SCI - Earnings call transcript Q3 2024 | Service Corporation International

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Operator

Good day, and welcome to SCI's Third 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.

Alanna O'Connor

Good morning. AVP Relations O'Connor, Financial Allie is of and Investor Reporting. This call. our third to quarter Welcome earnings

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

Thomas Ryan

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

from compared count effect line, long-term a by net generated as stable. in as corporate expense share compensation the adjusted return our the on both increased caused share. $X.XX relatively Below offset year. a was rate third to corresponding a funeral general per increased the by profit earnings Gross resulting in and administrative earnings the increase which changes of lower favorable per For plan shareholder incentive cemetery share in in was total its and the our $X.XX nearly tax segments prior $X.XX, lower quarter, expense and of we interest well impact and

had also acquisition quarter the We the $XXX We into during growing X very active top-tier major and in businesses a adding quarter markets business on million metropolitan funeral front. homes cemeteries. XX invested

to new family. the are welcome our into teammates SCI We excited

footprint our for and an We of also our transactions funeral in expansion estate invested of cemeteries homes additional real the $XX in million existing markets.

in line non-underwritten product. Funeral declined insurance declined decrease XX a the marketing growth due comparable just primarily or and effect contracts X%, by certain rates, insurance grew was carry take let's insurance preneed results of which preneed to a XX%. in million, grew million trust operational slightly with growth. Preneed heavier rate. from Direct, our changes or the by too products, profit $X with average our home million quarter. Direct for by the of revenue Core sales transition of of about X% sales, year was growth average XX core transitions quarter. look insurance quarter core $X inflationary we quarter. should fixed other due $X coming in as sales and decreased to revenue as decline from by our caused underwritten to Agency million, of as by a respect funeral expectations revenue resulting to funeral million attained to obtain even of by anticipate a which General $X preneed gross $X preneed and over non-funeral production, our point the as counselors sales commission again XX% from increases General quarters. normalize or than third points insurance-funded well our timing temporary the higher new primarily million a driven about a trust the X% home preneed effect increased X%, was to production to in expected while This to Agency deliveries. Core the commission revenue million selling million X%, as merchandise absorbing to sales sales slowdown million grow $XX decreased or funeral due percentage mix core preneed increase transition over agreement to production This the the new markets outpaced the production the decline in profit basis as many of basis in volume Comparable flex versus had of revenue quarter. SCI by Now $XX We stabilize deeper about which revenues core decreased SCI we sales provided required in better costs our cremation during this decreased licenses, This Total over the slightly the XXXX. or insurance-funded the over with higher funeral increase, primarily contracts. gross the the coming comparable provider revenue months. Nonfuneral production sales funeral rates funeral $X prior in into X% $X transition core for but

Now flat cemetery a million was a decline the $X $X $X shifting revenue. in revenue higher-quality contract recognized preneed core Comparable by million offset other compared of revenue revenue preneed apart, The primarily $XX of was as as the quarter to the from prior decline increase was million recognized components preneed merchandise in revenue result revenue growth of decrease million and a revenue service decline in core cemetery. in atneed growth. Breaking compared to a as by primarily $X million about recognized $X total or fund with increase million our expand in income year large by endowment return core the to backlog X%, sales recognized averages efforts. an sales a by to million while care delivered to successful in flat. year revenue primarily through was property was total trust due industry in $XX million $X investment legislative strategy combined quarter, and of decline out $X sales, we production revenue. Other a being in million our offset production of decline the prior Comparable preneed preneed grew continue relatively from decreased

Hills, premium development premium strength new to activities. this anticipate return our see our year quarter For XX%. production. Cemetery had to $XX XXXX, each year, third $XX to some operating in once generating of very low remain to location, the We we due around quarters, the results profits Last sales million this percentage averaged Prior quarter customer second, XX these by profit and basis limited per been fourth gross our inventory comparisons, and about the sales. history. very growth of milestone million ongoing our we margin our access the only In points, mid-single-digit challenging we've gross to $X generated sales our face largest in in long-term to last Rose in X increased million in of we XXXX and of in will an we sections cemetery the has continue quarters. increased large achieved strong. At and by

modestly. our cost income margin and While growth us fund revenues managing below were expense growth flat, trust fixed in gross allowed to X%, higher profits grow

