[Executive Summary & Company Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Company%20Highlights) Carriage Services achieved significant Q2 2025 financial growth, driven by strong net income and EPS, strategic acquisitions, and reduced leverage, leading to an upward revision of its full-year outlook [Second Quarter 2025 Performance Overview](index=1&type=section&id=Second%20Quarter%202025%20Performance%20Overview) Carriage Services achieved significant financial growth in Q2 2025, with GAAP net income and diluted EPS increasing substantially, while total revenue remained stable through organic growth and reduced leverage Key Financial Metrics for Q2 2025 (Year-over-Year) | Metric | Q2 2025 | Q2 2024 | Growth Rate | Change ($M) | Notes | | :--------------------- | :------- | :------- | :---------- | :---------- | :---- | | GAAP Net Income | - | - | 85.7% | $5.5 | [4](index=4&type=chunk)[5](index=5&type=chunk) | | GAAP Diluted EPS | $0.74 | $0.40 | 85.0% | $0.34 | [4](index=4&type=chunk)[5](index=5&type=chunk) | | Adjusted Diluted EPS | $0.74 | $0.63 | 17.5% | $0.11 | [4](index=4&type=chunk)[5](index=5&type=chunk) | | Total Revenue (Excluding Divestitures) | - | - | 1.7% | $1.8 | [4](index=4&type=chunk) | - The company's leverage ratio decreased from 4.6x in the prior year to **4.2x**, with **$7.1 million** in credit facility debt repaid during the second quarter[5](index=5&type=chunk) [Strategic Initiatives and Outlook Update](index=1&type=section&id=Strategic%20Initiatives%20and%20Outlook%20Update) After two years of debt reduction, the company is resuming its long-term strategy of increasing shareholder value through high-quality acquisitions and has updated its full-year 2025 guidance - The company has signed contracts to acquire new businesses, expected to close this quarter, which collectively served over **2,600 families** and generated over **$15 million** in revenue last year[4](index=4&type=chunk)[5](index=5&type=chunk) Revised Full-Year 2025 Guidance | Metric | Revised 2025 Outlook | Previous 2025 Outlook | | :--------------------- | :------------------- | :------------------- | | Total Revenue ($M) | $410 - $420 | $400 - $410 | | Adjusted Consolidated EBITDA ($M) | $129 - $134 | $128 - $133 | | Adjusted Diluted EPS | $3.15 - $3.35 | $3.10 - $3.30 | | Adjusted Free Cash Flow ($M) | $40 - $50 | $40 - $50 | - The revised outlook incorporates the anticipated revenue impact from acquisitions and divestitures of certain non-core assets[8](index=8&type=chunk) [Financial Performance](index=2&type=section&id=Financial%20Performance) This section details the company's Q2 and H1 2025 GAAP and non-GAAP financial metrics, including operational data for funeral and cemetery businesses, and provides a revised full-year outlook [Key Financial Highlights](index=2&type=section&id=Key%20Financial%20Highlights) This section details the company's GAAP and non-GAAP financial metrics and key operational data for both cemetery and funeral businesses, reflecting changes in revenue, profit, and operational efficiency [Three Months Ended June 30, 2025](index=2&type=section&id=Three%20Months%20Ended%20June%2030%2C%202025) In Q2 2025, net income significantly increased due to reduced general and administrative expenses and interest expenses, despite a slight decrease in total revenue, while average contract revenue for funeral services improved Q2 2025 Financial and Operational Metrics | Metric | Q2 2025 | Q2 2024 | Change ($M) | Change Rate | | :---------------------------------- | :------- | :------- | :---------- | :---------- | | Total Revenue ($M) | $102.1 | $102.3 | -$0.2 | -0.2% | | Operating Income ($M) | $24.0 | $18.4 | $5.6 | 30.4% | | Net Income ($M) | $11.7 | $6.3 | $5.4 | 85.7% | | Diluted EPS | $0.74 | $0.40 | $0.34 | 85.0% | | Pre-Need Cemetery Property Sales Volume | 4,016 | 4,179 | -163 | -3.9% | | Average Price Per Pre-Need Cemetery Property | $5,871 | $5,908 | -$37 | -0.6% | | Funeral Contract Volume | 10,589 | 10,679 | -90 | -0.8% | | Average Revenue Per Funeral Contract | $5,626 | $5,549 | $77 | 1.4% | - Net income growth was primarily driven by a **$6.7 million** reduction in general, administrative, and other expenses and a **$1.3 million** decrease in interest expense, partially offset by a **$1.1 million** reduction in business gross profit contribution and a **$0.9 million** increase in income tax expense[7](index=7&type=chunk) [Six Months Ended June 30, 2025](index=2&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025) In H1 2025, both total and net income increased, with the significant rise in net income primarily attributed to gains from