Service International(SCI) - 2024 Q4 - Annual Results

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]