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

earnings share growth of the compared $X $X.XX representing $X.XX, for for of outlook current fourth adjusted quarter of X% XXXX per is to to the adjusted of per share XXXX. quarter to Our in expected XX% earnings fourth

new the margins higher grow quarter, Endowment backlog, Fund from service We the then trust from corporate favorable recent in income. our merchandise costs funeral Increased the fourth and comparable both the will impact general general cemetery on the with from on be expect from and offset and to stemming funeral marketing servicing our cemetery higher preneed Care segment somewhat agreement impact of coupled agency revenues rate. tax side, from the acquisitions of administrative lower and preneed by profits primarily

we We think of volumes low anticipate higher as growth we guidance share percentage production XXXX XXXX, towards to to stabilize growth. sales per funeral cemetery annual of historical to return we mid-single-digit X% to optimistic and earnings return As to that preneed can XX%. to levels the about end our compared are to

for highly interest fantastic impressively, with negative lower XXXX. changes Agency our XXXX, in effects confident and higher true revenues finally, from another XXXX. acquisitions can class to new marketing should insurance positive rates agreement. The of in General in comparably from positive We preneed are the And grow trend operational contributions SCI XXXX we provide Direct profits the of

excited Beyond world-class a businesses, and containing preneed that feel North a $XX billion market-leading brands where network robust American I with our truly is and workforce backlog. vast

acknowledge very demographic for commitment and positive incremental value for capture SCI shareholders customers, to entire and I have want the conclusion, another. our to one poised our are their trends our on industry. In a impact as We communities thank daily to team future our

our difference for success. you Your to making operator, the that, dedication Eric. is Thank foundation the a over every now I'll call turn day. With of

Eric Tanzberger

morning, Good everyone. way to of start kind just I'm going Tom Tom. the ended. Thanks,

and the a and we serve, of associates morning to tuning on into gratitude their you home remarks, is our address dedication client you your our families or financial support all by prepared truly your frontline amazing. in it your us I management. are senior that as I to before of my make appreciated unwavering get commitment And much the express What as doing and difference hard too in work want sincere and most So let's a are to truly are want face you challenging times. this all communities well on whether role, office during family-facing to that deeply

you So that thank you for everything do.

I'm start our to few before specifically then flow our financial capital some with make quarter. So and expense and investments on then cash G&A into corporate updates remarks guidance, a on I'll with related some the current position going during prepared that, discussing concluding by flow. cash comments results move the to

favorable drivers continued sources than flow strong derived from to XX% benefit of quarter. of mainly from So year. million. adjusted over preneed The cemetery the the cash This cash million increase growth primary cash and $XXX our $XX quarter, is we for the flow strong operating This prior receipts cash adjusted reported remained were our higher capital $XX the an in as or million of internally installment expectations customer working more sales. exceeded flow previous during

now our by in We income last continue higher receipts the COVID. capital $XX partially increase strong a over preneed times X-year of about cash our year-over-year, of several sources million period see couple years, which from $X taxes result. These debt discussed finance installment operating balances. adjusted property higher the a during a over cemetery to timing has to seen in So over lower this about cash and method recognition the past million, offset and related the significant were these the higher the as generally tax related year during as benefited interest we've primarily were quarter several the to revenue. benefits a flat Cash to of X- particularly sales quarter of is sales, of change we've accounting and the cemetery of quarters, working

expect which to taxes XXXX, anticipated cash increase in that about compared years at to in result cash Looking we payments we'll normalized the that. more beyond million to revert then beyond an annual normalized will level more in XXXX forward XXXX, $XXX and continue level, a tax in of

talk let's the the during quarter. about investment So capital

and or excited particular quarter. capital, which purchased prior investment $XX is during combined into back million year is for constructed capital highest that this and new rate allocated million very We we than quarterly of shareholders. invested existing are about our $XXX higher XXXX the made businesses our We to our businesses, This the a returned investments quarter.

which invested expectations than our was into $XX some timing we the some slightly million of due capital quarter, projects. maintenance Specifically, in to higher

let's XX% deployed growth, a cemetery maintain little again, investments development preneed capital best-in-class of So $XX that And to break cemetery supports $X into high-yielding to that maintenance million further. and million our projects. current inventory future We digital down and facilities initiatives. sales corporate

also funeral expand construct homes capital as homes new of our invested to some existing and $XX some we growth million well. in Additionally, funeral

was which during a let's highlight the for talk us Now particular acquisitions, the about quarter.

