CSV - Earnings call transcript Q4 2021 | Carriage Services, Inc.

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Operator

Good day, and welcome to the Carriage Services Fourth Quarter and Full Year 2021 Earnings Call and Shareholder Letter. [Operator Instructions] As a reminder, this call is being recorded. I would now like to turn the call over to Steve Metzger; Executive Vice President, Chief Administrative Officer and General Counsel.

You may begin.

Steve Metzger

Thank you, Michelle, and Good morning, everyone. our and discussing for year be XXXX. we'll fourth full quarter results Today,

release yesterday archive today. supplemental made closed, related being website our was Our earnings later conference audio public made the page have is available the website. our This on and and posted after be release information including an financial recorded, Investors of will we market the on

a this Carlos morning and In period. President from will are: Officer. from the addition Ben myself, remarks question-and-answer to Officer; Chairman Officer; myself, Today's Mel, formal Mel Executive and and Operating Chief Chief and call Executive Brink, Vice Quezada, by on and Payne, call Ben be Chief will with Carlos, management and begin President Financial followed

and everyone expectations by team our the cause the projections risks forward-looking which website. that These those our this available to begin, in we'll call, in like uncertainties and from beliefs, some management contemplated future, made subject forward-looking. Before forward-looking we to plans, statements. or I'd factors comments not earnings our materially statements with of on that during to, are Any differ statements. identified our release results but filings both uncertainties such limited SEC, include, These and to for both risks actual are state remind are our that make in are could

I'd website. turn as all found measures. as over non-GAAP Mel. to joining earnings reconciliation Thank our GAAP our measures certain During these discuss And this can the morning. for financial A call measures in this we'll you well now us be call, also like release on the to appropriate to of also non-GAAP

Mel Payne

was out went stark invaded X our on and of shareholder in full the Thank Steve. who unusual on Thank earnings to has quarter letter. news and about which worldwide a XXXX on is you, all yesterday everyone proudly company, Group. It day year our our day and great fourth markets letter as other afternoon, are XXXX Principles that stands our Russia contrast co-written This the shareholder by masquerading this call vision The strategic crashing. members Ukraine, is release. today, you

he's present in about We will our about past, have does but President to done to yesterday. doing And especially and present since here, done, and on call And now, Quezada, as great I going promoted investment the performance all who's he's the was future. portfolio. he's been a this will And, this what and here I'd future our performance. congratulate Ben since Officer, he's release to to about about what Chief news Carlos a great and Brink, 'XX, like he's talked Operating say who what been that Carlos effective lot have legs into write-up

aligns. by think investors our our of our personalization came so And much learned the about I would be and section. incentives, General very how people, it Counsel performance this Ben's he's Steve intrigued all and about about about and business as then,

better written company, could. are describes in sections a his that DNA of our so than And probably way the I

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Carlos Quezada

platform things added portfolio kind since with team Houston and privilege on feel joined my will overwhelming hope by to me the in responsibilities. day Support And correspond Payne, in XX, of Thank a where company when encouraged. here paired represent success humbled speaking every June your this hard has Carriage unique I and XXXX. offered mentor earnings of story Good of an our Mel way. for you a fantastic much I morning, company you, is will with Thank in it Carriage family I things, very exceptional a I that opportunity. support to our And the but and a everyone. embraced, happen. it very one-of-a-kind compelling incredible Mel, just Center. so It's I innovation and creativity in and employees, chance fantastic our all support, lets are for had businesses Carriage and honor release not a and to of you XXXX today to as our work be across tells earn read our itself

more with call, much a of yet what by I future our with I the and about come. vision quick a our the stop at speak followed and today's XXXX For highlights, share bit little Carriage, will operational present is past is to will about the into happening currently what

with start XXXX. and had and The we segment following funeral the year a separately where combined same-store of acquisition, in tour acquisition combined portfolios. each for Let's results record operating the results and total highlights results. for the for mention I are same-store our past, will cemetery our Then

an of XXXX, increase basis funeral our operating an million XX.X%; which or funeral increase of field XXX XX.X%; revenue of an to field XX.X%; million increase and cemetery of EBITDA $XX.X XX.X%, of an revenue On compared $XX million, performance XX.X%; or cemetery $XXX.X XXXX or EBITDA points. million of reflects cemetery field XX.X%, XXX of margin million, of of $XX.X EBITDA of of $XX.X funeral of and $XX.X year operating increase entire $XX.X increase $XXX EBITDA points. an of field basis or For increase million, margin million, an million

EBITDA XX.X%, field points. an increase million, financial increase margin XX.X%, $XX.X $X revenue or of $XX.X XX.X%; of decrease financial Our of of basis financial million a XX million $X.X or an EBITDA of of million, and field

an total basis field of of and adds XX.X%, increase million, of field increase a million or million total increase an million, XX.X%, that EBITDA an of of to or $XXX.X of up $XXX.X EBITDA XX%; XXX $XX.X points. $XX.X margin revenue of All total

began with X-year plan, portfolio are included and Below through results, January a compensation followed which The cemetery cemetery transformation, our inflection X-year the our on XXXX, some the beginning the reformation. continue highlights of earnings of pilot XXXX. cemetery locations, the trend performance-based plan high by these reflects XXXX. report new the in For entire our launched plan same-store performance XXXX full of point throughout high-performance will at at coming to from integration XXXX, a Cemetery release,

our property than sales the year prior or XX.X% of total over $XX before; or preneed total over high the prior year cemetery the XX.X% XXXX. sales finished $XXX.X or of sales performance of preneed million million XXXX; than $XX.X the $XX.X For at of the year cemetery over XXXX, At-need greater preneed entire or production full XX.X% $XX.X or total same-store million million year; year; of cemetery XX.X% greater of and sales million XX.X%

and with very lots wide high-performance teams, XXXX, spectacular for work to Great families, sales range memorials. all every managing was earnings high-end Being and preneed the our Steve had of in options good their results. our sales contributions traditional private X of for profit In company's which a We that detail the protecting hard to our successful in an release, yet This our of leader a Our The is amazing fantastic not success. after record and our teams year news covers high-performance counsellors performance a X-year to great already families did from thank their Good partners, consistent revenue preneed to our property, Best stellar the sharing consistency year much sales to and and deliver program. the to cemetery portfolio and commitment an XXXX and is plan segment complete, incredible more the there businesses, is come. due job every and

