Service Corporation International's Q4 2024 Earnings: A Growth Story in Funeral and Cemetery Segments

Service Corporation International (SCI) recently held its fourth quarter 2024 earnings conference call, providing insights into the company's strong performance and long-term growth strategy, particularly in the funeral and cemetery segments. The company's impressive results reflect its commitment to acquisitions, expansions, and a focus on preneed sales growth.

SCI's fourth quarter 2024 earnings call highlighted several key drivers behind the company's impressive cemetery revenue growth:

1. Increased preneed cemetery sales production: SCI experienced a $30 million increase in preneed cemetery sales production, which was more than 9% higher than the prior year quarter. This growth was driven by both large sales and core cemetery production, each contributing about half of the preneed cemetery sales production growth.
2. Higher preneed merchandise and service revenue: SCI saw increased preneed merchandise and service revenue generated from higher delivered units and contract averages compared to the prior year quarter.
3. Strong sales contract velocity: Although sales contract velocity was slightly down over the prior year quarter, it was still 8% higher than 2019 levels.

These factors contributed to the impressive 8% increase in comparable cemetery revenue and the 11% growth in recognized preneed revenue.

SCI's approach to business acquisitions and real estate transactions has also been instrumental in driving its overall growth strategy. The company invests in top-tier businesses in growing major metropolitan markets and expands its footprint through real estate transactions. In the third quarter of 2024, SCI invested $123 million in acquiring 10 funeral homes and 2 cemeteries, as well as $31 million in real estate transactions for the expansion of its existing markets. These acquisitions and investments allowed SCI to grow its business, increase its revenue, and strengthen its market position.



In conclusion, SCI's impressive cemetery revenue growth is driven by increased preneed cemetery sales production, higher preneed merchandise and service revenue, and strong sales contract velocity. The company's strategic approach to business acquisitions and real estate transactions has also contributed to its overall growth strategy. As SCI continues to execute on its long-term growth strategy, investors can expect the company to maintain its strong performance and market leadership in the funeral and cemetery segments.