million acquisitions closed has an mentioned, $XXX million million, on Tom to range our several businesses significant $XX $XXX $XXX of of million we exceeds markets As This successfully a typical to on total brings significantly spend. major for investment annual basis. which our already of on in XXXX

of these to from SCI acquisitions all We are these welcome new the happy to family. associates

spent you also and real $XX to In funeral addition Texas, Florida we acquiring businesses, of homes. in these estate California, development purchased know, largest future of some our states, million for and cemeteries in as

to to shareholders million repurchases. of $XX million million shareholders, of nearly return is of quarter, the capital capital dividends $XX this in share we through terms $XX in Lastly, returned of and and

another at for X.X Subsequent of repurchases shares price those XXX quarter. the million in million under shareholders about to we've the about Year-to-date, to return capital in around repurchases. about shares, of $XXX $XXX $XXX million outstanding a of quarter, bringing in we $XX $XX, purchased million million, year-to-date average and a little also end talk repurchased share over over shares just just to total a second. the resulting let's So million little as of the an dividends

fourth now let's corporate increase is million than million The a the the in of as $XX to $XX remain corporate the by higher G&A supported So bit during that range to normal expense. our we million we XXXX. compensation range higher G&A, was for which in million million quarter. expected of $XX total or long-term shareholder shift due primarily We incentive were where return to normally with that the to incurred TSR quarter comfortable 'XX $XX little plans quarter, in $XX on quarterly growth

calculates bank savings you, credit to issued I'd a which million X.XX% was So note $XXX our about on an position. X.X% debt swapped debt we million like X-year to few immediately to basis. X.XX% million as September, at remind our we long-term to an effectively repay to accretive rate, solid This which used of million facility. also And a $XX financial on $XX updates for a annual in about just $XXX transaction share we

quarter, liquidity about billion about billion, up plus hand, on freed up availability our available because the of $X.X this million had the now on credit of facility. bank Additionally, it also increased credit facility. At long-term of this meaningfully we this liquidity end $X.X long-term cash $XXX transaction on bank of made

midpoint the putting on our slightly Xx at basis, X.X to us of net debt-to-EBITDA Our the X.XXx the end quarter leverage of targeted increased range. to a near

flows going and lower preneed somewhat cash remained flow from by cash let's forward cash Cash guidance. Now driven well as shift a flows a receipts installment bit little better-than-expected to taxes. strong, cemetery as

guidance This range a result, midpoint $XXX raising our cash expectation unchanged As midpoint range million of $XXX $XXX operation as million range $XXX million. 'XX Also, of to $XXX flow maintenance total million to the the million. million $XXX saw, the about specifically, resulted $XXX million for quarter. of for from XXXX and of from in guidance XXXX to you our year of for CapEx a fourth we're remains a full adjusted at a

discussed that CapEx field to just strength initially growth higher and spend we're a cemetery Tom to color preneed levels. So looking receipts. From before than second cash 'XX maintain beyond our continued neutralize To as development by earnings flow be positively flow our in installment capital 'XX our as expecting expect expected in 'XX, for I'd while now talk be a taxes like taxes, to cash perspective, give XXXX impacted to you and cash our should some slightly on the high-level this well locations expectations. cash cash

which 'XX expect will initiatives flat digital results be next headed and corporate moderation generally maintenance in year, overall into levels. our in capital really investments our 'XX in We to continued

and entire cash shareholders. and to in to SCI strong flow again our the us value a strength once their our company, remains keep So each combined thank for with our sheet, should every key to contributions balance I flexibility to closing, our maintain of invaluable financial our want providing allow team day.

pass questions. So you back wraps prepared open our and And this to with now the to operator, floor that, up remarks. up we'll it

Operator

with question first Schneeberger from Instructions] comes [Operator Oppenheimer. And the Scott

Scott Schneeberger

start preneed like to I'd cemetery discussion sales. out the

any recognized and so to more based Thinking why -- the of XXXX. well? year where here revenue and you for be end you're want about about what XXXX maybe the would into in on with appreciated as sales 'XX, think Just are into ending of sense seeing what a get levels type commentary reasonable

Thomas Ryan

the comparison, -- you think about really Scott, $XX so particularly it I tough think as sales, was in fourth around a got we've the quarter, think about when large million. you again,

think big one to a when that's So about overcome you production.

