SCI Reports Strong Q4 Earnings, Outlines Bright Future for Funeral and Cemetery Services
Service Corporation International (SCI), a leading provider of funeral and cemetery services, recently reported impressive fourth-quarter earnings results. In a conference call with investors, the company's management team highlighted several key achievements that demonstrate the resilience and growth potential of the business.
In its Q4 2024 earnings report, SCI announced adjusted earnings per share (EPS) of $1.06, representing a significant increase from $0.93 in the prior year. This growth was driven by revenue, gross profit, and comparable margin percentage increases in both the funeral and cemetery segments. The company also reported lower general and administrative expenses, contributing an additional $0.05 per share to adjusted EPS.
Funeral services were a particular highlight of the quarter, with total comparable revenues increasing by over $5 million or 1% year-over-year. Despite a decline in core funeral services performed, which decreased by 4.4%, SCI's core average revenue per service grew by 2.7%. This growth was achieved despite a modest increase in the core cremation rate.
The company's preneed sales production also showed promise, with core general agency and other revenue growing by an impressive $19 million. This growth was driven primarily by higher average commission rates derived from SCI's new preneed insurance marketing agreement. The gross profit percentage for funeral services increased by 40 basis points to around 22%, thanks to a modest revenue increase combined with effective cost management.
While preneed funeral sales production did decline by $27 million or 9% over the fourth quarter of 2023, SCI's management expressed optimism about the future. They cited the transition to a new preneed insurance provider as a key factor in this decline and expect increased underwritten insurance product sales production as counselors focus on raising customer awareness of the benefits of fully insured products.
Looking ahead to 2025, SCI's leadership outlined a vision for continued growth and innovation. With its strong track record and commitment to investing in digital transformation, the company is well-positioned to capitalize on emerging trends and preferences in the funeral and cemetery services industry."
