What changed in this filing

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Item 1. Financial Statements

2025-05-02 compared with 2024-11-01 · 399 added, 494 removed, 723 unchanged (55% of the section changed)

1 unchanged sentence

CARRIAGE SERVICES, INC.

CONSOLIDATED BALANCE SHEET

CONSOLIDATED BALANCE SHEETS

(unaudited and in thousands, except share data)

September 30, 2024 December 31, 2023

2025 December 31,

Current assets:

3 unchanged sentences

Prepaid and other current assets 4,719 4,123

Current assets held for sale 91 1,135

Total current assets 49,900 44,536

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Cemetery perpetual care trust investments 88,624 85,103

Non-current assets held for sale 3,795 19,453

Total assets $ 1,275,229 $ 1,279,580

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Accrued and other liabilities 34,058 38,460

Current liabilities held for sale 154 240

Total current liabilities 52,511 58,041

Acquisition debt, net of current portion 4,856 4,895

Long-term liabilities held for sale 1,963 13,842

Credit facility 118,470 135,382

25 unchanged sentences

(unaudited and in thousands, except per share data)

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended March 31,

Service revenue $ 53,010 $ 49,699

13 unchanged sentences

General, administrative and other 12,048 16,240

Net loss on divestitures, disposals and impairments charges 387 423 1,955 929

Net (gain) loss on divestitures, disposals and impairments charges ( 5,770 ) 1,545

Operating income 31,564 19,477

Interest expense 7,298 8,712

Net gain on property damage, net of insurance claims — ( 379 ) ( 417 ) ( 343 )

Other, net ( 1,988 ) 43

1 unchanged sentence

Expense for income taxes 8,191 3,519

Expense related to discrete income tax items 53 73 970 150

(Benefit) expense related to discrete income tax items ( 2,863 ) 230

Total expense for income taxes 5,328 3,749

13 unchanged sentences

(unaudited and in thousands)

Nine months ended September 30,

Three months ended March 31,

Cash flows from operating activities:

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Amortization and accretion of debt 138 132

Net loss on divestitures, disposals and impairment charges 1,955 929

Net gain on property damage, net of insurance claims ( 417 ) ( 343 )

Gain on sale of excess land — ( 658 )

Net (gain) loss on divestitures, disposals and impairment charges ( 5,770 ) 1,545

Gain on sale of excess real property ( 1,988 ) —

Changes in operating assets and liabilities that provided (used) cash:

5 unchanged sentences

Accrued and other liabilities ( 3,544 ) 4,831

Incentive payment from vendor — 6,000

Deferred preneed funeral and cemetery revenue ( 1,534 ) 2,267

2 unchanged sentences

Cash flows from investing activities:

Acquisitions of businesses — ( 44,000 )

Proceeds from divestitures and sale of other assets 18,660 10,877

1 unchanged sentence

Capital expenditures ( 3,163 ) ( 3,551 )

Net cash provided by (used in) investing activities 708 ( 53,385 )

Net cash provided by investing activities 15,497 7,372

Cash flows from financing activities:

1 unchanged sentence

Payments against the credit facility ( 24,100 ) ( 38,600 )

Payment of debt issuance costs for the credit facility ( 782 ) —

Payments on acquisition debt and obligations under finance leases ( 148 ) ( 152 )

Proceeds from the exercise of stock options and employee stock purchase plan contributions 688 347

Taxes paid on restricted stock vestings and exercise of stock options ( 424 ) ( 252 )

Taxes paid on restricted stock and performance award vestings and exercise of stock options ( 7,629 ) ( 418 )

Dividends paid on common stock ( 1,722 ) ( 1,686 )

Net cash used in financing activities ( 25,811 ) ( 26,909 )

Net (decrease) increase in cash and cash equivalents ( 263 ) 505

Net increase in cash and cash equivalents 3,478 166

Cash and cash equivalents at beginning of period 1,165 1,523

Cash and cash equivalents at end of period $ 4,643 $ 1,689

The accompanying condensed notes are an integral part of these Consolidated Financial Statements.

The accompanying notes are an integral part of these Consolidated Financial Statements.

CARRIAGE SERVICES, INC.

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(unaudited and in thousands)

Three months ended September 30, 2024

Outstanding Common

Stock Additional

Capital Retained

Earnings Treasury

Balance – June 30, 2024 15,236 $ 269 $ 242,883 $ 223,488 $ ( 278,753 ) $ 187,887

Net income — — — 9,866 — 9,866

Issuance of common stock from employee stock purchase plan 11 — 239 — — 239

Issuance of common stock to directors and board advisor 4 — 136 — — 136

Exercise of stock options 1 — — — — —

Restricted common stock and stock options surrendered for taxes paid ( 29 ) — ( 5 ) — — ( 5 )

Stock-based compensation expense — — 1,714 — — 1,714

Dividends on common stock — — ( 1,708 ) — — ( 1,708 )

Balance – September 30, 2024 15,223 $ 269 $ 243,259 $ 233,354 $ ( 278,753 ) $ 198,129

Three months ended September 30, 2023

Outstanding Common

Stock Additional

Capital Retained

Earnings Treasury

Balance – June 30, 2023 14,958 $ 266 $ 240,681 $ 193,973 $ ( 278,753 ) $ 156,167

Net income — — — 4,645 — 4,645

Issuance of common stock from employee stock purchase plan 12 — 284 — — 284

Issuance of common stock to directors and board advisor 5 — 161 — — 161

Exercise of stock options 7 — ( 133 ) — — ( 133 )

Stock-based compensation expense — — 1,831 — — 1,831

Dividends on common stock — — ( 1,683 ) — — ( 1,683 )

Balance – September 30, 2023 14,982 $ 266 $ 241,141 $ 198,618 $ ( 278,753 ) $ 161,272

Nine months ended September 30, 2024

Outstanding Common

Stock Additional

Capital Retained

Earnings Treasury

Three months ended March 31, 2025

Shares Outstanding Common Stock Additional Paid-in Capital Retained Earnings Treasury Stock Total

Balance - December 31, 2024 15,254 $ 269 $ 243,825 $ 243,209 $ ( 278,753 ) $ 208,550

2 unchanged sentences

Issuance of common stock to directors and board advisor 2 — 77 — — 77

Issuance of common stock 271 3 ( 3 ) — — —

Issuance of restricted common stock 115 1 ( 1 ) — — —

Exercise of stock options 77 — 321 — — 321

Restricted common stock and stock options surrendered for taxes paid ( 72 ) — ( 424 ) — — ( 424 )

Restricted common stock, performance awards and stock options surrendered for taxes paid ( 49 ) — ( 7,629 ) — — ( 7,629 )

Stock-based compensation expense — — 1,676 — — 1,676

1 unchanged sentence

Other 12 — 496 — — 496

Balance – September 30, 2024 15,223 $ 269 $ 243,259 $ 233,354 $ ( 278,753 ) $ 198,129

Nine months ended September 30, 2023

Outstanding Common

Stock Additional

Capital Retained

Earnings Treasury

Balance - March 31, 2025 15,693 $ 273 $ 237,407 $ 264,135 $ ( 278,753 ) $ 223,062

Three months ended March 31, 2024

Shares Outstanding Common Stock Additional Paid-in Capital Retained Earnings Treasury Stock Total

Balance - December 31, 2023 15,000 $ 266 $ 241,291 $ 210,256 $ ( 278,753 ) $ 173,060

2 unchanged sentences

Issuance of common stock to directors and board advisor 4 — 113 — — 113

Issuance of common stock to former executive 30 — 826 — — 826

Issuance of restricted common stock 157 2 ( 2 ) — — —

Exercise of stock options 12 — ( 174 ) — — ( 174 )

Restricted common stock and stock options surrendered for taxes paid ( 43 ) — ( 418 ) — — ( 418 )

2 unchanged sentences

Other 31 — 790 — — 790

Balance – September 30, 2023 14,982 $ 266 $ 241,141 $ 198,618 $ ( 278,753 ) $ 161,272

Balance - March 31, 2024 15,165 $ 268 $ 240,811 $ 217,229 $ ( 278,753 ) $ 179,555

The accompanying condensed notes are an integral part of these Consolidated Financial Statements.

CARRIAGE SERVICES, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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Funeral Home Operations, which currently accounts for approximately 70 % of our total revenue and Cemetery Operations, which currently accounts for approximately 30 % of our total revenue.

At September 30, 2024, we operated 162 funeral homes in 26 states and 31 cemeteries in 11 states.

At March 31, 2025, we operated 160 funeral homes in 25 states and 28 cemeteries in 10 states.

Our funeral home operations are principally service businesses that generate revenue from sales of burial and cremation services and related merchandise, such as caskets and urns.

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Inventory is relieved using specific identification in fulfillment of performance obligations on our contracts.

Contingent Liability

During the nine months ended September 30, 2024, we recorded a $ 5.0 million contingent liability to reflect our agreement to pay our financial advisor in connection with the review of strategic alternatives.

At September 30, 2024, the contingency has been resolved resulting in no change to the liability recorded.

Deferred Revenue

During the nine months ended September 30, 2023, we withdrew $ 8.6 million of realized capital gains and earnings from our preneed funeral and cemetery trust investments.

We did not withdraw any realized capital gains and earnings from our preneed trust investments during the nine months ended September 30, 2024.

In certain states, we are allowed to make these withdrawals prior to the delivery of preneed merchandise and service contracts.

The realized capital gains and earnings withdrawn increase our cash flow from operations, but are not recognized as revenue in our Consolidated Statements of Operations, however, they reduce our Preneed funeral trust investments and Preneed cemetery trust investments and increase our Deferred preneed funeral revenue and Deferred preneed cemetery revenue.

Additionally, during the nine months ended September 30, 2023, we received a $ 6.0 million incentive payment from a vendor for entering into a strategic partnership agreement to market and sell prearranged funeral services in the future, which increased our cash flow from operations and Deferred preneed funeral revenue.

The incentive payment is subject to partial claw-back if certain preneed funeral sales volumes are not met within the ten-year term of the agreement.

As such, we will recognize the incentive payment in proportion to our achieved preneed funeral sales volume per the agreement at each reporting period.

Held for Sale

At September 30, 2024, we had $ 0.3 million of assets classified as held for sale on our Consolidated Balance Sheet related to one funeral home.

The carrying value of these assets held for sale exceeded their fair value and in accordance with U.S.

Generally Accepted Accounting Principles (“GAAP”), we recognized an impairment of $ 40 thousand related to property, plant and equipment, which was recorded in Net loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations.

The excess of the purchase price over the fair value of identifiable net assets of funeral home businesses and cemeteries we acquire is recorded as goodwill.

Goodwill has an indefinite life and is not subject to amortization.

As such, we test goodwill for impairment on an annual basis as of August 31st each year.

Under current guidance, we are permitted to first assess qualitative factors to determine whether it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform a quantitative goodwill impairment test.

We performed our most recent annual goodwill impairment test as of August 31, 2024.

We intend to perform a quantitative impairment test at least once every three years and perform a qualitative assessment during the remaining two years.

We conducted a quantitative assessment in 2022 and a qualitative assessment in 2023.

In addition to our annual test, we assess the impairment of goodwill whenever events or changes in circumstances indicate that the carrying value of a reporting unit may be greater than fair value.

Factors that could trigger an interim impairment review include, but are not limited to, significant negative industry or economic trends and significant adverse changes in the business climate, which may be indicated by a decline in our market capitalization or decline in operating results.

Our quantitative goodwill impairment test involves estimates and management judgment.

In the quantitative analysis, we compare the fair value of each reporting unit to its carrying value, including goodwill.

If the fair value of the reporting unit exceeds its carrying amount, the goodwill of that reporting unit is not considered impaired.

We determine fair value for each reporting unit using both an income approach, weighted 90%, and a market approach, weighted 10%.

Our methodology for determining an income-based fair value is based on discounting projected future cash flows.

The projected future cash flows include assumptions concerning future operating performance and economic conditions that may differ from actual future cash flows discounted at our weighted average cost of capital based on market participant assumptions.

Our methodology for determining a market approach fair value utilizes the guideline public company method, in which we rely on market multiples of comparable companies operating in the same industry as the individual reporting units.