divestitures and real estate sales, alongside reduced administrative expenses H1 2025 Financial and Operational Metrics | Metric | H1 2025 | H1 2024 | Change ($M) | Change Rate | | :---------------------------------- | :------------- | :------------- | :---------- | :---------- | | Total Revenue ($M) | $209.2 | $205.8 | $3.4 | 1.7% | | Operating Income ($M) | $55.6 | $37.8 | $17.8 | 47.1% | | Net Income ($M) | $32.7 | $13.2 | $19.5 | 147.7% | | Diluted EPS | $2.07 | $0.85 | $1.22 | 143.5% | | Pre-Need Cemetery Property Sales Volume | 7,252 | 7,616 | -364 | -4.8% | | Average Price Per Pre-Need Cemetery Property | $5,669 | $5,430 | $239 | 4.4% | | Funeral Contract Volume | 22,761 | 22,770 | -9 | 0.0% | | Average Revenue Per Funeral Contract | $5,671 | $5,565 | $106 | 1.9% | - Net income growth was primarily driven by a **$9.3 million** increase in gains from divestitures and real estate sales, a **$10.9 million** reduction in general, administrative, and other expenses, and a **$2.7 million** decrease in interest expense, partially offset by a **$2.5 million** increase in income tax expense and a **$0.5 million** reduction in business gross profit contribution[13](index=13&type=chunk) [Revised Full-Year 2025 Outlook](index=3&type=section&id=Revised%20Full-Year%202025%20Outlook) The company has raised its full-year 2025 guidance for total revenue, adjusted consolidated EBITDA, and adjusted diluted EPS, reflecting current performance trends and the impact of acquisitions and divestitures in the second half Revised Full-Year 2025 Guidance | Metric | Revised 2025 Outlook | Previous 2025 Outlook | | :--------------------- | :------------------- | :------------------- | | Total Revenue ($M) | $410 - $420 | $400 - $410 | | Adjusted Consolidated EBITDA ($M) | $129 - $134 | $128 - $133 | | Adjusted Diluted EPS | $3.15 - $3.35 | $3.10 - $3.30 | | Adjusted Free Cash Flow ($M) | $40 - $50 | $40 - $50 | - Adjusted Consolidated EBITDA, Adjusted Diluted EPS, and Adjusted Free Cash Flow are non-GAAP financial measures, with their outlook excluding special items such as gains/losses on divestitures, acquisition costs, severance, and goodwill impairment[9](index=9&type=chunk) [Condensed Financial Statements](index=5&type=section&id=Condensed%20Financial%20Statements) This section presents the company's condensed operating and financial trends, balance sheet, statements of operations, and cash flows for Q2 and H1 2025, highlighting key financial positions and performance [Condensed Operating and Financial Trend Report](index=5&type=section&id=Condensed%20Operating%20and%20Financial%20Trend%20Report) This report provides detailed revenue and EBITDA data by business segment, along with trends in other expenses and net income, illustrating the profitability of each segment and overall financial performance Q2 and H1 2025 Operating and Financial Trends | Metric | Q2 2025 ($K) | Q2 2024 ($K) | H1 2025 ($K) | H1 2024 ($K) | | :----------------------- | :----------- | :----------- | :----------- | :----------- | | Funeral Business Revenue | $59,572 | $58,753 | $128,662 | $124,801 | | Cemetery Business Revenue | $33,450 | $33,644 | $61,388 | $60,049 | | Financial Revenue | $8,224 | $6,921 | $15,580 | $13,664 | | Total Revenue | $102,147 | $102,318 | $209,216 | $205,811 | | Funeral Business EBITDA | $22,030 | $23,220 | $51,570 | $50,569 | | Cemetery Business EBITDA | $15,003 | $16,712 | $26,368 | $28,247 | | Consolidated EBITDA | $32,262 | $26,778 | $65,210 | $53,749 | | Net Income | $11,739 | $6,259 | $32,665 | $13,232 | [Condensed Consolidated Balance Sheet](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheet) As of June 30, 2025, the company's total assets slightly decreased, while total shareholders' equity increased, reflecting changes in its asset and liability structure Condensed Consolidated Balance Sheet (As of Date) | Metric | June 30, 2025 ($K) | December 31, 2024 ($K) | | :--------------------- | :----------------- | :--------------------- | | Total Assets | $1,275,714 | $1,279,580 | | Total Liabilities | $1,040,294 | $1,071,030 | | Total Shareholders' Equity | $235,420 | $208,550 | [Consolidated Statements of Operations](index=9&type=section&id=Consolidated%20Statements%20of%20Operations) The consolidated statements of operations show increased service revenue but decreased property and merchandise revenue in Q2 and H1 2025, with operating and net income significantly growing due to corporate cost and expense control despite a slight reduction in gross profit Consolidated Statements of Operations Key Data | Metric | Q2 2025 ($K) | Q2 2024 ($K) | H1 2025 ($K) | H1 2024 ($K) | | :--------------------- | :----------- | :----------- | :----------- | :----------- | | Service Revenue | $46,510 | $44,433 | $99,520 | $94,132 | | Property and Merchandise Revenue | $46,513 | $49,590 | $92,099 | $95,092 | | Total Revenue | $102,147 | $102,318 | $209,216 | $205,811 | | Gross Profit | $35,935 | $36,993 | $73,777 | $74,255 | | Operating Income | $23,998 | $18,369 | $55,562 | $37,846 | | Net Income | $11,739 | $6,259 | $32,665 | $13,232 | | Diluted EPS | $0.74 | $0.40 | $2.07 | $0.85 | | Dividends Per Share | $0.1125 | $0.1125 | $0.2250 | $0.2250 | [Consolidated Statements of Cash Flows](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) In H1 2025, cash flow from operating activities remained stable, while cash flow from investing activities significantly increased due to proceeds from divestitures and asset sales, with increased financing outflows leading to a slight rise in period-end cash and cash equivalents Consolidated Statements of Cash Flows Key Data (Half-Year) | Metric | H1 2025 ($K) | H1 2024 ($K) | | :------------------------- | :----------- | :----------- | | Net Cash Provided by Operating Activities | $21,877 | $21,860 | | Net Cash Provided by Investing Activities | $12,813 | $4,392 | | Net Cash Used in Financing Activities | -$34,457 | -$26,272 | | Net Increase (Decrease) in Cash and Cash Equivalents | $233 | -$20 | | Cash and Cash Equivalents at End of Period | $1,398 | $1,503 | - The increase in cash flow from investing activities was primarily due to proceeds from divestitures and sales of other assets, which rose from **$11,174 thousand** in H1 2024 to **$18,822 thousand** in H1 2025[22](index=22&type=chunk) [Non-GAAP Financial Measures](index=11&type=section&id=Non-GAAP%20Financial%20Measures) This section defines and reconciles the company's non-GAAP financial measures, including various EBITDA and free cash flow metrics, to provide a clearer view of core operational performance [Definitions of Non-GAAP Measures](index=11&type=section&id=Definitions%20of%20Non-GAAP%20Measures) This section provides detailed definitions of the non-GAAP financial measures used by the company to assess financial performance, aiming to offer investors additional information and enhance comparability with historical performance and industry peers - Non-GAAP financial measures include special items, adjusted net income, consolidated EBITDA, adjusted consolidated EBITDA, adjusted free cash flow, funeral business EBITDA, and cemetery business EBITDA, designed to exclude expenses and gains not directly reflecting core or normal business operations[23](index=23&type=chunk)[24](index=24&type=chunk)[33](index=33&type=chunk) - The company considers Adjusted Consolidated EBITDA a supplemental measure of operating performance, aiding in the analysis and comparison of continuing operations by excluding items that may not be representative of ongoing performance[30](index=30&type=chunk) - Funeral Business EBITDA and Cemetery Business EBITDA aim to highlight the cash profitability and controllable margins of each business segment, excluding regional and unallocated costs determined by the Houston Support Center[25](index=25&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk) [Reconciliation of Non-GAAP Financial Measures](index=13&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section provides detailed tables reconciling non-GAAP financial measures to the most directly comparable GAAP measures, ensuring transparency and traceability in financial reporting Reconciliation of Operating Income to Consolidated EBITDA and Adjusted Consolidated EBITDA | Metric | Q2 2025 ($K) | Q2 2024 ($K) | H1 2025 ($K) | H1 2024 ($K) | | :------------------------- | :----------- | :----------- | :----------- | :----------- | | Operating Income | $23,998 | $18,369 | $55,562 | $37,846 | | Depreciation and Amortization | $6,173 | $6,204 | $11,574 | $11,664 | | Non-Cash Share-Based Compensation | $2,092 | $2,182 | $3,845 | $2,671 | | Consolidated EBITDA | $32,262 | $26,778 | $65,210 | $53,749 | | Adjusted Consolidated EBITDA | $32,262 | $32,604 | $65,210 | $66,205 | Special Items Affecting Adjusted Net Income | Special Item | Q2 2025 ($K) | Q2 2024 ($K) | H1 2025 ($K) | H1 2024 ($K) | | :--------------------------------- | :----------- | :----------- | :----------- | :----------- | | Severance and Termination Costs | $0 | $771 | $0 | $6,228 | | Net (Gain) Loss on Divestitures and Real Estate Sales | $12 | $8 | -$7,913 | $1,509 | | Other Special Items | $0 | $5,055 | $0 | $6,228 | | Total | $12 | $5,417 | -$8,217 | $12,212 | Reconciliation of Operating Cash Flow to Adjusted Free