Best and Being years, the many every have Good named we for However, winners. Great to

very a the will While for them time list name is so year this take all. long that long to it

have and Great well. this record Moreover, all portfolio, led an of high-performance portfolio XX.X% businesses best-of-the-best is an winners of Funeral all-time our funeral standards managing We'd thank our We record. managing for milestone. and for standards, their like all-time to employees cemetery and businesses Home for XX to Good managing of teams achievement, an encouraged partners record XX consists of all-time XX.X% achievement XX standards amazing incredible X-year as and which achieve our also partners, to partners which XX

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partners performance to financial Carriage to White, before. Carriage first-ever will media joined is managing our transformation grow our Shane than brands businesses. welcome January portfolio be of and He created to ever share, marketing have operating We Marketing. our expand and marketing on gain increase their department family. the in new help our our support social X, customer presence, reach, loyalty, deliver market and leading position higher We Alfred Alfred entire Director of market Services who

service CAREdge vision and annual the we're the guest experience. and as managing pandemic. focus XXXX, annual This the XXXX Carriage, had XXXX on first to of meeting have will to due Forum, our which by transforming partner of postpone Now, future since calling will we COVID-XX we meeting,

is of and detail-oriented we businesses, Funeral leave, guests, market leaders, Cemetery think gain we our about and Support high-potential across believe to for special highly challenged be XXXX, while all Home that our And both share had through excellence. will teams a record to All to and services there personalized a in and operational Houston managing and service partners significant performance portfolios. need Center opportunity experiences sales additional breathe differently

so There higher on with bit become time preparing of most seamlessly going view in and This capture the of that digital the a culture, be digital innovative continue new will all best, systems. support Carriage Great business value of and strategy here full to families, be ahead blue complete creating creator future. but for about and best Chief our excited that primary of opportunity, cybersecurity the in implementation at with the value and guest on and be portfolio from not also serve to they in which Committee optimistic opportunities transformation In because, further their that performance all of much else be group employees better And -- so families. customer-centric this Carriage, believe integration come. we're other even I many current a XXXX, and to Good circumstances Deathcare for step best and the and best beginning together to of we our field creation digital our a Great it Carriage can digital can comprised and a our include, to that is consolidator is to plan the service our will to not to seamless skies end to so create to can We're designing, integrates better, experience it our of is to This enabling very past thoughtful turn excited for of celebrations XX-year this service X-year Good and the IT has and Creativity other businesses. of start be a innovative partners of the years is time the that their first on some that day our April, Information for be We're limited best complete focus that managing our and XXXX what Carriage use of come back is to best the will forward been of to always custody, will their closing, Officer, never and with have optimizing for vision, this everything through first-in-class carry We redundancies integration will we announce for To value accelerating is creating operator, company automate with with partners which a another they us industry. we a in CAREdge vision become complete ahead journey. grow and talented of ends. Innovation by responsibility a of at policies. the that Our the plan. every Carriage create we little successful creating a teams Best chain this and you, recruited XXXX looking the Steve. and our businesses, who our tools best and managing innovations transformation improve passionate chain of the of experience, platform and Journey, X do and serve, over release, operations Carriage alignment new transformation to the mission Being Journey implementing Forum the is every to theme will customer situ transformation to strive each of our in beginning reason growth, technology further, families have creative catalyst will becoming vision, server whose years. employees, X-year covered challenging most Thank of the front have platform our design earnings our even yet and over the on we creative value shareholders. our and will and These best And office our to creation systems, continue processes, I come. systems most impossible and and say technology, value that life in to

Steve Metzger

Thank you, Carlos.

couple the just to that in relates performance industry you and we was second, of related past growth related again it volume first, at this just come follow reality know begin do understandably call up of to The to and performance that, the we years, questions in that have been, beginning described, time isn't how and to a to and X decrease as is, suit. nobody can As during questions pandemic. answer normalize, revenue have the COVID; equipped those deaths COVID sure the be the how won't

X impact right with its COVID, into roughly reasonable, business. make which on and surrounding now begin of to we're we years from However, the have can living benefit some inferences, our data

look when on of from capture COVID contracts. the last calls in full we beginning XXXX, our to captured reported of a to deaths the deaths When on pandemic began clear at funeral by XXXX, year certificates example, our the all first December XXXX, we supported same-store to For growth. market COVID-related among death prior and year full our portfolio, contracts, were share data story the of supports homes our total

total increase same portfolio of year-end Specifically, call related but XX.X%, to month more related growth an more approximately year-end of and growth deaths, past for volume of in greater meaning, COVID hearing and of homes contracts. of funeral not is XX% identical COVID the story contracts contracts, among total And XXXX. to field in all achieved approximately same-store we've we the and our market X.X% reported almost of businesses XX.X% we seen see Furthermore, from growth that COVID, about is in an our to beyond years. funeral That's to several portfolio, what of number roughly we've related than compelling our same-store gains XXXX been in leaders Of COVID. that our a just of and have last our same-store XX.X% XX%. our supports broad beyond at over XX% it the growth share recently, non-COVID last look total when compare month from year, than funeral

