ended October 31, 2018
|
|
H&R Block, Inc.
(Guarantor) |
|
|
Block Financial
(Issuer) |
|
|
Other
Subsidiaries |
|
|
Eliminations
|
|
|
Consolidated
H&R Block |
|
|||||
Total revenues
|
|
$
|
—
|
|
|
$
|
11,458
|
|
|
$
|
142,154
|
|
|
$
|
(4,741
|
)
|
|
$
|
148,871
|
|
Cost of revenues
|
|
—
|
|
|
7,014
|
|
|
245,969
|
|
|
(2,168
|
)
|
|
250,815
|
|
|||||
Selling, general and administrative
|
|
1,476
|
|
|
2,847
|
|
|
111,569
|
|
|
(2,573
|
)
|
|
113,319
|
|
|||||
Total operating expenses
|
|
1,476
|
|
|
9,861
|
|
|
357,538
|
|
|
(4,741
|
)
|
|
364,134
|
|
|||||
Other income (expense), net
|
|
(176,485
|
)
|
|
9,018
|
|
|
(898
|
)
|
|
172,829
|
|
|
4,464
|
|
|||||
Interest expense on external borrowings
|
|
—
|
|
|
(21,126
|
)
|
|
(65
|
)
|
|
—
|
|
|
(21,191
|
)
|
|||||
Loss from continuing operations before income tax benefit
|
|
(177,961
|
)
|
|
(10,511
|
)
|
|
(216,347
|
)
|
|
172,829
|
|
|
(231,990
|
)
|
|||||
Income tax benefit
|
|
(1,685
|
)
|
|
(2,316
|
)
|
|
(57,052
|
)
|
|
—
|
|
|
(61,053
|
)
|
|||||
Net loss from continuing operations
|
|
(176,276
|
)
|
|
(8,195
|
)
|
|
(159,295
|
)
|
|
172,829
|
|
|
(170,937
|
)
|
|||||
Net loss from discontinued operations
|
|
—
|
|
|
(5,339
|
)
|
|
—
|
|
|
—
|
|
|
(5,339
|
)
|
|||||
Net loss
|
|
(176,276
|
)
|
|
(13,534
|
)
|
|
(159,295
|
)
|
|
172,829
|
|
|
(176,276
|
)
|
|||||
Other comprehensive loss
|
|
(2,846
|
)
|
|
—
|
|
|
(2,846
|
)
|
|
2,846
|
|
|
(2,846
|
)
|
|||||
Comprehensive loss
|
|
$
|
(179,122
|
)
|
|
$
|
(13,534
|
)
|
|
$
|
(162,141
|
)
|
|
$
|
175,675
|
|
|
$
|
(179,122
|
)
|
|
|
|
|
|
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
21
|
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
|
|
(in 000s)
|
|
|||||||||||||||||
Six months ended October 31, 2019
|
|
H&R Block, Inc.
(Guarantor)
|
|
|
Block Financial
(Issuer)
|
|
|
Other
Subsidiaries
|
|
|
Eliminations
|
|
|
Consolidated
H&R Block
|
|
|||||
Total revenues
|
|
$
|
—
|
|
|
$
|
28,284
|
|
|
$
|
289,840
|
|
|
$
|
(6,961
|
)
|
|
$
|
311,163
|
|
Cost of revenues
|
|
—
|
|
|
10,082
|
|
|
473,211
|
|
|
(695
|
)
|
|
482,598
|
|
|||||
Selling, general and administrative
|
|
1,538
|
|
|
8,187
|
|
|
263,011
|
|
|
(6,266
|
)
|
|
266,470
|
|
|||||
Total operating expenses
|
|
1,538
|
|
|
18,269
|
|
|
736,222
|
|
|
(6,961
|
)
|
|
749,068
|
|
|||||
Other income (expense), net
|
|
(340,149
|
)
|
|
20,492
|
|
|
15,077
|
|
|
316,442
|
|
|
11,862
|
|
|||||
Interest expense on external borrowings
|
|
—
|
|
|
(42,356
|
)
|
|
(21
|
)
|
|
—
|
|
|
(42,377
|
)
|
|||||
Loss from continuing operations before income tax benefit
|
|
(341,687
|
)
|
|
(11,849
|
)
|
|
(431,326
|
)
|
|
316,442
|
|
|
(468,420
|
)
|
|||||
Income tax benefit
|
|
(3,441
|
)
|
|
(3,010
|
)
|
|
(132,691
|
)
|
|
—
|
|
|
(139,142
|
)
|
|||||
Net loss from continuing operations
|
|
(338,246
|
)
|
|
(8,839
|
)
|
|
(298,635
|
)
|
|
316,442
|
|
|
(329,278
|
)
|
|||||
Net loss from discontinued operations
|
|
—
|
|
|
(8,968
|
)
|
|
—
|
|
|
—
|
|
|
(8,968
|
)
|
|||||
Net loss
|
|
(338,246
|
)
|
|
(17,807
|
)
|
|
(298,635
|
)
|
|
316,442
|
|
|
(338,246
|
)
|
|||||
Other comprehensive loss
|
|
(1,401
|
)
|
|
—
|
|
|
(1,401
|
)
|
|
1,401
|
|
|
(1,401
|
)
|
|||||
Comprehensive loss
|
|
$
|
(339,647
|
)
|
|
$
|
(17,807
|
)
|
|
$
|
(300,036
|
)
|
|
$
|
317,843
|
|
|
$
|
(339,647
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in 000s)
|
|
|||||||||||||||||
Six months ended October 31, 2018
|
|
H&R Block, Inc.
(Guarantor)
|
|
|
Block Financial
(Issuer)
|
|
|
Other
Subsidiaries
|
|
|
Eliminations
|
|
|
Consolidated
H&R Block
|
|
|||||
Total revenues
|
|
$
|
—
|
|
|
$
|
28,290
|
|
|
$
|
273,631
|
|
|
$
|
(7,867
|
)
|
|
$
|
294,054
|
|
Cost of revenues
|
|
—
|
|
|
12,047
|
|
|
463,087
|
|
|
(2,759
|
)
|
|
472,375
|
|
|||||
Selling, general and administrative
|
|
1,476
|
|
|
6,097
|
|
|
216,594
|
|
|
(5,108
|
)
|
|
219,059
|
|
|||||
Total operating expenses
|
|
1,476
|
|
|
18,144
|
|
|
679,681
|
|
|
(7,867
|
)
|
|
691,434
|
|
|||||
Other income (expense), net
|
|
(330,101
|
)
|
|
18,845
|
|
|
6,150
|
|
|
314,112
|
|
|
9,006
|
|
|||||
Interest expense on external borrowings
|
|
—
|
|
|
(42,249
|
)
|
|
(132
|
)
|
|
—
|
|
|
(42,381
|
)
|
|||||
Loss from continuing operations before income tax benefit
|
|
(331,577
|
)
|
|
(13,258
|
)
|
|
(400,032
|
)
|
|
314,112
|
|
|
(430,755
|
)
|
|||||
Income tax benefit
|
|
(2,631
|
)
|
|
(6,017
|
)
|
|
(102,373
|
)
|
|
—
|
|
|
(111,021
|
)
|
|||||
Net loss from continuing operations
|
|
(328,946
|
)
|
|
(7,241
|
)
|
|
(297,659
|
)
|
|
314,112
|
|
|
(319,734
|
)
|
|||||
Net loss from discontinued operations
|
|
—
|
|
|
(9,212
|
)
|
|
—
|
|
|
—
|
|
|
(9,212
|
)
|
|||||
Net loss
|
|
(328,946
|
)
|
|
(16,453
|
)
|
|
(297,659
|
)
|
|
314,112
|
|
|
(328,946
|
)
|
|||||
Other comprehensive loss
|
|
(4,577
|
)
|
|
—
|
|
|
(4,577
|
)
|
|
4,577
|
|
|
(4,577
|
)
|
|||||
Comprehensive loss
|
|
$
|
(333,523
|
)
|
|
$
|
(16,453
|
)
|
|
$
|
(302,236
|
)
|
|
$
|
318,689
|
|
|
$
|
(333,523
|
)
|
|
|
|
|
|
|
|
|
|
|
|
22
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
CONDENSED CONSOLIDATING BALANCE SHEETS
|
|
(in 000s)
|
|
|||||||||||||||||
As of October 31, 2019
|
|
H&R Block, Inc.
