What changed in this filing

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Item 1. Financial Statements

2025-08-07 compared with 2025-05-02 · 239 added, 363 removed, 759 unchanged (44% of the section changed)

1 unchanged sentence

CARRIAGE SERVICES, INC.

CONSOLIDATED BALANCE SHEETS

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited and in thousands, except share data)

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Total liabilities and stockholders’ equity $ 1,275,714 $ 1,279,580

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

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

CARRIAGE SERVICES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited and in thousands, except per share data)

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Service revenue $ 46,510 $ 44,433 $ 99,520 $ 94,132

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Interest expense 7,034 8,324 14,332 17,036

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

Other, net 107 3 ( 1,881 ) 46

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Diluted 15,653 15,403 15,528 15,356

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

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

CARRIAGE SERVICES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in thousands)

Three months ended March 31,

Six months ended June 30,

Cash flows from operating activities:

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Net (gain) loss on divestitures, disposals, and impairment charges ( 5,771 ) 1,568

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

Gain on sale of excess real property ( 1,993 ) —

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Proceeds from the exercise of stock options and employee stock purchase plan contributions 983 1,942

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

Taxes paid on restricted stock, performance award vestings, and exercise of stock options ( 7,631 ) ( 419 )

Dividends paid on common stock ( 3,488 ) ( 3,390 )

Net cash used in financing activities ( 34,457 ) ( 26,272 )

Net increase in cash and cash equivalents 3,478 166

Net increase (decrease) in cash and cash equivalents 233 ( 20 )

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

Cash and cash equivalents at end of period $ 1,398 $ 1,503

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

Supplemental disclosure of cash flow information:

Cash paid for interest and financing costs $ 13,614 $ 16,258

Cash paid for taxes 9,884 9,200

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

CARRIAGE SERVICES, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(unaudited and in thousands)

Three months ended March 31, 2025

Three months ended June 30, 2025

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

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

Net income — — — 11,739 — 11,739

Issuance of common stock from employee stock purchase plan 9 — 295 — — 295

Issuance of common stock to directors and board advisor 1 — 63 — — 63

Exercise of stock options 2 — — — — —

Restricted common stock, performance awards and stock options surrendered for taxes paid ( 4 ) — ( 2 ) — — ( 2 )

Stock-based compensation expense — — 2,029 — — 2,029

Dividends on common stock ($ 0.1125 per share)

— — ( 1,766 ) — — ( 1,766 )

Balance - June 30, 2025 15,701 $ 273 $ 238,026 $ 275,874 $ ( 278,753 ) $ 235,420

Three months ended June 30, 2024

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

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

Net income — — — 6,259 — 6,259

Issuance of common stock from employee stock purchase plan 15 — 324 — — 324

Issuance of common stock to directors and board advisor 6 — 151 — — 151

Exercise of stock options 50 1 1,271 — — 1,272

Restricted common stock and stock options surrendered for taxes paid — — ( 1 ) — — ( 1 )

Stock-based compensation expense — — 2,031 — — 2,031

Dividends on common stock ($ 0.1125 per share)

— — ( 1,704 ) — — ( 1,704 )

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

Six months ended June 30, 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

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Stock-based compensation expense — — 3,705 — — 3,705

Dividends on common stock — — ( 1,722 ) — — ( 1,722 )

Dividends on common stock ($ 0.2250 per share)

— — ( 3,488 ) — — ( 3,488 )

Other 12 — 496 — — 496

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

Three months ended March 31, 2024

Balance - June 30, 2025 15,701 $ 273 $ 238,026 $ 275,874 $ ( 278,753 ) $ 235,420

Six months ended June 30, 2024

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

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Issuance of common stock to directors and board advisor 10 — 264 — — 264

Issuance of common stock — — — — — —

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

Exercise of stock options 50 1 1,271 — — 1,272

Restricted common stock and stock options surrendered for taxes paid ( 43 ) — ( 419 ) — — ( 419 )

Stock-based compensation expense — — 2,407 — — 2,407

Dividends on common stock — — ( 1,686 ) — — ( 1,686 )

Dividends on common stock ($ 0.2250 per share)

— — ( 3,390 ) — — ( 3,390 )

Other 31 — 790 — — 790

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.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

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

NOTES TO UNAUDITED CONDENSED 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 March 31, 2025, we operated 160 funeral homes in 25 states and 28 cemeteries in 10 states.

At June 30, 2025, we operated 159 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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Principles of Consolidation and Interim Condensed Disclosures

Our unaudited Consolidated Financial Statements include the Company and its subsidiaries.

Our unaudited Condensed Consolidated Financial Statements include the Company and its subsidiaries.

All intercompany balances and transactions have been eliminated.

Our interim Consolidated Financial Statements are unaudited, but include all adjustments, which consist of normal, recurring accruals, that are necessary for a fair presentation of our financial position and results of operations as of and for the interim periods presented.

