SCI - Earnings call transcript Q1 2024 | Service Corporation International

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the SCI First Quarter 2024 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to SCI management. Please go ahead.

Debbie Young

We're going to have some prepared remarks about the quarter from Tom and Eric in just a moment. me over let language. safe that, before quickly the go harbor But forward-looking comments team projections expectations are management by for state future Any our beliefs, that made our plans, the statements. or SEC release to filings to, risks forward-looking actual are to in those that include, statements. These factors materially differ but are with such earnings These those in and and identified results contemplated our statements and from risks on that our website. could uncertainties are the also cause in subject uncertainties available not our limited will Today, measures, earnings we Tom to tables measures found non-GAAP the on might and now at Chairman also discuss Ryan, I that and the release a can turn certain financial website. With it in our these reconciliation of our of over of CEO. also the end out be way,

Thomas Ryan

Debbie. on us around quarter to high-level funeral Thank close cemetery for business for of and I'm the outlook and our my performance call rest everyone, with color remarks then you, I you XXXX. going greater for This results. on detail with provide some our some thoughts morning, our the begin thank joining some will solid Hello, on and today. the

due earnings For earnings per projects. of share compared year from the or lower anticipated completed decline revenues and recognized in quarter, $X.XX volumes, had to a lower quarter per funeral home we revenues construction a per in from the share adjusted for first of which decline $X.XX lower $X.XX, generated cemetery to prior share. nonfuneral the We operations

of operating resulting share operating decline better funeral per $X.XX cemetery preneed anticipated, in combined in count share interest in of $X.XX, that to for slightly a a quarter. resulting share trended year net over in than lower sales reduce earnings a and as the better-than-expected producing rate, a us these While had prior quarter. Below $X.XX more expense, per of increase in decrease earnings net stronger-than-expected we average the tax earnings shortfall, allowed per the share lower higher per a offset the income and a sales share impact favorable

take about quarter Now results comparable or million million nonfuneral the funeral deeper for prior X% million funeral an look revenue the an Total by sales revenue. over declined in $XX revenues the increase of in $X expected was year let's than quarter. funeral and core more decrease home preneed $X offset a into

core anticipated. with the effects, the Although due volume quarter, had to prior pull-forward funeral we what to COVID we line compared in were declined believe X% year volumes

revenue average core market to even preneed changes by timing We a negative by merchandise service respect decreased the delivery. over anticipate modest of mix. SCI cremation per the would basis to Direct sales of year grew the nonfuneral our with Our increase revenue $XX primarily prior an home after due point X% operational XX in California effects impressive quarter-over-quarter in million, the the revenue operational nonfuneral an to home protection net SCI the XXXX. It to over changes quarter implement makes insurance-funded this across to intention sense. coming quarters merchandise several insurance-funded product offering first the other it quarters well compared remaining we Direct over as as an for diminish and travel shifting market sales begin is certain sales as of product and the decline where the as service next to our absorbing

contracts expect which mitigate until these at-need will the we changes it services operational these the revenue effect from of preneed sale upon will performed, general generate significant defer revenue the recognition to the of streams cremation While these the of revenue also agency decline changes.

primarily preneed rates growth backlog XXX first sustainable a basis in an growth about costs to was over quarter. due X% healthy From SCI increase organic production core gross by the gross in over when decrease relatively the for of the to maturing incentive General points SCI declined funeral nonfuneral Agency year compensation and due prior grow to very at expect growth year contracts would Direct. profit number XXXX. over and combined profit to primarily from decreased we years, $X coming percentage declined And the annual for impressive revenue million revenue, decline in rates. XX%. This production Over the revenues sales in quarter the This Preneed of the quarter. million, decline by flat production a Direct profit as $XX or should result about while perspective, sales is in funeral profit the very our was a with sales home prior