(Guarantor) |
|
|
Block Financial
(Issuer) |
|
|
Other
Subsidiaries |
|
|
Eliminations
|
|
|
Consolidated
H&R Block |
|
|||||
Cash & cash equivalents
|
|
$
|
—
|
|
|
$
|
4,143
|
|
|
$
|
241,169
|
|
|
$
|
—
|
|
|
$
|
245,312
|
|
Cash & cash equivalents - restricted
|
|
—
|
|
|
—
|
|
|
176,332
|
|
|
—
|
|
|
176,332
|
|
|||||
Receivables, net
|
|
—
|
|
|
36,244
|
|
|
38,466
|
|
|
—
|
|
|
74,710
|
|
|||||
Prepaid expenses and other current assets
|
|
2,812
|
|
|
3,480
|
|
|
98,766
|
|
|
—
|
|
|
105,058
|
|
|||||
Total current assets
|
|
2,812
|
|
|
43,867
|
|
|
554,733
|
|
|
—
|
|
|
601,412
|
|
|||||
Property and equipment, net
|
|
—
|
|
|
387
|
|
|
205,829
|
|
|
—
|
|
|
206,216
|
|
|||||
Operating lease right of use asset
|
|
—
|
|
|
295
|
|
|
475,674
|
|
|
—
|
|
|
475,969
|
|
|||||
Intangible assets, net
|
|
—
|
|
|
—
|
|
|
425,377
|
|
|
—
|
|
|
425,377
|
|
|||||
Goodwill
|
|
—
|
|
|
—
|
|
|
815,331
|
|
|
—
|
|
|
815,331
|
|
|||||
Deferred tax assets and income taxes receivable
|
|
2,322
|
|
|
15,953
|
|
|
127,532
|
|
|
—
|
|
|
145,807
|
|
|||||
Investments in subsidiaries
|
|
3,078,076
|
|
|
—
|
|
|
119,925
|
|
|
(3,198,001
|
)
|
|
—
|
|
|||||
Amounts due from affiliates
|
|
—
|
|
|
1,667,699
|
|
|
3,131,764
|
|
|
(4,799,463
|
)
|
|
—
|
|
|||||
Other noncurrent assets
|
|
—
|
|
|
58,773
|
|
|
27,856
|
|
|
—
|
|
|
86,629
|
|
|||||
Total assets
|
|
$
|
3,083,210
|
|
|
$
|
1,786,974
|
|
|
$
|
5,884,021
|
|
|
$
|
(7,997,464
|
)
|
|
$
|
2,756,741
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and accrued expenses
|
|
2,570
|
|
|
8,252
|
|
|
100,617
|
|
|
—
|
|
|
111,439
|
|
|||||
Accrued salaries, wages and payroll taxes
|
|
—
|
|
|
2,013
|
|
|
55,589
|
|
|
—
|
|
|
57,602
|
|
|||||
Accrued income taxes and reserves for uncertain tax positions
|
|
—
|
|
|
1,060
|
|
|
105,065
|
|
|
—
|
|
|
106,125
|
|
|||||
Current portion of long-term debt
|
|
—
|
|
|
648,651
|
|
|
—
|
|
|
—
|
|
|
648,651
|
|
|||||
Operating lease liabilities
|
|
—
|
|
|
150
|
|
|
162,747
|
|
|
—
|
|
|
162,897
|
|
|||||
Deferred revenue and other current liabilities
|
|
—
|
|
|
20,342
|
|
|
156,901
|
|
|
—
|
|
|
177,243
|
|
|||||
Total current liabilities
|
|
2,570
|
|
|
680,468
|
|
|
580,919
|
|
|
—
|
|
|
1,263,957
|
|
|||||
Long-term debt and line of credit borrowings
|
|
—
|
|
|
980,299
|
|
|
—
|
|
|
—
|
|
|
980,299
|
|
|||||
Deferred tax liabilities and reserves for uncertain tax positions
|
|
24,623
|
|
|
1,486
|
|
|
154,253
|
|
|
—
|
|
|
180,362
|
|
|||||
Operating lease liabilities
|
|
—
|
|
|
148
|
|
|
326,543
|
|
|
—
|
|
|
326,691
|
|
|||||
Deferred revenue and other noncurrent liabilities
|
|
—
|
|
|
4,648
|
|
|
76,531
|
|
|
—
|
|
|
81,179
|
|
|||||
Amounts due to affiliates
|
|
3,131,764
|
|
|
—
|
|
|
1,667,699
|
|
|
(4,799,463
|
)
|
|
—
|
|
|||||
Total liabilities
|
|
3,158,957
|
|
|
1,667,049
|
|
|
2,805,945
|
|
|
(4,799,463
|
)
|
|
2,832,488
|
|
|||||
Stockholders' equity (deficiency)
|
|
(75,747
|
)
|
|
119,925
|
|
|
3,078,076
|
|
|
(3,198,001
|
)
|
|
(75,747
|
)
|
|||||
Total liabilities and stockholders' equity
|
|
$
|
3,083,210
|
|
|
$
|
1,786,974
|
|
|
$
|
5,884,021
|
|
|
$
|
(7,997,464
|
)
|
|
$
|
2,756,741
|
|
|
|
|
|
|
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
23
|
CONDENSED CONSOLIDATING BALANCE SHEETS
|
|
(in 000s)
|
|
|||||||||||||||||
As of October 31, 2018
|
|
H&R Block, Inc.
