附件 99.1
 | 服務公司國際（Service Corporation International） | ||||
宣佈2024年第三季度財務業績 | |||||
2024年10月31日星期四上午8:00中部時間舉行電話會議。
2024年10月30日，德克薩斯州休斯頓 ........ service corporation international（紐交所：SCI），北美最大的喪葬產品和服務提供商，今天報告了2024年第三季度的業績。
第三季度亮點：
–2023年第三季度營業收入增長了1210萬美元
–每股收益爲0.81美元，與2023年第三季度的0.80美元相比
–調整後的每股收益爲0.79美元，較2023年第三季度的0.78美元有所增加
–本年度季度的經營活動現金流淨額較去年同期增長16%，達到26380萬美元，而去年同期爲22780萬美元。
–除特殊項目外，經營活動產生的淨現金流量與去年同期相比，今年當季增長了18％，從22780萬元增長至26900萬元
–當前季度可比核心喪葬銷售平均增長了2.1%
–本季度的收購支出爲12300萬美元，而2023年第三季度爲3300萬美元
公司主席兼首席執行官湯姆·瑞安對第三季度業績發表評論：
今天我們報告的每股調整後收益爲0.79美元，經營活動產生的淨現金（不包括特殊項目）爲26900萬美元。我們很高興看到，由於與我們的新首選預先保險提供商達成的新營銷協議，在本季度推出的服務協議對殯葬收入產生了積極影響。此外，我們很高興看到殯儀和墓地的毛利潤與去年第三季度基本穩定，並且營業收入略有增長，反映了我們繼續專注於管理固定成本。
我們在收購方面也非常活躍，包括主要大都會市場的優越位置。我們投資了12300萬美元，增加了10家殯儀館和2座墓地，其中包括一個綜合位置。我們很高興歡迎這些新同事加入SCI大家庭。此外，我們在房地產交易中投資了3100萬美元，用於擴大殯儀館和墓地。”
到2025年，我們的目標是實現長期增長框架8-12%的高端回報。我們堅定致力於長期增長策略，增長營業收入，利用我們無與倫比的規模，明智地投資資本以增加股東價值。沒有我們的25,000名員工及其對爲我們的客戶家庭提供卓越服務的堅定承諾，我們將無法實現這一目標。
我們第三季度的詳細情況 2024年第三季度 基本報表和未經審計的合併財務報表可在本新聞稿末尾的附錄中找到。下表總結了我們的關鍵財務業績。
| (以百萬美元計，每股金額除外) | 截至9月30日的三個月， | 截至9月30日的九個月 | ||||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||
| 營業收入 | $ | 1,014.0 | $ | 1,001.9 | $ | 3,093.4 | $ | 3,044.0 | ||||||||||||||||||
| 營業利潤 | $ | 212.4 | $ | 223.0 | $ | 665.5 | $ | 702.1 | ||||||||||||||||||
| 歸屬於普通股股東的淨收益 | $ | 117.8 | $ | 122.0 | $ | 367.3 | $ | 398.9 | ||||||||||||||||||
| 攤薄每股收益 | $ | 0.81 | $ | 0.80 | $ | 2.50 | $ | 2.60 | ||||||||||||||||||
除特殊項目外的收益 (1) | $ | 115.3 | $ | 119.1 | $ | 363.1 | $ | 390.9 | ||||||||||||||||||
每股攤薄收益（不包括特殊項目） (1) | $ | 0.79 | $ | 0.78 | $ | 2.47 | $ | 2.55 | ||||||||||||||||||
| 攤薄加權平均股份數 | 146.2 | 152.3 | 147.0 | 153.6 | ||||||||||||||||||||||
| 經營活動產生的現金流量淨額 | $ | 263.8 | $ | 227.8 | $ | 680.8 | $ | 591.5 | ||||||||||||||||||
經營活動產生的淨現金流（不包括特殊項目） (1) | $ | 269.0 | $ | 227.8 | $ | 709.0 | $ | 604.8 | ||||||||||||||||||
(1)非特殊項目的收入、非特殊項目的攤薄每股收益，以及排除特殊項目的經營活動現金淨額均爲非美國通用會計準則（GAAP）之外的財務衡量指標。這些項目也被稱爲"調整後每股收益"和"調整後的經營現金流"。從歸屬於普通股股東的淨利潤、攤薄每股收益和按照美國通用會計準則確定的經營活動現金淨額到"現金流量和資本支出"和本新聞稿結尾的"非GAAP財務指標"標題下進行了調解。
•2024年第三季度稀釋每股收益爲0.81美元，而2023年第三季度爲0.80美元。當年第三季度受到淨處置收益和減值損失共計350萬美元的積極影響。去年同期主要受到淨處置收益和減值損失共計250萬美元的積極影響。2024年第三季度排除特殊項目的稀釋每股收益爲0.79美元，而2023年第三季度爲0.78美元。殯儀和墓地的毛利潤均持平，而較低的股份數量和較低的稅率更有利。
1 服務公司國際
相較於偏移的企業總務費用增加，這是由於我們的股價對我們的長期激勵補償計劃產生的影響，以及略微增加的利息支出。
•2024年第三季度，經營活動現金淨額增加3600萬美元，從2023年第三季度的22780萬美元增至26380萬美元。 當年受2022年支付的與法律事務相關的費用影響爲520萬美元。2024年第三季度，除特殊項目外，經營活動現金淨額增加4120萬美元，從2023年第三季度的22780萬美元增至269.0萬美元。預繳工作資本有利的變化得到更多預繳現金收入的支持，這大大抵消了現金利息支付增加和營業額下降。
2024年展望
Our current outlook for the fourth quarter of 2024 for adjusted earnings per share is $1.00 to $1.10, representing expected growth of approximately 8-18% compared to $0.93 of adjusted earnings per share in the fourth quarter of 2023. This fourth quarter guidance range yields an annual adjusted earnings per share range of $3.47 to $3.57, compared to the previous expectation of the lower half of a prior $3.50 to $3.80 range.
