Core Points - Service Corporation International (SCI) has announced a 6.7% increase in its quarterly cash dividend, raising it from thirty cents to thirty-two cents per share of common stock [1] - The new dividend is payable on March 31, 2025, to shareholders of record as of March 14, 2025 [1] - The company intends to continue paying regular quarterly cash dividends, subject to the Board of Directors' review of financial performance [1] Company Overview - Service Corporation International is the largest provider of deathcare products and services in North America, serving approximately 700,000 families annually [3] - The company operates a diversified portfolio of brands, offering a range of services from simple cremations to full life celebrations [3] - As of December 31, 2024, SCI owned and operated 1,493 funeral service locations and 496 cemeteries across 44 states, eight Canadian provinces, the District of Columbia, and Puerto Rico [3]

Company Operations - The company operates 1,493 funeral service locations and 496 cemeteries across 44 states, eight Canadian provinces, the District of Columbia, and Puerto Rico, serving approximately 700,000 families annually[158]. Financial Performance - Total revenue for 2024 was $4.186 billion, an increase from $4.099 billion in 2023, representing a growth of approximately 2.1%[273]. - Service revenue increased to $1.732 billion in 2024 from $1.683 billion in 2023, reflecting a growth of about 2.9%[273]. - Gross profit for 2024 was $1.091 billion, slightly down from $1.092 billion in 2023, indicating a decrease of approximately 0.1%[273]. - Consolidated net income attributable to common stockholders for 2024 was $518.6 million, a decrease from $537.3 million in 2023, with earnings per diluted share remaining at $3.53[209]. - The company reported a total comprehensive income of $486.632 million for 2024, down from $546.014 million in 2023, a decrease of about 10.9%[275]. Cash Flow and Investments - Operating cash flow increased to $944.9 million in 2024 from $869.0 million in 2023, reflecting a $75.9 million increase[171]. - The company reported a net cash used in investing activities of $620,949 in 2024, compared to $469,386 in 2023, indicating a 32.2% increase[278]. - Capital expenditures for 2024 were $389,107, an increase of 7.6% compared to $361,793 in 2023[278]. - The company reported realized gains from sales of securities of $509.98 million in 2024, significantly higher than $281.17 million in 2023[348]. Debt and Leverage - The company had $4.8 billion in aggregate principal outstanding on debt and finance leases as of December 31, 2024, with $83.9 million due in the next twelve months[174]. - The leverage ratio was 3.65 as of December 31, 2024, within the target range of 3.5x to 4.0x[165]. - Approximately 84% of the company's total debt as of December 31, 2024, consisted of fixed-rate debt at a weighted average rate of 4.64%[255]. Shareholder Returns - The quarterly dividend rate increased from $0.025 per share in 2005 to $0.30 per share at the end of 2024, targeting a payout ratio of 30% to 40% of after-tax earnings[168]. - In 2024, the company repurchased 3,439,551 shares at an average cost of $72.63 per share, totaling $249.8 million[168]. - Dividends declared on common stock increased to $174,282 in 2024, up from $167,983 in 2023, representing a 7.7% increase[279]. Trust and Preneed Sales - As of December 31, 2024, the company has a $16.0 billion backlog of future revenue from trust and insurance-funded preneed sales, enhancing revenue stability and predictability[159]. - Preneed insurance-funded sales production reached $725.0 million in 2024, with 120,434 contracts sold, compared to $704.8 million and 113,095 contracts in 2023[186]. - Preneed trust-funded sales production decreased to $480.0 million in 2024 from $541.5 million in 2023, representing a decline of approximately 11.4%[189]. - The backlog of insurance-funded contracts was $8.37 billion as of December 31, 2024, compared to $7.78 billion in 2023, indicating an increase of 7.6%[193]. Asset Management - The total fair value of trust investments was $7,084.7 million, with unrealized gains of $1,094.8 million and unrealized losses of $211.6 million[350]. - The fair value of deferred receipts held in trust increased to $5.16 billion in 2024 from $4.50 billion in 2023, a growth of 14.7%[193]. - Trust investments at fair value rose to $7,084.7 million in 2024, compared to $6,394.8 million in 2023, marking an increase of 10.8%[345]. Expenses and Costs - Consolidated funeral gross profit decreased by $31.8 million, or 6.4%, to $465.3 million in 2024, attributed to higher employee-related costs and increased maintenance expenses from natural disasters[213]. - Corporate general and administrative expenses decreased to $139.0 million in 2024 from $157.4 million in 2023, with a notable $20.3 million reduction in legal reserves[219]. - Interest expense increased by $18.3 million to $257.8 million in 2024, primarily due to higher interest rates on floating rate debt[222]. Tax and Regulatory Matters - The effective tax rate for 2024 was 23.2%, down from 24.1% in 2023, mainly due to increased excess tax benefits from employee share-based awards[223]. - The company believes it is reasonably possible that the recorded amount of gross unrecognized tax benefits may decrease by $0.4 million within the next twelve months[248]. Goodwill and Intangible Assets - The consolidated goodwill balance was $2.1 billion as of December 31, 2024, with $1.7 billion associated with the funeral reporting unit[268]. - The company performed its annual goodwill impairment test using a 7.50% discount rate and revenue growth rates averaging 2.8% over a six-year period[308]. Market Risks - The company’s exposure to market risk includes price risk from marketable equity and debt securities, interest rate risk from floating rate debt, and currency risk primarily associated with the Canadian dollar[251]. - A hypothetical 10% increase in interest rates would increase the company's interest expense by $4.9 million[255].

