Park Lawn Corporation

Good morning, ladies and gentlemen, and welcome to the Park Lawn Corporation third quarter 2022 earnings call. At this time, all participants have been placed on a listen-only mode, and we will open the floor for your questions and comments after the presentation. I will now hand the call over to Jennifer Hay, General Counsel of Park Lawn. Ma'am, the floor is yours.

Thank you, Matt, and good morning, everybody. Thank you for joining us on today's third quarter 2022 earnings call. Before we begin our prepared commentary on the quarter, please note that today's call is being recorded and a replay will be available after the call. Please be aware that certain information discussed today is forward-looking in nature. Any such information is subject to risks, uncertainties, and assumptions that could cause actual results to differ materially. Please see our public filings for more information regarding forward-looking statements. During the call we will reference non-IFRS financial measures. Although we believe these measures provide useful supplemental information about our financial performance, they are not recognized measures and do not have standardized meanings under IFRS. Please see our public filings for additional information regarding our non-IFRS financial measures, including for reconciliations to the nearest IFRS measures. I will now hand the call over to Park Lawn CEO Brad Green to open our discussion today.

Thank you, Jennifer, and good morning, everyone. In addition to Jennifer, with me on the call today is our CFO, Dan Millett. Our third quarter operating results exceeded our expectations as it relates to the comparable COVID-19 impacted quarter, especially considering the decline in the death rate. During the quarter, we experienced continued revenue growth, with revenue increasing 10.7%, principally as a result of acquired operations, while adjusted EBITDA remained relatively flat. Our admin sales in both our funeral and cemetery businesses were impacted as a result of the drop in the death rate, although we are pleased that the decline in our same-store call volume decreased significantly less than the national average. More specifically, recent CDC data suggests deaths in the United States were approximately 14% lower during Q3 2022 versus Q3 2021. However, in looking at our operations, we only saw a decrease in call volume of approximately 8%, which was not only lower than the national average, but also compares favorably to our peers. We believe this demonstrates our market share growth and strength. And while we expect the death rate to stabilize in the near term, we also expect year over year mortality to continue to decline as compared to the two remaining COVID impacted quarters. Looking to our cemeteries, our comparable cemetery sales increased approximately 2.7 million year over year. This increase was due in part to strong pre-need property sales, including a couple of large bulk sales. As we have explained in the past, including at length last quarter, these sales can vary significantly from quarter to quarter. As a result of our strong cemetery sales, our revenue from comparable operations remained relatively flat, exceeding our expectations, especially when taking into account the sharp decline in mortality year over year. In addition, in the quarter, we continue to see positive results from both our organic and M&A initiatives. On the organic front, we announced that the Westminster Funeral Home and Reception Center in Toronto has opened for business and it has performed very well in the past month and a half. It is a first class premier property which pairs quite nicely with our exceptional on-site cemetery and mausoleums. As a matter of fact, we had our board meeting there yesterday which concluded with a very nice lunch at our fully catered on-site event center. On the M&A side, we had previously expressed that the second half of the year was going to be very active. During the quarter, we acquired nine standalone funeral homes, two standalone cemeteries, and another two onsite, adding approximately 1,935 calls, 376 internments, expanding our presence into western Tennessee and entering a new market for park lawn in Virginia. After the quarter ended, we expanded our presence on the western slope of Colorado by adding five standalone funeral homes and one onsite property. Finally, we have announced an agreement to purchase substantially all the assets of three additional standalone funeral homes in Kansas and Missouri. This transaction is anticipated to close later this month. In total, this adds approximately 4,300 colds and 411 internments, which equates to roughly 8% of Park Lawn's annual volume. As we continue to partner with premier independent business operators, we have seen very strong performance from our acquired operations through 2022 exceeding our integration expectation. As we continue to be a desired partner for succession planning, our acquisition pipeline remains robust with high-quality businesses, which will have a beneficial impact on the strength of our businesses moving forward. I'd now like to turn the call over to Dan, who will provide some additional detail regarding our Q3 results.