Carriage Services(US:CSV)2021-10-29 01:06Financial Data and Key Metrics Changes - Revenue for Q3 2021 increased by 12.6% to $95 million, with year-to-date revenue up 17% to $280 million [33] - Adjusted consolidated EBITDA rose by 17.1% to $32.4 million for Q3, and increased by 26.1% to $95.8 million year-to-date [33] - Adjusted diluted earnings per share increased by 60.8% to $0.82 for Q3, and by 74.6% to $2.27 year-to-date [33] - Total debt to adjusted consolidated EBITDA leverage ratio remained flat at 3.98x [40] Business Line Data and Key Metrics Changes - Funeral segment total operating revenue for Q3 2021 was $64.9 million, an increase of 15.7% [13] - Cemetery segment total operating revenue for Q3 2021 was $22.7 million, an increase of 15.8% [18] - Total funeral field EBITDA for Q3 was $28.9 million, up 26%, with a field EBITDA margin of 44.6% [13] - Total cemetery field EBITDA for Q3 was $10 million, an increase of 17.8%, with a field EBITDA margin of 44.1% [18] Market Data and Key Metrics Changes - The company reported that 60% of funeral volume in Q3 was related to COVID-19 deaths, indicating a significant impact on market dynamics [50] - The company is gaining market share from both independent firms and consolidators, attributed to innovative service offerings [48][49] Company Strategy and Development Direction - The company is focused on organic growth and is actively seeking acquisition partners that meet strategic criteria [21] - The implementation of Microsoft Dynamics 365 CRM, branded as Sales Edge, aims to enhance sales and marketing capabilities [19] - The company plans to continue investing in cemetery product development and high-quality inventory [38][55] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining a higher normalized death rate due to the aging population and the impact of COVID-19 [51] - The company anticipates continued strong performance and is optimistic about growth opportunities in 2022 and beyond [31][42] - Management emphasized the importance of focusing on improving service quality to capture more market share, regardless of death rate fluctuations [51] Other Important Information - The company announced a $0.05 annual increase in its dividend, effective December 1 [38] - Share repurchase activity has been significant, with approximately 1.2 million shares repurchased in Q3 at an average price of $44.24 [35] - The company has a new intrinsic value per share range of $65 to $75, reflecting a 16.7% increase from previous estimates [45] Q&A Session Summary Question: Can you provide examples of new ways you are serving families? - Management highlighted that innovative service offerings have attracted families, leading to market share gains [48][49] Question: What is your expectation for future death rates? - Management expects a higher normalized death rate due to the aging population and the effects of COVID-19 [51] Question: How do you plan to balance share repurchases and M&A? - Management indicated that they can pursue both share repurchases and acquisitions, depending on market conditions and opportunities [52][54] Question: Can you elaborate on the Sales Edge platform? - The Sales Edge platform is a customized CRM system designed to enhance sales processes and improve customer engagement [64]