increase service gross delivered slightly in over as of quarter service percentage production and quarter. revenue our the year increased income, year $XX gross in cemetery. gross as from the averages declined the favorably production prior still merchandise of quarters. Preneed primarily in to and as the X%. Growth quarter, million preneed about of increase to for Cemetery growth other to recognized revenue a preneed XXX revenue Recognized of an the as percentage units, production by XX% generating was a impressive million increase, the $X XX% compared from deferred recognized $XX by an increase the over was compensation by prior and of recognized the growth sales revenues shifting Comparable costs merchandise or million compared sales X% year core of $XX in sales of in increased preponderance trust million with annual X% increased robust be increase increased delivered generated the the contract the cemetery of profit $X profit to the was impacted increase or accounted million cemetery points, to over subsequent profits XX%. year prior in in higher over Now sales the quarter. million the by million decline combined almost for quarter. Bard increases total. growing basis delivered million revenue prior in This X% million and a by $XX increase year cemetery will $XX or preneed due incentive was preponderance increase the first prior prior sales $XX year $XX compared cemetery which margins the million delivered $X quarter. accounted revenue

our to outlook XXXX. shift discussion let's Now about for

As home most the difficult challenging both comparison from or you revenue the first in to $X.XX because was our $X.XX. Remember, occur our saw of the guidance completed earnings confirming nonfuneral in had sales midpoint earnings per release, share XXXX revenue. most cemetery quarter we're expected year-over-year the and comps construction of quarter $X.XX preneed projects range for normalized in to a recognized we

challenging on rates first debt floating our occur We most of comparison would quarter. also interest variable knew our the in

last increased As about per in each customers, of months. In single-digit to thank both cemetery X team funeral by the we rest share driven anticipate and and against expect completed per each production for cemetery communities X expect like and drive months you expectations all increased revenues, the continue in coming earnings of earnings do construction we in the over XXXX from we normalized projects XXXX quarters, sales funeral recognized revenue revenue our entire year-over-year our increased I'd growth other. per would the the increases subsequent would comparing our to SCI day profitability share, and to mid-single-digit for conclusion, that low think every combined increases in share of would earnings in segments. We

our what that Eric. company are turn You operator, With call the makes over now great. I'll to

Eric Tanzberger

morning. everybody remarks. And just Tom to a to his again, and Good welcome similar earnings call warm ended today's joining way the

gratitude want to remarks, I I appreciation associates into SCI. But get extend at team to do. over to customarily I take dedicated without prepared genuine my never our Before of moment sincere as my a XX,XXX again,

respect, empathy, client unwavering We of excellence the and take fostering is enduring relationships. truly associates every service integrity, and embody excellence pride fact Your our with that serving constant and commitment families to immense values each fundamental our in one our remarkable. of

thank So you.

now also So investments before commentary and to talking outlook, moving cash position. some capital current remarks and to our with my discuss providing I'm with quarter. our our I'll flow first on ahead to the the during go finish results for financial going forward-looking let's quarter. end about shift

in to higher is cash of million. adjusted line by operating capital. So and slightly in Lower was generated we favorable $XXX cash flow than payments were first lower compared expectations. taxes cash year This impressive interest and working income prior the an our quarter, flat offset the with and from operations more

So that us Tom let decline Operating me an give items. on declined you through. million a expected earnings to quarter-over-quarter little bit walked $XX those more color in just about by due income

slightly lower the Additionally, we about saw of and rate million debt the anticipated as $X year rates cash in prior and weighted quarter. the interest as during taxes period interest average floating balances during of were our result million. quarter higher Cash the a on higher by payments than $XX

source in generally I primarily impacted last XXXX. And were my that capital and XXXX, we mention are a driven think of first while that benefit taxes during now to cash this of as look result again, method as provided net cash cash of $XX about made to was Now lower that, want that payments cash the federal well. accounting working and that payments million taxes million. XXXX our impacts expect more previous XXXX from of I comments not quarter $XX would I've with incentive $XXX by is $XX the trend not XXXX a a actually and this quarter's I toward as the temporary we And $XXX tax a normalized comp million over million beyond, in paid we tax XXXX, benefit being payments favorable call between the in to to reduced revert did range million last this change expect to cash the tax several discussed in include from period, cash beginning associated reiterate finally, quarter, quarters.

