H&R Block, Inc. (NYSE:HRB) Q3 2015 Earnings Conference Call - Final Transcript

Mar 04, 2015 • 04:30 pm ET


H&R Block, Inc. (NYSE:HRB) Q3 2015 Earnings Conference Call - Final Transcript


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Good afternoon. My name is Kevin, and I will be your conference operator today. At this time, I would like to welcome everyone to the Third Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions]

Thank you.

Colby Brown

Thank you, Kevin. Good afternoon, everyone, and thank you for joining us to discuss our third quarter fiscal 2015 results. Joining me on the call today are Bill Cobb, our President and CEO; and Greg Macfarlane, our CFO; Jason Houseworth, President, Global Digital & Product Management; and Mark Ciaramitaro, Vice President, Health Care will be available during the Q&A session.

In connection with this call, we have posted today's press release on the Investor Relations website, at hrblock.com. Some of the figures that we'll discuss today are presented on a non-GAAP basis. We've reconciled the comparable GAAP and non-GAAP figures in the schedules attached to our press release.

Before we begin our prepared remarks, I'd like to remind everyone, this call will include forward-looking statements as defined under the securities laws. Such statements are based on current information and management's expectations as of this date, and are not guarantees of future performance.

Forward-looking statements involve certain risks, uncertainties and assumptions that are difficult to predict. As a result, our actual outcomes and results could differ materially. You can learn more about these risks in our Form 10-K for fiscal 2014 and our other SEC filings. H&R Block undertakes no obligation to publicly update these risk factors or forward-looking statements.

With that, I'll now turn the call over to Bill.

William C. Cobb

Thanks, Colby, and good afternoon, everyone. Earlier today, we announced our results for the fiscal 2015 third quarter, which ended January 31. The IRS opened e-file earlier this January than it did last year, which allowed us to recognize additional revenue in the third quarter compared to last year's quarter. Of course, because of the seasonality of our business, our third quarter results are not indicative of our expected full-year performance.

Greg will provide more details on our fiscal third quarter later during this call. As has become the norm in our industry, the tax season is off to an interesting start. We entered this season with the Affordable Care Act featured prominently in the news. This soon gave way to market disruptions in the DIY category, due to pricing actions taken by our competitor.

Finally, industry-wide DIY tax fraud, which we have been discussing for some time, became a key focus this season. With our top competitor in the DIY space, saying they're seeing as much as 3,700% increase in DIY fraud related to tax refunds in some states. I'd like to spend the next several minutes talking about what we've seen in the industry this year, specifically focusing on the Affordable Care Act and fraud, and then I'll provide some thoughts on our performance.

Let's start with the ACA, which represents the largest change