H&R Block in the black

LONDON (ShareCast) - Tax preparation company H&R Block returned to profitability after shutting down its sub-prime lending business last year.

Earnings from continuing operations in the three months to end-April 2008 rose to $691.1m from $591.2m a year earlier, on revenues that grew 11% to $2.6bn.

Earnings per share from continuing operations in the company's fourth quarter rose to $2.11 from $1.81.

Full-year earnings per share rose 21% to $1.39 from $1.15 in the preceding year and exceeded management's expectations.

The company took a $763,1m hit during fiscal 2008, equivalent to $2,33 per share, from discontinued operations. Fourth quarter losses from discontinued operations totalled $147.6m, or 45 cents a share.

The losses represent provisions related to the company's discontinued sub-prime lending business. The company closed Option One for new business in December and sold off its mortgage servicing business in April 2008.

The company said it expects full-year earnings per share next year to be in the range of $1.60 to $1.70.

"While we are not providing earnings guidance beyond fiscal 2009, we are confident that for the three-year horizon through fiscal 2011, we can realise significant gains in earnings per share through unit growth, greater efficiency in our tax and other operations, and capital deployment, rather than relying solely on annual price increases for growth," said interim chief executive officer Alan Bennett.

Source: http://uk.biz.yahoo.com/080630/214/i2lja.html