Summary of Carriage Services Q4 2025 Earnings Call

1Key Financial Results and Metrics

Q4 Revenue: $105.5 million, up 8% year-over-year.

Funeral Operating Revenue: $61.1 million (+9.6% YoY).

Cemetery Operating Revenue: $33.8 million (+18.4% YoY).

Financial Revenue: $9.3 million (+15.3% YoY).

Adjusted Consolidated EBITDA: $32.5 million (30.8% margin), up 11% YoY.

Adjusted Diluted EPS: $0.75, a 21% increase from $0.62 in Q4 2024.

Full Year Revenue: $417.4 million (+3.3% YoY), impacted by $9 million from divested noncore businesses.

Full Year Adjusted EBITDA: $130.7 million (+3.5% YoY).

Full Year Adjusted Diluted EPS: $3.20, up 20.8% YoY.

2Strategic Updates and Business Highlights

The company is transitioning from a rebuilding phase to a compounding phase, focusing on disciplined growth and high-quality acquisitions.

Investments in systems and infrastructure, including the rollout of Sales Edge 2.0 CRM, have enhanced sales capabilities.

Continued emphasis on supply chain optimization, with initiatives yielding improved margins and purchasing consistency.

The company is actively pursuing M&A opportunities, signaling a shift towards a growth-oriented strategy.

3Forward Guidance and Outlook

2026 Revenue Guidance: Expected between $440 million and $450 million (5.5% to 8% growth).

Adjusted EBITDA Guidance: Forecasted at $135 million to $140 million.

Adjusted Diluted EPS Guidance: Projected between $3.35 and $3.55.

Anticipated capital expenditures of $25 million to $30 million, reflecting ongoing investments in growth and maintenance.

4Bad News, Challenges, or Points of Concern

An unexpected employee benefit expense of approximately $1.2 million impacted Q4 results, affecting both EBITDA and EPS.

Overhead expenses rose to 14.4% of revenues, up from 13.2% in Q4 2024, primarily due to increased incentive pay.

The first quarter of 2026 is expected to present tough year-over-year comparisons due to strong performance in the prior year.

5Notable Q&A Insights

The Q&A session highlighted the impact of recent acquisitions, which contributed about $3 million in Q4 and are expected to generate $16 million in revenue in 2026.

The management acknowledged that the high-end of 2026 guidance assumes optimal performance from new acquisitions and favorable growth in both funeral and cemetery segments.

Discussions on M&A indicated a disciplined approach to acquisitions, with potential targets being evaluated based on specific criteria.

The integration process for recent acquisitions is ongoing, with a structured approach to ensure smooth transitions and capitalize on synergies. Overall, Carriage Services reported a strong finish to 2025, with solid revenue growth and improved profitability metrics, while also laying out an optimistic outlook for 2026 amidst some operational challenges and a focus on strategic growth initiatives.