In accordance with the guidance, if the fair value of the reporting unit is less than its carrying amount an impairment charge is recorded in an amount equal to the difference.

For our 2024 and 2023 annual qualitative assessments, we determined that there were no factors that would indicate the need to perform an additional quantitative goodwill impairment test.

We concluded that it is more-likely-than-not that the fair value of our reporting units is greater than their carrying value and thus there was no impairment to goodwill.

When we divest a portion of a reporting unit that constitutes a business in accordance with GAAP, we allocate goodwill associated with that business to be included in the gain or loss on divestiture.

The goodwill allocated is based on the relative fair value of the business being divested and the portion of the reporting unit that will be retained.

Additionally, after each divestiture, we will test the goodwill remaining in the portion of the reporting unit to be retained for impairment using a qualitative assessment unless we deem a quantitative assessment to be appropriate to ensure the fair value of our reporting units is greater than their carrying value.

For the nine months ended September 30, 2024 and 2023, after each divestiture, we concluded that it was more-likely-than not that the fair value of our reporting units was greater than their carrying value and thus there was no impairment to goodwill.

See Note 4 to the Consolidated Financial Statements included herein for additional information related to our goodwill.

Intangible Assets

Our intangible assets include tradenames resulting from acquisitions and are included in Intangible and other non-current assets , net on our Consolidated Balance Sheet.

Our tradenames are considered to have an indefinite life and are not subject to amortization.

As such, we test our intangible assets for impairment on an annual basis as of August 31st each year.

Under current guidance, we are permitted to first assess qualitative factors to determine whether it is more-likely-than-not that the fair value of the tradename is less than its carrying amount as a basis for determining whether it is necessary to perform a quantitative impairment test.

We performed our most recent annual intangible assets impairment test as of August 31, 2024.

We intend to perform a quantitative impairment test at least once every three years and perform a qualitative assessment during the remaining two years.

We conducted a quantitative assessment in 2022 and a qualitative assessment in 2023.

In addition to our intangible assets annual test, we assess the impairment of intangible assets whenever certain events or changes in circumstances indicate that the carrying value of the intangible asset may be greater than the fair value.

Factors that could trigger an interim impairment review include, but are not limited to, significant under-performance relative to historical or projected future operating results and significant negative industry or economic trends.

Our quantitative intangible asset impairment test involves estimates and management judgment.

Our quantitative analysis is performed using the relief from royalty method, which measures the tradenames by determining the value of the royalties that we are relieved from paying due to our ownership of the asset.

We determine the fair value of the asset by discounting the cash flows that represent a savings in lieu of paying a royalty fee for use of the tradename.

The discounted cash flow valuation uses projections of future cash flows and includes assumptions concerning future operating performance and economic conditions that may differ from actual future cash flows and the determination and application of an appropriate royalty rate and discount rate.

To estimate the royalty rates for the individual tradename, we mainly rely on the profit split method, but also consider the comparable third-party license agreements and the return on asset method.

A scorecard is used to assess the relative strength of the individual tradename to further adjust the royalty rates selected under the profit-split method for qualitative factors.

In accordance with the guidance, if the fair value of the tradename is less than its carrying amount, then an impairment charge is recorded in an amount equal to the difference.

As a result of our 2024 and 2023 qualitative assessments, we determined that there were factors that would indicate the need to perform additional quantitative impairment tests for certain funeral home businesses.

As a result of these additional quantitative impairment tests, we recorded an impairment to the tradenames for certain funeral home businesses of $ 0.6 million and $ 0.2 million, during the nine months ended September 30, 2024 and 2023, respectively, as the carrying amount of these tradenames exceeded their fair value.

See Note 10 to the Consolidated Financial Statements included herein for additional information related to our intangible assets.

At March 31, 2025, the assets and liabilities of non-core funeral home and cemetery businesses expected to be sold within the next twelve months, which have met the criteria for such classification, have been classified as held for sale.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The table below presents the carrying amounts of the assets and liabilities included as part of the expected sale (in thousands):

March 31, 2025 December 31, 2024

Accounts receivable, net $ 36 $ 833

Inventories 52 302

Prepaid and other current assets 3 —

Current assets held for sale $ 91 $ 1,135

Preneed cemetery trust investments $ 1,059 $ 4,876

Preneed funeral trust investments 405 2,197

Preneed cemetery receivables, net 3 1,671

Receivables from funeral preneed trusts, net 27 —

Property, plant and equipment, net 1,554 4,898

Cemetery property, net 128 3,362

Intangible and other non-current assets, net 223 215

Operating lease right-of-use assets 74 —

Cemetery perpetual care trust investments 322 2,234

Non-current assets held for sale $ 3,795 $ 19,453

Current portion of operating lease obligations $ 22 $ —

Accounts payable 18 94

Accrued and other liabilities 114 146

Current liabilities held for sale $ 154 $ 240

Obligations under operating leases, net of current portion $ 53 $ —

Deferred preneed cemetery revenue 97 3,517

Deferred preneed funeral revenue 27 1,018

Deferred preneed cemetery receipts held in trust 1,059 4,876

Deferred preneed funeral receipts held in trust 405 2,197

Care trusts’ corpus 322 2,234

Long-term liabilities held for sale $ 1,963 $ 13,842

Property, Plant and Equipment

Property, plant and equipment is comprised of the following (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Land $ 85,462 $ 86,609

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Property, plant and equipment, net $ 274,976 $ 277,902

During the nine months ended September 30, 2024, we sold six funeral homes and one cemetery that had a carrying value of property, plant and equipment of $ 3.1 million, which was included in the loss on sale and recorded in Net loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations, more fully described in Note 5 to the Consolidated Financial Statements.

Additionally, during the nine months ended September 30, 2024, we sold real property for $ 1.1 million, with a carrying value of $ 0.8 million and we recognized an impairment related to property, plant and equipment for assets held for sale of $ 40 thousand, which was recorded in Net loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations.

During the nine months ended September 30, 2023, we acquired $ 12.8 million of property, plant and equipment related to our acquisition of a business located in Bakersfield, CA, more fully described in Note 3 to the Consolidated Financial Statements.

Additionally, during the nine months ended September 30, 2023, we sold real property for $ 1.2 million, with a carrying value of $ 0.6 million, resulting in a gain on the sale of $ 0.6 million.

We also divested one funeral home that had a carrying value of $ 0.3 million, which was included in the loss on the sale of divestitures and recorded in Net loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations, more fully described in Note 5 to the Consolidated Financial Statements.

Our growth and maintenance capital expenditures totaled $ 2.9 million and $ 2.4 million for the three months ended September 30, 2024 and 2023, respectively, and $ 6.4 million and $ 7.9 million for the nine months ended September 30, 2024 and 2023, respectively.

In addition, we recorded depreciation expense of $ 3.5 million and $ 3.8 million for the three months ended September 30, 2024 and 2023, respectively, and $ 10.7 million and $ 11.0 million for the nine months ended September 30, 2024 and 2023, respectively.

Held for sale ( 1,554 ) ( 4,898 )

Property, plant and equipment, net $ 273,422 $ 273,004

During the three months ended March 31, 2025, we sold two funeral homes and three cemeteries that had a carrying value of property, plant and equipment of $ 3.4 million, which was included in the gain on sale and recorded in Net (gain) loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations, more fully described in Note 4 to the Consolidated Financial Statements.

Additionally, during the three months ended March 31, 2025, we sold real property for $ 2.9 million, with a carrying value of $ 0.9 million, resulting in a $ 2.0 million gain on the sale, which was recorded in Net (gain) loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

During the three months ended March 31, 2024, we sold six funeral homes and one cemetery that had a carrying value of property, plant and equipment of $ 3.1 million, which was included in the loss on sale and recorded in Net (gain) loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations.

Our growth and maintenance capital expenditures totaled $ 1.6 million for both the three months ended March 31, 2025 and 2024.

In addition, we recorded depreciation expense of $ 3.5 million and $ 3.6 million for the three months ended March 31, 2025 and 2024, respectively.

Cemetery Property

Cemetery property was $ 113.1 million and $ 114.6 million, net of accumulated amortization of $ 70.7 million and $ 64.6 million at September 30, 2024 and December 31, 2023, respectively.

Cemetery property was $ 109.4 million and $ 112.9 million, net of accumulated amortization of $ 71.4 million and $ 72.6 million at March 31, 2025 and December 31, 2024, respectively.

When cemetery property is sold, the value of the cemetery property (interment right costs) is expensed as amortization using the specific identification method in the period in which the sale of the interment right is recognized as revenue.

Our growth capital expenditures for cemetery property development totaled $ 1.7 million and $ 1.6 million for the three months ended September 30, 2024 and 2023, respectively, and $ 5.3 million and $ 5.1 million for the nine months ended September 30, 2024 and 2023, respectively.

We recorded amortization expense for cemetery interment rights of $ 2.0 million and $ 1.3 million for the three months ended September 30, 2024 and 2023, respectively, and $ 6.3 million and $ 4.4 million for the nine months ended September 30, 2024 and 2023, respectively.

During the nine months ended September 30, 2024, we sold one cemetery that had a carrying value of cemetery property of $ 0.8 million, which was included in the loss on sale and recorded in Net loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations, more fully described in Note 5 to the Consolidated Financial Statements.

During the nine months ended September 30, 2023, we acquired cemetery property for $ 9.0 million related to our acquisition of a business located in Bakersfield, CA, as more fully described in Note 3 to the Consolidated Financial Statements.

We also sold two cemeteries that had a carrying value of cemetery property of $ 0.8 million, which was included in the loss on sale and recorded in Net loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations, more fully described in Note 5 to the Consolidated Financial Statements.

Income tax expense was $ 5.0 million and $ 2.1 million for the three months ended September 30, 2024 and 2023, respectively, and $ 12.9 million and $ 9.0 million for the nine months ended September 30, 2024 and 2023, respectively.

Our operating tax rate before discrete items was 33.2 % and 30.4 % for the three months ended September 30, 2024 and 2023, respectively, and 33.2 % and 28.9 % for the nine months ended September 30, 2024 and 2023, respectively.

Our growth capital expenditures for cemetery property development totaled $ 1.6 million and $ 2.0 million for the three months ended March 31, 2025 and 2024, respectively.

We recorded amortization expense for cemetery interment rights of $ 1.8 million for both the three months ended March 31, 2025 and 2024.

During the three months ended March 31, 2025, we sold three cemeteries that had a carrying value of cemetery property of $ 3.3 million, which was included in the gain on sale and recorded in Net (gain) loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations, more fully described in Note 4 to the Consolidated Financial Statements.

During the three months ended March 31, 2024, we sold one cemetery that had a carrying value of cemetery property of $ 0.8 million, which was included in the loss on sale and recorded in Net (gain) loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations.

Income tax expense was $ 5.3 million and $ 3.7 million for the three months ended March 31, 2025 and 2024, respectively.

Our operating tax rate before discrete items was 31.2 % and 32.8 % for the three months ended March 31, 2025 and 2024, respectively.

Subsequent Events

We have evaluated events and transactions during the period subsequent to September 30, 2024 through the date the financial statements were issued for potential recognition or disclosure in the accompanying financial statements covered by this report.

We have evaluated events and transactions during the period subsequent to March 31, 2025 through the date the financial statements were issued for potential recognition or disclosure in the accompanying consolidated financial statements covered by this report.

RECENTLY ISSUED ACCOUNTING STANDARDS

Segment Reporting

In November 2023, the FASB issued ASU, Segment Reporting - Improvements to Reportable Segment Disclosures (“Topic 280”) to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

The amendments in this update require that a public entity disclose, on an annual and interim basis (1) significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss;

and (2) an amount for other segment items, as described in the amendments, by reportable segment and a description of its composition.

Additionally, the amendments require that a public entity disclose the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources.

The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and therefore were effective for us for our fiscal year beginning January 1, 2024 and for interim periods within our fiscal year beginning January 1, 2025.

We expect the adoption will have no impact on our Consolidated Financial Statements.

Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU, Income Taxes - Improvements to Income Tax Disclosures (“Topic 740”) to enhance the transparency about income tax information through improvements to income tax disclosures primarily related to rate reconciliation and income taxes paid information.

In December 2023, the FASB issued ASU, Income Taxes - Improvements to Income Tax Disclosures to enhance the transparency about income tax information through improvements to income tax disclosures primarily related to rate reconciliation and income taxes paid information.

The amendments in this update require that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation;

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and (2) the amount of net income taxes paid disaggregated by individual jurisdictions in which net income taxes paid is equal to or greater than five percent of total net income taxes paid.

The amendments are effective for annual periods beginning after December 15, 2024.

Early adoption is permitted.

We plan to adopt the amendments of Topic 740 for our fiscal year beginning January 1, 2025.

We expect the adoption will have no impact on our Consolidated Financial Statements.

BUSINESS COMBINATIONS

Tangible and intangible assets acquired and liabilities assumed are recorded at fair value and goodwill is recognized for any difference between the price of the acquisition and fair value.

We recognize the assets acquired, the liabilities assumed and any non-controlling interest in the acquiree at the acquisition date, measured at the fair value as of that date.

Acquisition related costs are recognized separately from the acquisition and are expensed as incurred.

We customarily estimate related transaction costs known at closing.

To the extent that information not available to us at the closing date subsequently becomes available during the measurement period, we may adjust goodwill, intangible assets, assets or liabilities associated with the acquisition.

We did not acquire any businesses during the three and nine months ended September 30, 2024.

On March 22, 2023, we acquired a business consisting of three funeral homes, two cemeteries and one cremation focused business in Bakersfield, CA for $ 44.0 million in cash.

We acquired substantially all of the assets and assumed certain operating liabilities of this business.

The pro forma impact of this acquisition on prior periods is not presented, as the impact is not significant to our reported results.

The results of the acquired business are reflected in our Consolidated Statements of Operations from the date of acquisition.

The following table summarizes the breakdown of the purchase price allocation for our Bakersfield, CA business acquisition (in thousands):

Initial Purchase Price Allocation Adjustments Adjusted Purchase Price Allocation

Current assets $ 7,087 $ 131 $ 7,218

Preneed trust assets — 11,428 11,428

Property, plant & equipment 12,577 245 12,822

Cemetery property 9,035 — 9,035

Goodwill 13,612 ( 106 ) 13,506

Intangible and other non-current assets 3,763 — 3,763

Assumed liabilities ( 300 ) ( 66 ) ( 366 )

Preneed trust liabilities — ( 11,428 ) ( 11,428 )

Deferred revenue ( 1,774 ) ( 204 ) ( 1,978 )

Purchase price $ 44,000 $ — $ 44,000

The current assets relate to accounts receivable and inventory.

The intangible and other non-current assets relate to the fair value of tradenames and right-of-use operating lease assets.

The assumed liabilities relate to operating lease obligations and commissions payable.

As of December 31, 2023, our accounting for this acquisition was complete.

The following table summarizes the fair value of the assets acquired and liabilities assumed for this business (in thousands):

Acquisition Date Type of Business Market Assets Acquired (Excluding

Goodwill) Goodwill

Recorded Liabilities

March 22, 2023 Three Funeral Homes, Two Cemeteries and One Cremation Focused Business Bakersfield, CA $ 44,266 $ 13,506 $ ( 13,772 )

The following table presents changes in goodwill in the accompanying Consolidated Balance Sheet (in thousands):

September 30, 2024 December 31, 2023

The amendments are effective for annual periods beginning after December 15, 2024 and therefore were effective for us for our fiscal year beginning January 1, 2025 and for interim periods within our fiscal year beginning January 1, 2026.

The adoption had no material impact on our consolidated financial statements as it modified disclosure requirements only.

Accounting Pronouncements Not Yet Adopted

Expense Disaggregation

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures .

Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03.

The standard provides guidance to expand disclosures related to the disaggregation of income statement expenses.

The amendments in this update require, in the notes to the financial statements, disclosure of specified information about certain costs and expenses, which includes purchases of inventory, employee compensation, depreciation and intangible asset amortization included in each relevant expense caption.

This guidance is effective for fiscal years beginning after December 15,

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

2026, and interim periods within annual reporting periods beginning after December 15, 2027, on a retrospective or prospective basis, with early adoption permitted.

We expect the adoption will have no material impact on our consolidated financial statements as it modifies disclosure requirements only.

The following table presents changes in goodwill in the accompanying Consolidated Balance Sheets (in thousands):

March 31, 2025 December 31, 2024

Goodwill at the beginning of the period $ 414,859 $ 423,643

Increase in goodwill related to acquisitions — 13,506

Decrease in goodwill related to divestitures ( 4,156 ) ( 8,784 )

Goodwill at the end of the period $ 410,703 $ 414,859

During the nine months ended September 30, 2024, we allocated $ 8.8 million of goodwill to the sale of six funeral homes and one cemetery for a loss recorded in Net loss on divestitures, disposals and impairments charges, of which $ 7.8 million was allocated to our funeral home segment and $ 1.0 million was allocated to our cemetery segment.

During the nine months ended September 30, 2023, we recognized $ 13.5 million in goodwill related to our acquisition of a business located in Bakersfield, CA, of which $ 4.5 million was allocated to our cemetery segment and $ 9.0 million was allocated to our funeral home segment.

See Note 1 to the Consolidated Financial Statements included herein, for a discussion of the methodology used for our goodwill impairment test.

During the three months ended March 31, 2025, we allocated $ 4.2 million of goodwill to the sale of two funeral homes and three cemeteries which was recorded in Net (gain) loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations, of which $ 2.6 million was allocated to our funeral home segment and $ 1.6 million was allocated to our cemetery segment.

During the three months ended March 31, 2024, we allocated $ 8.7 million of goodwill to the sale of six funeral homes and one cemetery which was recorded in Net (gain) loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations, of which $ 7.8 million was allocated to our funeral homes segment and $ 1.0 million was allocated to our cemetery segment.

DIVESTED OPERATIONS

During the three months ended September 30, 2024, we merged two funeral homes with other businesses we own in existing markets.

During the nine months ended September 30, 2024, we sold six funeral homes and one cemetery for an aggregate of $ 10.9 million and merged three funeral homes with other businesses we own in existing markets.

During the three months ended September 30, 2023, we sold one funeral home for $ 0.3 million.

During the nine months ended September 30, 2023, we sold two funeral homes and two cemeteries for an aggregate of $ 1.1 million and merged one funeral home with another business we own in an existing market.

During the three months ended March 31, 2025, we sold two funeral homes and three cemeteries for an aggregate of $ 15.8 million.

During the three months ended March 31, 2024, we sold six funeral homes and one cemetery for an aggregate of $ 10.9 million.

The operating results of these divested funeral homes and cemeteries are reflected on our Consolidated Statements of Operations as shown in the table below (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended, March 31,

Revenue $ 1,653 $ 1,151

Operating income (loss) ( 154 ) 8 42 3

Gain (loss) on divestitures (1)

Operating income 476 122

Net gain (loss) on divestitures (1)

5,937 ( 1,501 )

1 unchanged sentence

Net gain (loss) from divested operations, after tax $ 4,412 $ ( 927 )

(1) Gain (loss) on divestitures is recorded in Net loss on divestitures, disposals and impairments charges on our Consolidated Statements of Operations.

Net loss on divestitures is recorded in Net (gain) loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations.

Accounts Receivable

2 unchanged sentences

Preneed cemetery receivables with payments expected to be received beyond one year from the balance sheet date are recorded in Preneed cemetery receivables, net .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Accounts receivable is comprised of the following (in thousands):

September 30, 2024

Funeral Cemetery Corporate Total

March 31, 2025

Column1 Funeral Cemetery Corporate Held for Sale Total

Trade and financed receivables $ 8,104 $ 23,963 $ — $ ( 36 ) $ 32,031

3 unchanged sentences

December 31, 2024

Funeral Cemetery Corporate Total

Column1 Funeral Cemetery Corporate Held for Sale Total

Trade and financed receivables $ 7,085 $ 24,355 $ — $ ( 833 ) $ 30,607

4 unchanged sentences

We do not provide an allowance for credit losses for these receivables as we have historically not had any collectability issues nor do we expect any in the foreseeable future.

The following table summarizes the activity in our allowance for credit losses by segment (in thousands):

January 1, 2024 Provision for Credit Losses Write Offs Recoveries September 30, 2024

The following table summarizes the activity in our allowance for credit losses by portfolio segment for the three months ended March 31, 2025 (in thousands):

January 1, 2025 Provision for Credit Losses Write Offs Recoveries March 31, 2025

Trade and financed receivables:

2 unchanged sentences

Total allowance for credit losses on trade and financed receivables $ ( 1,316 ) $ ( 583 ) $ 612 $ ( 162 ) $ ( 1,449 )

Balances due on undelivered preneed funeral trust contracts have been reclassified to reduce Deferred preneed funeral revenue on our Consolidated Balance Sheet of $ 10.7 million at both September 30, 2024 and December 31, 2023, respectively.

Balances due on undelivered preneed funeral trust contracts have been reclassified to reduce Deferred preneed funeral revenue on our Consolidated Balance Sheets of $ 9.7 million and $ 10.2 million at March 31, 2025 and December 31, 2024, respectively.

As these performance obligations are to be completed after the date of death, we cannot quantify the recognition of revenue in future periods.

2 unchanged sentences

Our cemetery receivables are comprised of the following (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Interment rights $ 79,440 $ 79,436

2 unchanged sentences

Cemetery receivables $ 96,921 $ 97,547

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The components of our cemetery receivables are as follows (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Cemetery receivables $ 96,921 $ 97,547

1 unchanged sentence

Cemetery receivables, at amortized cost $ 91,920 $ 92,564

allowance for credit losses ( 2,623 ) ( 3,495 )

allowance for contract cancellation and credit losses ( 3,447 ) ( 3,018 )

balances due on undelivered cemetery preneed contracts ( 15,619 ) ( 13,576 )

amounts in accounts receivable ( 22,817 ) ( 23,341 )

Preneed cemetery receivables, net including HFS $ 50,037 $ 52,629

Held for sale ( 3 ) ( 1,671 )

Preneed cemetery receivables, net $ 50,034 $ 50,958

The following table summarizes the activity in our allowance for credit losses for Preneed cemetery receivables, net (in thousands):

January 1, 2024 Provision for Credit Losses Write Offs September 30, 2024

The following table summarizes the activity in our allowance for credit losses for Preneed cemetery receivables, net for the three months ended March 31, 2025 (in thousands):

January 1, 2025 Provision for Credit Losses Write Offs March 31, 2025

Total allowance for credit losses on Preneed cemetery receivables, net

$ ( 2,004 ) $ ( 491 ) $ 194 $ ( 2,301 )

The amortized cost basis of our cemetery receivables by year of origination at September 30, 2024 is as follows (in thousands):

The amortized cost basis of our cemetery receivables by year of origination as of March 31, 2025 is as follows (in thousands):

2025 2024 2023 2022 2021 Prior Total

Total preneed cemetery receivables, at amortized cost $ 40,126 $ 24,821 $ 14,445 $ 6,304 $ 2,239 $ 1,016 $ 88,951

The aging of past due cemetery receivables at September 30, 2024 is as follows (in thousands):

Past Due 61-90

Past Due 91-120

Past Due >120

Past Due Total Past

Due Current Total

Total cemetery receivables, at amortized cost $ 11,923 $ 43,549 $ 19,397 $ 10,910 $ 4,283 $ 1,858 $ 91,920

The aging of past due cemetery receivables as of March 31, 2025 is as follows (in thousands):

31-60 Past Due 61-90 Past Due 91-120 Past Due >120 Past Due Total Past Due Current Total

Recognized revenue $ 1,336 $ 1,334 $ 439 $ 3,018 $ 6,127 $ 70,174 $ 76,301

1 unchanged sentence

Total contracts $ 1,776 $ 1,488 $ 521 $ 3,789 $ 7,574 $ 89,347 $ 96,921

Balances due on undelivered preneed cemetery contracts have been reclassified to reduce Deferred preneed cemetery revenue on our Consolidated Balance Sheet.