As the turned the U.S. related to further story, by COVID support CDC to we market this data share for deaths in growth published

fewer deaths fourth U.S. XXXX. fourth XX,XXX deaths the the XX% of COVID-related there as quarter opposed That's COVID XXXX to approximately As by quarter-over-quarter. the total of CDC, in reported were in fewer the quarter

by contracts. same volume that comparable same-store more actually timeframe, call XXX funeral than our increased During total

our trends growth gain at to We our goes decreasing, contract a same-store again, Preneed to insight. preneed At-need some substantially is when funeral then portfolio. maturity captures maturity deaths continue we COVID despite preneed served. So additional in and looked broadly see and

highly So gaining At-need than that being that are when pure total are we're goes maturity families families. rate costs it's our means more and preneed down, there preneed likely as serving maturity served. preneed are up, more If go rate we're At-need our share down the goes contracts market we walk-in

decrease Over year, additional maturity we're last total being by steady to growth several our a is gains. preneed the steady increase. market broad share just This significant likely calls impacted support rate, past despite decrease we've seeing including that a the years, just seen is in continuing

trends and question that X identified COVID separate contributed data-driven said, of market that story work in X these serve no have materially and there's growth to becomes by of compelling field past during and together, a for these to it leaders in of times. all significant years, additional and continue But share. persuasive. tragically compete market has that call when you been number to Now support the honored the With challenging to all to is beyond privilege trends our deaths a many of we've grow at these COVID. share we've look X the one the Any every families

net which performance is it confident plans we we a driving the So including revenue X over on the the help We combined a pay-for-performance what Standards best what's have broadly few placing revamped focus as September market emphasis discussion and our the talent we've we've approach changes what is Operating made growth, families, in incentive Ben high-performance These are believe and a since high-performance X-year leadership. everyone for to alignment, past level, and press incentive our encourage compounded create compensation, is alignment growth serving to changes financial unique now will Model to more this that modified detail years? and and a Carlos driving We to on cremation referenced, performance critical and this specifically margins. seen strong explanation release At significant XXXX, aggressive high in our to the read cover growth share just surrounding relates Carriage, deeper and shortly. strongly to industry. throughout of in

model, to our which release, combined just operating lead unique candidates X-year managing are businesses possible X plans, and we as in which discussed their owner succession best-in-class exploring are differentiators key that those who operators, allows acquisition highlight X our Our for truly we the with plans. partners incentive of

the XXXX As and be growth of continue remainder for prospects we forward through acquisition. the look to beyond, we by to encouraged

don't the forward to to discussions to partners and we a any look have of businesses, fantastic announce, advanced we currently number we continue XXXX. have in new to family welcoming While Carriage with transactions

as are approach acquisition, customized to selective candidates before, stated option. our one-of-a-kind with for a looking we we who succession in we've planning As potential through relationships build remain continue growth to highly

We capital who opportunities outside are and color well regarding available XXXX our and excited patient disciplined acquisition acquisitions, positioned with performance turn capital Ben, with about will more provide as remain we're beyond. and our that look to it to over positioning allocation why to structure, that, strategy. I'll With we of so

Ben Brink

year-end high-performance for a letter and joined only a in the Carlos, getting many is into to turned clear and Steve, you the of anyone shareholder encourage started. but review we to Great high for everybody you, that Journey in why record process the future. letter Thank order collaborative provide XXXX press study to fun our and Carriage fourth a in quarter Good Yesterday, which of on us Steve, others, to our not and understand in-depth interest fashion, released comprehensive, for performance phenomenal an a I and paint between believe XXXX, Carriage in to thank was XXXX Carriage earnings our drivers It true performance, this just XXXX. we call also morning. vision with who Mel, our myself the release, shareholder

consolidated increased to increased our per points consolidated $XX.X million. total expanded earnings XX.X% -- share and X.X% revenue fourth $XX.X basis consolidated EBITDA share. margin the adjusted For XX.X%, to Adjusted to $X.XX X.X% EBITDA adjusted to quarter, diluted per Adjusted million. increased XX

flow increased to Adjusted XX.X% For cash XXXX, an million. the consolidated and $XXX.X increased margin XXX share. $XX.X $X.XX EBITDA total consolidated full revenue XX.X%, XXXX, free increased EBITDA earnings In to diluted XX% year incredible expanded points adjusted million. our Adjusted per million. per to X.X% increased XX.X% adjusted share to $XXX.X to basis

XXXX. margin Our free to adjusted in XX.X% compared cash XX.X% flow was

of was at lower in note senior free of free refinancing our adjusted interest a XXXX, costs when flow million, margin forma was our full pro cash flow cash flat adjusting XX.X%. for and from pro year Our $XX.X forma impact May adjusted

maintenance year-over-year as funeral forma to to margin adjusted cash in an back free cemeteries, pro in and compared Our homes continue reinvest as cash increase was an to flow paid we taxes due capital local due and to flat into expenditures, XXXX. increase our

to quarter, Xx total debt at third consolidated of year-end the at XXXX. end to compared Our the end X.Xx EBITDA ratio adjusted at was and the of X.Xx

X.XXx. today, ratio of quarter. the debt our consolidated increase to of total repurchase to our in the to due execution in is leverage leverage quarter The program compared share EBITDA adjusted our the third ratio As is fourth

during taking when the will report execution year. on $X million into our This the program, estimated $XX.X be first expense share lower year account shares decrease to approximately and we diluted value $XX.X $XX.X shares results, million the to of an repurchased total the prior million, from $XX.XX of outstanding million average reflected the $XX.XX. opportunistically of $XX diluted fourth our for intrinsic shares The the shares the X.X per range of shares average cost mid-point mainly per share XXXX of million. basis, quarter pro impact in X.X This of roughly compared compared brought a to the outstanding forma which million share. in repurchase we fully During half quarter, opinion at our prior we XX.X%, represents outstanding million is full to of outstanding million of shares XX% shares $XX.X with X.XX of total approximately approximately repurchased basic the interest purchase second Carriage for newly and outstanding -- $XXX.X the of a a of decrease in shares shares our million price price purchase increased right below

Directors repurchase XXXX. our to our XX% XX% and increase diluted total for program, Yesterday, is $X.XX, equity $XX authorized which an brings of to share forma represents pro or of Our approximately availability market $X.XX, our Board an XXXX than of current diluted $XX million share our earnings to EPS million compared additional per our higher XX% reported capitalization.

