CSV — Carriage Services, Inc.

Carriage Services (CSV) Q1 2026 Earnings Call Summary

1. Key Financial Results and Metrics:

• Revenue: $106.1 million, a 0.9% decrease year-over-year due to a 5.8% decline in funeral home admit volume.
• Funeral Revenue: $63.3 million, down 4.2% from the previous year, partially offset by a 1.6% increase in average revenue per contract.
• Cemetery Revenue: $29.6 million, up 6% year-over-year, driven by a 9% increase in preneed cemetery sales and a 15.3% rise in average revenue per property contract.
• Financial Revenue: $8.5 million, up 15.7% year-over-year.
• Adjusted EBITDA: $33.8 million (31.8% margin), up 2.4% from the prior year.
• Adjusted Diluted EPS: $0.86, down 10.4% from $0.96 in the prior year, primarily due to a higher effective tax rate.
• Free Cash Flow: $400,000, a 3.5% increase year-over-year; adjusted free cash flow decreased by $2.2 million due to special payments in the prior year.

2. Strategic Updates and Business Highlights:

• The company emphasized operational improvements and a focus on long-term value creation, highlighting a strengthened balance sheet and disciplined capital allocation.
• Integration of recent acquisitions (Osceola and Faith Chapel) is progressing well, with all systems fully integrated.
• The company is pursuing an at-the-market (ATM) equity offering program to enhance capital flexibility for acquisitions and growth initiatives.

3. Forward Guidance and Outlook:

• Maintaining full-year guidance with expected revenues between $440 million and $450 million, adjusted EBITDA of $135 million to $140 million, and adjusted diluted EPS of $3.35 to $3.55.
• Anticipates continued growth in preneed sales and market share gains, with expectations for revenue growth in subsequent quarters despite a challenging first quarter.

4. Bad News, Challenges, or Points of Concern:

• The decline in funeral home admit volume (5.8%) and comparable funeral revenue (4.2%) presents a challenge, especially given the strong prior year due to a flu season spike.
• Increased effective tax rate impacted EPS negatively, and the company noted the potential for continued variability in funeral volumes due to cyclical trends.
• Competitive pressures in the death care industry remain, with ongoing efforts to capture market share being critical.

5. Notable Q&A Insights:

• Management expressed confidence in revenue growth returning in the latter part of the year, citing historical trends and successful integration of acquisitions.
• The M&A pipeline is robust, with plans for significant activity in the second half of the year, potentially exceeding initial revenue assumptions from acquisitions.
• Efforts to improve customer interactions and market share through enhanced training and operational efficiencies were highlighted as key strategies moving forward.

Overall, while Carriage Services faced some challenges in Q1 2026, management remains optimistic about future growth and strategic initiatives aimed at enhancing long-term value.