The transaction price allocated to preneed merchandise and service performance obligations that were unfulfilled were $ 13.8 million and $ 15.8 million at September 30, 2024 and December 31, 2023, respectively.

Balances due on undelivered preneed cemetery contracts have been reclassified to reduce Deferred preneed cemetery revenue on our Consolidated Balance Sheets.

The transaction price allocated to preneed merchandise and service performance obligations that were unfulfilled were $ 15.6 million and $ 13.6 million at March 31, 2025 and December 31, 2024, respectively.

As these performance obligations are to be completed after the date of death, we cannot quantify the recognition of revenue in future periods.

5 unchanged sentences

Our acquisition debt and Credit Facility (as defined in Note 10) and Senior Notes (as defined in Note 11) are classified within Level 2 of the Fair Value Measurements hierarchy.

At September 30, 2024, the carrying value and fair value of our Credit Facility was $ 140.0 million.

At March 31, 2025, the carrying value and fair value of our Credit Facility was $ 120.0 million.

We believe that our Credit Facility bears interest at a rate that approximates prevailing market rates for instruments with similar characteristics and therefore, the carrying value of our Credit Facility approximates fair value.

We estimate the fair value of our acquisition

debt utilizing an income approach, which uses a present value calculation to discount payments based on current market rates as of the reporting date.

At September 30, 2024, the carrying value of our acquisition debt was $ 5.9 million, which approximated its fair value.

The fair value of our Senior Notes was $ 371.4 million at September 30, 2024, based on the last traded or broker quoted price.

We identified investments in fixed income securities, common stock and mutual funds presented within the preneed and perpetual care trust investments categories on our Consolidated Balance Sheet as having met the criteria for fair value measurement.

Where quoted prices are available in an active market, investments held by the trusts are classified as Level 1 investments pursuant to the three-level valuation hierarchy.

Our Level 1 investments include cash, U.S.

treasury debt, common stock and equity mutual funds.

We estimate the fair value of our acquisition debt utilizing an income approach, which uses a present value calculation to discount payments based on current market rates as of the reporting date.

At March 31, 2025, the carrying value of our acquisition debt was $ 5.4 million, which approximated its fair value.

The fair value of our Senior Notes was $ 364.4 million at March 31, 2025, based on the last traded or broker quoted price.

We identified investments in fixed income securities, common stock and mutual funds presented within the preneed and perpetual care trust investments categories on our Consolidated Balance Sheets as having met the criteria for fair value measurement.

Where quoted prices are available in an active market, investments held by the trusts are classified as Level 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

investments pursuant to the three-level valuation hierarchy.

Our Level 1 investments include cash, common stock and equity mutual funds.

Where quoted market prices are not available for the specific security, then fair values are estimated by using quoted prices of similar securities in active markets or inputs other than quoted prices that can corroborate observable market data.

1 unchanged sentence

agency obligations, foreign debt, corporate debt, preferred stocks, certificates of deposit and fixed income mutual funds and other investments, all of which are classified within Level 2 of the valuation hierarchy.

In addition, we have an investment in a limited partnership fund, whose fair value has been estimated using the net asset value per share practical expedient described in ASC 820-10-35-59, Fair Value Measurement of Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) and therefore, has not been classified in the fair value hierarchy.

In addition, we have an investment in a limited partnership fund, whose fair value has been estimated using the net asset value per share (“NAV”) practical expedient described in ASC 820-10-35-59, Fair Value Measurement of Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) and therefore, has not been classified in the fair value hierarchy.

The investment strategy of this fund is to generate attractive, risk-adjusted returns over a multi-year performance period through the construction of a concentrated portfolio of investments possessing certain distinct business attributes that suggest the potential for long-term value creation.

Beginning March 31, 2024, the agreement permits us to withdraw a percentage of the value of the investments in this fund through quarterly withdrawals with the intention to permit withdrawal of the entire investment over twelve successive withdrawal dates.

Our unfunded commitment for this investment at September 30, 2024 was $ 10.0 million.

The value of the investments in this fund cannot be liquidated at March 31, 2025 because the investments include restrictions that do not allow for liquidation until 2027.

As of March 31, 2025, we do not have an unfunded commitment for this investment.

Furthermore, we have two investments in real estate debt and structured credit (“alternative investments”), whose fair value has been estimated using NAV and therefore, has not been classified in the fair value hierarchy.

The investment strategy for these alternative investments is to create capital growth, income generation, and risk-adjusted returns.

Capital growth is achieved by identifying high-potential investments that are appreciated over time.

Income generation may involve dividends, rental income, or interest from various investments.

Risk-adjusted returns focus on balancing potential profits with acceptable levels of risk, often through diversification and careful asset allocation.

The real estate debt is approximately 39% of the total alternative investment and can be liquidated with a 40-day notice period and cannot exceed 5% of the total fund’s value.

The structured credit is approximately 61% of the total alternative investment and can be liquidated with a 15-day notice period with no restrictions.

As of March 31, 2025, we do not have an unfunded commitment for these investments.

Our receivables from preneed funeral trusts represent assets in trusts which are controlled and operated by third parties in which we do not have a controlling financial interest (less than 50%) in the trust assets.

5 unchanged sentences

These earnings are recognized in Other revenue on our Consolidated Statements of Operations, when a service is performed or merchandise is delivered.

Trust management fees charged by our wholly-owned registered investment advisory firm are included as revenue in the period in which they are earned.

Trust management fees charged by our wholly owned registered investment advisory firm (“CSV RIA”) are included as revenue in the period in which they are earned.

Our investments are diversified across multiple industry segments using a balanced allocation strategy to minimize long-term risk.

7 unchanged sentences

Because of the long-term relationship between the establishment of trust investments and the required performance of the underlying contractual obligations, the impact of current market conditions that may exist at any given time is not necessarily indicative of our ability to generate profit on our future performance obligations.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Preneed Cemetery Trust Investments

The components of Preneed cemetery trust investments on our Consolidated Balance Sheet are as follows (in thousands):

September 30, 2024 December 31, 2023

The components of Preneed cemetery trust investments on our Consolidated Balance Sheets are as follows (in thousands):

March 31, 2025 December 31, 2024

Preneed cemetery trust investments, at market value $ 108,073 $ 106,143

1 unchanged sentence

Preneed cemetery trust investments $ 104,876 $ 102,996

The cost and market values associated with preneed cemetery trust investments at September 30, 2024 are detailed below (in thousands):

Fair Value Hierarchy Level Cost Unrealized

Gains Unrealized

Losses Fair Market

Held for sale ( 1,059 ) ( 4,876 )

Preneed cemetery trust investments $ 103,817 $ 98,120

The cost and market values associated with preneed cemetery trust investments at March 31, 2025 are detailed below (in thousands):

Fair Value Hierarchy Level Cost Unrealized Gains Unrealized Losses Fair Market Value

Cash and money market accounts 1 $ 26,369 $ — $ — $ 26,369

10 unchanged sentences

Fixed income 2 24,979 75 ( 1,690 ) 23,364

Alternative investments 13,324 — — 13,324

Trust securities $ 106,571 $ 6,221 $ ( 5,366 ) $ 107,426

8 unchanged sentences

Total fixed income securities $ 11,093

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The cost and market values associated with preneed cemetery trust investments at December 31, 2024 are detailed below (in thousands):

Fair Value Hierarchy Level Cost Unrealized

Gains Unrealized

Losses Fair Market

Fair Value Hierarchy Level Cost Unrealized Gains Unrealized Losses Fair Market Value

Cash and money market accounts 1 $ 23,215 $ — $ — $ 23,215

4 unchanged sentences

Preferred stock 2 2,833 479 ( 176 ) 3,136

Certificate of deposit 2 79 — ( 7 ) 72

Certificates of deposit 2 79 — ( 5 ) 74

Common stock 1 29,325 4,322 ( 3,381 ) 30,266

7 unchanged sentences

Market value as a percentage of cost 100.6 %

The following table summarizes our fixed income securities (excluding mutual funds) within our preneed cemetery trust investments in an unrealized loss position at September 30, 2024, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

September 30, 2024

The following table summarizes our fixed income securities (excluding mutual funds) within our preneed cemetery trust investments in an unrealized loss position at March 31, 2025, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

March 31, 2025

In Loss Position Less than 12 months In Loss Position Greater than 12 months Total

7 unchanged sentences

Total fixed income securities with an unrealized loss $ 279 $ ( 10 ) $ 1,048 $ ( 286 ) $ 1,327 $ ( 296 )

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes our fixed income securities (excluding mutual funds) within our preneed cemetery trust investments in an unrealized loss position at December 31, 2024, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

10 unchanged sentences

Preneed cemetery trust investment security transactions recorded in Other, net on our Consolidated Statements of Operations are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended March 31,

Investment income $ 647 $ 539

4 unchanged sentences

Net change in deferred preneed cemetery receipts held in trust ( 1,678 ) 242

$ — $ — $ — $ —

Purchases and sales of investments in the preneed cemetery trusts are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended March 31,

Purchases $ ( 3,506 ) $ ( 4,326 )

3 unchanged sentences

Preneed funeral contracts are secured by payments from customers, less retained amounts not required to be deposited into trust.

The components of Preneed funeral trust investments on our Consolidated Balance Sheet are as follows (in thousands):

September 30, 2024 December 31, 2023

The components of Preneed funeral trust investments on our Consolidated Balance Sheets are as follows (in thousands):

March 31, 2025 December 31, 2024

Preneed funeral trust investments, at market value $ 111,997 $ 111,721

1 unchanged sentence

Preneed funeral trust investments $ 108,695 $ 108,416

The cost and market values associated with preneed funeral trust investments at September 30, 2024 are detailed below (in thousands):

Fair Value Hierarchy Level Cost Unrealized

Gains Unrealized

Losses Fair Market

Held for sale ( 405 ) ( 2,197 )

Preneed funeral trust investments $ 108,290 $ 106,219

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The cost and market values associated with preneed funeral trust investments at March 31, 2025 are detailed below (in thousands):

Fair Value Hierarchy Level Cost Unrealized Gains Unrealized Losses Fair Market Value

Cash and money market accounts 1 $ 35,199 $ — $ — $ 35,199

Fixed income securities:

treasury debt 1 406 — ( 24 ) 382

U.S agency obligations 2 304 — ( 24 ) 280

Foreign debt 2 5,045 682 ( 7 ) 5,720

Corporate debt 2 3,888 134 ( 9 ) 4,013

Preferred stock 2 10,345 471 ( 1,548 ) 9,268

Common stock 1 24,394 4,833 ( 2,630 ) 26,597

4 unchanged sentences

Other investments 2 1,884 — — 1,884

Alternative investments 12,814 — — 12,814

Trust securities $ 110,094 $ 5,700 $ ( 4,387 ) $ 111,407

Accrued investment income $ 590 $ 590

Preneed funeral trust investments $ 112,373

Preneed cemetery trust investments $ 111,997

Market value as a percentage of cost 101.2 %

5 unchanged sentences

Total fixed income securities $ 10,013

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The cost and market values associated with preneed funeral trust investments at December 31, 2024 are detailed below (in thousands):

Fair Value Hierarchy Level Cost Unrealized

Gains Unrealized

Losses Fair Market

Fair Value Hierarchy Level Cost Unrealized Gains Unrealized Losses Fair Market Value

Cash and money market accounts 1 $ 33,735 $ — $ — $ 33,735

Fixed income securities:

treasury debt 1 451 — ( 34 ) 417

U.S agency obligations 2 387 — ( 30 ) 357

Foreign debt 2 8,193 1,373 ( 7 ) 9,559

9 unchanged sentences

Accrued investment income $ 584 $ 584

Preneed funeral trust investments $ 111,247

Preneed cemetery trust investments $ 111,721

Market value as a percentage of cost 100.9 %

The following table summarizes our fixed income securities (excluding mutual funds) within our preneed funeral trust investment in an unrealized loss position at September 30, 2024, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

September 30, 2024

The following table summarizes our fixed income securities (excluding mutual funds) within our preneed funeral trust investment in an unrealized loss position at March 31, 2025, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