(Guarantor)
|
|
|
Block Financial
(Issuer)
|
|
|
Other
Subsidiaries
|
|
|
Eliminations
|
|
|
Consolidated
H&R Block
|
|
|||||
Cash & cash equivalents
|
|
$
|
—
|
|
|
$
|
4,417
|
|
|
$
|
596,382
|
|
|
$
|
—
|
|
|
$
|
600,799
|
|
Cash & cash equivalents - restricted
|
|
—
|
|
|
—
|
|
|
122,507
|
|
|
—
|
|
|
122,507
|
|
|||||
Receivables, net
|
|
—
|
|
|
39,241
|
|
|
22,045
|
|
|
—
|
|
|
61,286
|
|
|||||
Prepaid expenses and other current assets
|
|
2,811
|
|
|
3,593
|
|
|
100,006
|
|
|
—
|
|
|
106,410
|
|
|||||
Total current assets
|
|
2,811
|
|
|
47,251
|
|
|
840,940
|
|
|
—
|
|
|
891,002
|
|
|||||
Property and equipment, net
|
|
—
|
|
|
524
|
|
|
241,248
|
|
|
—
|
|
|
241,772
|
|
|||||
Intangible assets, net
|
|
—
|
|
|
—
|
|
|
364,524
|
|
|
—
|
|
|
364,524
|
|
|||||
Goodwill
|
|
—
|
|
|
—
|
|
|
507,191
|
|
|
—
|
|
|
507,191
|
|
|||||
Deferred tax assets and income taxes receivable
|
|
434
|
|
|
17,941
|
|
|
112,612
|
|
|
—
|
|
|
130,987
|
|
|||||
Investments in subsidiaries
|
|
2,600,520
|
|
|
—
|
|
|
114,862
|
|
|
(2,715,382
|
)
|
|
—
|
|
|||||
Amounts due from affiliates
|
|
—
|
|
|
1,520,018
|
|
|
2,623,445
|
|
|
(4,143,463
|
)
|
|
—
|
|
|||||
Other noncurrent assets
|
|
—
|
|
|
58,288
|
|
|
39,532
|
|
|
—
|
|
|
97,820
|
|
|||||
Total assets
|
|
$
|
2,603,765
|
|
|
$
|
1,644,022
|
|
|
$
|
4,844,354
|
|
|
$
|
(6,858,845
|
)
|
|
$
|
2,233,296
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and accrued expenses
|
|
$
|
2,360
|
|
|
$
|
9,933
|
|
|
$
|
102,100
|
|
|
$
|
—
|
|
|
$
|
114,393
|
|
Accrued salaries, wages and payroll taxes
|
|
—
|
|
|
1,641
|
|
|
41,755
|
|
|
—
|
|
|
43,396
|
|
|||||
Accrued income taxes and reserves for uncertain tax positions
|
|
—
|
|
|
1,060
|
|
|
93,197
|
|
|
—
|
|
|
94,257
|
|
|||||
Deferred revenue and other current liabilities
|
|
—
|
|
|
20,409
|
|
|
163,266
|
|
|
—
|
|
|
183,675
|
|
|||||
Total current liabilities
|
|
2,360
|
|
|
33,043
|
|
|
400,318
|
|
|
—
|
|
|
435,721
|
|
|||||
Long-term debt
|
|
—
|
|
|
1,491,328
|
|
|
—
|
|
|
—
|
|
|
1,491,328
|
|
|||||
Deferred tax liabilities and reserves for uncertain tax positions
|
|
9,285
|
|
|
3,989
|
|
|
222,525
|
|
|
—
|
|
|
235,799
|
|
|||||
Deferred revenue and other noncurrent liabilities
|
|
—
|
|
|
800
|
|
|
100,973
|
|
|
—
|
|
|
101,773
|
|
|||||
Amounts due to affiliates
|
|
2,623,445
|
|
|
—
|
|
|
1,520,018
|
|
|
(4,143,463
|
)
|
|
—
|
|
|||||
Total liabilities
|
|
2,635,090
|
|
|
1,529,160
|
|
|
2,243,834
|
|
|
(4,143,463
|
)
|
|
2,264,621
|
|
|||||
Stockholders' equity (deficiency)
|
|
(31,325
|
)
|
|
114,862
|
|
|
2,600,520
|
|
|
(2,715,382
|
)
|
|
(31,325
|
)
|
|||||
Total liabilities and stockholders' equity
|
|
$
|
2,603,765
|
|
|
$
|
1,644,022
|
|
|
$
|
4,844,354
|
|
|
$
|
(6,858,845
|
)
|
|
$
|
2,233,296
|
|
|
|
|
|
|
|
|
|
|
|
|
24
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
CONDENSED CONSOLIDATING BALANCE SHEETS
|
|
(in 000s)
|
|
|||||||||||||||||
As of April 30, 2019
|
|
H&R Block, Inc.
(Guarantor)
|
|
|
Block Financial
(Issuer)
|
|
|
Other
Subsidiaries
|
|
|
Eliminations
|
|
|
Consolidated
H&R Block
|
|
|||||
Cash & cash equivalents
|
|
$
|
—
|
|
|
$
|
4,109
|
|
|
$
|
1,568,041
|
|
|
$
|
—
|
|
|
$
|
1,572,150
|
|
Cash & cash equivalents - restricted
|
|
—
|
|
|
—
|
|
|
135,577
|
|
|
—
|
|
|
135,577
|
|
|||||
Receivables, net
|
|
—
|
|
|
35,901
|
|
|
103,064
|
|
|
—
|
|
|
138,965
|
|
|||||
Prepaid expenses and other current assets
|
|
2,812
|
|
|
1,695
|
|
|
142,160
|
|
|
—
|
|
|
146,667
|
|
|||||
Total current assets
|
|
2,812
|
|
|
41,705
|
|
|
1,948,842
|
|
|
—
|
|
|
1,993,359
|
|
|||||
Property and equipment, net
|
|
—
|
|
|
552
|
|
|
211,540
|
|
|
—
|
|
|
212,092
|
|
|||||
Intangible assets, net
|
|
—
|
|
|
—
|
|
|
342,493
|
|
|
—
|
|
|
342,493
|
|
|||||
Goodwill
|
|
—
|
|
|
—
|
|
|
519,937
|
|
|
—
|
|
|
519,937
|
|
|||||
Deferred tax assets and income taxes receivable
|
|
3,218
|
|
|
15,953
|
|
|
122,808
|
|
|
—
|
|
|
141,979
|
|
|||||
Investments in subsidiaries
|
|
3,378,009
|
|
|
—
|
|
|
137,733
|
|
|
(3,515,742
|
)
|
|
—
|
|
|||||
Amounts due from affiliates
|
|
—
|
|
|
1,562,958
|
|
|
2,815,617
|
|
|
(4,378,575
|
)
|
|
—
|
|
|||||
Other noncurrent assets
|
|
—
|
|
|
54,976
|
|
|
35,109
|
|
|
—
|
|
|
90,085
|
|
|||||
Total assets
|
|
$
|
3,384,039
|
|
|
$
|
1,676,144
|
|
|
$
|
6,134,079
|
|
|
$
|
(7,894,317
|
)
|
|
$
|
3,299,945
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and accrued expenses
|
|
$
|
2,272
|
|
|
$
|
19,735
|
|
|
$
|
227,518
|
|
|
$
|
—
|
|
|
$
|
249,525
|
|
Accrued salaries, wages and payroll taxes
|
|
—
|
|
|
1,564
|
|
|
194,963
|
|
|
—
|
|
|
196,527
|
|
|||||
Accrued income taxes and reserves for uncertain tax positions
|
|
—
|
|
|
1,060
|
|
|
270,913
|
|
|
—
|
|
|
271,973
|
|
|||||
Deferred revenue and other current liabilities
|
|
—
|
|
|
21,144
|
|
|
183,832
|
|
|
—
|
|
|
204,976
|
|
|||||
Total current liabilities
|
|
2,272
|
|
|
43,503
|
|
|
877,226
|
|
|
—
|
|
|
923,001
|
|
|||||
Long-term debt
|
|
—
|
|
|
1,492,629
|
|
|
—
|
|
|
—
|
|
|
1,492,629
|
|
|||||
Deferred tax liabilities and reserves for uncertain tax positions
|
|
24,623
|
|
|
1,486
|
|
|
171,797
|
|
|
—
|
|
|
197,906
|
|
|||||
Deferred revenue and other noncurrent liabilities
|
|
—
|
|
|
793
|
|
|
144,089
|
|
|
—
|
|
|
144,882
|
|
|||||
Amounts due to affiliates
|
|
2,815,617
|
|
|
—
|
|
|
1,562,958
|
|
|
(4,378,575
|
)
|
|
—
|
|
|||||
Total liabilities
|
|
2,842,512
|
|
|
1,538,411
|
|
|
2,756,070
|
|
|
(4,378,575
|
)
|
|
2,758,418
|
|
|||||
Stockholders' equity
|
|
541,527
|
|
|
137,733
|
|
|
3,378,009
|
|
|
(3,515,742
|
)
|
|
541,527
|
|
|||||
Total liabilities and stockholders' equity
|
|
$
|
3,384,039
|
|
|
$
|
1,676,144
|
|
|
$
|
6,134,079
|
|
|
$
|
(7,894,317
|
)
|
|
$
|
3,299,945
|
|
|
|
|
|
|
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
25
|
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
|
|
(in 000s)
|
|
|||||||||||||||||
Six months ended October 31, 2019
|
|
H&R Block, Inc.