In conjunction with our expectation of continued strength in our operating cash flow and coupled with the strong fourth quarter growth anticipated in adjusted earnings per share stated above, we are raising the midpoint of our full year 2024 adjusted operating cash flow guidance from $93000萬 to $95000萬 with a revised guidance range of $94000萬 to $96000萬 (previous range of $90000萬 to $96000萬).
Our full year 2024 outlook for maintenance capital expenditures remains unchanged at approximately $32500萬. The forecast for cash taxes includes the impact of a change in a tax accounting method related to our cemetery segment, which will defer cash taxes into future years. Our outlook for net cash provided by operating activities also excludes special items relating to the payments of certain estimated legal charges of $6460萬 recognized in the fourth quarter of 2022.
| (Dollars in millions, except per share amounts) | Q4 2024 Outlook | 2024 Outlook | |||||||||||||||||||||
Diluted earnings per share excluding special items (1) | $1.00 - $1.10 | $3.47 - $3.57 | |||||||||||||||||||||
Net cash provided by operating activities excluding special items and cash taxes (1) | $240 - $255 | $965 - $980 | |||||||||||||||||||||
| Cash taxes | $5 - $10 | $20 - $25 | |||||||||||||||||||||
Net cash provided by operating activities excluding special items (1) | $230 - $250 | $940 - $960 | |||||||||||||||||||||
| Capital improvements at existing field locations | ~ $35 | $125 | |||||||||||||||||||||
| Development of cemetery property | ~ $40 | $165 | |||||||||||||||||||||
| Digital investments and corporate | ~ $5 | $35 | |||||||||||||||||||||
| Total maintenance, cemetery development, and other capital expenditures (Maintenance capital expenditures) | ~ $80 | $325 | |||||||||||||||||||||
(1)Diluted earnings per share excluding special items and net cash provided by operating activities excluding special items are non-GAAP financial measures. We normally reconcile these non-GAAP financial measures from diluted earnings per share and net cash provided by operating activities; however, diluted earnings per share and net cash provided by operating activities calculated in accordance with GAAP are not currently accessible on a forward-looking basis. Our outlook for 2024 excludes the following because this information is not currently available for 2024: Expenses net of insurance recoveries related to weather events and hurricanes, gains or losses associated with asset divestitures, gains or losses associated with the early extinguishment of debt, potential tax reserve adjustments and IRS payments and/or refunds, acquisition and integration costs, system implementation and transition costs, and potential costs or cash outflows associated with estimated litigation charges or legal settlements or the recognition of receivables for insurance recoveries associated with litigation, or deferred tax payments. The foregoing items could materially impact our forward-looking diluted earnings per share and/or our net cash provided by operating activities calculated in accordance with GAAP.
CONFERENCE CALL AND WEBCAST
We will host a conference call on Thursday, October 31, 2024, at 8:00 a.m. Central Time. A question and answer session will follow a brief presentation made by management. The conference call dial-in numbers are (888) 317-6003 (US) or (412) 317-6061 (International) with the passcode of 8508625. The conference call will also be broadcast live via the Internet and can be accessed through our website at www.sci-corp.com. A replay of the conference call will be available through November 7, 2024 and can be accessed at (877) 344-7529 (US) or (412) 317-0088 (International) with the passcode of 2356545. Additionally, a replay of the conference call will be available on our website for approximately three months.
2 Service Corporation International
ABOUT SERVICE CORPORATION INTERNATIONAL
Service Corporation International (NYSE: SCI), headquartered in Houston, Texas, is North America's leading provider of funeral, cemetery and cremation services, as well as final-arrangement planning in advance, serving more than 600,000 families each year. Our diversified portfolio of brands provides families and individuals a full range of choices to meet their needs, from simple cremations to full life celebrations and personalized remembrances. Our Dignity Memorial® brand is the name families turn to for professionalism, compassion, and attention to detail that is second to none. At September 30, 2024, we owned and operated 1,495 funeral service locations and 494 cemeteries (of which 307 are combination locations) in 44 states, eight Canadian provinces, the District of Columbia, and Puerto Rico. For more information about Service Corporation International, please visit our website at www.sci-corp.com. For more information about Dignity Memorial®, please visit www.dignitymemorial.com.
| For additional information contact: InvestorRelations@sci-us.com | ||||||||||||||
| Investors: | Allie O'Connor - Assistant Vice President / Investor Relations | (713) 525-9088 | ||||||||||||
| Trey Bocage - Director / Investor Relations | (713) 525-3454 | |||||||||||||
| Media: | Jay Andrew - Assistant Vice President / Corporate Communications | (713) 525-3468 | ||||||||||||
3 Service Corporation International
CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS
The statements in this press release that are not historical facts are forward-looking statements made in reliance on the “safe harbor” protections provided under the Private Securities Litigation Reform Act of 1995. These statements may be accompanied by words such as “believe,” “estimate,” “project,” “expect,” “anticipate,” “predict,” or other similar words that convey the uncertainty of future events or outcomes. The absence of these words, however, does not mean that the statements are not forward-looking. These statements are based on assumptions that we believe are reasonable; however, many important factors could cause our actual results in the future to differ materially from the forward-looking statements made herein and in any other documents or oral presentations made by us, or on our behalf. Important factors, which could cause actual results to differ materially from those in forward-looking statements include, among others, the following:
•Our affiliated trust funds own investments in securities, which are affected by market conditions that are beyond our control.