We repurchase intrinsic our of a roughly projects. while value, right shares, capital will compared priorities other of acquisitions, discount more and the share the high at growth execution or continue balancing with high-quality return of low on capital end of repurchase trade range allocation to they of strategic to the and internal program XX% our invested

also the We EBITDA to X.Xx adjusted ratio debt long range over maintain to intend total a X.Xx consolidated of term. to leverage

growing the October cash for our XXXX. of fund XXXX necessary Our portfolio Carriage. in managing flow, structure, successful of trust portfolio provides in to took our our capital reoccurring the and preneed assets free long-term for performance XXX XX.X% highly was combined intrinsic since benchmark. bond discretionary with for to S&P a value high-yield opportunistically, was our over low-cost XX.X% to to us compared return track the The trust flexibility continue of our allocate XX-XX XXX, grow discretionary record capital fund our of of XX.X% S&P financial trust and management, The continuation investment we total

discretionary of high-yield interest the at strategy higher importantly, Over compound can and considering XX experiencing approximately for down positioned been in fund XX.X% X.X% XXX, our a for S&P income, in management XX% portfolio expect as and conflicts, We trust and of remain the of given of geopolitical that remarkable, return the which is caused almost our crisis, XX% assets. we market market the been average, discretionary prudent yesterday, just portfolio capital, Most return interest that, portfolio our to such have the bonds. to for has our our negative higher for to is total fund negative inflation, have the fund trust We years, rates particularly return market, portfolio on have our repositioning Year-to-date market we XX.X% our we X% to and assets the deployment preneed current XXX, the XX.X% rate of are sitting the of compared past Coronavirus and the S&P compared done resilient of preneed a long-term volatility patient happening of since believe depths XX% do NASDAQ. annual volatility, in as fixed cash, the invested today. of are in remain by trust events impacting balance through inflation trust we've and that environment the trust currently persist. over execution currently of that the

are growth, include current each margins. strategic future XXXX, field our right realistic to ranges annual excited projections of performance ranges on to and not about future meant organic invested updated through maintaining projects, and new The growth allocation ranges for potential, a precisely scenario has EBITDA trying under return dividend case scenario internal be years with are We are in capital acquisitions, projections of right capital performance future allocation XXXX. and EBITDA base roughly sure incremental a performance roughly scenarios be field share scenarios high year only revenue right with repurchases case our precisely and performance, cash growth for rate. conceptual announce but XXX% expectations to rather our provide of in capital wrong of exact These the future. our of of XXXX This We free flow. believe that base to

We as in is the acquisitions to beginning favorable current view estimations have acquisition Carriage, in our have and towards high-growth on, capital to included of our markets highly commented, Steve had remains landscape we'll that XXXX. based that strategic opportunities acquisition allocate activity of expectation

of to grow to XX%, of EBITDA from a million $XXX.X consolidated X right expand $XXX to EPS million scenario to range XXXX in XX% from performance in $X.XX XXXX grow in new XXXX, $XXX ranges from to released X-year $XXX Page a roughly million of XX.X% included diluted to shareholder expect to $XXX a adjusted to in on to margin million letter EBITDA grow the range have a to of of million to $X.XX we in yesterday. range million the We consolidated Total from we $XXX.X adjusted XXXX. XXXX, to of range adjusted revenue $X.XX

to range margin cash flow grow a to range free from with being cash to in free adjusted expect $XX in million XXXX, a $XXX XX% adjusted million of million flow We XX%. to $XX.X of

our fairly debt ratio consolidated to remain over leverage to We adjusted the -- X.Xx and to expect debt debt period, flat. EBITDA within X.Xx our net to range total of remain our

cash applying equity operating intrinsic itself value roughly with to organic trust local range Carriage, our opinion to the range share. on transformation at income And away and a and improved flow. $X.X it by flexibility complete equity free size have is range equity market and Additionally, and of only operations of sales, sustainably included revenue, shareholder multiples letter, and performance adjusted realistic EBITDA cash and years on yield final preneed improved in and These per last of range growth, and valuation flow platform scale, value leverage of X opportunities was margins, This X.X% What potential intrinsic share our share, overhead market roughly to call, into of my and greater our close, flow cash little $XX million, yield. updated what manifested with of right after significantly for at of and potential an I've is anyone over roughly by shareholder there financial to earnings the has equals leverage using to in homes we to billion reader cost free enterprise I'd a the share long yield at mid-point we of invested free Therefore, invest scenario and with different shareholder multiple, through billion, on a to grow our flow high-performance higher price listening should letter high believe over free appropriate experienced using a equal bit right of rates an Page financial share cash fund these savviness the improved right flow capitalization a past $X.X a taken financial funeral value, illustrate cemeteries to field sheet of of This to capital price cemetery has and thoughts read accelerating adjusted methodologies: of course for cash X improved of right range right leading X our been the higher share free updated over our flow to accelerating. sustainable flow turned letter. X person per the higher per our to XX.X%. long-term this EBITDA have is range necessary that preferred rounded our to ranges calculate roughly term. transformation from at $XX of share cash profitability, equity that, this and finally, midpoint approximately XXXX consolidated a adjusted higher greater lower on value here of cash capital, X.X% like greater broad capital Carriage our balance XXXX low-cost, adjusted machine, allocation consolidated structure of with flexibility significantly this witnessed return free of lower provides free that count a to platform capital, quarter. transformation current to for leverage leverage, our free multiple, more fourth be methodology a you've updated XXXX high-performance to The are Carriage $XX ranges that The to price flow, cash years, valuation XXXX. Carriage roughly meant discipline $X.XX intrinsic

entrepreneurial we other any website, shareholder on here in is truly long-term investor dynamics at Relations of that Carriage, questions. leaders Good radical Journey would being is belief and of by an vision formed across your who materials to look an takes have encourage has that that our of best, understand our a undergone performance, in amazing which union of that available to you value transformation, by with study end. find the unique for the Great Carriage creation begin then culture talented here confidence company For is led our accelerating to never high-performance And best the the described, are say curiosity differentiated all first journey us and unbreakable underneath covers producing group the high of our is over come. I to the side, us yet turn who to here transformation that Carriage letter, a that that, and will because our have at work studying a to by leaders opportunity the at visit It's you Houston peaked I his high-performance call will getting come accelerating What this the for of to Investor Carriage. will