March 31, 2025

In Loss Position Less than 12 months In Loss Position Greater than 12 months Total

1 unchanged sentence

Fixed income securities:

treasury debt $ — $ — $ 382 $ ( 24 ) $ 382 $ ( 24 )

U.S agency obligations $ — $ — $ 280 $ ( 24 ) $ 280 $ ( 24 )

Foreign debt — — 202 ( 7 ) 202 ( 7 )

Corporate debt 256 ( 9 ) — — 256 ( 9 )

Preferred stock 684 ( 2 ) 7,125 ( 1,546 ) 7,809 ( 1,548 )

Total fixed income securities with an unrealized loss $ 256 $ ( 9 ) $ 482 $ ( 31 ) $ 738 $ ( 40 )

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes our fixed income securities (excluding mutual funds) within our preneed funeral trust investment in an unrealized loss position at December 31, 2024, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

3 unchanged sentences

Fixed income securities:

treasury debt $ — $ — $ 371 $ ( 34 ) $ 371 $ ( 34 )

U.S agency obligations $ — $ — $ 274 $ ( 30 ) $ 274 $ ( 30 )

Foreign debt — — 203 ( 7 ) 203 ( 7 )

2 unchanged sentences

Total fixed income securities with an unrealized loss $ 2,067 $ ( 137 ) $ 1,194 $ ( 252 ) $ 3,261 $ ( 389 )

Preneed funeral trust investment security transactions recorded in Other, net on the Consolidated Statements of Operations are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Preneed funeral trust investment security transactions recorded in Other, net on our Consolidated Statements of Operations are as follows (in thousands):

Three months ended March 31,

Investment income $ 473 $ 436

4 unchanged sentences

Net change in deferred preneed funeral receipts held in trust ( 1,899 ) ( 788 )

$ — $ — $ — $ —

Purchases and sales of investments in the preneed funeral trusts are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended March 31,

Purchases $ ( 3,372 ) $ ( 4,003 )

1 unchanged sentence

Cemetery Perpetual Care Trust Investments

Care trusts’ corpus on our Consolidated Balance Sheet represents the corpus of those trusts plus undistributed income.

Care trusts’ corpus on our Consolidated Balance Sheets represent the corpus of those trusts plus undistributed income.

The components of Care trusts’ corpus are as follows (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Cemetery perpetual care trust investments, at market value $ 88,946 $ 87,337

Obligations due to (due from) trust 14 ( 885 )

Care trusts’ corpus, including HFS $ 88,960 $ 86,452

Held for sale ( 322 ) ( 2,234 )

Care trusts' corpus $ 88,638 $ 84,218

The following table reflects the cost and market values associated with the trust investments held in cemetery perpetual care trust funds at September 30, 2024 (in thousands):

Fair Value Hierarchy Level Cost Unrealized

Gains Unrealized

Losses Fair Market

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table reflects the cost and market values associated with the trust investments held in perpetual care trust funds at March 31, 2025 (in thousands):

Fair Value Hierarchy Level Cost Unrealized Gains Unrealized Losses Fair Market Value

Cash and money market accounts 1 $ 15,220 $ — $ — $ 15,220

8 unchanged sentences

Fixed income 2 22,784 102 ( 1,564 ) 21,322

Alternative investments 11,862 — — 11,862

Trust securities $ 87,639 $ 5,719 $ ( 5,031 ) $ 88,327

Accrued investment income $ 619 $ 619

Cemetery perpetual care investments $ 85,925

Preneed cemetery trust investments $ 88,946

Market value as a percentage of cost 100.8 %

5 unchanged sentences

Total fixed income securities $ 10,318

The following table reflects the cost and market values associated with the trust investments held in cemetery perpetual care trust funds at December 31, 2023 (in thousands):

Fair Value Hierarchy Level Cost Unrealized

Gains Unrealized

Losses Fair Market

The following table reflects the cost and market values associated with the trust investments held in perpetual care trust funds at December 31, 2024 (in thousands):

Fair Value Hierarchy Level Cost Unrealized Gains Unrealized Losses Fair Market Value

Cash and money market accounts 1 $ 14,054 $ — $ — $ 14,054

10 unchanged sentences

Accrued investment income $ 595 $ 595

Cemetery perpetual care investments $ 85,331

Preneed cemetery trust investments $ 87,337

Market value as a percentage of cost 100.5 %

The following table summarizes our fixed income securities (excluding mutual funds) within our cemetery perpetual care trust investment in an unrealized loss position at September 30, 2024, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

September 30, 2024

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes our fixed income securities (excluding mutual funds) within our perpetual care trust investment in an unrealized loss position at March 31, 2025, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

March 31, 2025

In Loss Position Less than 12 months In Loss Position Greater than 12 months Total

5 unchanged sentences

Total fixed income securities with an unrealized loss $ 237 $ ( 8 ) $ 965 $ ( 392 ) $ 1,202 $ ( 400 )

The following table summarizes our fixed income securities (excluding mutual funds) within our perpetual care trust investment in an unrealized loss position at December 31, 2023, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

The following table summarizes our fixed income securities within our perpetual care trust investment in an unrealized loss position at December 31, 2024, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

December 31, 2024

6 unchanged sentences

Total fixed income securities with an unrealized loss $ 1,875 $ ( 125 ) $ 1,586 $ ( 432 ) $ 3,461 $ ( 557 )

Cemetery perpetual care trust investment security transactions recorded in Other, net on our Consolidated Statements of Operations are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Perpetual care trust investment security transactions recorded in Other, net on our Consolidated Statements of Operations are as follows (in thousands):

Three months ended March 31,

Realized gains $ 251 $ 1,306

2 unchanged sentences

Net change in care trusts’ corpus ( 738 ) 5,189

Total $ — $ — $ — $ —

Cemetery perpetual care trust investment security transactions recorded in Other revenue are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Perpetual care trust investment security transactions recorded in Other revenue are as follows (in thousands):

Three months ended March 31,

Investment income $ 2,487 $ 3,129

Realized losses, net ( 1,087 ) ( 322 ) ( 2,212 ) ( 796 )

Realized losses ( 672 ) ( 374 )

Total $ 1,815 $ 2,755

Purchases and sales of investments in the cemetery perpetual care trusts are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Purchases and sales of investments in the perpetual care trusts are as follows (in thousands):

Three months ended March 31,

Purchases $ ( 3,122 ) $ ( 3,649 )

Sales 15,963 14,661

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

RECEIVABLES FROM PRENEED FUNERAL TRUSTS

2 unchanged sentences

Receivables from preneed funeral trusts are as follows (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Preneed funeral trust funds, at cost $ 22,955 $ 23,063

allowance for contract cancellation ( 689 ) ( 691 )

Receivables from preneed funeral trusts, net including HFS $ 22,266 $ 22,372

Held for sale ( 27 ) —

Receivables from preneed funeral trusts, net $ 22,239 $ 22,372

The following summary reflects the composition of the assets held in trust and controlled by third parties to satisfy our future obligations related to the underlying preneed funeral contracts at September 30, 2024 and December 31, 2023.

The cost basis includes reinvested interest and dividends that have been earned on the trust assets.

Fair value includes unrealized gains and losses on trust assets.

The composition of the preneed funeral trust funds at September 30, 2024 is as follows (in thousands):

Cost Basis Fair Value

The composition of the preneed trust funds at March 31, 2025 is as follows (in thousands):

Historical Cost Basis Fair Value

Cash and cash equivalents $ 6,860 $ 6,860

3 unchanged sentences

Total $ 22,955 $ 22,757

The composition of the preneed funeral trust funds at December 31, 2023 is as follows (in thousands):

Cost Basis Fair Value

The composition of the preneed trust funds at December 31, 2024 is as follows (in thousands):

Historical Cost Basis Fair Value

Cash and cash equivalents $ 6,826 $ 6,826

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Intangible and other non-current assets are as follows (in thousands):

September 30, 2024 December 31, 2023

Tradenames $ 28,116 $ 28,862

Capitalized commissions on preneed contracts, net of accumulated amortization of $ 4,422 and $ 3,788 , respectively

Internal-use software, net of accumulated amortization of $ 694 and $ 444 , respectively

March 31, 2025 December 31, 2024

Trade names $ 28,116 $ 28,116

Internally developed software, net of accumulated amortization of $ 831 and $ 764 , respectively

Capitalized commissions on preneed contracts, net of accumulated amortization

of $ 4,616 and $ 4,653 , respectively

Prepaid agreements not-to-compete, net of accumulated amortization of $ 3,654 and $ 3,543 , respectively

Other 280 380

Non-current prepaid and other intangibles, net of accumulated amortization of $ 142 and $ 109 , respectively

Intangible and other non-current assets, net including HFS

$ 40,967 $ 40,642

Held for sale ( 223 ) ( 215 )

Intangible and other non-current assets, net

Our tradenames have indefinite lives and therefore are not amortized.

During the nine months ended September 30, 2024, two of the funeral homes that we sold had a carrying value of tradenames of $ 0.2 million, which was included in the loss on sale and recorded in Net loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations.

As a result of our 2024 qualitative assessment, we determined that there were factors that would indicate the need to perform an additional quantitative impairment test for certain funeral home businesses.

As a result of this additional quantitative impairment test, we recorded a $ 0.6 million impairment to the tradename of one funeral home, during the three and nine months ended September 30, 2024, as the carrying amount of this tradename exceeded its fair value.

For our 2023 assessment, we determined that there were factors that would indicate the need to perform an additional quantitative impairment test for certain funeral home businesses.

As a result of this additional quantitative impairment test, we recorded an impairment to the tradenames for two of our funeral homes of $ 0.2 million, during the three and nine months ended September 30, 2023, as the carrying amount of these tradenames exceeded their fair value.

See Note 1 to the Consolidated Financial Statements included herein for a discussion of the methodology used for our indefinite-lived intangible asset impairment test.

$ 40,744 $ 40,427

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Our trade names have indefinite lives and therefore are not amortized.

During the three months ended March 31, 2024, two of the funeral homes that we sold had a carrying value of tradenames of $ 0.2 million, which was included in the loss on sale and recorded in Net (gain) loss on divestitures, disposals and impairment charges on our Consolidated Statements of Operations.

Internally Developed Software

Internally developed software is amortized on a straight-line basis typically over three to five years .

Amortization expense was $ 0.1 million for both the three months ended March 31, 2025 and 2024.

Capitalized Commissions

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Our capitalized commissions on preneed contracts are amortized on a straight-line basis over the average maturity period of ten years for our preneed funeral trust contracts and eight years for our preneed cemetery merchandise and services contracts.

Amortization expense was $ 0.2 million for both the three months ended September 30, 2024, and 2023, and $ 0.7 million and $ 0.6 million for the nine months ended September 30, 2024 and 2023, respectively.

Internal-use Software

Internal-use software is amortized on a straight-line basis typically over three to five years .

Amortization expense was $ 0.1 million for both the three months ended September 30, 2024 and 2023, and $ 0.3 million and $ 0.2 million for the nine months ended September 30, 2024 and 2023, respectively.

Prepaid Agreements

Amortization expense was $ 0.2 million for both the three months ended March 31, 2025 and 2024.

Prepaid Agreements Not-to-Compete

Prepaid agreements not-to-compete are amortized over the term of the respective agreements, generally ranging from one to ten years .

Amortization expense was $ 0.1 million for both the three months ended September 30, 2024, and 2023 and $ 0.4 million for both the nine months ended September 30, 2024 and 2023.

The aggregate amortization expense for our capitalized commissions, internal-use software and prepaid agreements as of September 30, 2024 is as follows (in thousands):

Capitalized Commissions Internal-use Software Prepaid Agreements

Amortization expense was $ 0.1 million for both the three months ended March 31, 2025 and 2024.

Non-current Prepaid and Other Intangibles

Non-current prepaid agreements are related to software licenses that have been prepaid for multiple years.

These agreements are amortized on a straight-line basis over the term of the respective agreements, generally ranging from two to three years .

Other intangible assets relate to intellectual property and are amortized on a straight-line basis, typically over three years .

Amortization expense was immaterial for both the three months ended March 31, 2025 and 2024.

