Kansas City, Mo. (Jun 14, 2002) -- Bolstered by an accounting change, tax prep giant H&R Block Inc. reported a 55 percent jump in net earnings for the year, and an 11.3 percent increase in revenue.
The Kansas City, Mo.-based company also announced that its chairman, Frank L. Salizzoni, would retire effective at the close of its annual shareholder meeting in September. The board did not name a successor, and said it would reduce its size from 10 to nine directors as a result of Salizzoni's retirement.Block reported net earnings for the fiscal year ended April 30 of $434.4 million, up from $281.2 million, bolstered in part by its early adoption of Statement of Financial Accounting Standards (SFAS) No. 141 and 142, which the firm noted improved net earnings for fiscal year 2002 by $47.9 million, or 26 cents per diluted share. Net earnings per diluted share increased 52 percent to $2.31, up 79 cents per share from the prior year.

Revenue for the fiscal year rose to $3.3 billion. Fourth quarter revenue totaled $1.9 billion, an 11.7 percent increase over the prior year's fourth quarter, while net earnings totaled $463.6 million, up 22.6 percent. Earnings per diluted share rose 21.8 percent for the quarter to $2.46. Block said it expects earnings per diluted share for fiscal year 2003 to increase to $2.60 to $2.75. The firm's board also approved a 12.5 percent increase in the quarterly cash dividend.

Salizzoni, who is credited with developing Block's strategy to expand into mortgage and accounting services, became chairman in September 2000, succeeding co-founder Henry W. Bloch. Prior to that, he served as Block's president and chief executive officer. Salizzoni has served on H&R Block's board of directors since 1988.

"Frank led this company at a very critical time in its history," said Mark A. Ernst, president and chief executive officer. "We are very grateful for his contributions toward our change from a tax preparation firm to a financial services provider."

-- Electronic Accountant Newswire staff

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