SCI: SERVICE CORPORATION INTERNATIONAL ANNOUNCES FOURTH QUARTER 2024 FINANCIAL RESULTS AND PROVIDES 2025 GUIDANCE

In This Article: Conference call on Thursday, February 13, 2025, at 8:00 a.m. Central Time . HOUSTON , Feb. 12, 2025 /PRNewswire/ -- Service Corporation International (NYSE: SCI), the largest provider of deathcare products and services in North America , today reported results for the fourth quarter of 2024. Highlights : Tom Ryan , the Company's Chairman and Chief Executive Officer, commented on fourth quarter results: "We are pleased to report a strong finish for the year with adjusted earnings per share growth of 14% in the fourth quarter of 2024. This was driven by revenue growth in both our segments, which translated into solid gross profit performance and margin expansion. Growth in cemetery preneed sales production and higher funeral general agency revenue more than offset a decline in services performed during the quarter. For the full year of 2024, we reported adjusted earnings per share of $3.53 and adjusted operating cash flow of $977 million. Our robust cash flow for the year allowed us to invest $181 million into the acquisition of 26 funeral homes and 6 cemeteries in major metropolitan markets and $62 million into real estate transactions to expand our footprint of funeral homes and cemeteries in our existing markets. Looking ahead to 2025, we believe we are well positioned to deliver solid results, with the midpoint of our expected adjusted earnings per share growth within our long-term targeted growth range of 8% to 12%. I would like to thank our 25,000 associates for their unwavering commitment to providing excellent service to our client families. Through their hard work, SCI remains in a position of financial strength affording flexibility for continued growth. We continue to believe in our long-term growth strategy to grow revenue, leverage our unparalleled scale, and invest our capital wisely to enhance shareholder value." FOURTH QUARTER AND FULL YEAR SUMMARY Details of our fourth quarter 2024 financial results and the consolidated financial statements can be found in the Appendix at the end of this press release. The table below summarizes our key financial results. (Dollars in millions, except for per share amounts) Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Revenue $ 1,093.0 $ 1,055.8 $ 4,186.4 $ 4,099.8 Operating income $ 262.2 $ 242.1 $ 927.7 $ 944.3 Net income attributable to common stockholders $ 151.4 $ 138.4 $ 518.6 $ 537.3 Diluted earnings per share $ 1.04 $ 0.93 $ 3.53 $ 3.53 Earnings excluding special items (1) $ 154.8 $ 138.4 $ 517.9 $ 529.3 Diluted earnings per share excluding special items (1) $ 1.06 $ 0.93 $ 3.53 $ 3.47 Diluted weighted average shares outstanding 146.2 148.8 146.8 152.4 Net cash provided by operating activities $ 264.1 $ 277.6 $ 944.9 $ 869.0 Net cash provided by operating activities excluding special items (1) $ 267.6 $ 277.6 $ 976.7 $ 882.3 (1) Earnings excluding special items, diluted earnings per share excluding special items, and net cash provided by operating activities excluding special items are non-GAAP financial measures. These items are also referred to as "adjusted earnings per share" and "adjusted operating cash flow". A reconciliation from net income attributable to common stockholders, diluted earnings per share, and net cash provided by operating activities in accordance with generally accepted accounting principles in the United States (GAAP) can be found under the headings "Cash Flow and Capital Spending" and "Non-GAAP Financial Measures" in the Appendix at the end of this press release. Diluted earnings per share were $1.04 in the fourth quarter of 2024 compared to $0.93 in the fourth quarter of 2023. The current year quarter was favorably impacted by $20.3 million resulting from a reduction in our California legal reserve as the primary claims period expired. This benefit was offset by $17.2 million of net losses on divestitures and impairment charges and $11.5 million of restructuring charges. The prior year quarter was impacted by a $0.4 million pre-tax gain on divestitures. Diluted earnings per share, excluding special items, were $1.06 in the fourth quarter of 2024 compared to $0.93 in the fourth quarter of 2023. Higher gross profit, lower corporate general and administrative expenses, and a lower share count more than offset a higher tax rate resulting in 14% growth over the prior year fourth quarter. Net cash provided by operating activities decreased $13.5 million to $264.1 million in the fourth quarter of 2024 compared to $277.6 million in the fourth quarter of 2023. Net cash provided by operating activities in the current quarter was impacted by payments related to legal matters that were expensed in 2022 of $1.2 million and current period restructuring charge payments of $2.3 million . The $10.0 million decrease in net cash provided by operating activities excluding special items is due to uses associated with payroll timing as well as net preneed and other working capital that were offset by an increase in operating income and lower cash interest. OUTLOOK FOR 2025 Our 2025 outlook for diluted earnings per share from continuing operations excluding special items, at the midpoint of our guidance range, is anticipated to be within our expected long-term growth framework of 8%-12%. Our outlook for net cash provided by operating activities excludes special items relating to the payments of certain estimated legal charges recognized in the fourth quarter of 2022 and payments for the restructuring charge recognized in the fourth quarter of 2024. (Dollars in millions, except per share amounts) 2025 Outlook Diluted earnings per share excluding special items (1) $3.70 - $4.00 Net cash provided by operating activities excluding special items and cash taxes (1) $1,005 - $1,065 Cash taxes expected in 2025 (at the midpoint of Diluted earnings per share guidance) $175 Net cash provided by operating activities excluding special items (1) $830 - $890 Capital improvements at existing field locations $130 Development of cemetery property $160 Digital investments and corporate $25 Total maintenance, cemetery development, and other capital expenditures (Maintenance capital expenditures) $315 (1) Diluted earnings per share excluding special items and net cash provided by operating activities excluding special items are non-GAAP financial measures. We normally reconcile these non-GAAP financial measures from diluted earnings per share and net cash provided by operating activities; however, diluted earnings per share and net cash provided by operating activities calculated in accordance with GAAP are not currently accessible on a forward-looking basis. Our outlook for 2025 excludes the following because this information is not currently available for 2025: Expenses net of insurance recoveries related to hurricanes, gains or losses associated with asset divestitures, gains or losses associated with the early extinguishment of debt, potential tax reserve adjustments and IRS payments and/or refunds, acquisition and integration costs, system implementation and transition costs, and potential costs associated with estimated litigation charges or legal settlements or the recognition of receivables for insurance recoveries associated with litigation, or deferred tax payments. The foregoing items could materially impact our forward-looking diluted earnings per share and/or our net cash provided by operating activities calculated in accordance with GAAP, consistent with the historical disclosures found in the Appendix at the end of this press release under the headings "Cash Flow and Capital Spending" and "Non-GAAP Financial Measures". CONFERENCE CALL AND WEBCAST We will host a conference call on Thursday, February 13, 2025, at 8:00 a.m. Central Time . A question and answer session will follow prepared remarks made by management. The conference call dial-in numbers are (888) 317-6003 (US) or (412) 317-6061 (International) with the passcode of 2973360. The conference call will also be broadcast live via the Internet and can be accessed through our website at www.sci-corp.com . A replay of the conference call will be available through February 20, 2025 and can be accessed at (877) 344-7529 (US) or (412) 317-0088 (International) with the passcode of 2327241. Additionally, a replay of the conference call will be available on our website for approximately one year. ABOUT SERVICE CORPORATION INTERNATIONAL Service Corporation International (NYSE: SCI), headquartered in Houston, Texas , is North America's leading provider of funeral, cemetery and cremation services, as well as final-arrangement planning in advance, serving approximately 700,000 families each year. Our diversified portfolio of brands provides families and individuals a full range of choices to meet their needs, from simple cremations to full life celebrations and personalized remembrances. Our Dignity Memorial® brand is the name families turn to for professionalism, compassion, and attention to detail that is second to none. At December 31, 2024, we owned and operated 1,493 funeral service locations and 496 cemeteries (of which 308 are combination locations) in 44 states, eight Canadian provinces, the District of Columbia , and Puerto Rico . For more information about Service Corporation International, please visit our website at www.sci-corp.com . For more information about Dignity Memorial®, please visit www.dignitymemorial.com . For additional information contact: InvestorRelations@sci-us.com Investors: Allie O'Connor - Assistant Vice President / Financial Reporting and Investor Relations (713) 525-9088 Trey Bocage - Director / Investor Relations (713) 525-3454 Media: Jay Andrew - Assistant Vice President / Corporate Communications (713) 525-3468 CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS The statements in this press release that are not historical facts are forward-looking statements made in reliance on the "safe harbor" protections provided under