(Guarantor)
|
|
|
Block Financial
(Issuer)
|
|
|
Other
Subsidiaries
|
|
|
Eliminations
|
|
|
Consolidated
H&R Block
|
|
|||||
Net cash used in operating activities
|
|
$
|
—
|
|
|
$
|
(20,938
|
)
|
|
$
|
(672,378
|
)
|
|
$
|
—
|
|
|
$
|
(693,316
|
)
|
Cash flows from investing:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
|
—
|
|
|
—
|
|
|
(42,854
|
)
|
|
—
|
|
|
(42,854
|
)
|
|||||
Payments made for business acquisitions, net of cash acquired
|
|
—
|
|
|
—
|
|
|
(416,925
|
)
|
|
—
|
|
|
(416,925
|
)
|
|||||
Franchise loans funded
|
|
—
|
|
|
(15,868
|
)
|
|
(153
|
)
|
|
—
|
|
|
(16,021
|
)
|
|||||
Payments from franchisees
|
|
—
|
|
|
7,476
|
|
|
426
|
|
|
—
|
|
|
7,902
|
|
|||||
Intercompany borrowings (payments)
|
|
—
|
|
|
(104,742
|
)
|
|
(293,217
|
)
|
|
397,959
|
|
|
—
|
|
|||||
Other, net
|
|
—
|
|
|
(894
|
)
|
|
51,733
|
|
|
—
|
|
|
50,839
|
|
|||||
Net cash used in investing activities
|
|
—
|
|
|
(114,028
|
)
|
|
(700,990
|
)
|
|
397,959
|
|
|
(417,059
|
)
|
|||||
Cash flows from financing:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from line of credit borrowings
|
|
—
|
|
|
135,000
|
|
|
—
|
|
|
—
|
|
|
135,000
|
|
|||||
Dividends paid
|
|
(104,063
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(104,063
|
)
|
|||||
Repurchase of common stock, including shares surrendered
|
|
(190,369
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(190,369
|
)
|
|||||
Proceeds from exercise of stock options
|
|
1,215
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,215
|
|
|||||
Intercompany borrowings (payments)
|
|
293,217
|
|
|
—
|
|
|
104,742
|
|
|
(397,959
|
)
|
|
—
|
|
|||||
Other, net
|
|
—
|
|
|
—
|
|
|
(18,544
|
)
|
|
—
|
|
|
(18,544
|
)
|
|||||
Net cash provided by (used in) financing activities
|
|
—
|
|
|
135,000
|
|
|
86,198
|
|
|
(397,959
|
)
|
|
(176,761
|
)
|
|||||
Effects of exchange rates on cash
|
|
—
|
|
|
—
|
|
|
1,053
|
|
|
—
|
|
|
1,053
|
|
|||||
Net increase (decrease) in cash, including restricted balances
|
|
—
|
|
|
34
|
|
|
(1,286,117
|
)
|
|
—
|
|
|
(1,286,083
|
)
|
|||||
Cash, cash equivalents and restricted cash, beginning of period
|
|
—
|
|
|
4,109
|
|
|
1,703,618
|
|
|
—
|
|
|
1,707,727
|
|
|||||
Cash, cash equivalents and restricted cash, end of period
|
|
$
|
—
|
|
|
$
|
4,143
|
|
|
$
|
417,501
|
|
|
$
|
—
|
|
|
$
|
421,644
|
|
|
|
|
|
|
|
|
|
|
|
|
26
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
|
|
(in 000s)
|
|
|||||||||||||||||
Six months ended October 31, 2018
|
|
H&R Block, Inc.
