H&R Block, Inc.

Thank you for standing by and welcome to H&R Block's fourth quarter fiscal year 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. To remove yourself from the queue, you may press star 1-1 again. I would now like to hand the call over to Michaela Galena, Vice President, Investor Relations. Please go ahead.

Thank you, operator. Good afternoon, everyone, and welcome to H&R Block's fiscal year 2024 financial results conference call. Joining me today are Jeff Jones, our president and chief executive officer, and Tony Bowen, our chief financial officer. Earlier today, we issued a press release and presentation that can be downloaded or viewed live on our website at investors.hrblock.com. Our call is being broadcast and webcast live, and a replay of the webcast will be available for 90 days. Before we begin, I'd like to remind listeners that comments made by management may include forward-looking statements within the meaning of federal securities laws. These statements involve material risks and uncertainties, and actual results could differ from those projected in any forward-looking statement due to numerous factors. For a description of these risks and uncertainties, please see H&R Block's Annual Report on Form 10-K and quarterly reports on Form 10-Q, as updated periodically with our other SEC filings. Please note, some metrics we'll discuss today are presented on a non-GAAP basis. We've reconciled the comparable GAAP and non-GAAP figures in the appendix of our presentation. Finally, the content of this call contains time-sensitive information, accurate only as of today, August 15, 2024. H&R Block undertakes no obligation to revise or otherwise update any statement to reflect events or circumstances after the date of this call. With that, I will now turn it over to Jeff.

Good afternoon, everyone, and thanks for joining us today. We will begin by sharing our results for the full fiscal year and the progress we continue to make on our Block Horizons imperatives. Then Tony will discuss our financial performance and outlook for fiscal 25, and then we'll open it up for Q&A. Beginning with our fiscal 24 results, I am pleased that we were able to deliver another year of revenue growth, EBITDA that grows even faster, and double-digit EPS growth. Our DIY business continued its momentum with market share gains for the second consecutive year. Performance was driven by paid client and NAC growth, as well as ongoing strength in our TaxPro review product. I was pleased with how fast we were able to launch AI Tax Assist, which resulted in higher new client conversion, and our customer satisfaction scores remained strong. In Assisted, our brand continued to resonate with higher value clients, and we were able to grow NAC. Trends in Assisted Small Business Tax also remained positive this year. In addition, we're continuing to drive value for shareholders through our capital allocation practice. In fact, today we announced another 17% increase to our quarterly dividend, as well as a new repurchase authorization of $1.5 billion, which replaces the prior authorization. Since 2016 through today, we've increased the dividend 88% and repurchased more than 40% of shares outstanding. Looking to fiscal 25, we feel well-positioned to deliver for our clients and shareholders. And Tony will share more about our outlook in a moment. But first, let me turn to our block horizon strategy, where we continue to make important progress in all three of our imperatives. Starting with small business, we had another good year in tax, delivering revenue growth in the mid-single digits. NAP grew 3%. entity trends remained strong, and bookkeeping and payroll had another year of double-digit growth. Our centralized fulfillment model, alongside our dedicated sales team, have driven services client conversion, and we continue to see a lot of opportunity ahead. Turning to WAVE, I'm pleased with the progress that's been made in the last year on our key priorities to accelerate revenue growth and drive profitability. You'll recall we recently launched a new paid subscription solution called ProTier. This, along with our paid receipt product, are both designed to further empower small business owners to manage their business better. These products have been performing better than anticipated. For the full year, revenue growth was 7%. We continue to improve the losses in the business and expect ongoing positive trends in fiscal 25. Moving on to our financial products imperative, we're pleased with the growth of our mobile banking platform, Spruce, and its performance in both the assisted and DIY channels this season. Since launch through June 30, Spruce has 476,000 sign-ups, and we're nearing a milestone of $1 billion in customer deposits. We're pleased to see positive deposit trends with nearly 50% coming from non-tax sources this year. In fact, last month, deposits increased 60% year over year. At the same time, Spruce is continuing to deliver on its mission to help people be better with money. We're excited about new innovations that will be rolling out in the coming months, and our team is focused on acquiring users in and out of the tax season. Now let's turn to Block Experience. which is all about blending digital tools with human expertise and care. We feel great about how we're positioned to serve clients however they want to be served, fully virtual to fully in person and every way in between. In DIY, our strategy continues to deliver, and we're pleased with the results. As I mentioned, we had meaningful growth in paid clients and NAC, which translated to strong revenue growth of 11% this year. AI tax assists perform well, and we're excited about our Gen AI use cases, which have the potential to drive future efficiencies and cost savings. We look forward to continuing this momentum in fiscal year 25. In the assisted channel, we were pleased with our NAT growth, improved client satisfaction scores, and success in attracting and serving higher value clients. We're clear about where we can improve the experience for clients. and recently welcomed Curtis Campbell as President of Global Consumer Tax and Chief Product Officer, who has more than 10 years of tax industry experience. His impact is already being felt across the organization, and I'm excited about his leadership. Over the last few years, we've made significant strides in our products, services, and features through our Block Horizons plan, and I'm feeling very good about our positioning for fiscal year 25. Before I turn things over to Tony to share more about our financial performance and outlook, I want to take a moment to thank him for his incredible tenure at H&R Block. As we shared on the Q2 call, Tony made the personal decision to retire after a 20-year career with Block. Tony has been an integral part of our company, playing a key role in our growth, transformation, and success. His financial acumen, strategic insights, and industry experience have been invaluable to our team. During his tenure, Tony helped us navigate through numerous challenges and opportunities, ensuring that we remain on strong financial footing. He began his career with H&R Block as a senior treasury analyst and has since held multiple executive roles. Under his leadership as CFO, we've returned more than $3.9 billion to shareholders. His impact on H&R Block will be felt for years to come. On behalf of the entire Block family and our board of directors, I want to extend our gratitude to Tony for his years of service and leadership, and we wish him all the best in his retirement and future endeavors. As you may have seen in our announcement last week, I'm pleased to share that we've hired Tony's successor. Tiffany Mason brings a proven track record of financial leadership in consumer services, retail, and franchising, which are all critical to our business. She most recently served as EVP and CFO at Driven Brands, a high-growth auto services company where she drove strong organic and inorganic growth and led the company through a successful IPO. Prior to that, Tiffany spent 13 years at Lowe's, a Fortune 50 omnichannel home improvement retailer. Tony and Tiffany are working closely together to ensure a seamless transition and she will officially step into the role of CFO on September 13th. In addition, as we continue to transform H&R Block into an agile and innovative company that delivers more value to our clients, associates, and shareholders, I've also added another key member to our senior leadership team. Scott Manuel joined last week as Chief Strategy and Operations Officer and reports directly to me. Within this role, Scott is overseeing functions essential to driving our long-term enterprise strategy and improving our execution. Scott has a long history of delivering customer-centric innovation in complex and dynamic environments. He's an accomplished engineer, has worked in large-scale companies and private equity and across industries, and he is steeped in artificial intelligence. I'm thrilled to have Curtis, Tiffany, and Scott join the already strong senior leadership team. With that, Tony, I'll now turn it over to you.