Financial Data and Key Metrics Changes - Adjusted earnings per share for Q4 2024 was $1.06, up from $0.93 in the prior year, reflecting a growth of $0.14 per share from operating income [7][8] - Total adjusted operating cash flow for Q4 was $268 million, exceeding expectations, with full-year adjusted operating cash flow reaching over $975 million [26][29] - The effective tax rate for 2025 is anticipated to be about 25.5%, which is 180 basis points higher than 2024 [18][39] Business Line Data and Key Metrics Changes - Comparable funeral revenues increased by over $5 million or about 1% year-over-year, while core funeral revenues decreased by $9 million or about 2% due to a 4.4% decrease in core funeral services performed [9][10] - Comparable cemetery revenue increased by $20 million or about 4%, primarily driven by a $21 million increase in core revenue [15][16] - Preneed funeral sales production decreased by $27 million or about 9% compared to Q4 2023, while comparable preneed cemetery sales production increased by $7 million or about 2% [12][17] Market Data and Key Metrics Changes - The company expects flat to slightly down funeral volume in 2025 compared to 2024, with average revenue per case growing at inflationary rates [19][20] - The anticipated growth for preneed cemetery sales production is in the low to mid-single-digit percentage range, resulting in cemetery revenue growth of about 2% to 3% [21] Company Strategy and Development Direction - The company is transitioning from trust to insurance-funded preneed contracts, with expectations of increased underwritten insurance product sales production [13][70] - The 2025 guidance for adjusted earnings per share is set between $3.70 and $4.00, indicating a growth of 5% to 13% [18] - The company plans to continue returning capital to shareholders through dividends and share buybacks, maintaining a disciplined approach [42] Management's Comments on Operating Environment and Future Outlook - Management noted that the impact of COVID-19 is diminishing, with life expectancy numbers returning to normal, which may stabilize funeral volumes [62][90] - The company anticipates a gradual increase in service volumes as the first baby boomers turn 80 next year, projecting a slow stair-step growth over the next few years [124] Other Important Information - The company invested $140 million in Q4 2024 into current locations, growth opportunities, and acquisitions, with a total of $348 million in maintenance capital expenditures for the full year [30][31] - A restructuring charge of over $11 million was recorded, primarily related to corporate and back-office functions, aimed at improving efficiency [99][102] Q&A Session Summary Question: What is the expected pretax benefit from the general agency and acquisition timing? - Management indicated that the estimated benefit is likely a bit lower than $40 million to $45 million but not dramatically off [46][48] Question: How is the long-term funeral pricing outlook? - Management suggested that the pricing growth may settle closer to 100 basis points rather than 150, with CPI being a fair way to assess pricing [50][53] Question: What is the outlook for funeral volumes and case growth in 2025? - Management acknowledged a potential for flat to slightly down volumes, influenced by the residual effects of COVID-19 [62][63] Question: How is the transition from trust to preneed insurance sales progressing? - Management clarified that 75% of production has been converted in key states, with expectations for stabilization and growth in the back half of the year [68][70] Question: What is the current status of the acquisition pipeline? - Management confirmed that the acquisition pipeline remains robust, with hopes to exceed the initial guidance of $75 million to $125 million based on market conditions [76][79]

