Question · Q3 2025
Donnie asked about the trends in cemetery preneed sales production velocity, its year-on-year acceleration, implications for consumer behavior, and the sustainability of this trend into the next year.
Answer
Tom Ryan, Chairman and CEO, Service Corporation International, highlighted the impact of flexible financing plans and fundamental sales management. He noted strong velocity, impressive growth in large sales (up 18%), and core sales growth, expressing confidence in these trends continuing into Q4 and 2026. Donnie also inquired about the confidence level in achieving the 8%-12% EPS growth target for next year and any unique cash flow considerations. Tom Ryan reiterated an 85%-90% assurance in a typical year, citing historical compounded growth and the importance of revenue drivers like volume, average sales, and preneed cemetery sales. Eric Tanzberger, CFO, Service Corporation International, emphasized cash taxes as the primary factor for cash flow, noting a $40 million reduction due to federal tax legislation and accelerated depreciation, though some of this benefit might be temporary. He confirmed stable maintenance capital expenditures and projected free cash flow over $4 per share.