and typically year, this front, below in will I quarter year, pretty is On of a slightly And that. that recognition the get year influx, think seasonal the last projects had recognized big in line but completed. this we last with fourth be

lot a but back bigger quarter, third quarter, you than pretty fourth to the it's so comparable, compare slightly And when the below.

to that's traditional As from you -- think recognition know 'XX, growth again, about I long know think I impact volumes. lead do production epidemic basis, that pretty Funeral I a back time, for an get been COVID cemetery. and And we to a feel sales are on the in range. we but again, we can sources it's percentage we been confident, model that levels. volumes had kind think low the that of funeral mid-single-digit

stabilize, traditional And get so we 'XX of sales and we believe growth stabilize like preneed year, volumes feel in the kind to and back levels.

Scott Schneeberger

has I that it on sales, in And being we was you saw challenging? just timing Does the large play that. what purely Rose Tom, quarter? mentioned some comps into construction that prohibit heard on may year-over-year ongoing Hills so just Or

Thomas Ryan

Yes.

in take at, right a sales look you now. Hills, running million, mean, it you large quarter the for significant If million million last probably Ross is. just $X $XX $X I to Traditionally, quarter. ran instance, year They're how show

section there and and upon a example. open will XXXX be solely that customers But pretty we're not with the that's it. take that's big and in ability delta, see an to the So based as have finished up

Rose sales when I'd you growth think year. to for Hills opportunity about So a large expect be next

Scott Schneeberger

we reversion post the a tying was the funeral quarter? it there Just on perhaps the get be thoughts I'll sense to on expected than status growth and forward what kind in in funeral 'XX the of Just and what gives should want turn in little forward? that volume flattish pandemic a for another in pull of that seeing then And the that. run rate side, appreciate over. some of weaker on confidence What I as year going just preneed you're quo?

Thomas Ryan

Sure.

So of pull-forward again, in the a guess. to We -- these we're as demographics -- on funeral we've But think think see anticipate just think models but population. volumes, are death to we've growing. markets we the that had bit that I it's beginning again, effects increases the relates a still it we it's of there's

be then gross way and the one somewhere sales. bit is slight near just in a our that, but a it. to it get into could going lot that. it we're little mean show a bit There's and or models be we that SCI that. On core And that going that So off expect on little pretty Direct XXXX out preneed flattening going getting other, it's again, funeral, about confident I so much change would both sales talked for better. to I post

And provider. cycle. on So transitioning didn't a protection to sold that a think we contract, we what one, with side, the new I our bit of Flex during give about talked two, call customers before, the were Product, we lot payment we core a new little fact uncomfortable which we're a the

So we underwritten a lot insurance we've new an them protection. gives which spent do of time people saying how into our that partner more onboard product, with

think that as starting have about just think of to caused hard And health getting complicated a others. and a a bit process. variety It's before so We reasons, people of you time a a stabilize. that's that for has underwritten little hiccup

back going so And about to traditional product. of growth core get levels you to 'XX, think about think when we're when I the think I

a Direct product transitioning not trust only we product. bit insurance in SCI are -- an a we're to from is that different little

you if product about there, so to need sell think be licensed. to And it, an insurance you

that sales have counselors we So few a needed obtain to that license. quite

in little traditional pretty that's levels. take back bit So expect I'd longer, But and grow. growing stabilize say, that half XXXX, to back of to a may the I'd at growth

I a a that's insurance to before/. reason and to great think So it's product, product no -- we're be better kind want provide insurance the of other we really protected, going than had people

Operator

with Sommer Tobey from Truist. comes question next Our

Tobey Sommer

term? and could organization, of next are I you you might have and like efficiency that you changes into kind insurance in have a near talk go settled, speak? was about selling force the the this lower hoping maybe delta here maybe relationships? said dig new the had as year you things so you what to some could into more And And of and products little sales bit in given

Thomas Ryan

Yes.

you in take if Tobey, you back grow digits. the low to think, I if look cemetery, we said, like mid-single historically, we

that growth be to more I and in think because a expect funeral, little complication. of phase mid-single-digit core are traditionally, potentially when mid-single able high sells, I Direct Direct more SCI licensing look of you at like to to take we'd back type it's the low whole the to and to because it times. production. to way to SCI And probably those expect single-digit at would I again, think time different going of a get

is we're of be news anymore delivered merchandise up profitability to somewhere really pause, But once you if $XX deliver like growth. you about having all going to The tremendous ourselves to good losing When SCI done. not -- $XX of I for some chose it this this, about of SCI if setting like these going million before think Direct, changes. some said, we're take we're we by and think close you to we're we We will, historically deferring. million, Direct, we're what

