H&R Block, Inc. (NYSE:HRB) Q1 2021 Earnings Conference Call - Final Transcript
Sep 01, 2020 • 04:30 pm ET
of Morgan Stanley. Your question, please.
Hey, guys. Just thinking about the assisted trajectory going forward, maybe just help us with what type of recovery you're expecting from here. So, I mean are you expecting a return to 2019 volumes or maybe it's -- maybe a return to some place in between 2019 and 2020? And I know you're not providing any specific numbers. But just in broad strokes, how should we think about the pace of recovery from here on the assisted side, given COVID seems to -- at least this year seems to have altered the path forward in that business?
Jeffrey J. Jones II
Yeah. Thanks for the question. Obviously, a few different pieces there. Let me just start with this is the second year of making real changes to our assisted business on the price/value relationship, the quality of execution, digitizing the way we can serve customers, and you may remember that in mid-March when we had our call, we were on track to deliver our year, which meant holding share in the category which was a real improvement year-over-year in the assisted business. Obviously, that got derailed a bit. But nevertheless, we're very pleased with how we ended the year.
What we're doing now is really trying to develop multiple different scenarios, given potential variables in the industry. And starting with a large, large number of filers that were EIP-only. When you remove those from the mix and you start looking at unemployment rates for next year, how long and how rich the state and Fed unemployment benefits remain, what the operating environment looks like in next tax season, and that's obviously a variable that could go different ways. When you net all of that, we're expecting the industry to be flat to down slightly next year.
Our goal remains to grow the business. To grow assisted clients, and we think we're on a nice trajectory to do that, there are many variables obviously that are weighing on next year. And that's how we're thinking about the industry overall and the scenarios that we have to develop. And again, in December, we'll be providing our exact outlook on the year.
Okay. That was all great. And I think this one is for Tony. It just looked like you got a lot of leverage on your field wages line item relative to your overall revenue growth this quarter. So, were there any added efficiencies in there that could be more permanent in nature? Just what was really driving that leverage?
Yeah. I mean obviously, there is a challenging environment to try to think about how we were going to staff offices, given unprecedented -- no history to really guide us, but we went into the quarter expecting a certain efficiency level. We did a lot better than what we even thought. Part of that was volume related in the assisted side where we just had more returns and more clients that we served, which was a good thing. We also