homes investments first touch capital a now in upon million improvements and I'll and $XXX real into quarter. for expansion. of our opportunities total funeral invested new our We estate of So growth existing future cemeteries, the

with a maintenance these projects cemetery basis recent a drive to to invested development returning million million investments. The year-over-year and into current the to development, $XX we projects. million opportunities this preneed $X So our improvements let's cemetery back seen generate $XX execute this property million customers, break high-quality little cemetery quarter various other for And for corporate further. We construction results locations on as capital our and remember, continue in helped funeral to our cemetery into that invest strategy quarters. cemetery of high down strong and and businesses digital on $XX we've our cemetery increased spend into

estate, of expansion existing We the of in funeral of million also towards real and the construction homes purchase of invested the and homes funeral capital growth quarter $XX cemeteries. new

remain our optimistic seeing We we'll in the and Finally, with target of several at acquisitions pipeline second the quarter the that, the we $XX activity the on made we're high million $XX now about end through million And total. of acquisition accretive $XXX XXXX. closing we investment the to believe year. for million quarter, in remainder be the in

million business million the at $XX to the shareholders the during dividends and addition $XX acquisitions, million of investments and repurchases. just In shares through purchased quarter the of returned million capital shares price we $XX outstanding. share just of to this the XXX of and XXX,XXX under an over into average with our ended about quarter We quarter, $XX about in

investment. continue to million to of on shares, a another repurchase quarter, for the under just active we $XXX,XXX of subsequent the shares about $XX acquiring Now be

adjusted XXXX the just a million per remembers $XXX press of of capital, impressive in XXXX. operating cash for million, which appropriate. million expected to midpoint $XXX or again release, and maintenance with as $XXX an adjusted of over flow this cash $XXX confirmed million, our we free over cash of flow results $X we deduct this $XXX So When deem free range million we've flow share in while a adjusted guidance,

$XXX a the In flow the have which liquidity facility. the $XXX just foundation, of cash our just available over very and million end we maturity strong a million balance consists as cash credit bank approximately addition quarter, to $XXX long-term on as of of favorable well over profile at debt also million

little near-term of the the net remained bias quarter to at interest debt end range to end here to the clarity for have more will of our from the lower to leverage -- number the our EBITDA rates a and targeted towards the year. we of Xx at Our year-end leverage maintain rest of as again, X.XXx X.Xx close go we where until bit

in to that So order best closing, to our will the in investment reiterate ample to our predictable and use to highest I'd fortify of value. liquidity investing solid sheet, balance like strategy cash and maximize our our capital continue flows shareholder

very call have just before and open to very on more know well. like compliment mention the to I'd Debbie of Debbie most recognize like I you topic who So to And out Young, I'd we call the briefly. questions, one

personal people when We Some quarters. over program has a want for perspective, look remarkable has is decided over Debbie a of great perhaps son Scott lot XX to at led for husband with spend you best at wish I Relations you're you a you where Debbie our with lot will last work a great on luck. here, as several tough here a like good make her makes friends And she's has the this years, years your the Ransom able the what on And XXX call, of last has Investor with over and time And our made done and end her of times has from the A.J. quarter. And been questions more over the Relations better. XX to join company years become that to at easier or as job. Debbie many, job the times retire to of led years please say, early Investor Debbie, Matthew. years. ago, XX us. led these around I and many lot a ultimately,

So that, thank you, all for thank and we you. I

ahead you back call for with operator, and up and pass So that, open we'll questions. Cindy, it the go to

