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Service Corporation International (SCI) investor relations material
Service Corporation International BofA Securities Leveraged Finance Conference 2025 summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.Business performance and outlook
Funeral and cemetery segments have normalized post-pandemic, with strong averages and steady growth in contract velocity and value over recent quarters.
Large cemetery sales are lumpy but make up 10%-15% of pre-need sales, with no clear correlation to financial markets; teams are focused on growing this segment.
Maintenance capital of $160 million is allocated to cemetery property development, including both community and private family mausoleums.
COVID-19's impact on death rates has normalized, with volumes expected to be flat to slightly down in 2025, mirroring pre-pandemic trends.
Earnings growth framework targets 8%-12%, with 5%-7% from base business; funeral volume is expected to remain flat, while cemetery pre-need production should see mid-single-digit growth.
Market share and growth strategies
Holds 17%-18% revenue market share in death care, 12%-13% in funeral, and 27%-28% in cemetery; organic growth is driven by preneed sales and consumer relevance.
Pre-need growth is supported by 3,700-3,800 counselors, Salesforce CRM, targeted marketing, and ongoing training; efforts are ongoing to optimize headcount and lead management.
AI is being piloted for obituary writing and lead routing, with early adoption in analytics and forecasting; broader use cases are being explored.
Industry trends and margin dynamics
Cremation mix has shifted from a 100-150 basis point annual increase to 50-100, now at 57%-58%; each 1% shift impacts EBITDA by $13 million.
Urban areas are nearing 70%-80% cremation mix, suggesting future moderation in the rate of increase.
Cemetery margins have grown from 17%-18% to 33% over 15-20 years, driven by pre-need sales; funeral margins are stable at 21% with potential for growth as baby boomer demographics shift.
New marketing agreement with Global Atlantic increased general agency commission from 26%-27% to 35%-36%, effective July 2024, boosting funeral pre-need profitability.
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