Our interim Condensed Consolidated Financial Statements are unaudited, but include all adjustments, which consist of normal, recurring accruals, that are necessary for a fair presentation of our financial position and results of operations as of and for the interim periods presented.

There have been no material changes in our accounting policies previously disclosed in Part II, Item 8 “Financial Statements and Supplementary Data” in Note 1 in our Annual Report on Form 10-K for the year ended December 31, 2024.

In addition, our unaudited Consolidated Financial Statements have been prepared in a manner consistent with the accounting principles described in our Annual Report on Form 10-K for the year ended December 31, 2024 unless otherwise disclosed herein, and should be read in conjunction therewith.

In addition, our unaudited Condensed Consolidated Financial Statements have been prepared in a manner consistent with the accounting principles described in our Annual Report on Form 10-K for the year ended December 31, 2024, unless otherwise disclosed herein, and should be read in conjunction therewith.

Use of Estimates

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On an ongoing basis, we evaluate our critical estimates and judgments, which include those related to the impairment of goodwill and the fair value measurements used in business combinations.

These policies are considered critical because they may result in fluctuations in our reported results from period to period due to the significant judgments, estimates and assumptions about complex and inherently uncertain matters and because the use of different judgments, assumptions or estimates could have a material impact on our financial condition or results of operations.

These policies are considered critical because they may result in fluctuations in our reported results from period to period due to significant judgments, estimates and assumptions about complex and inherently uncertain matters and because the use of different judgments, assumptions or estimates could have a material impact on our financial condition or results of operations.

Actual results may differ from these estimates and such estimates may change if the underlying conditions or assumptions change.

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Held for Sale

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.

At June 30, 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

June 30, 2025 December 31, 2024

Accounts receivable, net $ 1 $ 833

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

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Land $ 85,479 $ 86,609

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Property, plant, and equipment, net $ 271,445 $ 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.

During the six months ended June 30, 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 Condensed Consolidated Financial Statements.

Additionally, during the six months ended June 30, 2025, we sold real property for $ 3.0 million, with a carrying value of $ 1.0 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.

During the six months ended June 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 (gain) loss on divestitures, disposals, and impairment charges on our Consolidated Statements of Operations.

Additionally, we sold real property for $ 0.3 million, with a carrying value of $ 0.3 million.

Our growth and maintenance capital expenditures totaled $ 1.4 million and $ 1.9 million for the three months ended June 30, 2025 and 2024, respectively, and $ 3.0 million and $ 3.5 million for the six months ended June 30, 2025 and 2024, respectively.

In addition, we recorded depreciation expense of $ 3.3 million and $ 3.5 million for the three months ended June 30, 2025 and 2024, respectively, and $ 6.8 million and $ 7.2 million for the six months ended June 30, 2025 and 2024, respectively.

Cemetery Property

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.

Cemetery property was $ 110.7 million and $ 112.9 million, net of accumulated amortization of $ 73.7 million and $ 72.6 million at June 30, 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 $ 1.6 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 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.

Our growth capital expenditures for cemetery property development totaled $ 1.4 million and $ 1.6 million for the three months ended June 30, 2025 and 2024, respectively, and $ 3.0 million and $ 3.5 million for the six months ended June 30, 2025 and 2024, respectively.

We recorded amortization expense for cemetery interment rights of $ 2.2 million and $ 2.6 million for the three months ended June 30, 2025 and 2024, respectively, and $ 4.1 million and $ 4.3 million for the six months ended June 30, 2025 and 2024, respectively.

During the six months ended June 30, 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 Condensed Consolidated Financial Statements.

During the six months ended June 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 (gain) loss on divestitures, disposals, and impairment charges on our Consolidated Statements of Operations.

Income tax expense was $ 5.1 million and $ 4.2 million for the three months ended June 30, 2025 and 2024, respectively, and $ 10.4 million and $ 7.9 million for the six months ended June 30, 2025 and 2024, respectively.

Our operating tax rate before discrete items was 31.2 % and 33.6 % for the six months ended June 30, 2025 and 2024, respectively, and 31.2 % and 33.2 % for the three months ended June 30, 2025 and 2024, respectively.

RECENTLY ISSUED ACCOUNTING STANDARDS

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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.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Accounting Pronouncements Not Yet Adopted

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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.

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

June 30, 2025 December 31, 2024

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

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

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.

During the six months ended June 30, 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 six months ended June 30, 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 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.

During the three months ended June 30, 2025, we merged one funeral home with another business we own in an existing market.

During the six months ended June 30, 2025, we sold two funeral homes and three cemeteries for an aggregate of $ 15.8 million and merged one funeral homes with another business we own in an existing market.

During the three months ended June 30, 2024, we merged one funeral home with another business we own in an existing market.

During the six months ended June 30, 2024, we sold six funeral homes and one cemetery for an aggregate of $ 10.9 million and merged one funeral home with another business we own in an existing market.