•We may be required to replenish our affiliated funeral and cemetery trust funds to meet minimum funding requirements, which would have a negative effect on our earnings and cash flow.
•Our ability to execute our strategic plan depends on many factors, some of which are beyond our control.
•We may be adversely affected by the effects of inflation.
•Our results may be adversely affected by significant weather events, natural disasters, catastrophic events, or public health crises.
•Our credit agreements contain covenants that may prevent us from engaging in certain transactions.
•If we lost the ability to use surety bonding to support our preneed activities, we may be required to make material cash payments to fund certain trust funds.
•The financial condition of third-party life insurance companies that fund our preneed contracts may impact our future revenue.
•Unfavorable publicity could affect our reputation and business.
•Our failure to attract and retain qualified sales personnel could have an adverse effect on our business and financial condition.
•We use a combination of insurance, self-insurance, and large deductibles in managing our exposure to certain inherent risks; therefore, we could be exposed to unexpected costs that could negatively affect our financial performance.
•Declines in overall economic conditions beyond our control could reduce future potential earnings and cash flows and could result in future impairments to goodwill and/or other intangible assets.
•Any failure to maintain the security of the information relating to our customers, their loved ones, our associates, and our vendors could damage our reputation, could cause us to incur substantial additional costs and to become subject to litigation, and could adversely affect our operating results, financial condition, or cash flow.
•Our Canadian business exposes us to operational, economic, and currency risks.
•Our level of indebtedness could adversely affect our cash flows, our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry, and may prevent us from fulfilling our obligations under our indebtedness.
•A failure of a key information technology system or process could disrupt and adversely affect our business.
•The funeral and cemetery industry is competitive.
•If the number of deaths in our markets declines, our cash flows and revenue may decrease. Changes in the number of deaths are not predictable from market to market or over the short term.
•If we are not able to respond effectively to changing consumer preferences, our market share, revenue, and/or profitability could decrease.
•The continuing upward trend in life expectancy and the number of cremations performed in North America could result in lower revenue, operating profit, and cash flows.
•Our funeral and cemetery businesses are high fixed-cost businesses.
•Risks associated with our supply chain could materially adversely affect our financial performance.
•Regulation and compliance could have a material adverse impact on our financial results.
•Unfavorable results of litigation could have a material adverse impact on our financial statements.
•Cemetery burial practice claims could have a material adverse impact on our financial results.
•The application of unclaimed property laws by certain states to our preneed funeral and cemetery backlog could have a material adverse impact on our liquidity, cash flows, and financial results.
•Changes in taxation, or the interpretation of tax laws or regulations, as well as the inherent difficulty in quantifying potential tax effects of business decisions could have a material adverse effect on the results of our operations, financial condition, or cash flows.
For further information on these and other risks and uncertainties, see our Securities and Exchange Commission filings, including our 2023 Annual Report on Form 10-K. Copies of this document as well as other SEC filings can be obtained from our website at www.sci-corp.com. We assume no obligation and make no undertaking to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by us whether as a result of new information, future events, or otherwise.
4 Service Corporation International
| SERVICE CORPORATION INTERNATIONAL | ||||
APPENDIX: RESULTS FOR THE THIRD QUARTER OF 2024 | |||||
Consolidated Statement of Operations (Unaudited)
| (Dollars in thousands, except per share amounts) | Three Months Ended | Nine Months Ended | |||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Revenue | $ | 1,013,958 | $ | 1,001,859 | $ | 3,093,356 | $ | 3,043,982 | |||||||||||||||
| Cost of revenue | (761,319) | (748,176) | (2,308,589) | (2,239,737) | |||||||||||||||||||
| Gross profit | 252,639 | 253,683 | 784,767 | 804,245 | |||||||||||||||||||
| Corporate general and administrative expenses | (43,732) | (33,213) | (124,055) | (112,294) | |||||||||||||||||||
| Gains on divestitures and impairment charges, net | 3,515 | 2,542 | 4,755 | 10,187 | |||||||||||||||||||
| Operating income | 212,422 | 223,012 | 665,467 | 702,138 | |||||||||||||||||||
| Interest expense | (65,804) | (61,512) | (194,540) | (174,904) | |||||||||||||||||||
| Losses on early extinguishment of debt | (25) | — | (25) | (1,114) | |||||||||||||||||||
| Other income, net | 2,815 | 128 | 7,002 | 2,647 | |||||||||||||||||||
| Income before income taxes | 149,408 | 161,628 | 477,904 | 528,767 | |||||||||||||||||||
| Provision for income taxes | (31,547) | (39,585) | (110,549) | (129,543) | |||||||||||||||||||
| Net income | 117,861 | 122,043 | 367,355 | 399,224 | |||||||||||||||||||
| Net income attributable to noncontrolling interests | (34) | (72) | (61) | (302) | |||||||||||||||||||
| Net income attributable to common stockholders | $ | 117,827 | $ | 121,971 | $ | 367,294 | $ | 398,922 | |||||||||||||||
| Basic earnings per share: | |||||||||||||||||||||||
| Net income attributable to common stockholders | $ | 0.81 | $ | 0.81 | $ | 2.53 | $ | 2.63 | |||||||||||||||
| Basic weighted average number of shares | 144,706 | 150,630 | 145,421 | 151,654 | |||||||||||||||||||
