Adjusted EPS Slightly Improved
Adjusted EPS of $0.97 vs. $0.96 prior year (+~1¢), with management noting underlying strength and that flat funeral volumes would have implied EPS of ~$1.12 (roughly 17% growth).
Strong Cemetery Revenue and Gross Profit Growth
Comparable cemetery revenue up $31M (~7%); core recognized preneed revenue up $28M (~10%); cemetery gross profit up $15M (+11%) with margin expansion of ~120 basis points to ~33% driven by higher-margin trust income.
Robust Preneed Sales Momentum
Total preneed funeral and cemetery sales production increased meaningfully: preneed funeral sales production +$18M (~6%) (core +$13M, non-funeral home +$5M or ~9%); comparable preneed cemetery sales production +$32M (+10%). Management highlighted sustained velocity, seminar initiatives and roll-out of insurance product across SCI Direct locations.
Resilient Operating Cash Flow
Adjusted operating cash flow of $335M, up just under $20M (~6%) YoY, driven by preneed cash receipts and favorable working capital timing despite lower operating income and higher cash interest.
Healthy Capital Deployment and Shareholder Returns
Invested $108M in capex (including $41M new cemetery development, $17M growth capex, $24M acquisitions). Returned $190M to shareholders ($143M buybacks — ~2M shares at ~$80 avg — and $47M dividends). Acquisition pipeline on pace for $75M–$125M target.
Solid Liquidity and Leverage Position
Ended quarter with ~$1.7B liquidity ($260M cash, ~$1.45B available credit) and leverage of 3.68x net debt/EBITDA (at lower end of long-term 3.5–4.0x target).
Trust Fund Recovery and Full-Year Expectation
Combined trust fund returns down 0.7% in Q1 but rebounded an estimated 4%–5% in April; company reiterates expectation of ~7% trust fund return for full year 2026.
Guidance Reaffirmed
Reaffirmed 2026 normalized EPS guidance of $4.05–$4.35 and adjusted operating cash flow guidance of $1.0B–$1.06B; management expects full-year comparable funeral volumes down ~1%–3% and continued cemetery momentum (management now aiming for mid-single-digit cemetery growth).