Operator

from with Our comes Instructions] first Barrington question Research. Paris [Operator Alex

Alexander Paris

congratulate offer his Carlos to you like I'd to year. my specifically, wanted I the finish the promotion. on to on And, strong congratulations

Carlos Quezada

much, very Thank Alex. appreciate I you. it. you Thank

Alexander Paris

letter that competitors in a very follow-ups that January this it December you other XXXX. and I death In So last many -- tough encouraging unlike comps an thought annual that have pull night, of talk in questions of for I some was have acceleration that been forward versus year-over-year, few noted also the you've and comps COVID my a answered, had tough of that the space but published you. about in you that in

release, could talked press was little a wondering offer Specifically, bit in if more you you tailwinds. us the becoming about color I headwinds there.

think death like about of through whether talking celebrating or funeral things about through traditional services I appreciation life, rates, the cremations. you're

So a helpful. there bit little would be color more

Mel Payne

cofounding after company XX years at this old. years XX-plus

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of department XXs, stores. were we stores, and a lender Walmart was companies And operations had at stores, company private those placement all there So including were blah. XX America which kind private drug blah, in to across time, like all multi-store still the biggest that the convenience stores, blah,

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down in profit So I division, career moved then that when I I to by Newark, amount history by a about tremendous was knew the where taken to I I margins gross And line, long-term Commerce how that's learned because and product Bank Texas a didn't to be. want data, data, Houston, store. break would always

X became of in that's So the time, that a at years bank AAA other being X the JPMorgan. banks X

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of build Texas and better and I got more number Commerce to through the to Bank. now great entrepreneurship. up certain data -- close and do. how mean to of then But a was going bit it's a I I X how performance at to be company more toward though said, thing be So as I running part could Ben in it was high be curious, And And I I one, got that personal, told metrics. to last see always felt and wanted I and was risk years, even as the I I doing that bank

funeral your loan got want see, the years. But companies a for of I get the to start didn't idea own finance you meaningful I until the Took company. to And homes." We'll money. noble so I got until the used 'XX. company, was my June satisfied. own that to the around of I career. was It know company buy wasn't death turned spend that. said, X We that willing at XX a March had I you 'XX. And I me "We'll you you good was kept rest but of money, and going to somebody business and in years I wasn't

XX over Now it's been years.

transparent best and that has competitive we about our the incentive was kind tell being detail today, for back. operations. of resistant financially, vision, advantage talent do cemetery our it It's best. exist, upgrading, to described -- mediocrity it in in you and to it's the put And happens a you because want strong to a all you high-performance let take And me cannot huge in this to that when Once company shareholder will It's If want they you, been the database, the company master. you be about enables high-performance to and you always funeral I is And culture programs been letter, industry out being That difficult buy it, out company company industry. and so is challenging. this my there, the Nobody. do, so been see no Carriage. we know it put just say ideas trust will to show that funds. the it and and

You got better. to getting keep

shareholder of secular blah." He's started boomers are "oh, in notion when to from what not high-performance huge whole done, our though day. And the been start Carlos, he's the from baby I what cremation, wins, company, and Ben. being acquisitions money, at the hearing whether going we're the talking you're everything hearing facing and I best you're talent skepticism just investors, trends attorney. mean, is and is god, company, it's it's so this so related incentives. making writing These And mean what teens people right was It we've now, My even we And about guys the I heard blah, from all my an blah, much a I we operating. or was the learned we're do, letter. not investing tomorrow. Carriage. Steve. to XX and dying revenue for years, do,

Coronavirus be have they along get death best wasn't and the way, years the probably rich. I It that I later, could You a baby been just the years on to or would higher every we death years XX-plus like we decided, rates disease every XX, to and rate just and better knew better and high Carlos higher got wait it finally, market, performance and happened. demographics, that dying. said, for control somewhere become endemic make, we and Well, it's will here and are as and the wouldn't a the come, known last ageing XX. day, to hasn't maybe an I going not better and death have that the along gravy. to up rely when rate, for And seems a give would boomers did, better for something going by been Who I could me if in catalyst XX just with get would we we

that be We and wrong all in tries predict that. future, precisely pull people precisely XXX% Now for don't who it's believe to the will happening. the time. It's crap. it, hard but believe of forward Anybody to

seeing All You -- just what's That's do, you has at the on fill with and people, get funeral deaths January. see a blah. play blah, We I it plummeting, our in see high. out in Steve our revenue Carriage. had -- them hell of going blah, the to The blah, that variance the compete. cases continued -- read in positive organic what in We're put are we're -- to on better of let our it your the don't got we 'XX. them blah, and We and trust February. covered cases into papers, in going side beat

cash in why Alex. machine the free allocate. place We're All I will and a including got just future anything, better know get no terms I trust doing what's is, And change bring is we've to how to It's we sheet There know now what best funeral and both And geopolitical operations flow servicing don't what So it. in in problems, death problem. the balance sales. will problem? be, the times, of guests, don't Carlos good I the I is home, rates. with of know the

Alexander Paris

but what much was better you. from I coming said you -- It's thinking,

of did You headwinds, headwinds and may in tailwind. and face become the those that well it appears abating a are

do it performers So better forward. those will help better going even

back from letter last the So night. going to

You've acquisition of signaled a activity. resumption

ones in big early XXXX. You X XXXX, did late

you're the and return sheet, growth acquisitions, and encouraged of balance You've the been number debt, advanced discussions you're been you've those some. by acquisition, but to opportunities, acquisition been you're with restructuring signaling through in integrating a reducing you've

like look you evenly I is while at cash front-end in repurchases XXXX, be split If more loaded acquisition loaded, XXXX it for back-end in the share be first share activity selected will repurchases plan pretty Am would the more the using right of that between free activity. base off? looks allocation flow assuming acquisition case, and

Ben Brink

acquisition of in we year. repurchases just latter XXXX would Yes. conceptually base case, share like. Under the that the right, what under -- front more on look versus think the activity again, end be half it would

You're right.