Core Insights - Service Corp. (SCI) reported revenue of $1.09 billion for the quarter ended December 2024, reflecting a year-over-year increase of 3.5% and a surprise of +0.74% over the Zacks Consensus Estimate [1] - Earnings per share (EPS) for the quarter was $1.06, up from $0.93 in the same quarter last year, with an EPS surprise of +0.95% compared to the consensus estimate of $1.05 [1] Financial Performance Metrics - Total comparable funeral average revenue per service was $5,721, exceeding the two-analyst average estimate of $5,667.83 [4] - Funeral services performed totaled 88,934, which was below the two-analyst average estimate of 91,395 [4] - Cemetery revenues reached $505.30 million, surpassing the $494.32 million average estimate based on three analysts, representing a year-over-year change of +4.7% [4] - Funeral revenues were reported at $587.70 million, slightly below the $590.69 million average estimate based on three analysts, with a year-over-year change of +2.5% [4] - Gross profit from funeral services was $125.10 million, compared to the average estimate of $131.58 million based on three analysts [4] - Gross profit from cemetery services was $180.80 million, exceeding the three-analyst average estimate of $174.01 million [4] Stock Performance - Shares of Service Corp. have returned +0.6% over the past month, while the Zacks S&P 500 composite has changed by +4.3% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Viewpoint - Service Corp. (SCI) reported quarterly earnings of $1.06 per share, exceeding the Zacks Consensus Estimate of $1.05 per share, and showing an increase from $0.93 per share a year ago, indicating a positive earnings surprise of 0.95% [1] Group 1: Earnings and Revenue Performance - The company posted revenues of $1.09 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.74%, and showing a slight increase from $1.06 billion year-over-year [2] - Over the last four quarters, Service Corp. has exceeded consensus EPS estimates two times and topped consensus revenue estimates four times [2] Group 2: Stock Performance and Outlook - Service Corp. shares have declined approximately 3.1% since the beginning of the year, contrasting with the S&P 500's gain of 3.2% [3] - The company's current consensus EPS estimate for the upcoming quarter is $0.95 on revenues of $1.08 billion, and for the current fiscal year, it is $3.92 on revenues of $4.32 billion [7] Group 3: Industry Context - The Funeral Services industry, to which Service Corp. belongs, is currently ranked in the bottom 11% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Service Corp.'s stock performance [5]