| Diluted earnings per share: | |||||||||||||||||||||||
| Net income attributable to common stockholders | $ | 0.81 | $ | 0.80 | $ | 2.50 | $ | 2.60 | |||||||||||||||
| Diluted weighted average number of shares | 146,223 | 152,289 | 146,978 | 153,554 | |||||||||||||||||||
5 Service Corporation International
Consolidated Balance Sheet (Unaudited)
| (Dollars in thousands, except share amounts) | |||||||||||
| September 30, 2024 | December 31, 2023 | ||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 185,420 | $ | 221,557 | |||||||
| Receivables, net | 80,955 | 97,939 | |||||||||
| Inventories | 34,571 | 33,597 | |||||||||
| Income tax receivable | 52,487 | 122,183 | |||||||||
| Other | 35,661 | 23,010 | |||||||||
| Total current assets | 389,094 | 498,286 | |||||||||
| Preneed receivables, net and trust investments | 6,766,755 | 6,191,912 | |||||||||
| Cemetery property | 2,113,801 | 2,020,846 | |||||||||
| Property and equipment, net | 2,564,241 | 2,480,099 | |||||||||
| Goodwill | 2,084,790 | 1,977,186 | |||||||||
| Deferred charges and other assets, net | 1,324,768 | 1,247,830 | |||||||||
| Cemetery perpetual care trust investments | 2,162,902 | 1,939,241 | |||||||||
| Total assets | $ | 17,406,351 | $ | 16,355,400 | |||||||
| LIABILITIES & EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable and accrued liabilities | $ | 658,837 | $ | 685,759 | |||||||
| Current maturities of long-term debt | 84,349 | 63,341 | |||||||||
| Total current liabilities | 743,186 | 749,100 | |||||||||
| Long-term debt | 4,743,679 | 4,649,155 | |||||||||
| Deferred revenue, net | 1,750,755 | 1,703,509 | |||||||||
| Deferred tax liability | 655,486 | 638,106 | |||||||||
| Other liabilities | 506,388 | 464,935 | |||||||||
| Deferred receipts held in trust | 5,225,878 | 4,670,884 | |||||||||
| Care trusts’ corpus | 2,153,178 | 1,938,238 | |||||||||
| Equity: | |||||||||||
Common stock, $1 per share par value, 500,000,000 shares authorized, 149,741,975 and 148,297,042 shares issued, respectively, and 144,979,108 and 146,323,340 shares outstanding, respectively | 144,979 | 146,323 | |||||||||
| Capital in excess of par value | 972,511 | 937,596 | |||||||||
| Retained earnings | 492,294 | 432,454 | |||||||||
| Accumulated other comprehensive income | 17,391 | 24,891 | |||||||||
| Total common stockholders’ equity | 1,627,175 | 1,541,264 | |||||||||
| Noncontrolling interests | 626 | 209 | |||||||||
| Total equity | 1,627,801 | 1,541,473 | |||||||||
| Total liabilities and equity | $ | 17,406,351 | $ | 16,355,400 | |||||||
6 Service Corporation International
Consolidated Statement of Cash Flows (Unaudited)
| (Dollars in thousands) | Nine months ended September 30, | ||||||||||
| 2024 | 2023 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 367,355 | $ | 399,224 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Loss on early extinguishment of debt | 25 | 1,114 | |||||||||
| Depreciation and amortization | 153,932 | 141,228 | |||||||||
| Amortization of intangibles | 12,759 | 14,158 | |||||||||
| Amortization of cemetery property | 70,431 | 71,892 | |||||||||
| Amortization of loan costs | 5,365 | 5,133 | |||||||||
| Provision for expected credit losses | 9,693 | 6,997 | |||||||||
| Provision for deferred income taxes | 15,243 | 166,786 | |||||||||
| Gains on divestitures and impairment charges, net | (4,755) | (10,187) | |||||||||
| Share-based compensation | 12,042 | 11,786 | |||||||||
| Change in assets and liabilities, net of effects from acquisitions and divestitures: | |||||||||||
| Decrease in receivables | 11,366 | 11,781 | |||||||||
| Decrease (increase) in other assets | 12,464 | (161,687) | |||||||||
| Increase (decrease) in payables and other liabilities | 20,768 | (21,961) | |||||||||
| Effect of preneed sales production and maturities: | |||||||||||
| Increase in preneed receivables, net and trust investments | (139,876) | (162,087) | |||||||||
| Increase in deferred revenue, net | 83,331 | 105,923 | |||||||||
| Increase in deferred receipts held in trust | 50,652 | 11,358 | |||||||||
| Net cash provided by operating activities | 680,795 | 591,458 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (276,837) | (267,752) | |||||||||
| Business acquisitions, net of cash acquired | (161,865) | (72,535) | |||||||||
| Real estate acquisitions | (53,329) | (41,084) | |||||||||
| Proceeds from divestitures and sales of property and equipment | 21,632 | 22,713 | |||||||||
| Payments for Company-owned life insurance policies | (3,009) | (8,050) | |||||||||
| Proceeds from Company-owned life insurance policies and other | 2,673 | 10,119 | |||||||||
| Other investing activities | (13,864) | — | |||||||||
| Net cash used in investing activities | (484,599) | (356,589) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from issuance of long-term debt | 1,336,137 | 737,433 | |||||||||
| Debt issuance costs | (15,246) | (7,471) | |||||||||
| Scheduled payments of debt | (18,421) | (16,402) | |||||||||
| Early payments and extinguishment of debt | (1,210,024) | (490,973) | |||||||||
| Principal payments on finance leases | (27,524) | (25,678) | |||||||||
| Proceeds from exercise of stock options | 42,898 | 16,106 | |||||||||
| Purchase of Company common stock | (197,511) | (340,279) | |||||||||
| Payments of dividends | (130,811) | (125,543) | |||||||||
| Bank overdrafts and other | (10,253) | (9,362) | |||||||||
| Net cash used in financing activities | (230,755) | (262,169) | |||||||||
| Effect of foreign currency | (1,566) | (298) | |||||||||
| Net decrease in cash, cash equivalents, and restricted cash | (36,125) | (27,598) | |||||||||
| Cash, cash equivalents, and restricted cash at beginning of period | 224,761 | 204,524 | |||||||||
| Cash, cash equivalents, and restricted cash at end of period | $ | 188,636 | $ | 176,926 | |||||||
7 Service Corporation International
Consolidated Segment Results
(See definitions of revenue line items later in this appendix.)