The aggregate amortization expense for our capitalized commissions, prepaid not-to-compete agreements, internal-use software and non-current prepaid and other agreements as of March 31, 2025 is as follows (in thousands):

Capitalized Commissions Prepaid Agreements Not-to-compete Internally Developed Software Non-current Prepaid and Other Intangibles

Years ending December 31,

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CREDIT FACILITY AND ACQUISITION DEBT

At September 30, 2024, our senior secured revolving credit facility (as amended, the “Credit Facility”) was comprised of:

At March 31, 2025, our senior secured revolving credit facility (as amended, the “Credit Facility”) was comprised of:

(i) a $ 250.0 million revolving credit facility, including a $ 15.0 million subfacility for letters of credit and a $ 10.0 million swingline, and (ii) an accordion or incremental option allowing for future increases in the facility size by an additional amount of up to $ 75.0 million in the aggregate in the form of increased revolving commitments or incremental term loans.

Our obligations under the Credit Facility are unconditionally guaranteed on a joint and several basis by the same subsidiaries which guarantee the Senior Notes (as defined in Note 11) and certain of our subsequently acquired or organized domestic subsidiaries (collectively, the “Subsidiary Guarantors”).

On July 31, 2024, the Company entered into a fourth amendment, (the “Credit Facility Amendment”), to our Credit Facility, with the financial institutions party thereto, as lenders, and Bank of America, N.A., as administrative agent.

The Credit Facility Amendment provided, among other things, for (i) the extension of the maturity date of the Credit Facility to July 31, 2029, provided that, if the Senior Notes (as defined in the Credit Facility) have a stated maturity date that is prior to July 31, 2029, then the maturity date shall instead be the date that is 91 days prior to the stated maturity date of the Senior Notes;

(ii) the establishment of Term Secured Overnight Financing Rate (“SOFR”) as a benchmark rate and the removal of BSBY from the Credit Facility, including conforming revisions to certain defined terms under the Credit Facility;

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

establishment of Term Secured Overnight Financing Rate (“SOFR”) as a benchmark rate and the removal of BSBY from the Credit Facility, including conforming revisions to certain defined terms under the Credit Facility;

(iii) the conversion of each existing BSBY Rate Loan (as defined in the Credit Facility prior to giving effect to the Credit Facility Amendment) to a Term SOFR Loan (as defined in the Credit Facility);

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and (vi) modifications to the permitted investments covenant, relating to the Company’s ability to make certain acquisitions, subject to the satisfaction of certain conditions therein.

We incurred $ 0.8 million in transactions costs related to the Credit Facility Amendment, which were capitalized and will be amortized over the remaining term of the related debt using the straight-line method.

Our obligations under the Credit Facility are unconditionally guaranteed on a joint and several basis by the same subsidiaries which guarantee the Senior Notes (as defined in Note 12) and certain of our subsequently acquired or organized domestic subsidiaries (collectively, the “Subsidiary Guarantors”).

The Credit Facility contains customary affirmative covenants, including, but not limited to, covenants with respect to the use of proceeds, payment of taxes and other obligations, continuation of the Company’s business and the maintenance of existing rights and privileges, and the maintenance of property and insurance, among others.

liens, make investments, engage in mergers and acquisitions, pay dividends and make other restricted payments, and certain financial maintenance covenants.

At September 30, 2024, we were subject to the following financial covenants under our Credit Facility:

The Credit Facility contains customary affirmative covenants, including, but not limited to, covenants with respect to the use of proceeds, payment of taxes and other obligations, continuation of the Company’s business and the maintenance of existing rights and privileges, the maintenance of property and insurance, among others.

In addition, the Credit Facility also contains customary negative covenants, including, but not limited to, covenants that restrict (subject to certain exceptions) the ability of the Company and the Subsidiary Guarantors to incur indebtedness, grant liens, make investments, engage in mergers and acquisitions, and pay dividends and other restricted payments, and certain financial maintenance covenants.

At March 31, 2025, we were subject to the following financial covenants under our Credit Facility:

(A) a Total Leverage Ratio not to exceed 5.00 to 1.00 and (B) a Fixed Charge Coverage Ratio (as defined in the Credit Facility) of not less than 1.20 to 1.00 as of the end of any period of four consecutive fiscal quarters.

These financial maintenance covenants are calculated for the Company and its subsidiaries on a consolidated basis.

We were in compliance with all of the covenants contained in our Credit Facility at September 30, 2024.

We were in compliance with all of the covenants contained in our Credit Facility at March 31, 2025.

Our Credit Facility and acquisition debt consisted of the following (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Credit Facility $ 120,000 $ 137,000

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Total acquisition debt, net of current portion $ 4,856 $ 4,895

At September 30, 2024, we had outstanding borrowings under the Credit Facility of $ 140.0 million.

At March 31, 2025, we had outstanding borrowings under the Credit Facility of $ 120.0 million.

We also had one letter of credit for $ 2.2 million under the Credit Facility.

The letter of credit will expire on November 25, 2025 and is expected to automatically renew annually and secures our obligations under our various self-insured policies.

At September 30, 2024, we had $ 107.4 million of availability under the Credit Facility.

At March 31, 2025, we had $ 127.8 million of availability under the Credit Facility.

The interest expense and amortization of debt issuance costs related to our Credit Facility are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended March 31,

Credit Facility interest expense $ 2,499 $ 3,916

Credit Facility amortization of debt issuance costs 88 138

At September 30, 2024, our outstanding borrowings under our Credit Facility bore interest at a prime rate or the SOFR rate, plus an applicable margin based on our leverage ratio.

At September 30, 2024, the prime rate margin was equivalent to 1.50 % and the SOFR term margin was 2.60 %.

The weighted average interest rate on our Credit Facility was 8.5 % and 9.0 % for the three months ended September 30, 2024 and 2023, respectively, and 8.7 % and 8.5 % for the nine months ended September 30, 2024 and 2023, respectively.

At March 31, 2025, our outstanding borrowings under our Credit Facility bore interest at a prime rate or the SOFR rate, plus an applicable margin based on our leverage ratio.

At March 31, 2025, the prime rate margin was equivalent to 1.50 % and the SOFR term margin was 2.50 %.

The weighted average interest rate on our Credit Facility was 6.9 % and 8.9 % for the three months ended March 31, 2025 and 2024, respectively.

Acquisition debt consists of deferred purchase price and promissory notes payable to sellers.

A majority of the deferred purchase price and notes bear no interest and are discounted at imputed interest rates ranging from 6.5 % to 7.3 %.

Original maturities range from nine to twenty years .

Original maturities typically range from nine to twenty years .

The imputed interest expense related to our acquisition debt is as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended March 31,

Acquisition debt imputed interest expense $ 94 $ 104

The carrying value of our 4.25 % senior notes due 2029 (the “Senior Notes”) is reflected on our Consolidated Balance Sheet as follows (in thousands):

September 30, 2024 December 31, 2023

Long-term liabilities:

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The carrying value of our 4.25 % senior notes due 2029 (the “Senior Notes”) is reflected on our Consolidated Balance Sheets as follows (in thousands):

March 31, 2025 December 31, 2024

Principal amount $ 400,000 $ 400,000

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Carrying value of the Senior Notes $ 396,774 $ 396,597

At September 30, 2024, the fair value of the Senior Notes, which are Level 2 measurements, was $ 371.4 million.

At March 31, 2025, the fair value of the Senior Notes, which are Level 2 measurements, was $ 364.4 million.

The Senior Notes were issued under an indenture, dated as of May 13, 2021 (the “Indenture”), among the Company, the Subsidiary Guarantors and Wilmington Trust, National Association, as trustee.

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The Senior Notes mature on May 15, 2029, unless earlier redeemed or purchased and bear interest at 4.25 % per year, which is payable semi-annually in arrears on May 15 and November 15 of each year, beginning on November 15, 2021.

The Indenture contains restrictive covenants limiting our ability and the ability of our Restricted Subsidiaries (as defined in the Indenture) to, among other things, incur additional indebtedness or issue certain preferred shares, create liens on certain assets to secure debt, pay dividends or make other equity distributions, purchase or redeem capital stock, make certain investments, sell assets, agree to certain restrictions on the ability of Restricted Subsidiaries to make payments to us, consolidate, merge, sell or otherwise dispose of all or substantially all assets, or engage in transactions with affiliates.

The Indenture contains restrictive covenants limiting our ability and our Restricted Subsidiaries (as defined in the Indenture) to, among other things, incur additional indebtedness or issue certain preferred shares, create liens on certain assets to secure debt, pay dividends or make other equity distributions, purchase or redeem capital stock, make certain investments, sell assets, agree to certain restrictions on the ability of Restricted Subsidiaries to make payments to us, consolidate, merge, sell or otherwise dispose of all or substantially all assets, or engage in transactions with affiliates.

The Indenture also contains customary events of default.

The interest expense and amortization of debt discount and debt issuance costs related to our Senior Notes are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended March 31,

Senior Notes interest expense $ 4,250 $ 4,250

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The debt discount and the debt issuance costs are being amortized using the effective interest method over the remaining term of approximately 50 months of the Senior Notes.

The effective interest rates on the unamortized debt discount and the unamortized debt issuance costs for the Senior Notes for both the three and nine months ended September 30, 2024 and 2023 were 4.42 % and 4.30 %, respectively.

The effective interest rates on the unamortized debt discount and the unamortized debt issuance costs for the Senior Notes for both the three months ended March 31, 2025 and 2024 were 4.42 % and 4.30 %, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Our lease obligations consist of operating and finance leases related to real estate, vehicles and equipment.

The components of lease cost are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

Three months ended March 31,

Income Statement Classification 2025 2024

Operating lease cost Facilities and grounds expense (1)

$ 1,007 $ 887 $ 2,984 $ 2,638

Short-term lease cost Facilities and grounds expense (1)

63 75 157 261

Variable lease cost Facilities and grounds expense (1)

86 69 278 183

Finance lease cost:

Depreciation of leased assets Depreciation and amortization (2)

$ 126 $ 190 $ 378 $ 407

Interest on lease liabilities Interest expense 188 125

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Supplemental cash flow information related to our leases is as follows (in thousands):

Nine months ended September 30,

Three months ended March 31,

Cash paid for operating leases included in operating activities $ 1,072 $ 1,071

Cash paid for finance leases included in financing activities 308 277

Right-of-use assets obtained in exchange for new lease liabilities are as follows (in thousands):

Nine months ended September 30,

Right-of-use assets obtained in exchange for new leases are as follows (in thousands):

Three months ended March 31,

Right-of-use assets obtained in exchange for new operating lease liabilities $ 159 $ 852

Right-of-use assets obtained in exchange for new finance lease liabilities 3,483 —

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Supplemental balance sheet information related to leases is as follows (in thousands):

Lease Type Balance Sheet Classification September 30, 2024 December 31, 2023

Operating lease right-of-use assets Operating lease right-of-use assets $ 15,522 $ 16,295

Lease Type Balance Sheet Classification March 31, 2025 December 31, 2024

Operating lease right-of-use assets Operating lease right-of-use assets, including HFS $ 14,452 $ 14,953

Held for sale ( 74 ) —

Operating lease right-of-use assets $ 14,378 $ 14,953

Finance lease right-of-use assets Property, plant and equipment, net $ 12,047 $ 8,564

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Finance lease current liabilities Current portion of finance lease obligations 790 533

Total current lease liabilities Total current lease liabilities, including HFS $ 3,633 $ 3,343

Held for sale ( 22 ) —

Total current lease liabilities $ 3,611 $ 3,343

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Finance lease non-current liabilities Obligations under finance leases, net of current portion 9,152 6,045

Total non-current lease liabilities Total non-current lease liabilities, including HFS $ 22,584 $ 20,080

Held for sale ( 53 ) —

Total non-current lease liabilities $ 22,531 $ 20,080

Total lease liabilities $ 24,194 $ 24,933

The average lease terms and discount rates at September 30, 2024 are as follows:

Total lease liabilities, including HFS $ 26,217 $ 23,423

The average lease terms and discount rates at March 31, 2025 are as follows:

Weighted-average remaining lease term (years) Weighted-average discount rate

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Finance leases 18.8 8.4 %

The aggregate future lease payments for non-cancelable operating and finance leases at September 30, 2024 are as follows (in thousands):

The aggregate future lease payments for non-cancelable operating and finance leases at March 31, 2025 are as follows (in thousands):

Operating Finance

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Interest ( 4,777 ) ( 12,534 )

Present value of lease liabilities $ 17,491 $ 6,703

At September 30, 2024, we had no significant operating or finance leases that had not yet commenced.