Cash Flow | Metric | Q2 2025 ($K) | Q2 2024 ($K) | H1 2025 ($K) | H1 2024 ($K) | | :------------------------- | :----------- | :----------- | :----------- | :----------- | | Cash Flow from Operating Activities | $8,085 | $2,157 | $21,877 | $21,860 | | Capital Expenditures | -$2,846 | -$3,545 | -$6,009 | -$7,096 | | Free Cash Flow | $5,239 | -$1,388 | $15,868 | $14,764 | | Adjusted Free Cash Flow | $6,900 | -$339 | $20,253 | $18,197 | [Additional Information](index=3&type=section&id=Additional%20Information) This section provides details on the upcoming conference call, investor relations contact, and a cautionary statement regarding forward-looking statements and associated risks [Conference Call and Investor Relations Contact](index=3&type=section&id=Conference%20Call%20and%20Investor%20Relations%20Contact) The company has scheduled a conference call for August 7, 2025, to discuss Q2 results and outlook, and has provided investor relations contact information - A conference call is scheduled for **Thursday, August 7, 2025, at 8:00 AM Central Time**, accessible by dialing **888-254-3590** (Conference ID - **6237081**)[11](index=11&type=chunk) - Carriage Services is a leading provider of funeral and cemetery services and merchandise in the United States, operating **159 funeral homes** and **28 cemeteries** as of June 30, 2025[12](index=12&type=chunk) - Investor relations inquiries can be directed via email to **InvestorRelations@carriageservices.com**[12](index=12&type=chunk) [Cautionary Statement on Forward-Looking Statements](index=16&type=section&id=Cautionary%20Statement%20on%20Forward-Looking%20Statements) This press release contains forward-looking statements regarding future performance, strategy, economic conditions, and market performance, cautioning investors about significant risks and uncertainties that could cause actual results to differ materially from expectations - Forward-looking statements include, but are not limited to, projections for financial items such as earnings, revenue, cash flow, return on invested capital, capital allocation, debt levels, market share growth, and cost inflation[42](index=42&type=chunk) - Key risk factors include the ability to retain skilled personnel, competitive impacts, changes in market death rates, shifts in consumer preferences, pre-need sales capabilities, trust fund investment performance, interest rate fluctuations, inflationary effects, financing capabilities, debt levels, tax law changes, litigation, industry consolidation, successful integration of acquisitions and divestitures, information technology disruptions, and acts of war or terrorism[42](index=42&type=chunk)[43](index=43&type=chunk) - Investors should review the 'Risk Factors' disclosed in the company's Form 10-K annual report and other SEC filings, and should not place undue reliance on forward-looking statements[44](index=44&type=chunk)

Core Viewpoint - Carriage Services, Inc. reported strong financial performance for the second quarter of 2025, with significant growth in net income and earnings per share, despite challenges from divestitures. The company is poised to return to a growth trajectory through strategic acquisitions [3][10]. Financial Highlights - GAAP net income increased by $5.5 million, or 85.7%, compared to the same quarter last year, reaching $11.7 million [4][6]. - GAAP diluted EPS was $0.74, reflecting an 85.0% increase from $0.40 in the prior year quarter [4][6]. - Total revenue for the second quarter was $102.1 million, slightly down from $102.3 million in the previous year, but flat due to organic growth strategies [4][10]. - Operating income rose to $24.0 million, up from $18.4 million in the prior year, with an operating income margin of 23.5% [4][6]. - Cash provided by operating activities was $8.1 million, compared to $2.2 million in the prior year [4][6]. Operational Metrics - Total funeral consolidated revenue increased by $1.7 million, or 2.6%, driven by a 1.4% increase in average revenue per funeral contract [6][10]. - The company sold 4,016 preneed interment rights in the quarter, with an average price of $5,871 per right [4][7]. - The leverage ratio improved to 4.2x from 4.6x year-over-year, as the company paid down $7.1 million of debt during the quarter [6][10]. Revised Outlook - The company updated its full-year guidance to reflect current performance trends and the anticipated impact of acquisitions and divestitures [3][10]. - Total revenue for the full year is projected to be between $410 million and $420 million, with adjusted consolidated EBITDA expected to be between $129 million and $134 million [11][10].

Group 1 - Carriage Services, Inc. plans to release its second quarter 2025 results on August 6, 2025, after market close [1] - A conference call to discuss the earnings will be held on August 7, 2025, at 8:00 a.m. Central Time [2] - The company operates 159 funeral homes across 25 states and 28 cemeteries in 10 states as of June 30, 2025 [3] Group 2 - The conference call will be accessible via phone or live webcast [2] - An audio archive of the call will be available on the company's website after the event [3] - Carriage Services is recognized as a leading provider of funeral and cemetery services and merchandise in the United States [3]

Core Viewpoint - Carriage Services (CSV) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive outlook driven by rising earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Performance - The Zacks rating system emphasizes the importance of earnings estimate revisions, which are strongly correlated with near-term stock price movements [4][6]. - For the fiscal year ending December 2025, Carriage Services is projected to earn $3.21 per share, reflecting a 21.1% increase from the previous year, with a 13.8% rise in the Zacks Consensus Estimate over the past three months [8]. Institutional Investor Influence - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to buying or selling actions that affect stock prices [4][5]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [7]. - Carriage Services' upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

[PART I – FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited Consolidated Financial Statements for the quarter ended March 31, 2025, covering Balance Sheets, Statements of Operations, Cash Flows, and Stockholders' Equity, with accompanying notes Consolidated Statement of Operations Highlights (Q1 2025 vs Q1 2024) | Financial Metric | Q1 2025 (in thousands) | Q1 2024 (in thousands) | Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | $107,069 | $103,493 | +3.4% | | **Gross Profit** | $37,842 | $37,262 | +1.6% | | **Operating Income** | $31,564 | $19,477 | +62.1% | | **Net Income** | $20,926 | $6,973 | +200.1% | | **Diluted EPS** | $1.34 | $0.45 | +197.8% | Consolidated Balance Sheet Highlights | Balance Sheet Item | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | Total Current Assets | $49,900 | $44,536 | | **Total Assets** | **$1,275,229** | **$1,279,580** | | Total Current Liabilities | $52,511 | $58,041 | | **Total Liabilities** | **$1,052,167** | **$1,071,030** | | **Total Stockholders' Equity** | **$223,062** | **$208,550** | Consolidated Statement of Cash Flows Highlights (Q1 2025 vs Q1 2024) | Cash Flow Activity | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :--- | :--- | :--- | | Net Cash from Operating Activities | $13,792 | $19,703 | | Net Cash from Investing Activities | $15,497 | $7,372 | | Net Cash from Financing Activities | ($25,811) | ($26,909) | [Condensed Notes to Consolidated Financial Statements](index=8&type=section&id=Condensed%20Notes%20to%20Consolidated%20Financial%20Statements) These notes detail accounting policies and financial statement line items, covering business structure, divestitures, goodwill, debt, lease obligations, and segment reporting - The company operates **160 funeral homes** and **28 cemeteries**, with Funeral Home Operations accounting for approximately **70% of total revenue** and Cemetery Operations for about **30%**[20](index=20&type=chunk) - In Q1 2025, the company sold two funeral homes and three cemeteries for an aggregate of **$15.8 million**, resulting in a net gain of **$5.9 million**[46](index=46&type=chunk) - Goodwill decreased from **$414.9 million** at year-end 2024 to **$410.7 million** at March 31, 2025, primarily due to a **$4.2 million** allocation of goodwill to divested businesses[44](index=44&type=chunk) Debt and Lease Obligations (March 31, 2025) | Obligation Type | Carrying Value (in thousands) | | :--- | :--- | | Credit Facility | $118,470 | | Senior Notes | $396,774 | | Operating Lease Liabilities | $16,275 | | Finance Lease Liabilities | $9,942 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 financial performance, highlighting revenue and net income growth, key company developments, liquidity, capital resources, and segment operational results, attributing success to pricing strategy and cost management [Overview & Company Developments](index=37&type=section&id=Overview%20%26%20Company%20Developments) This section outlines significant corporate events in early 2025, including new executive appointments and the continuation of the company's divestiture program - Effective January 2, 2025, **John Enwright** was appointed as the company's new **Senior Vice President, Chief Financial Officer, and Treasurer**[153](index=153&type=chunk) - On February 24, 2025, **Donald D. Patteson, Jr.