Alexander Paris

closer the then, to remaining to the based flow I'm $XX you, repurchases. $XX what of that guess out is, to cash million best at drive what independent dedicated trying by you're to free acquisitions, with million is But allocated of on allocation, there? regard spend plan? share $XX adjusted of to in in forecast, multiples And case; terms the group, terms hope operators next what wondering from more in look we $XX million this and I'm year, over that like on year in based revenue for $XX revenue or EBITDA million, base EBITDA million and XX% to just multiples? multiples XXXX. incremental acquisition can I this What going

Steve Metzger

stands terms it. the is that in to every what way on own is acquisition strategy, the we its applied multiple think, view business of I

owners that the range on, potential also focus internal an moving have growth multiple but for get We business, the market and and forward. we the know to the really we

together customized we're them. them, for often a we businesses front -- looking we're in businesses, years solution we on focused when putting behind not best those find where about of them. So talk the for And are

business. of size terms And can million depends us. for of $XX of it Obviously, buy? the a terms it's In on it placeholder the number, in what

act than little a so $XX that to $XX the really ready, depending is pops bit million, up. than We'll businesses. placeholder And that's a on or more million right be on whether what less

Alexander Paris

in the get year. Again, the helpful. queue. congrats on back finish to strong Very the I'll

Mel Payne

question. the itself, value people's see mind in much average Alex, is and with have over X course. been I I it going of And planning to just life planning, notion is both of your to owners like just multiple years of X you the challenged and of succession uppermost our up. A last of lot inevitable, death on COVID, which is more think, for the cover so or celebrate more. So today, the idea And wanted with dealing ritual,

for what deliver pay want, are great people value. people a they'll will because and doing the -- that's Our they job it you if

we this becoming of ebb makes semiannually, predict but group milk be of to strategy, franchises. company happen. activity a try think activity be versus or even to now a have 'XXs, a it cash. we us after how of they're part to planning to have of over knows that, periods have candidates, because even And higher the quarterly do everybody your good that that That's next the know awareness and really of hard the it opposed some years think, good and owners I but will join kinds they're will for X succession flow, good the It's got franchises, businesses do the to maximum I the and ready. and be franchises. So they that existing should and better And what relationships as

don't steal franchise owner market, great from you last positioned to So great over business that is was a larger in where any for it an and than XX better get future the years.

the we XX our the So of ability to the in go that model. shareholders XX%, we'll on is, be multiple, it's years, pay a the because grow nice will and returns our invest, cash but worked over and and this to way X after And multiple will growing that. integrate down or into

Operator

Riley. with B. comes from Burke Liam next Our question

Liam Burke

you? another for with revenue Is then In still market contract of on contract. of growth growth per basis, terms a some trend of how cremation growth penetration is opportunities in terms and that source

Steve Metzger

question. we great something a It's yesterday. It's addressed

level high that really our talk just focus a give operating example. model to you an cremation So at to standards, on changing We contract. about

So increases, of look to opportunity. as it out we an and in front as trend it the at want get cremation

XXXX, from year, So increased, went our contract even year-end average we during year-end cremations as though per past right saw But, XX.X%. well. XX.X% cremation up the XXXX --so from that rate more actually until broadly to revenue

doing our to as folks So options great us the that on are of in tells families, at taking memorialization advantage a what an explaining job and with cremation, that families field is, educating opportunity.

Liam Burke

Or looks meet standards? them your with that may a Ben, you've of portfolio sense, down. underperforming there your assets, are you not return And other it candidates At in like, sort assets of terms are now? of run satisfied macro

Ben Brink

we've to of of XX' to kind pieces majority we -- looking either or set out businesses identified -- of -- the were The to mid-XXXX property to XX' divest. done we've that. we point, that And, your

we have X are X list. on think more to still that I the

this good anytime really everybody is do that, outside with here not get any portfolio, And soon. about the I We are to expect done significant where year. feel how and would we look of to divestitures performing,

a it's be to said, Mel -- good So really in. really like good spot a

Mel Payne

become for a of mean candidate XX% many a of framework of candidate. not many, standards businesses XX%. this the example achieve well And and being standards, told they the just standards updated to have financial I level -- standards thing. the Look, would company to have the now And, Steve we we that's there not becomes we XX% because Funeral that's well But impossible. high-performance X close after done. grow Cemetery above if Home it's ago, would incentives 'XX achievement think something can in is and and And guess few higher the -- in as who it that. like I we it have model amazing it's very or to a and for XX% that you covered below it then I said very purely a and mean, 'XX averaged me -- possible and a I achievement. like history years from -- is They have

every And the standard that on to sees lead goes as the if managing clean we got for a you've on every one every down business, Everybody XX% is partner report Carriage stand that But little a and in now. other is And a so -- table. it's decent that very self-cleaning and going we is you lead you managing to you month going that throw have they where fall partner below business region, get oven. a get Every achievement -- a of -- knows table company-wide. monthly out.