Present value of lease liabilities, including HFS $ 16,275 $ 9,942

At March 31, 2025, we had no significant operating or finance leases that had not yet commenced .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

STOCKHOLDERS’ EQUITY

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Restricted stock activity is as follows (in thousands, except shares):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Shares Fair Value Shares Fair Value Shares Fair Value Shares Fair Value

Three months ended March 31,

Shares Fair Value Shares Fair Value

114,684 $ 4,764 156,630 $ 3,834

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Cancelled — $ — 26,240 $ 841

(1) Restricted stock granted during the nine months ended September 30 2024 and 2023 vests over a three-year period, if the employee has remained continuously employed by us during the vesting period, at a weighted average stock price of $ 24.48 and $ 32.63 , respectively.

We recorded stock-based compensation expense, which is included in General, administrative and other expenses , for restricted stock awards of $ 0.4 million for both the three months ended September 30, 2024 and 2023, and $ 1.5 million and $ 1.0 million for the nine months ended September 30, 2024 and 2023, respectively.

(1) Restricted stock granted during the three months ended March 31, 2025 and 2024 vests over a three-year period, if the employee has remained continuously employed by us during the vesting period, at a weighted average stock price of $ 41.54 and $ 24.48 , respectively.

We recorded stock-based compensation expense, which is included in General, administrative and other expenses , for restricted stock awards of $ 0.7 million and $ 0.5 million, for the three months ended March 31, 2025 and 2024, respectively.

Stock Options

Stock option grants and cancellations are as follows (in thousands, except shares):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Shares Fair Value Shares Fair Value Shares Fair Value Shares Fair Value

Three months ended March 31,

Shares Fair Value Shares Fair Value

— $ — 370,590 $ 3,830

Cancelled 1,180 $ 15 294,728 $ 3,757

(1) Stock options granted during the nine months ended September 30, 2024 and 2023 had a weighted average price of $ 24.48 and $ 32.69 , respectively.

(1) Stock options granted during the three months ended March 31, 2024 had a weighted average price of $ 24.48 .

The fair value of these options was calculated using the Black-Scholes option pricing model.

The options granted in 2024 and 2023 vest over a three-year period and have a ten-year term.

The options granted in 2024 vest over a three-year period and have a ten-year term.

These options will vest if the employee has remained continuously employed by us through the vesting period.

The fair value of the options granted during the nine months ended September 30, 2024 was estimated using the Black-Scholes option pricing model with the following assumptions:

Grant Date February 21, 2024

Expected holding period (years) 6.00

Awards granted 370,590

Dividend yield 1.79 %

Expected volatility 43.59 %

Risk-free interest rate 4.31 %

Black-Scholes value $ 10.34

Additional stock option activity is as follows (in thousands, except shares):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Shares Cash Shares Cash Shares Cash Shares Cash

Three months ended March 31,

Shares Cash Shares Cash

Exercised (1)

2,360 N/A 44,900 N/A 52,360 $ 1,271 74,200 N/A

190,415 $ 321 — $ —

Returned for option price (2)

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20,016 $ 799 — $ —

(1) Stock options exercised during the three months ended September 30, 2024 and 2023 had a weighted average exercise price of $ 26.54 and $ 25.10 with an aggregate intrinsic value of $ 14,844 and $ 0.4 million, respectively.

Stock options exercised during the nine months ended September 30, 2024 and 2023 had a weighted average exercise price of $ 25.48 and $ 23.98 with an aggregate intrinsic value of $ 0.4 million and $ 0.5 million, respectively.

(1) Stock options exercised during the three months ended March 31, 2025 had a weighted average exercise price of $ 25.28 with an aggregate intrinsic value of $ 2.7 million.

(2) Represents shares withheld/cash received for the payment of the option price.

(3) Represents shares withheld/cash paid for the payment of payroll taxes.

We recorded stock-based compensation expense, which is included in General, administrative and other expenses , for stock options of $ 0.7 million for both the three months ended September 30, 2024 and 2023, and $ 1.7 million and $ 2.2 million for the nine months ended September 30, 2024 and 2023, respectively.

We recorded stock-based compensation expense, which is included in General, administrative and other expenses , for stock options of $ 0.8 million and $ 0.2 million, for the three months ended March 31, 2025 and 2024, respectively.

Performance Awards

Performance award activity is as follows (in thousands, except shares):

Three months ended September 30, Nine months ended September 30,

During the three months ended March 31, 2025, we granted performance awards to our executive leadership team payable in shares.

These awards will vest, if at all, provided that certain predetermined performance metrics related to the Company's adjusted consolidated EBITDA (adjusted earnings before interest tax depreciation and amortization) are achieved during the period commencing on the grant date, March 7, 2025, through March 31, 2028, subject to certification by the Compensation Committee of the Board of Directors (“Board”) and the individual remaining continuously employed by us through such date.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The performance award activity for the three months ended March 31, 2025 is as follows (in thousands, except shares):

Three months ended March 31,

Shares Fair Value Shares Fair Value

90,894 $ 3,508 — $ —

Shares Fair Value Shares Fair Value Shares Fair Value Shares Fair Value

Returned for payroll taxes 142,070 $ 5,662 — $ —

Cancelled — $ — 80,276 $ 871

We recorded stock-based compensation expense, which is included in General, administrative and other expenses , for performance awards of $ 0.5 million and $ 0.6 million, for the three months ended September 30, 2024 and 2023, respectively, and $ 0.6 million and $ 1.3 million for nine months ended September 30, 2024 and 2023, respectively.

(1) The fair value of the performance awards granted during the three months ended March 31, 2025 was calculated using the stock price on the grant date of $ 38.59 .

For the three months ended March 31, 2025 and 2024, we recorded stock-based compensation expense of $ 0.1 million and stock-based compensation benefit of $ 0.4 million, respectively, for performance awards, which is included in General, administrative and other expenses.

Employee Stock Purchase Plan

ESPP activity is as follows (in thousands, except shares):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Shares Price Shares Price Shares Price Shares Price

ESPP activity is as follows:

Three months ended March 31,

Shares Price Shares Price

ESPP 11,135 $ 32.94 16,296 $ 21.26

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Expected life (years) 0.25 , 0.50 , 0.75 , 1.00

We recorded stock-based compensation expense, which is included in General, administrative and other expenses and Regional and unallocated funeral and cemetery costs , for the ESPP totaling $ 0.1 million for both the three months ended September 30, 2024 and 2023, and $ 0.3 million and $ 0.5 million for the nine months ended September 30, 2024 and 2023, respectively.

Former Employee

Common stock activity is as follows (in thousands, except shares):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Shares Fair Value Shares Fair Value Shares Fair Value Shares Fair Value

— $ — — $ — — $ — 30,000 $ 826

Returned for payroll taxes — $ — — $ — — $ — 1,001 $ 28

(1) During the nine months ended September 30, 2023, we issued 30,000 shares of common stock to a former executive at a stock price of $ 27.54 , in accordance with his Separation and Release agreement pertaining to his resignation from his position as the Company’s Executive Vice President, Chief Financial Officer & Treasurer effective January 2, 2023.

We recorded stock-based compensation expense, which is included in General, administrative and other expenses , for common stock awards of $ 0.8 million, for the nine months ended September 30, 2023.

We recorded stock-based compensation expense, which is included in General, administrative and other expenses and Regional and unallocated funeral and cemetery costs , for the ESPP totaling $ 0.1 million and $ 0.2 million for the three months ended March 31, 2025 and 2024, respectively.

Good To Great Incentive Program

Common stock issued to certain employees under this incentive program is as follows (in thousands, except shares):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Shares Fair Value Shares Fair Value Shares Fair Value Shares Fair Value

Three months ended March 31,

Shares Fair Value Shares Fair Value

11,958 $ 496 31,470 $ 790

(1) Common stock granted during the nine months ended September 30, 2024 and 2023 had a grant date stock price of $ 25.08 and $ 32.69 , respectively.

(1) Common stock granted during the three months ended March 31, 2025 and 2024 had a grant date stock price of $ 41.54 and $ 25.08 , respectively.

Non-Employee Director and Board Advisor Compensation

On April 2, 2024, the Board of Directors (the “Board”) of the Company revised the Director Compensation Policy to provide that each independent director is entitled to a quarterly retainer of $ 37,500 payable in cash and/or unrestricted shares of our common stock at the end of each quarter.

The chair of the Board, so long as he or she is an independent director, and the chair of our Audit Committee shall be entitled to an additional annual retainer of $ 20,000 , payable in quarterly installments of $ 5,000 each at the end of each quarter, the chair of our Compensation Committee is entitled to an additional annual retainer of $ 15,000 , payable in quarterly installments of $ 3,750 at the end of each quarter, and the chair of our Corporate Governance Committee is entitled to an additional annual retainer of $ 10,000 , payable in quarterly installments of $ 2,500 at the end of each quarter.

Any new independent director will receive upon admission to the Board a grant of $ 25,000 (in addition to the independent director annual retainer prorated at the time the new director is admitted to the Board) which can be taken in cash or unrestricted shares of our common stock.

The number of shares of such common stock will be determined by dividing the cash amount by the closing price of our common stock on the date of grant, which will be the date of admission to the Board.

Non-Employee Director and Board Advisor common stock activity is as follows (in thousands, except shares):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Shares Fair Value Shares Fair Value Shares Fair Value Shares Fair Value

Three months ended March 31,

Shares Fair Value Shares Fair Value

Board of Directors (1)

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129 $ 5 184 $ 5

(1) Common stock granted during the three months ended September 30, 2024 and 2023 had a weighted average price of $ 32.83 and $ 28.25 , respectively, and $ 28.66 and $ 29.78 for the nine months ended September 30, 2024 and 2023, respectively.

We recorded compensation expense, which is included in General, administrative and other expenses , related to annual retainers, including the value of stock granted to non-employee directors and an advisor to our Board, of $ 0.2 million and $ 0.3 million for the three months ended September 30, 2024, and 2023, respectively, and $ 0.9 million and $ 0.6 million for the nine months ended September 30, 2024 and 2023, respectively.

(1) Common stock granted during the three months ended March 31, 2025 and 2024 had a grant date stock price of $ 38.75 and $ 27.04 , respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We recorded compensation expense, which is included in General, administrative and other expenses , related to annual retainers, including the value of stock granted to non-employee Directors and an advisor to our Board, of $ 0.3 million and $ 0.5 million for the three months ended March 31, 2025 and 2024, respectively.

Share Repurchase

We did not repurchase any shares during the three and nine months ended September 30, 2024 and 2023.

At September 30, 2024, our share repurchase program had $ 48.9 million authorized for repurchases.

We did not repurchase any shares during the three months ended March 31, 2025 and 2024.

At March 31, 2025, our share repurchase program had $ 48.9 million authorized for repurchases.

Cash Dividends

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2025 Per Share Dollar Value

$ 0.1125 $ 1,686

$ 0.1125 $ 1,704

September 1 st

$ 0.1125 $ 1,708

March 1st $ 0.1125 $ 1,722

2024 Per Share Dollar Value

$ 0.1125 $ 1,661

$ 0.1125 $ 1,679

September 1 st

$ 0.1125 $ 1,683

March 1st $ 0.1125 $ 1,686

EARNINGS PER SHARE

The following table sets forth the computation of the basic and diluted earnings per share (in thousands, except per share data):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended March 31,

Numerator for basic and diluted earnings per share:

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Stock options excluded from the computation of diluted earnings per share because the inclusion of such stock options would result in an antidilutive effect are as follows (in thousands):

Three months ended September 30, Nine months ended September 30,

2024 2023 2024 2023

Three months ended March 31,

Antidilutive stock options 189 1,565

Our performance awards are considered to be contingently issuable shares because their issuance is contingent upon the satisfaction of certain performance and service conditions.