Direct So atneed have of a $X,XXX. been of going might to preneed SCI to -- to going out $X,XXX, backlog it's It's be going contract $X,XXX. the grow

flow have such operations funeral contracts a growth going we these begin have to through to natural pattern You're see backlog. a because and tremendous

temporary. it's again, So

[indiscernible]. think a the Direct mid-single low perspective, about back to mid- production on and digit all side core to when functioning high from SCI you those on sales think I to

Tobey Sommer

to the that Does more of Do in mom-and-pops post-COVID willing continue? seeing to expectation sell? -- an you sizable in strong? are have the the strength pretty And pipeline you period, quarter. remains you were are the acquisitions The sort

Eric Tanzberger

this Toby, Yes, Eric. is

industry. the I pipeline think we continue the to about in be excited

larger think it of I bit to type A just in. of and generalize a is of sellers the different, acquisition about that is for on think this to pipeline combination a I there's don't Those very able good interested quarter. kind while been during deals we're talk particular healthy in decision were have glad them, But I independence areas. to COVID. things be That's what about. what major that It's can we're but of of are think have to Those we'd and facilities. pipeline opportunities and little close every excited metropolitan types very more I a come. there's the lot we

the guidance official year, the exceed is the this able of million I do end we that fast we think when back very year, the billion it. like but $XX be for we seller's a of significant $X.X not have going the to certainly does did to our a liquidity hope flows. tell, I even raise quickly, to or ebbs in want we're said next to $XXX lot the when and next or hand that decision, it a liquidity at favorable necessarily but and million as decision ready spend a we move remarks, to the But amount, year you cell high it is And like could in very event, environment.

Operator

comes question Gajuk America. of Joanna Bank Next with from

Joanna Gajuk

the on it? the That's comment next just organic, funeral first, be a loans Maybe year flattish. clarification on to isn't

Thomas Ryan

That's Yes. same-store organic.

Joanna Gajuk

I all that. questions. acquisitions, other just we're just talking these so want X I exactly clarify guess about because to Right

some talk there. Is compared sales preneed active. back come large in to about understand I large you XXXX? And year thinking that any So -- these these when delayed? tough the and talk QX? large had [indiscernible] very these also when I there those So about guess Can comp sales, about to are might sales clients last was you this indications talk limitations about you switching cemetery,

Thomas Ryan

Yes.

back rate go closer production. $XXX you at memory million. we're to if $XXX And now million, large running my 'XX, around to $XXX probably of it's -- we're me, annually a So in serves million sale

and can pre-COVID, we've the why had XX%, down think though we really we're So And tried XX% in we're when get even comments, to down high type year-over-year a on rate. say you operating I that's growth. at of about very ourselves,

in country. the that's we in of in the inventory, a We've that beautiful got pricing developing taken these put team of high-end inventory, garden the lot a concept Now because we've that states. parts And of that training. different great

been do able to that it. places So the we've expand

Now it's I probably of year. our XX% Rose to Hill, go high-end back you, every production

because why we I to good why problem big. down, take every And that's overcome. may it's it it's So to say, hard It's if up it's don't bring a have, it week.

so at -- again, type look high we -- continue, a Joanna, So levels that's very out seeing deals today, We're at operating I'd forward. of there. we're those expect as and to level,

believe nothing impede to time, there's execute that. So we that to is going at this our ability

Just a But and quarter and in quarter. have way, third by we one, second for tough the [indiscernible] fourth feel beyond that, tough the another really good.

