Carriage Services Announces Strong Third Quarter 2024 Results and Increases Full-Year 2024 Outlook
Conference call on Thursday, October 31, 2024 at 9:30 a.m. central time
HOUSTON, Oct. 30, 2024 (GLOBE NEWSWIRE) -- Carriage Services, Inc. (NYSE:CSV) today announced its financial results for the third quarter ended September 30, 2024.
Company Highlights:
A 27.1% increase in consolidated cemetery preneed sales, and an increase of 3.1% in consolidated funeral average revenue per contract, helped drive revenue of $100.7 million, representing growth of 11.3% over the prior year quarter;
GAAP net income growth of 112.4%, and Adjusted Consolidated EBITDA growth of 26.7%, over the prior year quarter;
GAAP diluted EPS of $0.63 and adjusted diluted EPS of $0.64, compared to $0.30 and $0.33 in the prior year quarter, a growth of 110% and 94%, respectively;
Leverage ratio lowered to 4.3x from 5.3x at the same period last year, as the Company paid down $15.0 million of debt on its credit facility during the third quarter;
The Company increased its guidance for 2024 to $395-$405 million in total revenue, adjusted consolidated EBITDA of $120-$125 million, and adjusted diluted EPS of $2.45-$2.55. Adjusted free cash flow remains at $55-$65 million; and
The Board of Directors has elected Edmondo Robinson to serve as an independent director effective October 30, 2024.
Carlos Quezada, Vice Chairman and CEO, stated, "I am pleased to announce that our growth continues with another strong quarter of performance. Our cemetery sales team achieved a notable increase of 27.1% year-over-year in preneed sales, affirming the continued effectiveness of our cemetery sales growth strategy. Together with an increase of 3.1% in our funeral average revenue per contract, these factors significantly propelled our total revenue, which grew by 11.3% over the same period last year. This marks the third straight quarter of exceeding $100 million of revenue, a first for Carriage.
Our strategic approach to preneed funeral sales also yielded remarkable results, with preneed funeral commission income surging by an impressive 415.4% to $1.6 million from $312 thousand in the previous year's quarter. This significant revenue boost, along with diligent cost management, contributed to our Adjusted Consolidated EBITDA of $30.7 million, growth of 26.7% or $6.5 million, and Adjusted Consolidated EBITDA Margin improvement of 373 basis points to 30.5%, up from 26.8% over the same period last year.
Additionally, our GAAP diluted earnings per share totaled $0.63, marking an increase of 110% or $0.33 over last year's $0.30. Adjusted diluted earnings per share also increased 93.9% to $0.64, compared to $0.33 in the third quarter of last year.
We are pleased to welcome Edmondo Robinson to our Board of Directors. Edmondo brings over 25 years of executive leadership and management experience in digital health and innovation in healthcare delivery, along with public company board experience. Edmondo holds a Bachelor in Science in Animal Physiology and Neuroscience from the University of California, San Diego, a Master's degree in Business Administration from the Wharton School at the University of Pennsylvania, a medical degree from the University of California, Los Angeles, and a Master's Degree in Health Policy Research from the University of Pennsylvania. Edmondo's experience and knowledge will further strengthen our commitment to driving long-term growth and shareholder value.
The third quarter delivered impressive success, and we are delighted with our progress and performance. The execution of our strategic objectives surpasses our already high expectations, and we look forward to continuing to execute our plan," concluded Mr. Quezada.
FINANCIAL HIGHLIGHTS
Three months ended September 30,
Nine months ended September 30,
(in millions, except volume, average, margins and EPS)
2024
2023
2024
2023
GAAP Metrics:
Total revenue
$
100.7
$
90.5
$
306.5
$
283.7
Operating income
$
22.9
$
15.7
$
60.7
$
57.1
Operating income margin
22.7
%
17.3
%
19.8
%
20.1
%
Net income
$
9.9
$
4.6
$
23.1
$
21.8
Diluted EPS
$
0.63
$
0.30
$
1.48
$
1.39
Cash provided by operating activities
$
20.8
$
22.7
$
42.7
$
61.8
Non-GAAP Metrics(1):
Adjusted consolidated EBITDA
$
30.7
$
24.3
$
96.9
$
80.7
Adjusted consolidated EBITDA margin
30.5
%
26.8
%
31.6
%
28.5
%
Adjusted diluted EPS
$
0.64
$
0.33
$
2.02
$
1.42
Adjusted free cash flow
$
20.0
$
21.4
$
42.6
$
42.3
Cemetery Operating Metrics(2):
Preneed interment rights (property) sold
3,511
2,736
11,107
8,521
Average price per preneed interment right sold
$
5,360
$
5,196
$
5,414
$
5,052
Funeral Operating Metrics(3):
Funeral contracts
10,713
10,842
33,293
34,159
Average revenue per funeral contract(4)
$
5,540
$
5,399
$
5,561
$
5,377
Burial rate
31.6
%
32.5
%
32.4
%
33.1
%
Cremation rate
60.7
%
59.5
%
59.8
%
59.1
%
(1) We present both GAAP and non-GAAP measures to provide investors with additional information and to allow for the increased comparability of our ongoing performance from period to period. The most comparable GAAP measures to the Non-GAAP measures presented in this table can be found in the Reconciliation of Non-GAAP Financial Measures section of this press release.
(2) Metrics calculated using cemetery operating results.
(3) Metrics calculated using funeral operating results.
(4) Excludes preneed interest earnings reflected in financial revenue.