Financial Performance - Adjusted earnings per share grew 14% in Q4 2024, reaching $1.06, while GAAP earnings per share increased 12% to $1.04[5] - Revenue for Q4 2024 was $1,093 million, a 4% increase from $1,056 million in Q4 2023, driven by growth in both funeral and cemetery segments[9] - Full year 2024 adjusted earnings per share totaled $3.53, consistent with the previous year, while adjusted operating cash flow reached $977 million[5] - Net income attributable to common stockholders for Q4 2024 was $151,354,000, up from $138,395,000 in Q4 2023, representing an increase of 9.3%[22] - Basic earnings per share for Q4 2024 was $1.05, compared to $0.94 in Q4 2023, marking an increase of 11.7%[22] - Net income attributable to common stockholders for the twelve months ended December 31, 2024, was $518.6 million, or $3.53 per diluted share[52] Revenue Breakdown - Total revenue for the consolidated funeral segment in Q4 2024 was $587.7 million, compared to $573.2 million in Q4 2023, reflecting a growth of 2.8%[27] - Total revenue for the consolidated cemetery segment in Q4 2024 was $505.3 million, an increase from $482.6 million in Q4 2023, representing a growth of 4.7%[27] - Total comparable funeral revenue increased by $5.4 million, or 1.0%, driven by an $18.5 million increase in core general agency and other revenue, offset by an $8.8 million decrease in core funeral revenue[41] - Total comparable cemetery revenue increased by $20.2 million, or 4.2%, with core revenue growing by $20.7 million, or 4.6%[36] Profitability Metrics - Gross profit for Q4 2024 increased by $18 million, or 6%, compared to the same quarter last year[9] - Gross profit for Q4 2024 was $305,890,000, compared to $287,562,000 in Q4 2023, reflecting a gross profit margin of 27.9%[22] - The company reported a gross profit percentage of 21.3% for the consolidated funeral segment in Q4 2024, slightly down from 21.4% in Q4 2023[27] - Comparable gross profit increased by $3.6 million to $125.9 million, with a gross profit percentage increase of 40 basis points to 21.9%[41] - Comparable cemetery gross profit rose by $14.1 million to $179.6 million, with a gross profit percentage increase of 150 basis points to 35.8%[45] Cash Flow and Investments - Net cash provided by operating activities for Q4 2024 was $264 million, down from $278 million in Q4 2023, impacted by legal and restructuring payments[15] - Cash flows from operating activities for the twelve months ended December 31, 2024, were $944,912,000, an increase from $869,043,000 in 2023[26] - The company plans to invest $315 million in capital expenditures for maintenance, cemetery development, and digital investments in 2025[12] - Total capital expenditures increased by $18.3 million to $112.3 million in the current quarter, driven by capital improvements at existing field locations[46] Debt and Assets - Total assets as of December 31, 2024, were $17,379,438,000, up from $16,355,400,000 in 2023, indicating a growth of 6.3%[24] - The company’s long-term debt as of December 31, 2024, was $4,751,448,000, compared to $4,649,155,000 in 2023, indicating an increase of 2.2%[24] Future Guidance - 2025 adjusted earnings per share guidance is set between $3.70 and $4.00, with a midpoint of $3.85, aligning with long-term growth expectations of 8%-12%[9] Sales Performance - Comparable preneed cemetery sales production grew by 2.0% in Q4 2024, and core funeral sales average increased by 2.7%[9] - Core funeral revenue decreased by $8.8 million, or 1.8%, primarily due to a 4.4% decrease in core funeral services performed, despite a 2.7% growth in core average revenue per service[41] - Recognized preneed revenue increased by $19.3 million, or 5.6%, driven by a $14.1 million increase in recognized preneed property revenue[36] - Non-funeral home preneed sales revenue decreased by $6.4 million, or 25.0%, primarily due to a decline in non-funeral home preneed sales production[41] - Core average revenue per contract sold for preneed sales increased by $99 to $6,698, reflecting a 1.5% growth[41] - Total comparable average revenue per service increased by $140 to $5,721, reflecting a 2.5% growth[41] Special Items - Losses on divestitures and impairment charges for the twelve months ended December 31, 2024, were $12.5 million, impacting earnings by $0.09 per diluted share[52] - Earnings excluding special items for the fourth quarter of 2024 were $154.8 million, or $1.06 per diluted share[50]

Conference call on Thursday, February 13, 2025, at 8:00 a.m. Central Time. HOUSTON, Feb. 12, 2025 /PRNewswire/ -- Service Corporation International (NYSE: SCI), the largest provider of deathcare products and services in North America, today reported results for the fourth quarter of 2024.Highlights: Revenue increased $37 million, or 4%, over the fourth quarter of 2023 with growth in both the funeral and cemetery segments Comparable preneed cemetery sales production grew 2.0% in the current quarter Comparabl ...

Service Corporation International (SCI) is likely to register top and bottom-line growth when it reports fourth-quarter 2024 earnings on Feb. 12. The Zacks Consensus Estimate for revenues is pegged at $1.08 billion, indicating a 2.8% increase from the prior-year quarter’s reported figure.The consensus mark for earnings has remained unchanged in the past 30 days at $1.05 per share, which suggests a 12.9% jump from the figure reported in the year-ago quarter. SCI has a trailing four-quarter earnings surprise ...

Wall Street analysts expect Service Corp. (SCI) to post quarterly earnings of $1.05 per share in its upcoming report, which indicates a year-over-year increase of 12.9%. Revenues are expected to be $1.09 billion, up 2.8% from the year-ago quarter.The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This represents how the covering analysts, as a whole, have reassessed their initial estimates during this timeframe.Before a company announces its earnings, it is essential to ...

HOUSTON, Jan. 30, 2025 /PRNewswire/ -- Service Corporation International (NYSE: SCI) announced it expects to issue a press release with financial results for the fourth quarter 2024 on Wednesday, February 12, 2025.  A conference call will be hosted by SCI Management on Thursday, February 13, 2025.  Details of the conference call are as follows:  What:    Service Corporation International Fourth Quarter 2024 Earnings Conference Call When:    Thursday, February 13, at 8:00 a.m. Central Time ...