** was elected **Non-Executive Chair of the Board**, and **Dr. Edmondo Robinson** was elected **Chair of the Audit Committee**[154](index=154&type=chunk)[155](index=155&type=chunk) - During Q1 2025, the company sold two funeral homes and three cemeteries for **$15.8 million**, resulting in a **$5.9 million gain**, and sold additional real property for **$2.9 million**, resulting in a **$2.0 million gain**[156](index=156&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is primarily from operations and its credit facility, with Q1 2025 cash from operations decreasing due to working capital changes, and capital priorities focused on debt repayment, dividends, and internal growth - Cash provided by operating activities decreased to **$13.8 million** in Q1 2025 from **$19.7 million** in Q1 2024, mainly due to unfavorable working capital changes[169](index=169&type=chunk) - Net cash provided by investing activities was **$15.5 million**, driven by **$18.7 million** in proceeds from divestitures and asset sales[168](index=168&type=chunk)[170](index=170&type=chunk) - The company made net payments of **$17.1 million** on its Credit Facility, acquisition debt, and finance leases during Q1 2025[173](index=173&type=chunk) - As of March 31, 2025, the company had **$120.0 million** in outstanding borrowings and **$127.8 million** of availability under its Credit Facility[183](index=183&type=chunk) [Results of Operations](index=44&type=section&id=Results%20of%20Operations) This section analyzes Q1 2025 segment performance, detailing revenue growth in Funeral Home and Cemetery segments, and attributing overall net income increase to divestiture gains and reduced G&A expenses Financial Highlights (Q1 2025 vs Q1 2024) | Metric | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :--- | :--- | :--- | | Total Revenue | $107,069 | $103,493 | | Funeral Contracts | 12,172 | 12,091 | | Avg. Revenue per Funeral Contract | $5,710 | $5,580 | | Preneed Interment Rights Sold | 3,236 | 3,437 | | Avg. Price per Preneed Interment Right | $5,419 | $4,849 | - Funeral Home operating revenue increased by **$3.0 million**, driven by a **2.3%** increase in average revenue per contract and a **0.7%** increase in volume[204](index=204&type=chunk) - Cemetery operating revenue increased by **$1.5 million**, driven by an **11.8%** increase in the average price per interment right sold, which offset a **5.8%** decrease in sales volume[208](index=208&type=chunk) - General, administrative and other expenses decreased by **$4.2 million**, primarily due to a **$4.3 million** decrease in salary and incentive costs related to a former executive's termination agreement in Q1 2024[215](index=215&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are interest rate fluctuations on variable-rate debt and market value changes in trust securities, with a 100 basis point rate change impacting income by $1.2 million, while fixed-rate Senior Notes mitigate some exposure - The company is primarily exposed to **interest rate risk** on its **Credit Facility** and **market value risk** on securities in its **trust funds**[221](index=221&type=chunk) - Assuming the outstanding balance on the Credit Facility remains unchanged, a **100 basis point (1%)** change in the borrowing rate would result in a **$1.2 million** change in income before taxes[225](index=225&type=chunk) - The **$400 million** Senior Notes bear a fixed interest rate of **4.25%**, so changes in market interest rates do not affect interest costs but do affect the notes' fair value, which was **$364.4 million** at March 31, 2025[226](index=226&type=chunk)[227](index=227&type=chunk) [Controls and Procedures](index=48&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of the end of the reporting period, the company's principal executive and financial officers concluded that disclosure controls and procedures were **effective**[229](index=229&type=chunk) - There were **no changes** in the company's internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, these controls[230](index=230&type=chunk) [PART II – OTHER INFORMATION](index=49&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Legal Proceedings](index=49&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various ordinary course legal proceedings, including two class action lawsuits, which are not expected to have a material adverse effect - The company is party to a number of legal proceedings from the ordinary course of business, which are **not expected to have a material adverse effect** on its financial statements[233](index=233&type=chunk) - **Two class action lawsuits** have been filed against the company and its subsidiaries in California: a wage and hour case (Denning v. Carriage) and a consumer case related to cemetery maintenance (Frost v. Rolling Hills)[235](index=235&type=chunk)[236](index=236&type=chunk) [Risk Factors](index=49&type=section&id=Item%201A.