Total revenue for the three months ended September 30, 2024 increased $10.2 million compared to the three months ended September 30, 2023. We experienced a 26.1% increase in the number of preneed interment rights (property) sold and a 4.4% increase in the average price per preneed interment right sold. Additionally, we experienced a 3.1% decrease in funeral contract volume, which was offset by a 3.1% increase in the average revenue per funeral contract.
Net income for the three months ended September 30, 2024 increased $5.2 million compared to the three months ended September 30, 2023. We experienced an $8.1 million increase in gross profit contribution from our businesses, which was partially offset by a $2.9 million increase in income tax expense.
Total revenue for the nine months ended September 30, 2024 increased $22.8 million compared to the nine months ended September 30, 2023. We experienced a 28.2% increase in the number of preneed interment rights (property) sold and an 8.4% increase in the average price per preneed interment right sold. Additionally, we experienced a 4.1% decrease in funeral contract volume, which was partially offset by a 3.7% increase in the average revenue per funeral contract.
Net income for the nine months ended September 30, 2024 increased $1.3 million compared to the nine months ended September 30, 2023. We experienced a $20.1 million increase in gross profit contribution from our businesses, which was partially offset by a $15.4 million increase in general, administrative and other expenses, primarily composed of one-time costs related to executive severance payments and the Company's review of strategic alternatives and a $3.9 million increase in income tax expense.
REVISED 2024 OUTLOOK
Revised 2024 Outlook
Previous 2024 Outlook
(in millions, except per share amounts)
Total revenue
$395 - $405
$390 - $400
Adjusted consolidated EBITDA
$120 - $125
$117 - $123
Adjusted diluted EPS
$2.45 - $2.55
$2.30 - $2.40
Adjusted free cash flow
$55 - $65
$55 - $65
The most comparable GAAP measures to the Non-GAAP measures presented in this table can be found in the Reconciliation of Non-GAAP Financial Measures section of this press release.
CALL AND INVESTOR RELATIONS CONTACT
Carriage Services has scheduled a conference call for tomorrow, October 31, 2024 at 9:30 a.m. central time. To participate in the call, please dial 888-224-1005 (Conference ID - 6660738) or to listen live over the Internet via webcast click link. An audio archive of the call will be available on demand via the Company's website at www.carriageservices.com. For any investor relations questions, please email
CARRIAGE SERVICES, INC.
CONDENSED OPERATING AND FINANCIAL TREND REPORT
(in thousands - except per share amounts)
Three months ended September 30,
Nine months ended September 30,
2024
2023
2024
2023
Funeral operating revenue
$
59,347
$
58,533
$
185,150
$
183,673
Cemetery operating revenue
32,988
24,315
95,339
74,465
Financial revenue
7,306
5,247
21,362
17,407
Ancillary revenue
1,046
1,156
3,375
3,445
Divested revenue
—
1,243
1,272
4,696
Total revenue
$
100,687
$
90,494
$
306,498
$
283,686
Funeral operating EBITDA
$
22,384
$
21,871
$
73,277
$
69,749
Funeral operating EBITDA margin
37.7
%
37.4
%
39.6
%
38.0
%
Cemetery operating EBITDA
15,883
8,980
44,900
30,163
Cemetery operating EBITDA margin
48.1
%
36.9
%
47.1
%
40.5
%
Financial EBITDA
6,681
4,849
19,732
16,223
Financial EBITDA margin
91.4
%
92.4
%
92.4
%
93.2
%
Ancillary EBITDA
156
147
522
366
Ancillary EBITDA margin
14.9
%
12.7
%
15.5
%
10.6
%
Divested EBITDA
(161
)
288
42
1,464
Divested EBITDA margin
—
%
23.2
%
3.3
%
31.2
%
Total field EBITDA
$
44,943
$
36,135
$
138,473
$
117,965
Total field EBITDA margin
44.6
%
39.9
%
45.2
%
41.6
%
Total overhead
$
14,199
$
12,848
$
53,980
$
38,200
Overhead as a percentage of revenue
14.1
%
14.2
%
17.6
%
13.5
%
Consolidated EBITDA
$
30,744
$
23,287
$
84,493
$
79,765
Consolidated EBITDA margin
30.5
%
25.7
%
27.6
%
28.1
%
Other expenses and interest
Depreciation & amortization
$
5,610
$
5,186
$
17,274
$
15,623
Non-cash stock compensation
1,850
1,992
4,521
6,155
Interest expense
8,035
9,278
25,071
27,213
Other
400
55
1,597
(50
)
Pretax income
$
14,849
$
6,776
$
36,030
$
30,824
Net tax expense
4,983
2,131
12,932
9,049
Net income
$
9,866
$
4,645
$
23,098
$
21,775
Special items(1)
$
342
$
829
$
12,554
$
534
Tax on special items
114
238
4,168
154
Adjusted net income
$
10,094
$
5,236
$
31,484
$
22,155
Adjusted net income margin
10.0
%
5.8
%
10.3
%
7.8
%
Adjusted basic earnings per share
$
0.66
$
0.35
$
2.08
$
1.48
Adjusted diluted earnings per share
$
0.64
$
0.33
$
2.02
$
1.42
GAAP basic earnings per share
$
0.65
$
0.31
$
1.52
$
1.46
GAAP diluted earnings per share
$
0.63
$
0.30
$
1.48
$
1.39
Weighted average shares o/s - basic
15,011
14,820
14,951
14,791
Weighted average shares o/s - diluted
15,491
