Service Corporation International (SCI) Oppenheimer 21st Annual Industrial Growth Virtual Conference summary

Business model and strategy

• Operates 1,500 funeral and 500 cemetery locations, holding 18% revenue market share in the death care space.

• Employs a three-pronged strategy: revenue growth, leveraging scale, and capital deployment for acquisitions, new builds, or share buybacks.

• Targets 8%-12% annual earnings growth, with 5%-7% from organic growth and 3%-5% from capital deployment.

• Focuses on pre-need contracts to secure advanced market share and build a significant trust fund portfolio.

• Maintains a $17 billion backlog, over four times current revenue, supporting future growth.

Recent performance and volume trends

• Funeral volumes surged during COVID, then declined 5%-6% in 2022 and 2023, and 2.5% in 2024.

• First quarter 2026 saw a 6% volume decline, attributed to a weak flu season and historical patterns.

• Full-year 2026 volume expected to decline 1%-3%, with improvement anticipated in later quarters.

• Long-term, funeral volumes are expected to remain flat until late decade, then grow 0.5%-1% in early 2030s and 1%-2% in mid-2030s to 2040s as baby boomers age.

Revenue per service and pricing dynamics

• Funeral revenue per service has grown above 3% year-over-year, supported by inflationary pricing power.

• Trust fund income and cremation mix shifts have contributed to revenue growth.

• Transition to deferring urn kit recognition has led to 9% growth in non-funeral home business in Q1, with outsized growth expected until backlog normalizes.