%20Risk%20Factors) This section supplements existing risk factors by adding a specific risk concerning U.S. foreign trade policies, highlighting potential adverse effects from tariffs and trade barriers on costs and supply chain - A **supplemental risk factor** was added regarding changes in **U.S. foreign trade policies**, including **tariffs and trade barriers**[237](index=237&type=chunk)[238](index=238&type=chunk) - The company warns that such policies could lead to **inflationary pressures**, **increase the costs of goods** offered to customers, and **negatively impact the supply chain** for merchandise[238](index=238&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=50&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's Q1 2025 share repurchase activity, noting no repurchases under the public program and **$48.9 million** remaining authorized for future repurchases Share Repurchase Activity (Q1 2025) | Period | Total Shares Purchased | Average Price Paid ($) | Shares Purchased as Part of Program | | :--- | :--- | :--- | :--- | | Jan 2025 | 0 | $0.00 | 0 | | Feb 2025 | 170,726 | $40.00 | 0 | | Mar 2025 | 0 | $0.00 | 0 | - As of March 31, 2025, the company had **$48,898,769** remaining under its authorized share repurchase program[239](index=239&type=chunk) [Other Disclosures and Exhibits](index=50&type=section&id=Other%20Disclosures%20and%20Exhibits) This section confirms no defaults on senior securities, no mine safety disclosures, no Rule 10b5-1 trading arrangement changes by directors or officers, and refers to the Index of Exhibits - Item 3 (Defaults Upon Senior Securities) and Item 4 (Mine Safety Disclosures) are **not applicable**[240](index=240&type=chunk)[241](index=241&type=chunk) - During the fiscal quarter ended March 31, 2025, **no director or officer adopted or terminated any Rule 10b5-1 trading arrangements**[242](index=242&type=chunk)

Financial Data and Key Metrics Changes - Total revenue for the first quarter was $107.1 million, an increase of $3.6 million or 3.5% compared to the same quarter last year [8] - GAAP net income was $20.9 million, an increase of $13.9 million or 200.1% year-over-year [21] - Adjusted diluted EPS for the first quarter was $0.96 per share, an increase of $0.21 or 28% compared to the prior year quarter [12] Business Line Data and Key Metrics Changes - Total funeral operating revenue was $69.1 million, an increase of $3 million or 4.6% year-over-year, driven by a 1.8% increase in average revenue per contract and a 2.4% increase in admin volume [8][9] - Total cemetery revenue reached $27.9 million, an increase of $1.5 million or 5.8% [10] - Financial revenue was $7.4 million, an increase of $613,000 or 9.1%, primarily from preneed insurance funeral sales [11] Market Data and Key Metrics Changes - The company observed a shift in flu season affecting volume, with a positive variance of 7.7% compared to the first quarter of the previous year [9] - The preneed cemetery growth rate is expected to be between 10% to 20% for the year [10] Company Strategy and Development Direction - The company is focused on disciplined execution and strategic initiatives, including the implementation of the Trinity system and supply chain optimization [15][16] - The company aims to maintain its current guidance while monitoring economic conditions, with potential adjustments based on performance in the second quarter [14][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's momentum and the strength of its financial strategy, despite broader economic uncertainties [13][14] - The company plans to reinvest proceeds from divestitures into higher quality EBITDA-producing businesses, with expectations for acquisitions in the second half of the year [41][43] Other Important Information - Adjusted consolidated EBITDA for the first quarter was $32.9 million, a decrease of $653,000 or 1.9% [11] - Overhead expenses decreased to $15.3 million from $19.4 million in the prior year, with adjusted overhead as a percentage of revenue at 14.3% [24][25] Q&A Session Summary Question: How was March and April performance? - Management indicated that momentum has continued strongly from January through April, primarily due to volume increases [28][29] Question: Does the strength year-over-year suggest the COVID hangover is behind? - Management noted it is challenging to forecast but believes this year will level up and potentially increase volume moving forward [30][32] Question: What is attributed to the decline in preneed and terming rates sold? - Management attributed the decline to delays in available inventory at premier cemeteries rather than discretionary spending [34][36] Question: What are the expected proceeds from property monetization in Q2? - Expected proceeds from property monetization in Q2 are around $6 million, which is factored into guidance [62][63] Question: How does the company plan to react in a recessionary environment? - Management expressed confidence in the resilience of the industry and plans to accelerate lead generation programs to maintain growth [55][57]

