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Carriage Services Inc. Reports Operating Results (10-K)
Posted by: gurufocus (IP Logged)
Date: March 9, 2012 11:42AM

Carriage Services Inc. (CSV) filed Annual Report for the period ended 2011-12-31. Carriage Svcs-a has a market cap of $109.2 million; its shares were traded at around $5.96 with a P/E ratio of 10.6 and P/S ratio of 0.6. The dividend yield of Carriage Svcs-a stocks is 1.7%. Carriage Svcs-a had an annual average earning growth of 7.4% over the past 5 years.



Highlight of Business Operations:

Total revenue for the year ended December 31, 2011 was $190.6 million, an increase of 3.1%, compared to $184.9 million for the comparable period in 2010 and gross profit increased by $4.9 million, or 10.2% from 2010 to 2011. Our acquired businesses drove the overall revenues higher, and both existing and acquired business contributed to the higher increase in gross profit in 2011 compared to 2010. Operating income declined by $1.1 million from 2010 to 2011 due to approximately $6.3 million in higher general and administrative expenses in 2011 compared to 2010. Net income for the year ended December 31, 2011 totaled $7.0 million, equal to $0.38 per diluted share as compared to $8.1 million for the year ended December 31, 2010, or $0.45 per diluted share.

Funeral home same store operating revenues for the year ended December 31, 2011 decreased $1.0 million, or 0.9% when compared to the year ended December 31, 2010. We experienced a decline in the number of contracts year over year of 1.3% and the average revenue per contract for those existing operations increased $2 to $5,596. The average revenue per contract includes the impact of the funeral trust fund earnings recognized at the time that we provide the needed services for preneed families. Excluding funeral trust earnings, the average revenue per contract increased $8 to $5,348. The number of traditional burial contracts decreased 3.8% while the average revenue per burial contract increased 1.8% to $8,240. The cremation rate for the same store businesses rose from 40.8% to 42.1%. The average revenue per cremation contract increased 0.2% to $3,091, and the number of cremation contracts increased 1.7%. Cremations with services have declined from 42.2% of total cremation contracts in the year ended 2010 to 37.4% in the year ended 2011. The average revenue for “other” contracts, which make up approximately 7.7% of the number of contracts, increased from $2,018 to $2,053. Other contracts consist of charges for merchandise or services for which we do not perform a funeral service for the deceased during the period.

The two categories of financial revenue consist of trust earnings and finance charges on preneed receivables. Trust earnings increased $0.3 million, or 5.4%, when compared to the year ended December 31, 2010. Earnings from perpetual care trust funds totaled $3.6 million for the year ended December 31, 2011, compared to $4.2 million for the year ended December 31, 2010, a decrease of $0.6 million, or 14.3%. The decrease in perpetual care trust earnings is due to significantly higher capital gains realized in 2010 compared to 2011. Trust earnings recognized upon the delivery of merchandise and service contracts increased $0.9 million, or 154.0% to $1.4 million, compared to the same period in 2010. Higher trust income and capital gains realized in recent years in the merchandise and services trusts have been allocated to the preneed contracts which are providing higher income to recognize upon delivery. Finance charges on the preneed contracts decreased $0.2 million or 12.6% year over year due to the decline in overall preneed sales and preneed receivables.

Funeral home same store operating revenues for the year ended December 31, 2010 decreased $1.2 million, or 1.1% when compared to the year ended December 31, 2009. We experienced flat volume in the number of contracts year over year and an increase of 0.6%, to $5,610, in the average revenue per contract for those existing operations. The average revenue per contract includes the impact of the funeral trust fund earnings. The number of traditional burial contracts decreased 2.3% while the average revenue per burial contract increased 2.1% to $8,100. The cremation rate for the same store businesses rose from 39.7% to 40.7%. The average revenue per cremation contract increased 2.9% to $3,089, and the number of cremation contracts increased 2.5%. Cremations with services declined from 46.2% of total cremation contracts in the year ended 2009 to 44.4% in the year ended 2010. The average revenue for “other” contracts, which made up approximately 7.6% of the number of contracts, declined from $2,057 to $2,016. Other contracts consist of charges for merchandise or services for which we do not perform a funeral service for the deceased during the period.

Cemetery same store operating revenues for the year ended December 31, 2010, decreased $1.8 million, or 5.0%, compared to the year ended December 31, 2009. Same store revenue from preneed property sales decreased $1.8 million, or 10.2%, which was primarily a reflection of a 13.9% decrease in the number of interment rights (property) sold. We experienced a 10.9% increase in the average price per interment compared to 2009. The percentage of those interment rights sold that we were able to recognize as revenue, because we received at least 10% of the sales price from the customer, decreased from 87.8% to 83.4%. Revenue from deliveries of preneed merchandise and services deliveries decreased $0.1 million, or 0.9%, and same store at-need revenues increased $0.5 million, or 3.6%.

Read the The complete Report



Stocks Discussed: CSV,
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