(Guarantor)
|
|
|
Block Financial
(Issuer)
|
|
|
Other
Subsidiaries
|
|
|
Eliminations
|
|
|
Consolidated
H&R Block
|
|
|||||
Net cash used in operating activities
|
|
$
|
—
|
|
|
$
|
(22,827
|
)
|
|
$
|
(604,864
|
)
|
|
$
|
—
|
|
|
$
|
(627,691
|
)
|
Cash flows from investing:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
|
—
|
|
|
(164
|
)
|
|
(66,258
|
)
|
|
—
|
|
|
(66,422
|
)
|
|||||
Payments made for business acquisitions, net of cash acquired
|
|
—
|
|
|
—
|
|
|
(24,549
|
)
|
|
—
|
|
|
(24,549
|
)
|
|||||
Franchise loans funded
|
|
—
|
|
|
(8,740
|
)
|
|
(175
|
)
|
|
—
|
|
|
(8,915
|
)
|
|||||
Payments from franchisees
|
|
—
|
|
|
11,442
|
|
|
247
|
|
|
—
|
|
|
11,689
|
|
|||||
Intercompany borrowings (payments)
|
|
—
|
|
|
20,819
|
|
|
(203,834
|
)
|
|
183,015
|
|
|
—
|
|
|||||
Other, net
|
|
—
|
|
|
209
|
|
|
4,784
|
|
|
—
|
|
|
4,993
|
|
|||||
Net cash provided by (used in) investing activities
|
|
—
|
|
|
23,566
|
|
|
(289,785
|
)
|
|
183,015
|
|
|
(83,204
|
)
|
|||||
Cash flows from financing:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends paid
|
|
(103,484
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(103,484
|
)
|
|||||
Repurchase of common stock, including shares surrendered
|
|
(102,096
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(102,096
|
)
|
|||||
Proceeds from exercise of stock options
|
|
1,746
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,746
|
|
|||||
Intercompany borrowings (payments)
|
|
203,834
|
|
|
—
|
|
|
(20,819
|
)
|
|
(183,015
|
)
|
|
—
|
|
|||||
Other, net
|
|
—
|
|
|
(668
|
)
|
|
(21,766
|
)
|
|
—
|
|
|
(22,434
|
)
|
|||||
Net cash used in financing activities
|
|
—
|
|
|
(668
|
)
|
|
(42,585
|
)
|
|
(183,015
|
)
|
|
(226,268
|
)
|
|||||
Effects of exchange rates on cash
|
|
—
|
|
|
—
|
|
|
(3,209
|
)
|
|
—
|
|
|
(3,209
|
)
|
|||||
Net increase (decrease) in cash, including restricted balances
|
|
—
|
|
|
71
|
|
|
(940,443
|
)
|
|
—
|
|
|
(940,372
|
)
|
|||||
Cash, cash equivalents and restricted cash, beginning of period
|
|
—
|
|
|
4,346
|
|
|
1,659,332
|
|
|
—
|
|
|
1,663,678
|
|
|||||
Cash, cash equivalents and restricted cash, end of period
|
|
$
|
—
|
|
|
$
|
4,417
|
|
|
$
|
718,889
|
|
|
$
|
—
|
|
|
$
|
723,306
|
|
|
|
|
|
|
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
27
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
28
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
Consolidated – Financial Results
|
|
|
|
(in 000s, except per share amounts)
|
|
||||||||||
Three months ended October 31,
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|||||||
U.S. assisted tax preparation
|
|
$
|
41,226
|
|
|
$
|
41,652
|
|
|
$
|
(426
|
)
|
|
(1.0
|
)%
|
U.S. royalties
|
|
7,820
|
|
|
8,062
|
|
|
(242
|
)
|
|
(3.0
|
)%
|
|||
U.S. DIY tax preparation
|
|
4,541
|
|
|
2,994
|
|
|
1,547
|
|
|
51.7
|
%
|
|||
International
|
|
44,926
|
|
|
45,497
|
|
|
(571
|
)
|
|
(1.3
|
)%
|
|||
Refund Transfers
|
|
791
|
|
|
560
|
|
|
231
|
|
|
41.3
|
%
|
|||
Emerald Card®
|
|
8,616
|
|
|
9,478
|
|
|
(862
|
)
|
|
(9.1
|
)%
|
|||
Peace of Mind® Extended Service Plan
|
|
25,660
|
|
|
24,318
|
|
|
1,342
|
|
|
5.5
|
%
|
|||
Tax Identity Shield®
|
|
4,648
|
|
|
5,243
|
|
|
(595
|
)
|
|
(11.3
|
)%
|
|||
Interest and fee income on Emerald AdvanceTM
|
|
485
|
|
|
397
|
|
|
88
|
|
|
22.2
|
%
|
|||
Wave
|
|
10,902
|
|
|
—
|
|
|
10,902
|
|
|
**
|
|
|||
Other
|
|
11,186
|
|
|
10,670
|
|
|
516
|
|
|
4.8
|
%
|
|||
Total revenues
|
|
160,801
|
|
|
148,871
|
|
|
11,930
|
|
|
8.0
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Compensation and benefits:
|
|
|
|
|
|
|
|
|
|||||||
Field wages
|
|
60,993
|
|
|
59,096
|
|
|
1,897
|
|
|
3.2
|
%
|
|||
Other wages
|
|
60,744
|
|
|
50,046
|
|
|
10,698
|
|
|
21.4
|
%
|
|||
Benefits and other compensation
|
|
28,708
|
|
|
24,178
|
|
|
4,530
|
|
|
18.7
|
%
|
|||
|
|
150,445
|
|
|
133,320
|
|
|
17,125
|
|
|
12.8
|
%
|
|||
Occupancy
|
|
97,530
|
|
|
104,880
|
|
|
(7,350
|
)
|
|
(7.0
|
)%
|
|||
Marketing and advertising
|
|
9,651
|
|
|
8,586
|
|
|
1,065
|
|
|
12.4
|
%
|
|||
Depreciation and amortization
|
|
42,657
|
|
|
41,493
|
|
|
1,164
|
|
|
2.8
|
%
|
|||
Bad debt
|
|
2,035
|
|
|
188
|
|
|
1,847
|
|
|
982.4
|
%
|
|||
Other (1)
|
|
101,222
|
|
|
75,667
|
|
|
25,555
|
|
|
33.8
|
%
|
|||
Total operating expenses
|
|
403,540
|
|
|
364,134
|
|
|
39,406
|
|
|
10.8
|
%
|
|||
Other income (expense), net
|
|
2,739
|
|
|
4,464
|
|
|
(1,725
|
)
|
|
(38.6
|
)%
|
|||
Interest expense on borrowings
|
|
(21,306
|
)
|
|
(21,191
|
)
|
|
(115
|
)
|
|
(0.5
|
)%
|
|||
Pretax loss
|
|
(261,306
|
)
|
|
(231,990
|
)
|
|
(29,316
|
)
|
|
(12.6
|
)%
|
|||
Income tax benefit
|
|
(77,752
|
)
|
|
(61,053
|
)
|
|
16,699
|
|
|
27.4
|
%
|
|||
Net loss from continuing operations
|
|
(183,554
|
)
|
|
(170,937
|
)
|
|
(12,617
|
)
|
|
(7.4
|
)%
|
|||
Net loss from discontinued operations
|
|
(4,445
|
)
|
|
(5,339
|
)
|
|
894
|
|
|
16.7
|
%
|
|||
Net loss
|
|
$
|
(187,999
|
)
|
|
$
|
(176,276
|
)
|
|
$
|
(11,723
|
)
|
|
(6.7
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
BASIC AND DILUTED LOSS PER SHARE:
|
|
|
|
|
|
|
|
|
|||||||
Continuing operations
|
|
$
|
(0.93
|
)
|
|
$
|
(0.83
|
)
|
|
$
|
(0.10
|
)
|
|
(12.0
|
)%
|
Discontinued operations
|
|
(0.02
|
)
|
|
(0.03
|
)
|
|
0.01
|
|
|
33.3
|
%
|
|||
Consolidated
|
|
$
|
(0.95
|
)
|
|
$
|
(0.86
|
)
|
|
$
|
(0.09
|
)
|
|
(10.5
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
EBITDA from continuing operations (2)
|
|
$
|
(197,343
|
)
|
|
$
|
(169,306
|
)
|
|
$
|
(28,037
|
)
|
|
(16.6
|
)%
|
|
|
|
|
|
|
|
|
|
(1)
|
We reclassified $3.2 million of supplies expense from its own financial statement line to other expenses for fiscal year 2019 to conform to the current year presentation.
|
(2)
|
See "Non-GAAP Financial Information" at the end of this item for a reconciliation of non-GAAP measures.