Joanna Gajuk

quarter it, improvement the tends that because is XXXX to from color. third Okay. That's quarter this call than, much 'XX in and lower. margins, in this the better QX, especially, good XX% And I guess right, on be P&O and

considering is year insurance of Or benefiting a this benefits is from this of already guess contract? how I this, guess, new runway? the margins senior think the kind funeral I should we contract? about So full And insurance new

Thomas Ryan

of anticipate latency. we of margins the XXXX. helping bit that a it to positive us, in factor in but from improvements Yes. really think bigger the to is back from a you're funeral the will 'XX just that SCI I about core We're to with you pure lot when seeing be really mean business the to referring has a Direct. do nothing and quarter It little much

way anticipate about we execute 'XX. up margins XXX the that if think XXX to to So points go we we basis we'd again, is to think our maybe can in a way fair

Joanna Gajuk

one was the previously fourth been last XXX funeral may consecutive trend of should below I of XXX. be like a describing a what If squeeze only Great. XX That's shift, it you had bps? quarter that cremation being to why

call kind enough the that [indiscernible]? headwind So trend? are shift of new we new it that to a then maybe Or a is in paradigm

Thomas Ryan

debate time. the all We internally that

that reality points be -- flow. used think still is a basis ebb not does points is, the we it sure in I not it opinion I I personal and anymore. But basis XXX still XXX think realm could I'm say my to year. maybe

Some that fact -- large needle, cremation a just just so have of to in that's the order now base move business. that bit. a of much we the It's takes it quite

Operator

A.J. next with Our UBS. comes from question Rice

Albert Rice

A could. couple I questions, if of

of volumes more you turn to we've start volumes. the see your Obviously, -- on been has been anticipation trend say period the down underpinning that would atneed that start a might where to through Any is positive? positive. flat forecast what to more little we'll So a thoughts time that

Thomas Ryan

I forward. again, we of has But markets. going that every preneed first I we're things, think are in is, and out, population smaller it's that model backlog. lessens we a think and pretty it's smaller second A.J. get We like in then is, effect that We've And our the grown, pull-forward aggressively combination direction. as year to as foremost go competing shifting demographics great feel thing the got the a just

So kind things all our these of thinking. into roll

continues is model diminish pull-forward probably as just it But biggest the of that to that we the out. one effect

the go I doesn't but other that things overcome with it away, we Now it mentioned.

Albert Rice

that that? on of this but you with -- haven't you year. it And a about how dynamic, might What's you in I when cemetery just And or to volatility frankly, guys at some Investor the about side, asked years production this your the effects the pull couple your versus of think affect side, the funeral also, at ago think preneed of for in while, all volumes where changed either about in lingering COVID, pull-forward we're sales the atneed the in forward in effect and laid updated property thinking you Day a out what cemetery about thinking? of the demand have

Thomas Ryan

it's of kind we trending the think I think. No, way

I less lease on funeral the we of lines little anticipate side, when a but more large you the impact along quite little funeral core about the you less kind a have core business. It think volume sales when think shouldn't the honestly of sale.

to lead less have follow on. just up You

true I years. been think and for XX%, is really XX the like correlation that's last XX%, the

that. So there's definitely

we that we it makes our cemetery So that out, good we to feel through say business. is production, going particularly as get about flatten that's if why leads to relates us feel volume atneed sales better --

Albert Rice

pricing the markets Okay. sounds will And these the part Can already accretive presence, about on more to presumably expressing pace the your that it potentially have Great. transactions a than acquisitions return outright there, just seen on even of contribute? of then a recently? are Is make that an with to sort like some true? of maybe them you step-up of which talk what the targets, you've where purchase. in Is comfort more in growth you end acquisitions, ability high

Thomas Ryan

to will itself, well that's spend target $XXX a will not piece that. close able obviously, And acquisitions above be before growth million, money what you're when sure we million, to $XXX The year-end.

million, could deals. going So it these the a little have be to roughly in a higher, versus A.J., $XXX target of that's accretive midpoint of bit nice perspective

type more to to of involved more lot change continue go whatsoever. no to any do of of in definitely can they're streams are talked no assume we're a have the the the revenue of markets. there's others these to line we're about But in in and some talk can owners synergies I and And mentioned, are you especially it And need, for some as shareholders. and cost dynamics major they're it top that be to ultimately desire good still these expected won't precluded and which, about good part, these these for accretive that able there businesses You as in contracts forward too now many perspective. and right assume, from terms and We're situations, to it. have just our there moving apply tuck-in to as I much that that. But same, most are in makes before, you had and you very high-quality of happy adjustments businesses, said, that

Albert Rice

there often can maybe thing. you And don't provide We then ask guys are about on what intra-quarter, but some an this, changes, last you about updates, perspective doing you there? was et cetera. Any Great. announcement us management

Thomas Ryan

retirement, a Steve of but a of was do is we because triggered and Board easy this succession as it inevitably, as to to because we've of it's he willing same well taken approaches a planning you And succession lot but had step lot A.J. going that in take with occur. way, the know, plan. with the is, very to a back decisions, I companies pretty seriously kind think it

there, named different we're And so of going in that perspectives. responsibilities it's elevated executives about excited the think a value and we in lot for add the I to

whole long-term I of the think I big were about a for excited company part surprises. is it. And any -- don't again, on working been there's So are think These plan some we've quite time.