At September 30, 2024, we had satisfied certain performance criteria for the first, second and third predetermined growth targets of our performance awards to be considered outstanding.

Therefore, we included these awards in the computation of diluted earnings per share as of the beginning of the reporting period.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

SEGMENT REPORTING

Revenue, disaggregated by major source for each of our reportable segments was as follows (in thousands):

Three months ended September 30, 2024

Funeral Cemetery Total

Services $ 39,892 $ 5,024 $ 44,916

Merchandise 19,455 4,757 24,212

Cemetery property — 23,207 23,207

Other revenue 4,355 3,997 8,352

Total $ 63,702 $ 36,985 $ 100,687

Three months ended September 30, 2023

Funeral Cemetery Total

Services $ 39,090 $ 4,618 $ 43,708

Merchandise 20,325 4,067 24,392

Cemetery property — 15,895 15,895

Other revenue 3,211 3,288 6,499

Total $ 62,626 $ 27,868 $ 90,494

Nine months ended September 30, 2024

Funeral Cemetery Total

The tables below present revenue, disaggregated by major source for each of our reportable segments, as well as, significant segment expenses, other segment expenses, operating income (loss), depreciation and amortization, interest expense, income (loss) before income taxes, income tax expense (benefit), total assets, long-lived assets, goodwill, capital expenditures and number of operating locations by segment as follows, (in thousands, except number of operating locations) for the three months ended March 31, 2025 and 2024, respectively:

Three months ended, March 31, 2025 Funeral Cemetery Corporate Total

Services $ 47,949 $ 5,061 $ — $ 53,010

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Other revenue 5,114 3,359 — 8,473

Total $ 199,128 $ 107,370 $ 306,498

Nine months ended September 30, 2023

Funeral Cemetery Total

Total revenue 74,619 32,450 — 107,069

Salaries, benefits and commission expenses

17,977 9,919 — 27,896

Cost of merchandise 8,132 1,331 — 9,463

Allocated overhead costs (2)

3,227 1,331 — 4,558

Facilities and grounds expenses 2,929 1,205 — 4,134

General and administrative expenses (3)

3,021 895 — 3,916

Other segment expenses (4)

11,146 2,344 12,048 25,538

Operating income (loss) $ 28,187 $ 15,425 $ ( 12,048 ) $ 31,564

Interest expense $ 280 $ 3 $ 7,015 $ 7,298

Depreciation and amortization $ 2,826 $ 2,324 $ 251 $ 5,401

Income (loss) before income taxes $ 30,069 $ 16,016 $ ( 19,831 ) $ 26,254

Income tax expense (benefit) $ 6,104 $ 3,251 $ ( 4,027 ) $ 5,328

Total assets $ 777,995 $ 470,875 $ 26,359 $ 1,275,229

Long-lived assets $ 624,384 $ 200,427 $ 11,247 $ 836,058

Goodwill $ 354,314 $ 56,389 $ — $ 410,703

Capital expenditures $ 727 $ 1,852 $ 584 $ 3,163

Number of operating locations at year end 160 28 — 188

(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the Chief Operating Decision Maker ("CODM").

(2) Allocated overhead costs include:

property insurance costs, property tax expenses and corporate overhead fees allocated to the field, such as information technology, human resources, legal and finance.

(3) General and administrative expenses include:

professional services, travel and meals expenses, computer software expenses and office supplies.

(4) The Corporate segment's other segment expenses primarily include general, administrative and other expenses, net loss on divestitures, disposals and impairment charges and amortization and depreciation expenses.

The Funeral and Cemetery segment's other segment expenses primarily include transportation costs, other funeral costs, non-payroll related promotional costs, net loss on divestitures, disposals and impairment charges and amortization and depreciation expenses.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Three months ended March 31, 2024 Funeral Cemetery Corporate Total

Services $ 44,807 $ 4,892 $ — $ 49,699

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Other revenue 4,365 3,927 — 8,292

Total $ 197,216 $ 86,470 $ 283,686

The following table presents operating income (loss), income (loss) before income taxes and total assets (in thousands):

Funeral Cemetery Corporate Consolidated

Total revenue 71,831 31,662 — 103,493

Salaries, benefits and commission expenses

18,298 8,897 — 27,195

Cost of merchandise 7,843 1,156 — 8,999

Allocated overhead costs (2)

3,296 1,156 — 4,452

Facilities and grounds expenses 2,694 1,180 — 3,874

General and administrative expenses (3)

2,773 923 — 3,696

Other segment expenses (4)

13,853 5,708 16,239 35,800

Operating income (loss) $ 23,074 $ 12,642 $ ( 16,239 ) $ 19,477

Three months ended September 30, 2024 $ 19,958 $ 15,145 $ ( 12,206 ) $ 22,897

Three months ended September 30, 2023 18,145 8,844 ( 11,303 ) 15,686

Nine months ended September 30, 2024 $ 63,434 $ 44,348 $ ( 47,039 ) $ 60,743

Nine months ended September 30, 2023 58,236 30,496 ( 31,674 ) 57,058

Interest expense $ 225 $ 4 $ 8,483 $ 8,712

Depreciation and amortization $ 2,968 $ 2,255 $ 237 $ 5,460

Income (loss) before income taxes $ 22,869 $ 12,709 $ ( 24,856 ) $ 10,722

Three months ended September 30, 2024 $ 19,767 $ 15,282 $ ( 20,200 ) $ 14,849

Three months ended September 30, 2023 18,377 8,902 ( 20,503 ) 6,776

Nine months ended September 30, 2024 $ 63,301 $ 44,652 $ ( 71,923 ) $ 36,030

Nine months ended September 30, 2023 58,824 30,757 ( 58,757 ) 30,824

Income tax expense (benefit) $ 7,996 $ 4,444 $ ( 8,691 ) $ 3,749

Total assets $ 790,358 $ 452,517 $ 17,644 $ 1,260,519

September 30, 2024 $ 784,108 $ 472,464 $ 18,846 $ 1,275,418

December 31, 2023 802,368 448,018 17,666 1,268,052

Long-lived assets $ 635,574 $ 207,062 $ 6,099 $ 848,735

Goodwill $ 356,878 $ 58,017 $ — $ 414,895

Capital expenditures $ 1,168 $ 2,233 $ 150 $ 3,551

Number of operating locations at year end 165 31 — 196

(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

(2) Allocated overhead costs include:

property insurance costs, property tax expenses and corporate overhead fees allocated to the field, such as information technology, human resources, legal and finance.

(3) General and administrative expenses include:

professional services, travel and meals expenses, computer software expenses and office supplies.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

SUPPLEMENTARY DATA

Balance Sheet

Balance Sheets

The following table presents the detail of certain balance sheet accounts (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Prepaid and other current assets:

Prepaid expenses $ 4,230 $ 3,987

Federal income tax receivable 285 454

State income tax receivable 355 —

Other current assets 137 136

Total prepaid and other current assets, including HFS $ 4,722 $ 4,123

Held for sale ( 3 ) —

Total prepaid and other current assets $ 4,719 $ 4,123

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Operating lease obligations 2,843 2,810

Total current portion of debt and lease obligations, including HFS $ 4,214 $ 3,914

Held for sale ( 22 ) —

Total current portion of debt and lease obligations $ 4,192 $ 3,914

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Incentive compensation $ 2,707 $ 12,860

Salaries and wages 6,727 2,285

Interest 6,552 2,409

Insurance 4,308 3,584

Vacation 3,448 3,647

Unrecognized tax benefit 3,493 3,471

Ad valorem and franchise taxes 2,505 2,395

Vacation 3,114 2,803

Interest 6,521 2,288

Salaries and wages 4,838 4,867

Employee meetings and award trips 2,158 1,550

Commissions 1,045 1,144

Income tax payable 1,931 208

Commissions 1,252 1,218

Perpetual care trust payable 656 2,143

Ad valorem taxes 1,249 2,314

Other accrued liabilities 1,945 1,300

Total accrued and other liabilities, including HFS $ 34,172 $ 38,606

Held for sale ( 114 ) ( 146 )

Total accrued and other liabilities $ 34,058 $ 38,460

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Incentive compensation $ 1,009 $ 996

Deferred compensation 49 —

Other long-term liabilities — 183

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The following information is supplemental disclosure for the Consolidated Statements of Cash Flows (in thousands):

Nine months ended September 30,

Cash paid for interest $ 19,729 $ 21,754

Three months ended March 31,

Cash paid for interest and financing costs $ 2,705 $ 4,083

Cash paid for taxes 1,475 461

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These forward-looking statements include, but are not limited to, statements regarding any projections of earnings, revenue, cash flow, investment returns, capital allocation, debt levels, equity performance, death rates, market share growth, cost inflation, overhead, including talent recruitment, field and corporate incentive compensation, preneed sales or other financial items;

any statements of the plans, strategies, objectives and timing of management for future operations or financing activities, including, but not limited to, technology improvements, product development, capital allocation, organizational performance, execution of our strategic objectives and growth plan, planned divestitures, the ability to obtain credit or financing, anticipated integration, performance and other benefits of recently completed and anticipated acquisitions, and cost management and debt reductions;

any statements of the plans, strategies, objectives and timing of management for future operations or financing activities, including, but not limited to, capital allocation, organizational performance, execution of our strategic objectives and growth strategy, planned divestitures, technology improvements, product development, the ability to obtain credit or financing, anticipated integration, performance and other benefits of recently completed and anticipated acquisitions, and cost management and debt reductions;

any statements of the plans, timing and objectives of management for acquisition and divestiture activities;

any statements regarding future economic and market conditions or performance;

any projections or expectations related to the conclusion of the Board's strategic review;

any statements of belief;

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• the potential adverse effects on the Company's business, financial and equity performance if management fails to meet the expectations of its strategic objectives and growth plan;

• our ability to execute and meet the objectives of our High Performance and Credit Profile Restoration Plan, if at all;

• the execution of our Standards Operating and Strategic Acquisition Models;

• the execution of our Standards Operating Model and strategic acquisition framework;

• the effects of competition;

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• our ability to obtain debt or equity financing on satisfactory terms to fund additional acquisitions, expansion projects, working capital requirements and the repayment or refinancing of indebtedness;

• our ability to meet the timing, objectives and expectations related to our capital allocation framework, including our forecasted rates of return, planned uses of free cash flow and future capital allocation, including share repurchases, potential strategic acquisitions, internal growth projects, dividend increases, or debt repayment plans;

• our ability to meet the projected financial and equity performance goals of our full year outlook, if at all;

• our ability to meet the timing, objectives and expectations related to our capital allocation framework, including our forecasted rates of return, planned uses of free cash flow and future capital allocation, including debt repayment plans, internal growth projects, potential strategic acquisitions, share repurchases, or dividend increases;

• our ability to meet the projected financial and performance guidance of our full year outlook, if at all;

• the timely and full payment of death benefits related to preneed funeral contracts funded through life insurance contracts;

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• effects of the application of other applicable laws and regulations, including changes in such regulations or the interpretation thereof;

• the potential impact of epidemics and pandemics, such as the COVID-19 coronavirus, including any new or emerging public health threats, on customer preferences and on our business;

• government, social, business and other actions that have been and will be taken in response to pandemics and epidemics, such as those that were taken with the COVID-19 coronavirus, including potential responses to any new or emerging public health threats;

• the potential impact of epidemics and pandemics, including any new or emerging public health threats, on customer preferences and on our business;

• government, social, business and other actions that have been and will be taken in response to pandemics and epidemics, including potential responses to any new or emerging public health threats;

• effects and expense of litigation;

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• our ability to identify and consummate strategic acquisitions, if at all, and successfully integrate acquired businesses with our existing businesses, including expected performance and financial improvements related thereto;

• potential adverse impacts resulting from shareholder or market perceptions of our recent announcement regarding the conclusion of our Board’s review of potential strategic alternatives;

• the effects of any additional imposition or changes in tariffs or trade agreements including, but not limited to, any potential disruptions in international trade, any increased inflationary pressures on the economy or costs for our goods, and our ability, if at all, to mitigate such effects;

• economic, financial and stock market fluctuations;

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements