Tax preparation services provider Liberty Tax Inc. on Sept. 7 reported a sharp decline in full-year 2018 earnings despite posting stronger year-over-year sales.
For the year ended April 30, the Virginia-based company reported non-GAAP net income of $9 million, or 64 cents per diluted share, down 43% from $16 million, or $1.15 per diluted share, posted in the year-ago period. The S&P Global Market Intelligence consensus normalized EPS estimate for fiscal 2018 was $1.20, with one analyst reporting.
Total revenue for the 12-month period came in at $174.9 million, up slightly from $174 million in 2017 but below the S&P Global Market Intelligence consensus estimate of $179.3 million.
Total U.S. returns processed during fiscal 2018 were 1.49 million, lower than the 1.66 million returns processed a year ago, mainly due to reductions in locations and store closures. Meanwhile, total returns processed in Canada climbed to 377,000 from 359,000 returns in 2017.
Liberty Tax incurred $5 million in restructuring costs from the exit of company-owned stores and termination of a service provider contract. The specialized consumer services provider also recorded a noncash impairment charge of $3 million resulting from the underperformance of company-owned stores.
The company also said that it filed an appeal with the Nasdaq Listing and Review Council against the Nasdaq Hearing Panel's decision to delist its class A common stock.
Liberty Tax's class A common stock will continue to be quoted on the OTC Market under the symbol TAXA, pending the result of the appeal.
The tax solutions provider also said that it currently expects to file its delinquent Forms 10-Q for quarters ended Oct. 31, 2017, and Jan. 31, as well as its Form 10-K for the year ended April 30 on or before Oct. 15. Meanwhile, Liberty Tax plans to file its Form 10-Q for the quarter ended July 31 on or before Oct. 31.