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
29
|
Three months ended October 31,
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Consulting and outsourced services
|
|
$
|
24,284
|
|
|
$
|
17,817
|
|
|
$
|
6,467
|
|
|
36.3
|
%
|
Bank partner fees
|
|
1,373
|
|
|
1,368
|
|
|
5
|
|
|
0.4
|
%
|
|||
Client claims and refunds
|
|
9,457
|
|
|
10,098
|
|
|
(641
|
)
|
|
(6.3
|
)%
|
|||
Employee travel and related expenses
|
|
13,813
|
|
|
13,377
|
|
|
436
|
|
|
3.3
|
%
|
|||
Technology-related expenses
|
|
13,569
|
|
|
18,911
|
|
|
(5,342
|
)
|
|
(28.2
|
)%
|
|||
Credit card/bank charges
|
|
9,836
|
|
|
2,743
|
|
|
7,093
|
|
|
258.6
|
%
|
|||
Insurance
|
|
3,845
|
|
|
2,910
|
|
|
935
|
|
|
32.1
|
%
|
|||
Legal fees and settlements
|
|
13,028
|
|
|
916
|
|
|
12,112
|
|
|
1,322.3
|
%
|
|||
Supplies
|
|
5,260
|
|
|
3,189
|
|
|
2,071
|
|
|
64.9
|
%
|
|||
Other
|
|
6,757
|
|
|
4,338
|
|
|
2,419
|
|
|
55.8
|
%
|
|||
|
|
$
|
101,222
|
|
|
$
|
75,667
|
|
|
$
|
25,555
|
|
|
33.8
|
%
|
|
|
|
|
|
|
|
|
|
30
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
Consolidated - Financial Results
|
|
|
|
(in 000s, except per share amounts)
|
|
||||||||||
Six months ended October 31,
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
||||||
Revenues:
|
|
|
|
|
|
|
|
|
|||||||
U.S. assisted tax preparation
|
|
$
|
74,218
|
|
|
$
|
72,756
|
|
|
$
|
1,462
|
|
|
2.0
|
%
|
U.S. royalties
|
|
14,679
|
|
|
15,633
|
|
|
(954
|
)
|
|
(6.1
|
)%
|
|||
U.S. DIY tax preparation
|
|
7,951
|
|
|
5,775
|
|
|
2,176
|
|
|
37.7
|
%
|
|||
International
|
|
85,507
|
|
|
84,676
|
|
|
831
|
|
|
1.0
|
%
|
|||
Refund Transfers
|
|
2,300
|
|
|
1,984
|
|
|
316
|
|
|
15.9
|
%
|
|||
Emerald Card®
|
|
22,471
|
|
|
23,724
|
|
|
(1,253
|
)
|
|
(5.3
|
)%
|
|||
Peace of Mind® Extended Service Plan
|
|
58,497
|
|
|
60,895
|
|
|
(2,398
|
)
|
|
(3.9
|
)%
|
|||
Tax Identity Shield®
|
|
9,170
|
|
|
9,984
|
|
|
(814
|
)
|
|
(8.2
|
)%
|
|||
Interest and fee income on Emerald AdvanceTM
|
|
1,039
|
|
|
844
|
|
|
195
|
|
|
23.1
|
%
|
|||
Wave
|
|
14,527
|
|
|
—
|
|
|
14,527
|
|
|
**
|
|
|||
Other
|
|
20,804
|
|
|
17,783
|
|
|
3,021
|
|
|
17.0
|
%
|
|||
Total revenues
|
|
311,163
|
|
|
294,054
|
|
|
17,109
|
|
|
5.8
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Compensation and benefits:
|
|
|
|
|
|
|
|
|
|||||||
Field wages
|
|
114,796
|
|
|
109,028
|
|
|
5,768
|
|
|
5.3
|
%
|
|||
Other wages
|
|
114,581
|
|
|
97,868
|
|
|
16,713
|
|
|
17.1
|
%
|
|||
Benefits and other compensation
|
|
55,182
|
|
|
47,109
|
|
|
8,073
|
|
|
17.1
|
%
|
|||
|
|
284,559
|
|
|
254,005
|
|
|
30,554
|
|
|
12.0
|
%
|
|||
Occupancy
|
|
189,682
|
|
|
195,606
|
|
|
(5,924
|
)
|
|
(3.0
|
)%
|
|||
Marketing and advertising
|
|
16,430
|
|
|
15,480
|
|
|
950
|
|
|
6.1
|
%
|
|||
Depreciation and amortization
|
|
81,262
|
|
|
81,925
|
|
|
(663
|
)
|
|
(0.8
|
)%
|
|||
Bad debt
|
|
1,067
|
|
|
(670
|
)
|
|
1,737
|
|
|
**
|
|
|||
Other (1)
|
|
176,068
|
|
|
145,088
|
|
|
30,980
|
|
|
21.4
|
%
|
|||
Total operating expenses
|
|
749,068
|
|
|
691,434
|
|
|
57,634
|
|
|
8.3
|
%
|
|||
Other income (expense), net
|
|
11,862
|
|
|
9,006
|
|
|
2,856
|
|
|
31.7
|
%
|
|||
Interest expense on borrowings
|
|
(42,377
|
)
|
|
(42,381
|
)
|
|
4
|
|
|
—
|
%
|
|||
Pretax loss
|
|
(468,420
|
)
|
|
(430,755
|
)
|
|
(37,665
|
)
|
|
(8.7
|
)%
|
|||
Income tax benefit
|
|
(139,142
|
)
|
|
(111,021
|
)
|
|
28,121
|
|
|
25.3
|
%
|
|||
Net loss from continuing operations
|
|
(329,278
|
)
|
|
(319,734
|
)
|
|
(9,544
|
)
|
|
(3.0
|
)%
|
|||
Net loss from discontinued operations
|
|
(8,968
|
)
|
|
(9,212
|
)
|
|
244
|
|
|
2.6
|
%
|
|||
Net loss
|
|
$
|
(338,246
|
)
|
|
$
|
(328,946
|
)
|
|
$
|
(9,300
|
)
|
|
(2.8
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
BASIC AND DILUTED LOSS PER SHARE:
|
|
|
|
|
|
|
|
|
|||||||
Continuing operations
|
|
$
|
(1.65
|
)
|
|
$
|
(1.55
|
)
|
|
$
|
(0.10
|
)
|
|
(6.5
|
)%
|
Discontinued operations
|
|
(0.04
|
)
|
|
(0.04
|
)
|
|
—
|
|
|
—
|
%
|
|||
Consolidated
|
|
$
|
(1.69
|
)
|
|
$
|
(1.59
|
)
|
|
$
|
(0.10
|
)
|
|
(6.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
||||||
EBITDA from continuing operations (2)
|
|
$
|
(344,781
|
)
|
|
$
|
(306,449
|
)
|
|
$
|
(38,332
|
)
|
|
(12.5
|
)%
|
|
|
|
|
|
|
|
|
|
(1)
|
We reclassified $5.4 million of supplies expense from its own financial statement line to other expenses for fiscal year 2019 to conform to the current year presentation.