| (Dollars in millions, except funeral services performed and average revenue per service) | Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Consolidated funeral: | |||||||||||||||||||||||
| Atneed revenue | $ | 289.1 | $ | 283.0 | $ | 887.8 | $ | 884.8 | |||||||||||||||
| Matured preneed revenue | 173.8 | 172.3 | 542.5 | 533.7 | |||||||||||||||||||
| Core revenue | 462.9 | 455.3 | 1,430.3 | 1,418.5 | |||||||||||||||||||
| Non-funeral home revenue | 23.2 | 21.9 | 69.8 | 63.7 | |||||||||||||||||||
| Non-funeral home preneed sales revenue | 26.9 | 32.0 | 85.1 | 109.1 | |||||||||||||||||||
| Core general agency and other revenue | 53.0 | 45.6 | 151.3 | 138.6 | |||||||||||||||||||
| Total revenue | $ | 566.0 | $ | 554.8 | $ | 1,736.5 | $ | 1,729.9 | |||||||||||||||
| Gross profit | $ | 107.9 | $ | 109.7 | $ | 340.2 | $ | 374.8 | |||||||||||||||
| Gross profit percentage | 19.1 | % | 19.8 | % | 19.6 | % | 21.7 | % | |||||||||||||||
| Funeral services performed | 85,743 | 85,139 | 266,140 | 268,414 | |||||||||||||||||||
| Average revenue per service | $ | 5,669 | $ | 5,605 | $ | 5,637 | $ | 5,522 | |||||||||||||||
| (Dollars in millions) | Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Consolidated cemetery: | |||||||||||||||||||||||
| Atneed property revenue | $ | 34.7 | $ | 35.5 | $ | 105.0 | $ | 105.9 | |||||||||||||||
| Atneed merchandise and service revenue | 72.3 | 74.7 | 219.4 | 222.5 | |||||||||||||||||||
| Total atneed revenue | 107.0 | 110.2 | 324.4 | 328.4 | |||||||||||||||||||
| Recognized preneed property revenue | 203.4 | 214.6 | 628.2 | 626.0 | |||||||||||||||||||
| Recognized preneed merchandise and service revenue | 103.6 | 93.1 | 301.8 | 269.1 | |||||||||||||||||||
| Total recognized preneed revenue | 307.0 | 307.7 | 930.0 | 895.1 | |||||||||||||||||||
| Core revenue | 414.0 | 417.9 | 1,254.4 | 1,223.5 | |||||||||||||||||||
| Other cemetery revenue | 34.0 | 29.2 | 102.5 | 90.6 | |||||||||||||||||||
| Total revenue | $ | 448.0 | $ | 447.1 | $ | 1,356.9 | $ | 1,314.1 | |||||||||||||||
| Gross profit | $ | 144.8 | $ | 143.9 | $ | 444.6 | $ | 429.5 | |||||||||||||||
| Gross profit percentage | 32.3 | % | 32.2 | % | 32.8 | % | 32.7 | % | |||||||||||||||
8 Service Corporation International
Comparable Funeral Results
The table below details comparable funeral results of operations (“same store”) for the three months ended September 30, 2024 and 2023. We consider comparable funeral operations to be those businesses owned for the entire period beginning January 1, 2023 and ending September 30, 2024.