And top-graded under now a a Poly businesses so Board how Operating yesterday, Standards the has to evolved. partners, talking was we We Phillips, meeting right this been the and called -- Carlos, about who where get regional had you And managing concept Sean they're probably Model, witness underperforming Elliott, wonderful XX%. partner talent. thing it's

replace a player think a is or into it's this you B+. model, I In understand. Now turned -- this get really and what and C+ and like A don't framework investors an

But Now EBITDA, back and looked grower, an field that is not a budgets. B+ one; a get equal good might made you acquisition. really and all when $X.XX a it's one like we over mean, know it they you A-player only $XXX,XXX throwing it time, takes share. new literally, pretty have had performance out small that and I of

shy. all you and witness, tell Don't to calling to a that's on. call So be or our And creators. Standards why when of moving, here a thing at meter the about culture. closer we understands This it. language. what's EPS we a It's Council going talking moving you Pentagon. backcourt value not and wonderful meter look invite down member. They'll is this we're get the the secret is a come Everybody It's exactly

Operator

Partners. from Capital with comes question next ROTH Our Kelly George

George Kelly

I just So you. think X for

the to platform was And that First, about like Carlos of it make the back plan kind remarks, stuff. in years. next investments digital the prepared XX over was your talking some sounded office you and I believe mostly of it

cost be, put So Like how significant most where could platform? what opportunity opportunities a tech this curious if And this efficiencies? mostly for -- are about right. Is in the savings? heard to that there is better I

Carlos Quezada

your George. you Absolutely, question. Thank for

on for processes the strategies serving enabling rather their transformation. processes, an more really really we all deathcare all purpose the is then customer-centric, industry, manual and those market way of technology. really are as by the through than a tremendous have the So opportunity creating of maximizing It in type that guest for others. for about and cost delivering systems Carriage, disruption, to focus platform that be of call time it's things we our capturing service rather experience, we free that to additional that has about integrate designed than not ourselves reduction technology share the field elevated of is in opportunity It's focusing would and a all across families disrupted The way. just a it, and and disrupt

of And field help do businesses that as disruption a more to time transformation so for what our in how is this as Support their Houston our platform Center, across the and be portfolio well will those broadly we they best, families. dedicate which

George Kelly

Like see we help sort us Are it of of? of really speaking one of of functions that or can What key it place there different. what kind could make you me or is X you're down kind like, could you -- places just X here's boil different investment? if to

Ben Brink

Sure. Absolutely.

about of call hours, X and death. the The They going a process they selections, things, caskets, service just it things different So way family X.X works, go usually want they're conference, an through into services, arrangements, of arrangement all spend has right. going we think chapel, kinds the to what that all hours, merchandise, to do.

And into the the end a of get are Funeral go selections team and all and a members of coordinated process manually, the those into recorded there's goes the manual For significant throughout arrange of back to different get selections Home. most that the amount part, to recorded details throughout all and most computer. those then

And focus technology an into more the need helping rather how of through them change creating the tackles on customer the we they just through automating will of centric serve and facilitates make. by families, so that grief a choices selections, automated contract and that easier all dramatically to journey make process, most it, than on going selections just those

Mel Payne

is in find do what very intuitive. about business one in is However, efficiencies opposite about Carriage and that business. that, we are kind very which Like normal, is intuitive and wanted you that's if understand what unique, you'll unorthodox. what all is that It's on every goes of Look, normal help the all all cost every you -- thing unique and thing, rather than so counterintuitive to of market. a We're the is life and will

want part, about share, can't give X names you to in funeral light or partners you of, And And Carlos you how it. if so you learn can your brain growth, leverage rather cookie-cutter efficiencies, for that and market the cost X transformation each this map able the our works managing to it, margins. is than neurons, get what EBITDA you'll and and do compounded and can't they your operating a up there's our revenue lot inherent be field at to expanding going this will technology business it digital the because of

get promise it. buy won't I You you. it. will They

George Kelly

Appreciate with it. them. to love I'd chat

you after follow I'll up this yes, call. with So

maybe one, For sure, X questions.

could single-digit -- topic organic into So of portion the growth And I second that of just to Curious -- kind volume your broadly is and growth? growth. your for is what expectations you right help much looks just outlook. how the cover if like roughly the are pricing? how It rate of a that's wanted organic speaking, much baked high

Ben Brink

for not we're the that again, right. I get in real. mid business single-digit that term, of long and a There we've here. thought growth seen revenue the share growth trends, the half organic -- kind high rate of certainly George, market in that that about, terms -- that and this it's term. we about continue uncertainty have you short we in right. now that super weeds contract this, is to acquisitions can granular the growth revenue right, we kind to in about rate, where of long Steve our this That helps is there. of some up very time, growth is our and of into average COVID think capital that do if that there And talked even we per death break half very point what businesses at and versus If

George Kelly

Yes. does. It

Mel Payne

top me The well, should we down. is a to we No. mean, there. and on is is that. this So this just George, Carlos this I together -- Ben and bit impressive out not to elaborate put and way what not be little really Steve do

we business, every can We're Then used don't only it's what Carlos. maybe in next at second year, from have got every say was layer. business business -- every that, to what's they I I between me and one We the and there over going up, flat. looking the not the layer. He's here. like do because bottom on very know

Okay.