Operator

UBS. from A.J. Our of Instructions] first [Operator question comes Rice

Albert Rice

long didn't John could. wishes I Debbie. of I and try how guesstimate I'm if Best glad been A Eric couple Ransom have to to this. doing questions, you,

anything regarding of on on Attorney perspective if Does I announcement the cremation would was an there all, just it some -- on just your wonder out of be perspective First yes, And the us settlement practice. change could forward? that? guess you reaching I out of it General a California helpful. your going give

Thomas Ryan

A.J. for Sure, the Thanks question.

we in changes the agreed we've that believe Short negotiations, mentioned while dispute. And this finalizing And revenues law, the So we as law, we started the saw the the and had $XX probably in been There's or operational we estimated the you California in a civil company It specific nonfuneral adequate the changes. of reimbursement that we the and reached accrual forth, press interpretation to after to officers the refunds. Board. We specific that And comments, one quarter customers us with stopped settlement model. and XXXX in the about General California million, the mentioned model. agree that's very $XX of looking this again, X I certain which contract was is we these and right Direct on have cost while any compliance SCI no you fault and the of as an been every and penalties home years history lawsuit of to well down. And by don't includes back to is the my to receive certain by California, from under of provides penalty any the at that kind here, saw wrongdoing to cover California's opportunity And Attorney fourth I of with streamline in of admission believe little civil very that merchandise, is made A.J. the based release A.J., pre-need which the with remedy our primarily the California, the to interpretation, we've contract. In relation California. any was cancellations we reasons million that think with to allowed Act, reimbursement brought customer A.J., state. delivering as the or

we're that to in time. from time product. And transition insurance our that two, protection to over here, pay it go over do TRPP going merchandise streamline model; is and Direct delivery to mentioned to the we SCI reason I as that advance and so for shift delivering And product one the customers provides an could

if I'm product, time paid for. having die I So and insurance pay an over fully then

value and a that such will allows delivering have And offset It merchandise. we add insurance can just of general production that. the not because business, to we power generate powerful will which it kind sales also add stream So revenues, of leverage effects the of us will benefit. the this of our agency the

generate revenues of we're now is out coming significantly so revenue and contract And higher. the average going of these upfront to SCI Direct to be the backlog going

we're So I think for happy a settled win-win about it's the AG, dispute and with We've that. everybody. a

have the topic. guys covers you around questions may that that hopefully, So

Albert Rice

No, I great. arrangement I can prepared steward would open that you of want that's of you some and Yes. that's confirm standstill for you have expiration some new some available and up be you while. related the And opportunities bit. Would been you And to to last would in to the little I haven't But those a assume, I you've commented to locations? of on market the just a done, XX you in that for remarks obviously, accretive do available also the the in that got because wondered, that more those transactions been some extent that to years. know those acquisitions not that facilities already the do deals haven't markets can any

Thomas Ryan

Yes.

you you saying a was met she yourself I by dated Debbie when teenager. again, think, because

negotiation. a And other a that stages in of are exactly are think that I different in. rest intent, good question in -- right, that really that got final A.J. mentioned, kind will the ones year. deals about we've that that of under open of Eric of offers of the really we letter You're I pieces, feel up take means And number we've presence market think got do to the we like are your

is, as come to there, way seller point, these the businesses to for is when ready sale always A.J., think said, we've about to sell. think the your markets I

So there's businesses XX it time negotiations, opens, come wait and true. way, would is like from for really we we to the precluded that gate last we What seems participating. we our have but what been attractive you to Commission that's that found transactions have million, a the to going to a buyer notice going in, there. while -- the by is it's isn't us approve participate a to it's this allow us to is have we're to Federal for do think flood say, in not loved it just years under on Because over by this of FTC up have "Hey, prior don't point." So at out the to $XXX Trade I that necessity very

So again, it's I think a plus.

going it's think we But to be that, absent about of still today, good. good pipeline feel very the I'd say acquisitions. I