| (Dollars in millions, except average revenue per service and average revenue per contract sold) | Three months ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | Var | % | ||||||||||||||||||||
| Comparable funeral revenue: | |||||||||||||||||||||||
Atneed revenue (1) | $ | 283.3 | $ | 280.2 | $ | 3.1 | 1.1 | % | |||||||||||||||
Matured preneed revenue (2) | 172.1 | 170.8 | 1.3 | 0.8 | % | ||||||||||||||||||
Core revenue (3) | 455.4 | 451.0 | 4.4 | 1.0 | % | ||||||||||||||||||
Non-funeral home revenue (4) | 22.3 | 21.8 | 0.5 | 2.3 | % | ||||||||||||||||||
Non-funeral home preneed sales revenue (5) | 26.5 | 32.0 | (5.5) | (17.2) | % | ||||||||||||||||||
Core general agency and other revenue (6) | 52.7 | 45.1 | 7.6 | 16.9 | % | ||||||||||||||||||
| Total comparable revenue | $ | 556.9 | $ | 549.9 | $ | 7.0 | 1.3 | % | |||||||||||||||
| Comparable gross profit | $ | 107.4 | $ | 108.9 | $ | (1.5) | (1.4) | % | |||||||||||||||
| Comparable gross profit percentage | 19.3 | % | 19.8 | % | (0.5) | % | |||||||||||||||||
| Comparable funeral services performed: | |||||||||||||||||||||||
| Atneed | 44,978 | 45,761 | (783) | (1.7) | % | ||||||||||||||||||
| Matured preneed | 25,163 | 25,189 | (26) | (0.1) | % | ||||||||||||||||||
| Total core | 70,141 | 70,950 | (809) | (1.1) | % | ||||||||||||||||||
| Non-funeral home | 13,663 | 13,520 | 143 | 1.1 | % | ||||||||||||||||||
| Total comparable funeral services performed | 83,804 | 84,470 | (666) | (0.8) | % | ||||||||||||||||||
Comparable core cremation rate | 56.8 | % | 56.5 | % | 0.3 | % | |||||||||||||||||
Total comparable cremation rate (7) | 63.7 | % | 63.3 | % | 0.4 | % | |||||||||||||||||
Comparable funeral average revenue per service: | |||||||||||||||||||||||
| Atneed | $ | 6,299 | $ | 6,123 | $ | 176 | 2.9 | % | |||||||||||||||
| Matured preneed | 6,839 | 6,781 | 58 | 0.9 | % | ||||||||||||||||||
| Total core | 6,493 | 6,357 | 136 | 2.1 | % | ||||||||||||||||||
| Non-funeral home | 1,632 | 1,612 | 20 | 1.2 | % | ||||||||||||||||||
| Total comparable average revenue per service | $ | 5,700 | $ | 5,597 | $ | 103 | 1.8 | % | |||||||||||||||
Comparable funeral preneed sales production: | |||||||||||||||||||||||
| Total preneed sales | $ | 292.3 | $ | 314.5 | $ | (22.2) | (7.1) | % | |||||||||||||||
| Core contracts sold | 34,573 | 36,862 | (2,289) | (6.2) | % | ||||||||||||||||||
| Non-funeral home contracts sold | 22,991 | 25,294 | (2,303) | (9.1) | % | ||||||||||||||||||
| Core average revenue per contract sold | $ | 6,435 | $ | 6,417 | $ | 18 | 0.3 | % | |||||||||||||||
| Non-funeral home average revenue per contract sold | $ | 3,037 | $ | 3,081 | $ | (44) | (1.4) | % | |||||||||||||||
(1)Atneed revenue represents merchandise and services sold and delivered or performed once death has occurred.
(2)Matured preneed revenue represents merchandise and services sold on a preneed contract through our core funeral homes, which have been delivered or performed as well as the related merchandise and service trust fund income and other insurance benefits.
(3)Core revenue represents the sum of merchandise and services sold on an atneed contract or preneed contract, which were delivered or performed once death has occurred through our core funeral homes.
(4)Non-funeral home revenue represents services sold on a preneed or atneed contract through one of our non-funeral home sales channels (e.g. SCI Direct) and performed once death has occurred.
(5)Non-funeral home preneed sales revenue represents travel protection, net and merchandise sold on a preneed contract that is delivered before death has occurred and general agency revenue from our non-funeral home sales channel.
(6)Core general agency and other revenue primarily comprises core general agency revenue, which is commissions we receive from third-party insurance companies for life insurance policies sold to preneed customers for the purpose of funding preneed arrangements and core travel protection preneed sales, net.
(7)Total comparable cremation rate includes the impact of cremation services through our non-funeral sales channel (e.g. SCI Direct).
9 Service Corporation International
•Total comparable funeral revenue increased by $7.0 million, or 1.3%, as an increase of $4.4 million in core funeral revenue and a $7.6 million increase in core general agency and other revenue was offset by a $5.5 million decrease in non-funeral home preneed sales revenue.
•Core funeral revenue increased by $4.4 million, or 1.0%, primarily due to a favorable 2.1% increase in core average revenue per service partially offset by a 1.1% decrease in core funeral services performed. The core cremation rate increased 30 basis points to 56.8%.
•Non-funeral home preneed sales revenue decreased by $5.5 million, or 17.2%, primarily due to a decline of non-funeral home preneed sales production decrease of $8.1 million, or 10.4%, impacted by our transition from trust to insurance-funded contracts.
•Core general agency and other revenue grew $7.6 million, primarily due to growth in general agency revenue from higher commission rates, primarily as a result of our new preneed insurance marketing agreement.
•Comparable funeral gross profit decreased by $1.5 million to $107.4 million and the gross profit percentage decreased 50 basis points from 19.8% to 19.3%. The stability in gross profit, in light of modest revenue growth, reflects our continued focus on managing our fixed cost structure.
•Comparable preneed funeral sales production decreased by $22.2 million, or 7.1%, in the third quarter of 2024 compared to 2023. Core preneed sales production decreased by $14.1 million, or 6.0%, primarily due to the transition to our new preneed insurance provider. Non-funeral home preneed sales production decreased $8.1 million, or 10.4%, primarily due to our transition from trust to insurance-funded contracts.
