On Nov. 30, after the market closed, tax preparer H&R Block (NYSE:HRB) released fiscal second-quarter 2006 earnings for the period ended Oct. 31.

  • Total revenue fell 6.9% to $563.2 million. Core tax-service revenue grew 2%, and business service sales grew 37%, but mortgage services continue to be a thorn in the side of overall operations -- revenue fell 40% at that unit.
  • The company reported a total loss of $0.49 per diluted share, but this type of showing is common in the first and second fiscal quarters, which fall outside the lucrative tax season.
  • Management lowered its revenue guidance on Nov. 6 because of mortgage woes and now expects fiscal 2007 earnings of $1.20-$1.45 per share.
  • Check out our Foolish Take on H&R Block's current state of affairs.

(Figures in thousands, except per-share data)

Income Statement Highlights

Avg. Est.

Q2 2006

Q2 2005







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Diluted Shares




For the 13 weeks ended Oct. 31, 2006, and Oct. 31, 2005.

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Margin Checkup

Q2 2006

Q2 2005


Operating Margin




Net Margin




*Expressed in percentage points.

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Balance Sheet Highlights


Q2 2006

Q2 2005


Cash + ST Invest.




Accounts Rec.





Q2 2006

Q2 2005


Accounts Payable




Long-Term Debt




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Cash Flow Highlights

YTD 2006

YTD 2005


Cash From Ops.




Capital Expenditures




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For the six months ended Oct. 31, 2006, and Oct. 31, 2005.

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Fool contributor Ryan Fuhrmann has no financial interest in any company mentioned. Feel free to email him with feedback or to discuss any companies mentioned further. The Fool has an ironclad disclosure policy.