Operator

Our Raymond James. from question comes Snure Parker of next

Parker Snure

back You have that Ransom. cemetery to in talk end Was Parker the there? the Qingming last about production. high low was preneed out up on Anything of Maybe any just Anything the bounce almost for versus geography the there maybe X%. year? then It end? in and John notable lost call notable maybe you sales terms

Thomas Ryan

as Qingming, The typically tell have Qingming we're we But couple few -- in quarter that quarter, you I an again, It's this think in been have it very I of probably weeks the first will shows March results, crosses pleased we and April. think, a year. of too. with would kind happens Sure. in you and weeks impact again, know, of the last that

not the thing, we the XX%, feel nicest we have our by great Parker, sales yes, So core only is think, grew large X%. first that quarter do grew I mean, but products great. I about

volume markets again, as volume. is big lead think really one has. But and lot the for talked on a source our cemetery we of burial about the want in sales a you all really about effect. about is hangover team caution and this we preneed that we're to the So And and year have little bit we still good therefore, funeral a direction pull-forward a feel momentum thing hitting that different of cylinders sales

with can And they're in that digital increased teams of overcoming on of put available leads, news follow-ups, our that cemeteries our bit tiny think to source. The a pressure a are is little so good that it products pressure better I great lead bit but sell. sales

XXXX XX, momentum. we and great confident the about we we're so I ball the So the feel headed still about and feel spike confident first rest on the It's more want quarter, and 'XX. maybe but of don't the about even to 'XX where

Parker Snure

thoughts that? thoughts updated any FTC just then Any see timing And when and the we on rule? funeral updated on might

Eric Tanzberger

think No, it's through it, we've of Parker, Eric. stuff updated October the very done I the mean, around we've have all relationship And that back helpful kind submitted industry a FTC thoughts. with it. really is we we thing of with XXXX. to waiting It continue we been to But them. I with that good last for in the way and any whole official was the have of consistent finalization. staff the have work don't very

The remember, to good anything rule our one that's important to the think, it's though, our we coming vision, to a at least of effect to other. financial there's or or industry, anything. in but have our nothing of a we out that's impact is material company from going move thing think that's going projections don't any the way a the ultimately, for materially And rule

Parker Snure

Great. Congrats, right. All Debbie.

Operator

comes Bank from Our Joanna of of America. question next Gajuk

Joanna Gajuk

follow-ups. a So I of couple guess

one the actually large but sounds It the but guess -- the around core topic, I not production. also last the cemetery before sales, like was So up. pre-sales it's the

to core I pricing, what I ability that did drive So you inflation while on I high. [indiscernible] mostly and, gives up still interest I guess rates the was really guess, guess, And pricing?

of I So also about terms some core the guess, talk and consumer, perception kind more can details both, large demand in and the I maybe sales. of guess, in you

Thomas Ryan

product our force the continue were large I ago. bills a said, X mean that front close. put a of ability time, back I to go to to very years Joanna. again, And in X higher cliff. we're just than in lot look that to sales in is, you at if they able the significantly nice Sure, to Again, back like they're

not than on quarter. cash feel stock I you and high-end And we depending second with because or buyers either a are typically I where $XX million about think so is That's the very think, the good that fourth the to do to more again, million kind think about contingent seasonality, I stronger is that's of going that, that $XX quarter pace. And mean probably sale, We're about if quarter. is them. borrowing it's market of to economy consistent, good they money those where about buy temperature they feel it putting is, there, They're and been and typically the customer. don't.