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
31
|
Six months ended October 31,
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Consulting and outsourced services
|
|
$
|
42,473
|
|
|
$
|
38,632
|
|
|
$
|
3,841
|
|
|
9.9
|
%
|
Bank partner fees
|
|
2,855
|
|
|
2,833
|
|
|
22
|
|
|
0.8
|
%
|
|||
Client claims and refunds
|
|
18,701
|
|
|
22,720
|
|
|
(4,019
|
)
|
|
(17.7
|
)%
|
|||
Employee travel and related expenses
|
|
22,238
|
|
|
20,206
|
|
|
2,032
|
|
|
10.1
|
%
|
|||
Technology-related expenses
|
|
30,979
|
|
|
30,677
|
|
|
302
|
|
|
1.0
|
%
|
|||
Credit card/bank charges
|
|
13,828
|
|
|
5,146
|
|
|
8,682
|
|
|
168.7
|
%
|
|||
Insurance
|
|
8,239
|
|
|
6,299
|
|
|
1,940
|
|
|
30.8
|
%
|
|||
Legal fees and settlements
|
|
16,301
|
|
|
3,489
|
|
|
12,812
|
|
|
367.2
|
%
|
|||
Supplies
|
|
8,546
|
|
|
5,393
|
|
|
3,153
|
|
|
58.5
|
%
|
|||
Other
|
|
11,908
|
|
|
9,693
|
|
|
2,215
|
|
|
22.9
|
%
|
|||
|
|
$
|
176,068
|
|
|
$
|
145,088
|
|
|
$
|
30,980
|
|
|
21.4
|
%
|
|
|
|
|
|
|
|
|
|
32
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
|
|
(in 000s)
|
|
|||||
Six months ended October 31,
|
|
2019
|
|
|
2018
|
|
||
Net cash used in:
|
|
|
|
|
||||
Operating activities
|
|
$
|
(693,316
|
)
|
|
$
|
(627,691
|
)
|
Investing activities
|
|
(417,059
|
)
|
|
(83,204
|
)
|
||
Financing activities
|
|
(176,761
|
)
|
|
(226,268
|
)
|
||
Effects of exchange rates on cash
|
|
1,053
|
|
|
(3,209
|
)
|
||
Net change in cash, cash equivalents and restricted cash
|
|
$
|
(1,286,083
|
)
|
|
$
|
(940,372
|
)
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
33
|
As of
|
|
October 31, 2019
|
|
April 30, 2019
|
||||||||
|
|
Short-term
|
|
Long-term
|
|
Outlook
|
|
Short-term
|
|
Long-term
|
|
Outlook
|
Moody's
|
|
P-3
|
|
Baa3
|
|
Negative
|
|
P-3
|
|
Baa3
|
|
Negative
|
S&P
|
|
A-2
|
|
BBB
|
|
Stable
|
|
A-2
|
|
BBB
|
|
Stable
|
34
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
|
|
|
|
|
|
|
|
(in 000s)
|
|
|||||||
|
|
Three months ended October 31,
|
|
Six months ended October 31,
|
||||||||||||
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
||||
Net loss - as reported
|
|
$
|
(187,999
|
)
|
|
$
|
(176,276
|
)
|
|
$
|
(338,246
|
)
|
|
$
|
(328,946
|
)
|
Discontinued operations, net
|
|
4,445
|
|
|
5,339
|
|
|
8,968
|
|
|
9,212
|
|
||||
Net loss from continuing operations - as reported
|
|
(183,554
|
)
|
|
(170,937
|
)
|
|
(329,278
|
)
|
|
(319,734
|
)
|
||||
Add back:
|
|
|
|
|
|
|
|
|
||||||||
Income taxes of continuing operations
|
|
(77,752
|
)
|
|
(61,053
|
)
|
|
(139,142
|
)
|
|
(111,021
|
)
|
||||
Interest expense of continuing operations
|
|
21,306
|
|
|
21,191
|
|
|
42,377
|
|
|
42,381
|
|
||||
Depreciation and amortization of continuing operations
|
|
42,657
|
|
|
41,493
|
|
|
81,262
|
|
|
81,925
|
|
||||
|
|
(13,789
|
)
|
|
1,631
|
|
|
(15,503
|
)
|
|
13,285
|
|
||||
EBITDA from continuing operations
|
|
$
|
(197,343
|
)
|
|
$
|
(169,306
|
)
|
|
$
|
(344,781
|
)
|
|
$
|
(306,449
|
)
|
|
|
|
|
|
|
|
|
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
35
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
36
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
(in 000s, except per share amounts)
|
|
|||||||||||||
|
|
Total Number of
Shares Purchased (1) |
|
|
Average
Price Paid per Share |
|
|
Total Number of Shares
Purchased as Part of Publicly Announced Plans or Programs (2) |
|
|
Maximum Dollar Value of
Shares that May Yet Be Purchased Under the Plans or Programs (2) |
|
||
August 1 - August 31
|
|
250
|
|
|
$
|
24.26
|
|
|
244
|
|
|
$
|
948,518
|
|
September 1 - September 30
|
|
4,105
|
|
|
$
|
24.12
|
|
|
4,105
|
|
|
$
|
849,515
|
|
October 1 - October 31
|
|
1,371
|
|
|
$
|
23.30
|
|
|
1,371
|
|
|
$
|
817,568
|
|
|
|
5,726
|
|
|
$
|
23.93
|
|
|
5,720
|
|
|
|
||
|
|
|
|
|
|
|
|
|
(1)
|
We purchased approximately 6 thousand shares in connection with funding employee income tax withholding obligations arising upon the lapse of restrictions on restricted shares and restricted share units.
|
(2)
|
In September 2015, we announced that our Board of Directors approved a $3.5 billion share repurchase program, effective through June 2019. In June 2019, our Board of Directors extended the share repurchase program through June 2022.
|
10.1
|
31.1
|
31.2
|
32.1
|
32.2
|
101.INS
|
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
101.SCH
|
Inline XBRL Taxonomy Extension Schema
|
101.CAL
|
Inline XBRL Extension Calculation Linkbase
|
101.LAB
|
Inline XBRL Taxonomy Extension Label Linkbase
|
101.PRE
|
Inline XBRL Taxonomy Extension Presentation Linkbase
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase
|
104
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
|
H&R Block, Inc. | Q2 FY2020 Form 10-Q
|
37
|
H&R BLOCK, INC.
|
|
/s/ Jeffrey J. Jones II
|
Jeffrey J. Jones II
|
President and Chief Executive Officer
|
December 6, 2019
|
|
/s/ Tony G. Bowen
|
Tony G. Bowen
|
Chief Financial Officer
|
December 6, 2019
|
|
/s/ Kellie J. Logerwell
|
Kellie J. Logerwell
|
Chief Accounting Officer
|
December 6, 2019
|
38
|
Q2 FY2020 Form 10-Q | H&R Block, Inc.
|
(a)
|
“Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of Regulation 12B under the Securities Exchange Act of 1934, as amended.
|
(b)
|
“Base Compensation” means a Participant’s annual base salary plus Participant’s annual target short-term incentive opportunity.
|
(c)
|
“Board” means the Board of Directors of HRB.
|
(d)
|
“Cause” means any of the following unless, if capable of cure, such events are fully corrected in all material respects by Participant within ten (10) days after the Company provides notice of the occurrence of such event:
|
(i)
|
A Participant’s misconduct that materially interferes with or materially prejudices the proper conduct of the business of the Company;
|
(ii)
|
A Participant’s commission of an act materially and demonstrably detrimental to the good will of the Company;
|
(iii)
|
A Participant’s commission of any act of dishonesty or breach of trust resulting or intending to result in material personal gain or enrichment of the Participant at the expense of the Company;
|
(iv)
|
A Participant’s violation of any non-competition, non-solicitation, confidentiality or similar restrictive covenant under any employment-related agreement, plan or policy with respect to which the Participant is a party or is bound; or
|
(v)
|
A Participant’s conviction of, or plea of guilty or nolo contendere to, a misdemeanor involving an act of moral turpitude or a felony.