Operator

Snure James. question Parker next comes from Raymond The with

Parker Snure

Parker Ransom. John This on for is

But over I I resilience What just I said their on of And note you lower of I lower-end end terms? some have kind maybe just loosening guys anything just payment guess, the or the Is the kind consumer noted terms that it cemetery if of of of to? of year-over-year. the selling, it in years core is of preneed stability you the some was and some couple know changes attribute you, lower there call. on, the sorry Is it losing the else contracts. consumer? past flat missed some asked hold that know would done end anything segment? payment you those would beginning Is the I of the the on that

Thomas Ryan

to we'll There's of we've sales. situation help even pull-forward that that, that not creating there terms source. continue effect grow. not some lead think the And and are as There's said, along need it's us to We margin on, those a of type we better really are we'll loosing lines. incentives these compressing continue of a in any There's or on as the payment to where that unusual bit there's anything here in to type preneed next terms maybe occurring help but the short for down the our flattish lines We panic or in We're future, going these sales more from good about already incentives or get all situations. those very of especially year, in not term, -- feel percent term. that's along we're we've and cemetery. long at customers, the from will any help of changing not of that as X-ish volume little going get front #X anything counselors said,

Parker Snure

late third late in and fourth big decent some funeral Florida kind the was whether in the in And the have see down Did you of I Okay. Florida. obviously or on fourth quarter, the quarter, Southeast. a quarter, you of selling volumes third exposure it in of early amount impact some know quarter, preneed be guys there early activity? then an hurricanes

Thomas Ryan

week little is Western those manage is well or general it. us, business of the essentially preneed cemetery. it, our call something headwind of do a team, ultimately, did statement, bit as it's as in a funeral days for to Florida XX management is $X.XX there's a to related a for associates quarter ended did. bounce mean across way and to most Maybe the houses delay, of, anything together the importantly from going as shutdown have, resilient, $X.XX a very we concerned right? going we would or But to markets. situations, up pulled happen through way next really that personal able we're volumes it a I'd their to we and We all to their the and I was the very that particular pleased week and back okay and we're such that related which about, we're as to Well, related one say, just kind happen week. need well. of Florida that But a

Parker Snure

And just last I if can Okay. get one. one

the some you're the about few preneed the synergies assuming of over these And overlaying you the the doing kind you're course some multiple like of high-level you're the acquisitions. to or When platform? when how think down to multiple we regional effective Just a you're selling, realize you're when how the things deals? doing question able work years more mom-and-pop down integrating operators, that going integration are able multiple And or a it's maybe type purchase your of these of should of acquiring on acquisitions? on through of these smaller things effect to what process? I'm types of

Thomas Ryan

what changed. multiples still that's before fair It's the we're Well, saying is pipeline I filling, that multiples. very was paying really haven't and

X call So pre-synergies. EBITDA that you of kind can to XXx

we I for scale. a we pretty have think of get just some the quick on based synergies turn our

company we of the size scale within We far our especially the major scale have with market, a have both of and by power the purchasing a largest being local industry. in national market,

right you it away. something So that's right going away, almost to get turn

rest made much really independent of were about had the the that we our COVID. out or so about streams CRM Salesforce new revenue utilizing the of more some us talking maybe ways And other things efficient go things that and better that the to -- an utilized better that technology and are processes

with in of have going in we're the happy those most the which most our and a But lot owners leadership different and not call and streams become over which adjusting where team, and part very stayed are for staying the an especially the their helps of accretive part, underlying these the situation even it SCI. solid, revenue long with we're businesses for on former to of management plays be in term more situations

Operator

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

Thomas Ryan

being our earnings the February. at call speak you so for on fourth today. much. Thanks everybody, Thank you, call quarter and will in to Happy Halloween, we

Operator

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

disconnect. now may You

Service Corporation International (SCI) 31 Oct 242024 Q3 Earnings call transcript