On saw the in I a from activity. Again, flat quarter than we relatively unit's other But great we was a XX% XX% for end, think perspective. around in the were mind, XXXX. somewhere our activity or keep higher we're

of portion you're a, a But we investing I'll a that a some volume. sales. what X by the trading insignificant So has in seeing levels know buying and on cemetery, some this level enhanced effect the in increase tiers but and and you different we're lot in related our come money, that of of of product seeing at and remember, the is where from call average. people product, an in inflationary trade customers from product made cemeteries what an Joanna, is of this to that better elevated of core is of that right, not pricing, spent in are is an up. And being you're most And it, average

at that $XXX bringing invest will pricing levels we on year in inflationary to enhanced the cemeteries, of new property. things a million of we which our $XXX combination in a continue continue, So million offerings inventory think to it's really and

Joanna Gajuk

just higher breakdown sales I large the versus I what was have That's X% a dollars, production at I mean, for versus of I XX%, preneed 'XX. CAGR the you exactly. sensing. thank quarter No, the because, mean but don't core, like XX% first the it's looking

demand it to to there's sounds spend like, There's willing So definitely demand. yes, money. and people definitely me,

that's there follow-ups. I couple may, business. And I other of So if guess a good the for

big you So going your around be to for deals that's of at accretion and to it the and higher. year? -- the Does anything needle move not what's meaningful a spending like confidence mean or for deal maybe the you on make guidance increase here guess your the the I in year, you're these higher this from to terms sounds for from think to led moving comments enough for

Thomas Ryan

Joanna, Yes, you're right.

it's guidance. little of us the it's going our While the to first in of a Obviously, achieving more we're normal, gives bit range. excited about confidence And have a material not it, the it like impact quarter on a year.

I think get through that just better we year. a X idea we'll of better -- as have months year, It's a a have sales. we'll not is half of idea pipeline,

Joanna Gajuk

us And of that quarter maybe you the and in also give sense can pipeline? also a assets acquired the were in what's the

Thomas Ryan

got Eric and cemeteries. funeral first we were mentioned think quarter we've homes I that the predominantly don't cremation. assets the I think in had these

deals say, of be until getting coming process I in also we that will nice And I'd very As in also mix we do of it's hopefully But you a some of online. intent. closing. think have, to letter under we've and got about intent, have the they're anything some the investments are few are And cemeteries say a pipeline, under close that letter that deals funeral of both and again, to I always closed. hesitate so think

the So and a feel, multitude and and we it's range But the deals some achieving of some say end level the of activity, towards in confident said, the probably range. close like of high Eric will won't. pretty based I'd on

Joanna Gajuk

Okay. on deployment. And question to I other relates also capital guess my it

timing really is the like XXXX. QX, I was mean much that that? it did guess that why the it maybe not reason same to in you you deal of amount since So the stock anything spending, the into the things. in was sounds this confidence bought already $XX you a just I But quarter. read million and QX, buy the in -- lowest before

Eric Tanzberger

it answer X I'd Yes. ways.

a record of value up ramping have I on ramping and we based track the down. on opinion continue think to our

going you're now. see share heavily to So program We among quarters always some the that as in repurchase form definitely volatility we opinion. and right believe quarters

continue to thinking we X.X of bit That to bias everyone very just reference that it a as said. Obviously, the first I towards does some of But was $XXX momentum share I Tom the acquisitions in is, actually quarter. But to And any rate in us the paid boat and floating last come we debt, swing. to again, if strategy. where of I do we paid So on half the that's pivot the the that I already the this debt into and well quarter I went of in some quarter date. we from market and piece That's think this the of have it's that's just side the and of what QX went appears in relief the the where not come, some I'd that Xx and during as we that going some doesn't don't a we kind second done the That's you have down again, to first think make to said. year, said strong. to subsequent what that about debt. And X.Xx perspective, quarter Three year. took month year, repurchase in And is went want do quarter, stuff to program already as differently, expecting But months million we've of take think also year. the did it's little a relief and in including to shares appears the capital don't new. what down we've the in apparently back of leverage. last through timing a we the

now. hear how So clearly favorably it very levels very at right we these view us about

Thomas Ryan

make there's Joanna, to can't reason, a just periods, bit, decisions little we're day in when quiet to day. technical we Obviously, add too. a

We cheap under -- be in as aggressive. we and super to can't to but able to we formulaic number a change it, if want there have put it to maybe formula buy And that. not