|
(e)
|
“Change in Control” means the occurrence of one or more of the following events:
|
(i)
|
Any one person, or more than one person acting as a group, acquires ownership of stock of HRB that, together with stock held by such person or group, constitutes more than 50 percent of the total fair market value or total voting power of the stock of HRB. If any one person, or more than one person acting as a group, is considered to own more than 50 percent of the total fair market value or total voting power of the stock of HRB, the acquisition of additional stock by the same person or persons shall not be considered to cause a Change in Control. An increase in the percentage of stock owned by any one person, or persons acting as a group, as a result of a transaction in which HRB acquires its stock in exchange for property will be treated as an acquisition of stock for purposes of this Section 2(e)(i).
|
(ii)
|
Any one person, or more than one person acting as a group, acquires (when combined with all other acquisitions of HRB stock acquired during the twelve (12) month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of HRB possessing 35 percent or more of the total voting power of the stock of HRB. If any one person, or more than one person acting as a group, is considered to effectively control a corporation within the meaning of Treasury Regulation §1.409A-3(i)(5)(vi), the acquisition of additional control of the corporation by the same person or persons is not considered to cause a change in
|
(iii)
|
A majority of members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by two-thirds (2/3) of the members of the Board before the date of such appointment or election.
|
(iv)
|
Any one person, or more than one person acting as a group, acquires (when combined with all other acquisitions of HRB assets acquired during the twelve (12) month period ending on the date of the most recent acquisition by such person or persons) assets from HRB that have a total gross fair market value equal to or more than 50 percent of the total gross fair market value of all of the assets of HRB immediately before such acquisition or acquisitions. For this purpose, gross fair market value means the value of the assets of HRB, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets. Notwithstanding the foregoing, there is no Change in Control event under this Section 2(e)(iv) when there is a transfer to an entity that is controlled by the shareholders of HRB immediately after the transfer. A transfer of assets by HRB is not treated as a change in the ownership of such assets if the assets are transferred to: (a) a shareholder of HRB (immediately before the asset transfer) in exchange for or with respect to its stock; (b) an entity, 50 percent or more of the total value or voting power of which is owned, directly or indirectly, by HRB; (c) a person, or more than one person acting as a group, that owns, directly or indirectly, 50 percent or more of the total value or voting power of all the outstanding stock of HRB; or (d) an entity, at least 50 percent of the total value or voting power of which is owned, directly or indirectly, by a person described in (c) above.
|
(f)
|
“Change in Control Termination” means a Participant’s Qualifying Termination or Good Reason Termination, in either event within seventy-five (75) days immediately preceding or within eighteen (18) months immediately following a Change in Control.
|
(g)
|
“COBRA Subsidy” means an amount equal to the Participant’s monthly post-employment premium for health and welfare benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) less the amount paid from time to time by active employees for similar coverage. To be eligible for the COBRA Subsidy, the Participant must be enrolled in the Participating Employer’s health and welfare plans on the date of Separation from Service.
|
(h)
|
“Code” means the Internal Revenue Code of 1986, as amended.
|
(i)
|
“Company” means HRB and its Affiliates.
|
(j)
|
“Comparable Position” means a position where:
|
(i)
|
the primary work location is within 50 miles of the Participant’s primary work location prior to the Qualifying Termination; and
|
(ii)
|
the Base Compensation is not more than 10% below the Participant’s compensation rate at the time of the Qualifying Termination.
|
(k)
|
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
|
(l)
|
“Good Reason Termination” means a Separation from Service:
|
(i)
|
which is initiated by the Participant within seventy-five (75) days immediately preceding or within eighteen (18) months immediately following a Change in Control on account of one or more of the following conditions occurring within that same time frame:
|
(ii)
|
for which the Participant does not consent to the condition referenced in (i) above; and
|
(iii)
|
for which the Company does not substantially remedy the condition (as described in this section).
|
(m)
|
“HRB” means H&R Block, Inc., a Missouri corporation.
|
(n)
|
“Initial Effective Date” means May 12, 2009.
|
(o)
|
“Monthly Compensation” means a Participant’s highest annual base salary as of the Change in Control or during the twelve (12) month period immediately preceding his or her Termination Date divided by twelve (12). For the avoidance of doubt “annual base salary” does not include bonuses, incentive compensation, or compensation received pursuant to any equity award.
|
(p)
|
“Participant” means an associate of the Company whose participation in the Plan is approved by the Compensation Committee of the Board (or other committee appointed by the Board to administer the Plan pursuant to Section 18).
|
(q)
|
“Payment Deadline” means the date which is sixty (60) days after the Termination Date.
|
(r)
|
“Plan” means this H&R Block, Inc. Executive Severance Plan, as amended from time to time. This document serves as both the legal plan document and summary plan description.
|
(s)
|
“Plan Administrator” and “Plan Sponsor” means H&R Block Management, LLC. The address and telephone number of H&R Block Management, LLC is One H&R Block Way, Kansas City, Missouri 64105, (816) 854-3000.
|
(t)
|
“Qualifying Termination” means the involuntary Separation from Service by the Company under circumstances not constituting Cause but does not include:
|
(i)
|
the elimination of the Participant’s position where the Participant was offered a Comparable Position with the Company or with a party that acquires any asset from the Company (or a subsidiary or an affiliate of such a party),
|
(ii)
|
the redefinition of a Participant’s position to a lower compensation rate or grade; or
|
(iii)
|
the Participant’s Separation from Service due to death or disability.
|
(u)
|
“Release Agreement” means the release agreement, substantially in the form set forth as Exhibit A to this Plan, which a Participant shall be required to execute as a condition to receiving payments and benefits under this Plan.
|
(v)
|
“Separation from Service” means the date that a Participant separates from service within the meaning of Section 409A of the Code and Treasury Regulation §1.409A-1(h).
|
(w)
|
“Termination Date” means the effective date of a Participant’s Separation from Service.
|
(x)
|
“Year(s) of Service” means each period of twelve (12) consecutive months of employment measured from the Participant’s employment commencement date. In determining a Participant’s Years of Service, the Participant will be credited with a partial Year of Service for his or her final period of employment commencing on his or her most recent employment anniversary date equal to a fraction calculated in accordance with the following formula:
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(i)
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may review pertinent documents;
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(ii)
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may submit written comments or other documents; and/or
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(iii)
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may request a hearing, which the Board, in its sole discretion, may grant.
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Entity Name
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Title
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Date:
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December 6, 2019
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/s/ Jeffrey J. Jones II
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Jeffrey J. Jones II
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Chief Executive Officer
H&R Block, Inc.
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Date:
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December 6, 2019
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/s/ Tony G. Bowen
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Tony G. Bowen
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Chief Financial Officer
H&R Block, Inc.
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Jeffrey J. Jones II
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Jeffrey J. Jones II
Chief Executive Officer
H&R Block, Inc.
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December 6, 2019
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Tony G. Bowen
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Tony G. Bowen
Chief Financial Officer
H&R Block, Inc.
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December 6, 2019
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