Carriage Services, Inc.

and thank you for standing by. Welcome to the Carriage Services first quarter 2024 earnings conference call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Steve Metzger, President. Please go ahead, sir.

Good morning, everyone, and thank you for joining us to discuss our first quarter results. In addition to myself, on the call this morning from management, are Carlos Quesada, Chief Executive Officer and Vice Chairman of the Board of Directors, and Kian Grimaia, Executive Vice President and Chief Financial Officer. On the Carriage Services website, you can find our earnings press release, which was issued yesterday after the market closed. Our press release is intended to supplement our remarks this morning and include supplemental financial information, including the reconciliation of differences between GAAP and non-GAAP financial measures. Today's call will begin with formal remarks from Carlos and Kian Grimaia, and will be followed by a question and answer period. Before we begin, I'd like to remind everyone that during this call we'll make some forward-looking statements, including comments about our business, projections, and plans. Forward-looking statements inherently involve risks and uncertainties and only reflect our views as of today. These risks and uncertainties include, but are not limited to, factors identified in our earnings release as well as in our SEC filings, all of which can be found on our website. Thank you all for joining us this morning, and now I'd like to turn the call over to Carlos.

Thank you, Steve, and thank you all for joining our first quarter earnings call. We are excited to share our outstanding performance, but before we do, I want to express our heartfelt gratitude to the entire Carriage family. Whether in the field or our support center, each of you has played a crucial role in driving these results. Your unwavering dedication and relentless passion for delivering an elevated service to all families have been instrumental in our success. We deeply appreciate your continued support and commitment to our shared goals. Before we start, I hope you had an opportunity to read our 2023 Sharehold Letter and Proxy Statement. Both are reaching information related to our five-year strategic objectives and our core initiatives for 2024. setting the stage for a transformative vision of the carriage of the future. Now let's dive into our financial highlights. We are proud to report that our strategic objective plan is well underway and the progress in executing the individual initiatives to grow revenue and reduce costs is starting to produce positive results. For the first quarter, our total revenue was $103.5 million, a substantial increase of $8 million or 8.4%. This is a significant milestone for carriage history as it marks the first time we have surpassed the $100 million mark in a single quarter. This remarkable performance was primarily driven by the exceptional results of our pre-need cemetery team and the successful integration of Greenlawn, our most recent acquisition. These achievements underscore our strong financial position and ability to deliver on our strategic objectives. Looking at each of our revenue segments, we see that total funeral home operating revenue increased to $66.6 million, an increase of $1.2 million or 1.8%. Despite the expected decrease in total funeral operating volume of 1.9% as part of the post-pandemic normalization, Our targeted improvements to our pricing strategy have made a significant positive impact. We have seen an increase in total funeral operating average per contract of $219 per contract, or 4%, compared to the same quarter last year. This result of our pricing strategy is a testament to our confidence in its effectiveness, and we believe we will continue to make additional progress throughout the year. Regarding our cemetery operating revenue, we ended the quarter at $27.6 million, an increase of $6.3 million, or 29.4%, compared to the same quarter last year. This is another significant milestone for Carriage, achieving a record first quarter in pre-need cemetery sales. The pre-need cemetery team delivered an impressive 38.4% growth compared to the same period last year. We couldn't be prouder of this achievement, which is the direct result of our entire sales organization's hard work and dedication towards sales excellence. For total financial revenue, we ended the first quarter at $6.9 million, an increase of $868,000, or 14.3%, driven primarily by the impressive growth in pre-need funeral commission income, which increased by 570,000 or 177% compared to the same quarter last year. Our pre-need funeral strategy continues to produce positive results, and we continue to be very excited about our potential future performance through our exclusive strategic partnership with PRECOA and the National Guardian Life Insurance Company. We remain committed to our growth strategy, and we will continue to explore opportunities to enhance our financial performance. Regarding adjusted consolidated EBITDA for the first quarter, we finished with $33.6 million, an increase of $5.8 million or 20.9%. The combination of a higher average revenue per contract and the continued execution of our cost management initiatives delivered great success, demonstrated by our total final field EBITDA margin of 41.3% an increase of 100 basis points, and total cemetery field EBITDA margin of 43.3%, an increase of 430 basis points. While our corporate overhead experienced an increase of $6.1 million during the first quarter, 90% of it was non-recurring and related to mail separation agreement. Adjusted diluted EPS in the first quarter grew to $0.75 per share, an increase of $0.19 or 33.9%. While interest rates remain high, we are now at a comparable level to previous quarters, and even though we're paying high interest rates, we continue to be focused on committing most of our free cash flow towards debt payments, as evidenced by the $25 million of debt that we paid down this quarter. Kian will share more on this later in this call. We are very proud of these results, as this makes five out of the last six quarters of outperforming expectations. While we had a solid first quarter, we remained diligent about capital allocation and continuing to execute our strategic initiatives while being mindful of how seasonality and normalization post-pandemic may impact our volumes in the near term. March had the greatest decline in volume in the first three months of the year, so we will closely monitor those levels going forward. Therefore, we reconfirm our 2024 outlook. As we gather more information leading into the end of the second quarter, we should have more insight to share. Ian will also cover more on this in this call. In closing, we are very excited about the future at Carriage. With our strategic initiatives well underway and the hard work and dedication invested over the past year, we are well positioned for sustained innovation and financial progress. What we're building is not just about near-term achievements. It's about establishing a foundation to deliver lasting value to our shareholders for years to come. Thank you for your interest and support. With that, I will now turn things over to Kian.