If we November go it quiet, you think XX, to way the the goes your and about first earnings. all release and probably like quarter,

you of time longest where So period it's lot don't really the discretion. of a have

think shorter think. get so might you spend now point, as these that's months, it's you as didn't And I Eric's windows. And to much into that probably,

Joanna Gajuk

the guess, and made when looking this I it next to I just presales if it. production great you're out guess -- may around comments last year into Got and just production, a comes That and -- call, cemetery last you year. XXXX said on the Yes. seeing And Okay. very sense. about talking some one. makes heading momentum you I When

of talk So any read that this? ago you kind X to XX% months into to maybe and of should you EPS to than I did Or XX%, X% as about reported QX returning growing way I kind commentary. when guess, same feel you less the update you

Thomas Ryan

generate be again, say us that we'd of are and backlog Direct to say a and the filling transition I think think, that more because to our couple expectations feel platform confident robust first Yes. more now robust provide general strategy, as positive. revenues we're to seeing with SCI and which from us the us I we feel we're business. a behind perspective going matter get AG should years, that I'd I Because, this much Joanna, then, first the little funeral allowing new really also trends getting we averages. I and confident agency through for an just up real quarter, growth think the

So about great are excited cliff. And we these continue we about and a where pretty really again, to months. getting leads are grow digital at feel pronounced into

super Our sales teams productive. are super effective,

say And in XXXX. going we and we're leadership X% team. running with the excited period in you we XXX lighter leadership than people it into appreciate went is had over was effort, I and sales great about the think growth XXX just a in It's before forward. marketing, compounded fewer as great counselors mentioned, that's we sales, we And COVID. than rate Jerry got I'd

Operator

Scott of Our Oppenheimer. from comes Schneeberger next question

Scott Schneeberger

guess XXX you Tom, of we of through quarters quarters improvement have we've From the is Debbie, volume. normalization takes for expect this done. maybe a been see well in reversion? I career like we There that puts lot say a to impacting funeral start been out inning I'd -- some you and maybe volume, pull-forward, we're would question, high-level kind pandemic that? -- in, a of do reversion in a lot funeral Congratulations, period. going what Where and When to just it. Where are you.

Thomas Ryan

-- hangover bit net a we though crystal true felt based we of kind this this like we the is was of think about and I feel again, like but as 'XX Scott, ball, you year the Yes, had last that little think was impact. the

think the I natural the have in rate things a few share market slight overcome still they're but will about to gain debt think it. way so you is believe So 'XX your face, that we and our

of again, move the and demographics. move And but past it's 'XX, think into direction, good feel in we then lot your positive half as get as you about happens -- in a never flat including what out the will we a we the to you about 'XXs, XXXX. of you things comparison seasons, like flu as know feel back So

I should COVID. about our you to in again, volumes headwinds through half back be And we of reflected you're decade. as preneed, in capture share believe funeral with our that think growth the continuing think of the the market

Scott Schneeberger

you. For -- for Eric, one

and you interest about But variable the to what year? rates were last you change the a what thinking for any of then -- the quarter's after. Just quick in are Eric, Just final back one update. thinking half

have guidance line. specifically but We on that a update,

Eric Tanzberger

in half forward, the we're X-ish mean 'XX. When that's you comparison, would first X X debt. we look the Most one half I the Because year. X.X%-ish second we now the else, of material. to of I is be of already Scott, I the comparison point cuts everybody and more could you as rate the the the Obviously, going of you, we're think about have year or rate rest the it cuts tell thought thinking could thing there back half right about of up tough this to floating be all, like our first that wrong. But is now got not was it's like of year. though, on very that been Yes. that probably

XX% rate to follow floating the Our -- bps months with to expected debt the of about -- very just all. not in debt the rate it's total year, XX cut take be last of material floating and a couple of us the our would it's and at going is and just happened

little -- of But so as we any like point most the some to modeling view market bit move So anything know, that. obviously of took there. it's the or going you lighter and of going of terms the though, like in cuts, a a comments needle not of out to reading in not move guidance the the people have