Comparable Cemetery Results
The table below details comparable cemetery results of operations (“same store”) for the three months ended September 30, 2024 and 2023. We consider comparable cemetery operations to be those businesses owned for the entire period beginning January 1, 2023 and ending September 30, 2024.
| (Dollars in millions) | Three months ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | Var | % | ||||||||||||||||||||
| Comparable cemetery revenue: | |||||||||||||||||||||||
| Atneed property revenue | $ | 34.5 | $ | 35.5 | $ | (1.0) | (2.8) | % | |||||||||||||||
| Atneed merchandise and service revenue | 72.1 | 74.6 | (2.5) | (3.4) | % | ||||||||||||||||||
Total atneed revenue (1) | 106.6 | 110.1 | (3.5) | (3.2) | % | ||||||||||||||||||
| Recognized preneed property revenue | 202.8 | 214.4 | (11.6) | (5.4) | % | ||||||||||||||||||
| Recognized preneed merchandise and service revenue | 103.3 | 93.0 | 10.3 | 11.1 | % | ||||||||||||||||||
Total recognized preneed revenue (2) | 306.1 | 307.4 | (1.3) | (0.4) | % | ||||||||||||||||||
Core revenue (3) | 412.7 | 417.5 | (4.8) | (1.1) | % | ||||||||||||||||||
Other revenue (4) | 33.9 | 29.1 | 4.8 | 16.5 | % | ||||||||||||||||||
| Total comparable revenue | $ | 446.6 | $ | 446.6 | $ | — | — | % | |||||||||||||||
| Comparable gross profit | $ | 144.9 | $ | 144.3 | $ | 0.6 | 0.4 | % | |||||||||||||||
| Comparable gross profit percentage | 32.4 | % | 32.3 | % | 0.1 | % | |||||||||||||||||
Comparable cemetery preneed and atneed sales production: | |||||||||||||||||||||||
| Property | $ | 232.2 | $ | 244.3 | $ | (12.1) | (5.0) | % | |||||||||||||||
| Merchandise and services | 186.8 | 185.4 | 1.4 | 0.8 | % | ||||||||||||||||||
| Discounts and other | — | (4.8) | 4.8 | 100.0 | % | ||||||||||||||||||
| Preneed and atneed sales production | $ | 419.0 | $ | 424.9 | $ | (5.9) | (1.4) | % | |||||||||||||||
Preneed sales production | $ | 314.1 | $ | 322.0 | $ | (7.9) | (2.5) | % | |||||||||||||||
Recognition rate (5) | 98.5 | % | 98.3 | % | |||||||||||||||||||
(1)Atneed revenue represents property, merchandise, and services sold and delivered or performed once death has occurred.
(2)Recognized preneed revenue represents property, merchandise, and services sold on a preneed contract, which were delivered or performed as well as the related merchandise and service trust fund income.
(3)Core revenue represents the sum of property, merchandise, and services that have been delivered or performed as well as the related merchandise and service trust fund income.
(4)Other revenue is primarily related to endowment care trust fund income, royalty income, and interest and finance charges earned from customer receivables on preneed installment contracts.
(5)Represents the ratio of current period core revenue stated as a percentage of current period preneed and atneed sales production.
10 Service Corporation International
•Total comparable cemetery revenue in the third quarter of 2024 was flat to prior year at $446.6 million as a decrease in core revenue of $4.8 million was offset by an increase in other revenue of $4.8 million.
•Core revenue was lower by $4.8 million primarily as a result of a $3.5 million decline in atneed revenue combined with a $1.3 million decrease in total recognized preneed revenue. Growth in recognized preneed merchandise and service revenue of $10.3 million from higher quality sales averages maturing out of the backlog was offset by a decline of $11.6 million in recognized preneed property revenue.
•Other revenue was higher by $4.8 million, or 16.5%, compared to the prior year quarter primarily from an increase in endowment care trust fund income related to the expansion of our total return investment strategy in certain states.
•Comparable cemetery gross profit increased slightly by $0.6 million to $144.9 million, and the gross profit percentage increased from 32.3% to 32.4%. This growth in gross profit on relatively flat revenue reflects our continued focus on managing our fixed cost structure.
•Comparable preneed cemetery sales production decreased $7.9 million, or 2.5%, primarily due to a decline in large sales, while our core production was relatively flat.
Other Financial Results
•Corporate general and administrative expenses were $43.7 million in the third quarter of 2024 compared to the third quarter of 2023 of $33.2 million. The current year third quarter was pressured by long-term incentive compensation plan expenses that were impacted by the growth in our stock price. Conversely, during the prior year third quarter we saw a decline in our stock price benefiting our long-term incentive compensation plan expenses.
•Interest expense increased $4.3 million to $65.8 million in the third quarter of 2024 primarily due to higher average balances quarter over quarter on our floating rate debt.
•The GAAP effective income tax rate for the third quarter of 2024 was 21.1%, down from 24.5% in the prior year quarter. Our adjusted effective tax rate was 20.9% in the third quarter of 2024 compared to 25.1% in the prior year quarter. The lower effective tax rate in the current period was primarily due to more excess tax benefits recognized on the settlement of employee share-based awards.