Financial Data and Key Metrics Changes - For the first quarter, total revenue was reported at $107.1 million, an increase of $3.6 million or 3.5% compared to the same quarter last year [9] - GAAP net income for the first quarter was $20.9 million, an increase of $13.9 million or 200.1% [22] - Adjusted diluted EPS for the first quarter was $0.96 per share, an increase of $0.21 or 28% compared to the prior year quarter [13] - Adjusted consolidated EBITDA was $32.9 million, a decrease of $653,000 or 1.9% [12] Business Line Data and Key Metrics Changes - Total funeral operating revenue was $69.1 million, an increase of $3 million or 4.6% year-over-year, driven by a 1.8% increase in average revenue per contract and a 2.4% increase in admin volume [9] - Total cemetery revenue reached $27.9 million, an increase of $1.5 million or 5.8% [11] - Financial revenue was $7.4 million, an increase of $613,000 or 9.1%, primarily from preneed insurance funeral sales [12] Market Data and Key Metrics Changes - The company observed a shift in flu season, impacting volume expectations, with a positive variance of 7.7% compared to the first quarter of the previous year [10] - The preneed cemetery growth rate is expected to be between 10% to 20% for the year [11] Company Strategy and Development Direction - The company is maintaining its current guidance while monitoring economic conditions, with plans to potentially raise guidance if momentum continues [14][15] - The Trinity system is in Phase one of implementation, focusing on back office systems, with Phase two expected to begin in the third quarter [16] - The company is excited about the rollout of its express funeral funding partnership, aimed at improving family financial flexibility and unlocking new sales potential [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's momentum and the strength of its financial strategy, despite broader economic uncertainties [14][19] - The company is focused on operational excellence and innovation to create lasting value for shareholders [20] Other Important Information - Cash provided by operating activities for the quarter was $13.8 million, down from $19.7 million in the prior year [23] - The company ended the quarter with a maintained leverage ratio of 4.2 times, down from 5 times [24] Q&A Session Summary Question: How was March and April performance? - Management indicated that momentum has continued strongly from January through April, primarily due to volume increases [30][31] Question: What is the outlook for preneed and terming rates sold? - Management noted that while there was a decline in preneed property rights sold, they expect a return to normal growth rates starting in the second quarter [34][35] Question: What are the expected proceeds from property monetization in Q2? - Management estimated around $6 million in proceeds from property sales in Q2, which is factored into guidance [56] Question: How does the company plan to react in a recessionary environment? - Management expressed confidence in the resilience of the industry, noting that demand remains stable even during economic downturns [51][52] Question: What cost-saving measures are currently in place? - Management highlighted ongoing supply chain initiatives and fleet management as key areas for cost savings [47][48]

Group 1: Earnings Performance - Carriage Services (CSV) reported quarterly earnings of $0.96 per share, exceeding the Zacks Consensus Estimate of $0.80 per share, and up from $0.75 per share a year ago [1] - The earnings surprise for this quarter was 20%, following a previous quarter where earnings of $0.62 per share surpassed expectations of $0.51 per share by 21.57% [2] - Over the last four quarters, the company has consistently surpassed consensus EPS estimates [2] Group 2: Revenue Performance - The company posted revenues of $107.07 million for the quarter ended March 2025, which was 4.72% above the Zacks Consensus Estimate and an increase from $103.49 million year-over-year [3] - Carriage Services has also topped consensus revenue estimates in each of the last four quarters [3] Group 3: Stock Performance and Outlook - Carriage Services shares have increased approximately 1.3% since the beginning of the year, contrasting with a decline of 5.5% in the S&P 500 [4] - The future performance of the stock will largely depend on management's commentary during the earnings call and the company's earnings outlook [4][5] - The current consensus EPS estimate for the upcoming quarter is $0.76 on revenues of $100.31 million, and for the current fiscal year, it is $3.21 on revenues of $407.85 million [8] Group 4: Industry Context - The Funeral Services industry, to which Carriage Services belongs, is currently ranked in the top 36% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [9]

Carriage Services Announces First Quarter 2025 Results Conference call on Thursday, May 1, 2025 at 8:00 a.m. Central Time HOUSTON - April 30, 2025 - (GLOBE NEWSWIRE) Carriage Services, Inc. (NYSE: CSV) today announced its financial results for the first quarter ended March 31, 2025. Company Highlights: Carlos Quezada, Vice Chairman and CEO, stated, "We are proud of our first-quarter results, which reflect the strength of our strategy and execution discipline. Our solid financial performance, highlighted by ...

Conference call on Thursday, May 1, 2025 at 8:00 a.m. Central TimeHOUSTON, April 30, 2025 (GLOBE NEWSWIRE) -- Carriage Services, Inc. (NYSE: CSV) today announced its financial results for the first quarter ended March 31, 2025. Company Highlights: GAAP net income growth of $14.0 million or 200.1% over the prior year quarter;GAAP diluted EPS of $1.34 and adjusted diluted EPS of $0.96, compared to $0.45 and $0.75 in the prior year quarter, a growth of 197.8% and 28.0%, respectively;Total funeral operating rev ...