Scott Schneeberger

that than a or there? just that. lighter Appreciate comps anything should Is this a The of comps one, And year-over-year we cremation considering little factor or historic just else mix. year-over-year then trend. last be

Thomas Ryan

Scott, maybe. I'm thinking called Warren Jay you

I think our will belief revert mean. trends is the to that probably the

experienced we I sometimes we've think basis what points. experienced XXX you've of points, XX seen over number basis years, a

so not, And still to change a and than point think and XXX flow, the year. in we somewhere can likely basis we're it XXX ebb more

We we're We about don't a think have noticed great. I trend it's call. know it's excited to yet that in it. our just and numbers, if

Operator

next from Tobey Sommer The comes of Truist. question

Tobey Sommer

labor particularly 'XX the And seems time. last year, you century versus inflation, mark on how expense trending your you Debbie, apropos in and side. The the on see like could on -- comment merchandise that

Thomas Ryan

Yes.

again, we've on got long-term On have the caps merchandise inflationary agreements that side, them.

would general trending our inflation generally, like have what we and tell lower feel been a I it's be knowing will than I on good inflation. you, So handle

been to think, team I costs kind job pricing which hold we've different do just I also, a of of great able flexing transition are think products, merchandise those to So in. proactive through products contracts and

that anything we're not seeing not there. really happy So with

to wage the else. what 'XX over I you we're little more high years, like reach a I'd into see And tell back wage last starting the have front, to think and And inflation above X%. is that we Xs. at in we're is few normalize everybody the experienced On

probably inflation last seeing wage think still elevated of over towards wage the It's so. or X% and we're out inflation as a to subsiding. think you some So it we're the years back history, subside seeing and closer I XX bit but But obviously, the over definitely was Xs push Xs. since

Tobey Sommer

you revenue lens? your customer what on through tell look mid low, cemetery if that sort base were if experience, and the And bases. your How us trends and story sort of -- sales high-end at and funeral would at looked of customer to a in

Thomas Ryan

Yes.

probably an less issue And gets it's to more think that funeral of really and a nature versus atneed. on back on cemetery I preneed issue little the cemetery.

an it's atneed find forum. they and the and think right? in what from perspective, money that's So people important do, They spend pass decisions do something they they to and hat, a way, make I emotional got

emotional. Buying preneed cemetery property less is a lot

the I periods happen, high get like the up to things again, -- you tell think I we you, of at you're so lot end mid see end, I'd little would interest say, more mid that And sensitive. and of demand a and lot to we be at or going or you activity. interest price at a when And into continue still low, where good the go see rates -- continued success we're even seeing the level, a good activity.

about. And everyday again, And looking is and data than their industries I price I a by our how other lives impacted of seeing mid-level would talk the by not they're the little at consumer inflation. of the that back price being product, that challenged tell just you're think think to but that consumer the groceries. more I you gets I think gasoline,

customer product difficulty I low-end a a more about to their in they think exactly and So don't that little probably right there's to the need willingness engage yes, think now.

you together know, we into and So interest think to it. of terms help it's we've those rates, active. keep some pretty strategy contracts, plans try we've a them that I to job consumer but good as put -- And whether or done get

Operator

closing conference session. any question-and-answer the for to turn SCI management our concludes This over remarks. like back I to would

Thomas Ryan

Debbie for she's want We're what We to everybody and her, thank but, next love happy reiterate we're Young to superstar us. much. her want here miss being today. chapter. her very a been going We for to I to so

you we're and girl. miss Thank everybody. success, continued to going Debbie, So you,

Operator

today's for you conference attending The now concluded. presentation. has Thank

disconnect. You may now

Service Corporation International (SCI) 2 May 242024 Q1 Earnings call transcript