I good think that's a really layer.

on understand what's going business. we in So trends the each in

revenue is know this so what X standards, compound incentives collaborative, bottoms-up our they managing what X -- both interactive year it's to means And year, They not the and to them. have to do what and that partners. a and are, with their

Ben's -- year it next -- they so And right come up price, overpromise we concept; that DNA. and we under-deliver. is not overpromise mean, I some all and has ranges them What year, might then does everyone all up the this got add how us. he every investor take that business got roughly try market to we that's and And all under-deliver. that lay to determine. can we come But to how And and with that consolidate up. and don't how And out different about. and

Operator

[Operator & Chris Our Instructions] next McGinnis comes question with Sidoti Company. from

Christopher McGinnis

around fresh congrats lot strong Carlos, ask on to following you And to you change quarter. year. the -- the changed standards, a on going to relevant and a such just changes How today big promotion. XXXX keep -- Obviously, about standards. that, also of the Nice just when time congrats you're it a I And on want updated? incentive do keep do any think that forward? you

Steve Metzger

much, very you Chris. Thank

was at there yes, end XXXX. of meeting which and our as a at There an always last standard experience, the whether there's should we Standards now to when again, So XX% Mel and reconvene Cemetery. the Model. of XXXX sometimes over The the will the our Operating earnings of some that company weighting all One had small as changes want CEO the XXX. changes evolution weight they took changes look also that time to on some experience guest of few our on tweak, needs were Council in Council I out Standards just Forum, after It back, change. way to and those thing CAREdge service evolutionary both And, we with and process small managing organic a and to service you make little shooter goes together to not will, weeks as new made through partners evaluate or growth from I example, growth acquisition mentioned standards for through mention, those right we and also many by, on of this as get iterations whatever we and our different January, experience. to guest and continue some on things. at if Funeral adaptations, is need And release, the Standards all businesses changes is

to what in on So and adapting of where it continuous changes we environment. those a based are, process change, that is where needs going evaluating we're to in

Operator

from question Next [Richard Busch]. comes

Unidentified Analyst

I with numbers of exposed illnesses, X,XXX% to a you've leading next some been the as recently increases impressive, taken it's of not But able from XX community. I've to But position. There as XX, But to on I to now have investor that decrease the suffered itself? XXX% and have numbers people -- you've the to XX, of grow your position in you in are demise number is or that the the to vaccine analyst what projected growth part COVID the permanent new the but a and I'm a your vaccine financial due that others your Defense, shown from because with I'm look with took death illnesses. number attacks, new business recently being startling of growth vaccine. activity or projection activity I'm a the experienced Senator for cases. curious I'm any the wondering months, business just with revenues, only have of earnings Med Johnson in particularly I Carriage. like different of which their a heart ahead, data victims cases cancer COVID others of potential whether findings on now, are reported Department reports problems. not

Steve Metzger

talk lot provide what and for that not we referenced And call. to for is, Carriage just that control is looking that we compete what that the can about, We we But, service, control familiarity a in are have sure the service make a possible we available family we can we with. best if control. things trends you want

us. you no they when the families So that we equipped trends insight focused serve need to on are very into we're sure making that referenced, but

Operator

for to Mel There to are any Payne I'd like turn remarks. closing no further questions. over the back call

Mel Payne

as that of partner very reached willing have one Greatness been happened circumstance. counsel choice. when and I name [Christy not e-mail is I said, Council you we Well, at our help. to said Thank with to all of the how are. our got profound you a way it contours is like a yesterday has accept up few getting while choosing she will of Standards some turns matter a ever won't the And of and helped. members. now are mostly part it this of the I end a may Greatness, e-mail we It to about is much. go think is book out, company it, since times we're quote then edge had heard to close the but managing matter decided is reading truly from to a when we the of I on seems I Board high-performance Her times. Ihu], I and and during can position me. the with about her brand-new and choice our 'XX, are a princely because why attending that, of Services. from read in to I'd made it, she matter our of out more she's be jump she read a since college. and results I from many of message meeting a acquisition And clear mortuary is, then And to that off. a and I who of a just confusion I Carriage worked why this

won't client your this at of learning families a that no is have come and loved will order the just your about families in "We Then ideas high-value my You have to loved quote. families quote, never getting if one, because loved last life how have the stated That's enact with client to lost and on one, one. letter, shareholder the their who engaging Carriage people and the options right There recommend is of about XXX% first." statement you you of in to your learned time have memorialize their statement. best people life your focus truer deceased intensely don't right emotional her about honor

Who our serving I passed because had -- I needed team family ensure my to Mel, know, that jumped of needed I make and what putting to a son, our getting I experience and at every Downs to of of Right son all care trusted detail family on as the Franklin that is business my action That unique own the They partner client and & Mel. client veteran for is son. me. my pay into you funeral aside by their My to managing my I family lives XXX% own for my to family my tribute you, received away of adult onboard, arrangements. as -- combat As mattered. when That the knew simultaneously. focus everyone

in set tell am this. truth matters then proven of your we continually are all matters. our on. is and is a me of Hard and she ownership through through to have shared it and a made quotes I employee guiding you, work has for all the and Honestly, follow thing X. actions. success do, a let a and And You of all real "There difference. integrity fact amazed quality the principle. us actually And that path

of and proven numbers. to service partnership. proven is hand-in-hand, a company go being by For They leadership. the at and driven with not Outstanding is by and compensation, lie. respect drive this and The example, profitability Carriage. by inspires it recognized treated do realization and concept creates and of decentralization succeed, understanding Growth

the Where your high idea As X-year when Great is and opportunity you an tool pay leadership the be fulfilling drive I must then so inspirational, is performance no team she the any expectations. plan of I would a Being you how to a a Good thank for and and actually whose driver to passion difficult a the achievement Good looking truly determination to say out be in there company funeral Ihu." a done; to carry plan make others Best, the puts Christi the excited; Energy, to Being of results. decisions to the I beyond the sustained for called incentive recipient, had job loudly. off. leader industry gets to and amazing, part a Edge, sign And so ability best. created this that execute a the motivates and and the Great. mission deliver and is get Energize, even Then challenge would find possibility?

[Christy's] you might meeting wonderful during went about if reading best. at all it who simply what Council Board some idea our learn So our in yesterday, of to company of off the you signing Standards give can are people know members. you the Those and note

XX. have We

you what disappointed be will You will in the you whole it, not a for of read in day a the in crazy And find in lot XX on what more then calling out. sense. make letter, such all you world. pages Thank shareholder

Operator

This the concludes program.

now Everyone, day. You great have a may disconnect.

Carriage Services (CSV) 26 Feb 222021 Q4 Earnings call transcript