July 29, 2021September 22, 2022
Dear Fellow Shareholders,
2022 was another great year for H&R Block. As described in detail in our nation begins to emerge from2022 Annual Report, virtually all aspects of our business did exceptionally well as we refine and execute upon our Block Horizons 2025 strategy. And, as a result, calendar 2022 is also the COVID-19 pandemic, I am pleased to report thatyear our share price finally reflects the significant progress we have made.
For calendar 2022, through the end of August, with the broader stock market down about 17% (the worst market decline since the Great Recession of 2008), your company’s share price has increased 91%. To put this data in a broader context, on December 31, 2021, the market value of our company had its best overall year in morewas slightly less than $4 billion. As of September 20, 2022, at a decade. Based on activity through May 18, to account for the extended tax season 2021, we grew market share both overallprice of $44.94, it is over $7 billion.
This is an extraordinary performance, and in the Assisted tax category; DIY revenue increased year over year; we continued to broadenyour Board couldn’t be prouder of President and improve our digital services for both assistedCEO Jeff Jones, his Senior Leadership Team, and DIY customers; and Wave revenue growth returned to pre-pandemic levels.
None of these achievements would have been possible without the “above and beyond the call of duty” performance by all of our associates and franchisees. Working again under the continuing challenges of the COVID pandemic, the entire H&R Block community collaborated to ensure that our over 20 million US tax customers promptly received not only their refunds, but also—very importantly—the stimulus payments which have proven so critical to our nation’s economic recovery. I know all of you will join meus in conveying our sincere thanksrecognizing a job exceptionally well done.
Our success has enabled us to our CEO Jeff Jones, his senior management team, and the rest of our outstanding organization.
Making a great tax preparation business even greater is but one leg of our Block Horizons 2025 strategy for growth. Through both Block Advisors and Wave, we are moving aggressivelygive back to leverage and expand our more than two million small businesses we serve today. As we enhance the scope of these services, certifying 25,000 of our tax professionals as small business specialists, developing our small business oriented hybrid tax preparation products, and adding bookkeeping and payroll services, we are well on our way to serving a greater share of the 32 million small businesses in America.
And just as we are growing our small business capabilities, we are also building a capability to service the more than 30 million underbanked Americans, including eight million of our own tax preparation customers. We are building a mobile banking platform we expect to launch in beta form by the end of this calendar year. In the years ahead, we expect this product to meaningfully enhance our financial product revenues.
Giving Back is the cornerstone of our compact with all stakeholders. For you, our shareholders, Giving Back meansmore directly through increasing dividends and a 4%consistent program of share repurchases. In August, the Board authorized the 4th dividend increase—our fifth increase in sixthe last 5 years to a quarterly rate of $0.29 per share. We also approved a new $1.25 billion authorization for share repurchases, building upon a total increaseprogram that has resulted in repurchasing nearly a third of 35% in that time frame. It means $188 million in share buybacks during fiscal 2021, and nearly $1 billionoutstanding shares since 2017. And finally, as2016.
The headline for 2022 must of this writing (July 15th), it means a share price increase of more than 50% sincecourse be the start of 2021.
For the restperformance of our stakeholders, Giving Back means pursuingbusiness, but the Board is equally proud of the contributions the company and enhancingits associates and franchisees make in the legacythousands of Henrycommunities where we do business. Established company-wide programs such as Make Every Block Better are further enhanced by our strong corporate culture of caring, inclusion, and Richard Bloch, our founders, who were devoted to making our communities—andvolunteering. Indeed, the world at large—better places for all people. Our 2021 Annual Report and our Corporate Responsibility Report detailhelp that is provided daily throughout the broad range of waysH&R Block universe may in fact be the most prevalent way we contribute.make a difference.
Finally, a few wordsbrief word about yourthe Board of Directors. First, I want to acknowledge the enormous contributions of three individuals who have served as outstanding board members for, collectively, nearly four decades. David Baker Lewis stepped down last March and Paul Brown and Bruce Rohdewe are not candidatesrecommending for re-election this year. OverI believe the shareholders are fortunate to be represented by such a distinguished group of individuals. They are intelligent, diverse, and are all leaders in their respective fields. Along similar lines, I want to thank Christy Wood, who is not standing for re-election, for her diligence and dedication during her 14 years David, Paulof service on the Board.
I share with Jeff and Bruce provided invaluable advicehis team the conviction that this past year, while exceptional, is only the beginning. We are continuing to deliver strong results in our core tax business and played important leadership roles as committee chairs. It is a privilege to have worked with them and we will miss them, both professionally and personally.
Atare gaining traction in Block Horizons, our long-term strategic transformation, built on the same time, it is testimony to the vitality of our company and its leadershipfoundation that we are ablecan serve more customers in more ways by better leveraging our existing assets to attract new board members like Sean Cohanbecome a trusted partner year-round. H&R Block’s future is very bright. I am proud to be a part of it and Mia Mends, who are appearing on our slate for the first time. Sean and Mia joined the Board earlier this year and have already made substantial contributions. I trust you will agree that they are eminently qualifiedmost thankful to serve and represent you, our shareholders.
In conclusion, thankall of you for your loyalty and support. All of us on the Board are proud to serve. As always, we are available for your questions or comments.
Best regards,
Robert A. Gerard
Chairman of the Board