Cash Flow and Capital Spending
| (Dollars in millions) | Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Net cash provided by operating activities | $ | 263.8 | $ | 227.8 | $ | 680.8 | $ | 591.5 | |||||||||||||||
Payments for certain legal matters | 5.2 | — | 28.2 | 13.3 | |||||||||||||||||||
| Net cash provided by operating activities excluding special items | $ | 269.0 | $ | 227.8 | $ | 709.0 | $ | 604.8 | |||||||||||||||
| Cash taxes included in net cash provided by operating activities | $ | 4.0 | $ | 3.8 | $ | 15.8 | $ | 79.7 | |||||||||||||||
Net cash provided by operating activities excluding special items grew $41.2 million to $269.0 million in the third quarter of 2024 compared to $227.8 million in the third quarter of 2023. Favorable working capital of approximately $54 million, including higher cash receipts from installment payments on preneed cemetery and funeral contracts and other working capital changes, more than offset an increase in cash interest payments and $11 million of lower operating income.
| (Dollars in millions) | Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Capital improvements at existing field locations | $ | 37.0 | $ | 28.1 | $ | 91.3 | $ | 82.7 | |||||||||||||||
Development of cemetery property | 43.8 | 40.8 | 122.4 | 111.8 | |||||||||||||||||||
Digital investments and corporate | 7.6 | 12.9 | 32.0 | 47.5 | |||||||||||||||||||
| Total maintenance, cemetery development, and other capital expenditures (Maintenance capital expenditures) | $ | 88.4 | $ | 81.8 | $ | 245.7 | $ | 242.0 | |||||||||||||||
| Growth capital expenditures/construction of new funeral service locations | 12.6 | 8.9 | 31.1 | 25.8 | |||||||||||||||||||
| Total capital expenditures | $ | 101.0 | $ | 90.7 | $ | 276.8 | $ | 267.8 | |||||||||||||||
Total capital expenditures increased in the current quarter by $10.3 million, primarily due to higher capital improvements at existing field locations and spend on development of cemetery property, slightly offset by expected lower spend on digital investments and corporate.
11 Service Corporation International
Trust Fund Returns
Total trust fund returns include realized and unrealized gains and losses and dividends and are shown gross without netting of certain fees. A summary of our consolidated trust fund returns as of September 30, 2024 is set forth below:
| Three Months | Nine Months | ||||||||||
| Preneed funeral | 5.8% | 12.7% | |||||||||
| Preneed cemetery | 6.1% | 13.2% | |||||||||
| Cemetery perpetual care | 6.1% | 12.4% | |||||||||
| Combined trust funds | 6.0% | 12.8% | |||||||||
Non-GAAP Financial Measures
Earnings excluding special items and diluted earnings per share excluding special items shown above are non-GAAP financial measures. We believe these non-GAAP financial measures provide a consistent basis for comparison between quarters and years, and better reflect the performance of our core operations, as they are not influenced by certain income or expense items not affecting operations. We also believe these measures help facilitate comparisons to our competitors' operating results.
Set forth below is a reconciliation of our reported net income attributable to common stockholders to earnings excluding special items and our GAAP diluted earnings per share to diluted earnings per share excluding special items. We do not intend for this information to be considered in isolation or as a substitute for other measures of performance prepared in accordance with GAAP.
| (Dollars in millions, except diluted EPS) | Three months ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | ||||||||||||||||||||||
| Net Income | Diluted EPS | Net Income | Diluted EPS | ||||||||||||||||||||
| Net income attributable to common stockholders, as reported | $ | 117.8 | $ | 0.81 | $ | 122.0 | $ | 0.80 | |||||||||||||||
| Pre-tax reconciling items: | |||||||||||||||||||||||
| Gains on divestitures and impairment charges, net | (3.5) | (0.02) | (2.5) | (0.02) | |||||||||||||||||||
| Tax effect from significant items | 1.1 | — | 0.5 | 0.01 | |||||||||||||||||||
Change in uncertain tax reserves and other | (0.1) | — | (0.9) | (0.01) | |||||||||||||||||||
| Earnings excluding special items and diluted earnings per share excluding special items | $ | 115.3 | $ | 0.79 | $ | 119.1 | $ | 0.78 | |||||||||||||||
| Diluted weighted average shares outstanding | 146.2 | 152.3 | |||||||||||||||||||||
| (Dollars in millions, except diluted EPS) | Nine months ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | ||||||||||||||||||||||
| Net Income | Diluted EPS | Net Income | Diluted EPS | ||||||||||||||||||||
| Net income attributable to common stockholders, as reported | $ | 367.3 | $ | 2.50 | $ | 398.9 | $ | 2.60 | |||||||||||||||
| Pre-tax reconciling items: | |||||||||||||||||||||||
Gains on divestitures and impairment charges, net | (4.8) | (0.03) | (10.2) | (0.07) | |||||||||||||||||||
Losses on early extinguishment of debt | — | — | 1.1 | 0.01 | |||||||||||||||||||
| Tax effect from significant items | 1.6 | — | 2.5 | 0.02 | |||||||||||||||||||
Change in uncertain tax reserves and other | (1.0) | — | (1.4) | (0.01) | |||||||||||||||||||
| Earnings excluding special items and diluted earnings per share excluding special items | $ | 363.1 | $ | 2.47 | $ | 390.9 | $ | 2.55 | |||||||||||||||
| Diluted weighted average shares outstanding | 147.0 | 153.6 | |||||||||||||||||||||
12 Service Corporation International