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, March 31,

Three months ended June 30, Six months ended, June 30,

2025 2024 2025 2024

Revenue $ ( 3 ) $ 121 $ 1,650 $ 1,272

Operating income 42 33 518 151

Net gain (loss) on divestitures (1)

Income on divestitures (1)

1 ( 8 ) 5,938 ( 1,509 )

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Accounts Receivable

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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):

March 31, 2025

June 30, 2025

Column1 Funeral Cemetery Corporate Held for Sale Total

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Other receivables include supplier rebates, commissions due from third-party insurance companies and perpetual care income receivables.

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 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

The following table summarizes the activity in our allowance for credit losses by portfolio segment for the six months ended June 30, 2025 (in thousands):

January 1, 2025 Provision for Credit Losses Write Offs Recoveries June 30, 2025

Trade and financed receivables:

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Total allowance for credit losses on trade and financed receivables $ ( 712 ) $ ( 1,095 ) $ 1,823 $ ( 374 ) $ ( 358 )

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.

Balances due on undelivered preneed funeral trust contracts have been reclassified to reduce Deferred preneed funeral revenue on our Consolidated Balance Sheets of $ 8.9 million and $ 10.2 million at June 30, 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.

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

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Interment rights $ 87,512 $ 79,436

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

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Cemetery receivables $ 105,913 $ 97,547

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Preneed cemetery receivables, net $ 56,717 $ 50,958

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

The following table summarizes the activity in our allowance for credit losses for Preneed cemetery receivables, net for the six months ended June 30, 2025 (in thousands):

January 1, 2025 Provision for Credit Losses Write Offs June 30, 2025

Total allowance for credit losses on Preneed cemetery receivables, net

$ ( 2,004 ) $ ( 878 ) $ 520 $ ( 2,362 )

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

The amortized cost basis of our cemetery receivables by year of origination as of June 30, 2025 is as follows (in thousands):

2025 2024 2023 2022 2021 Prior Total

Total cemetery receivables, at amortized cost $ 30,003 $ 39,497 $ 17,377 $ 9,396 $ 3,431 $ 1,422 $ 101,126

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

The aging of past due cemetery receivables as of June 30, 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

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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.

The transaction price allocated to preneed merchandise and service performance obligations that were unfulfilled were $ 15.8 million and $ 13.6 million at June 30, 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.

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Our acquisition debt and Credit Facility (as defined in Note 9) and Senior Notes (as defined in Note 10) are classified within Level 2 of the Fair Value Measurements hierarchy.

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

At June 30, 2025, the carrying value and fair value of our Credit Facility was $ 112.9 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 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.

At June 30, 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 $ 378.3 million at June 30, 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

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, common stock and equity

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.

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.

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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.

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.

The value of the investments in this fund cannot be liquidated at June 30, 2025 because the investments include restrictions that do not allow for liquidation until 2027.

As of June 30, 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.

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The structured credit is approximately 52 % 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.

As of June 30, 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.

We account for these investments at cost.

See Notes 7 and 8 to our Consolidated Financial Statements for the fair value hierarchy levels of our trust investments.

See Notes 7 and 8 to our Condensed Consolidated Financial Statements for the fair value hierarchy levels of our trust investments.

TRUST INVESTMENTS

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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 (“CSV RIA”) are included as revenue in the period in which they are earned.

Trust management fees charged by our wholly owned registered investment advisory firm 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.

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

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Preneed cemetery trust investments, at market value $ 104,114 $ 106,143

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Preneed cemetery trust investments $ 99,908 $ 98,120

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

The cost and market values associated with preneed cemetery trust investments at June 30, 2025, are detailed below (in thousands):

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

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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 March 31, 2025, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

March 31, 2025

The following table summarizes our fixed income securities (excluding mutual funds) within our preneed cemetery trust investments in an unrealized loss position at June 30, 2025, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

June 30, 2025

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

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

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Investment income $ 770 $ 844 $ 1,417 $ 1,383

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Net change in deferred preneed cemetery receipts held in trust ( 4 ) 1,661 ( 1,682 ) 1,903

$ — $ — $ — $ —

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

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Purchases $ ( 38,172 ) $ ( 6,784 ) $ ( 41,678 ) $ ( 11,110 )

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

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Preneed funeral trust investments, at market value $ 111,668 $ 111,721

4 unchanged sentences

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):

The cost and market values associated with preneed funeral trust investments at June 30, 2025 are detailed below (in thousands):

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

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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 March 31, 2025, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

March 31, 2025

The following table summarizes our fixed income securities (excluding mutual funds) within our preneed funeral trust investment in an unrealized loss position at June 30, 2025, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

June 30, 2025

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

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Corporate debt — — — — — —

Preferred stock — — — — — —

Total fixed income securities with an unrealized loss $ — $ — $ 283 $ ( 21 ) $ 283 $ ( 21 )

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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,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Investment income $ 521 $ 675 994 1,111

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Net change in deferred preneed funeral receipts held in trust ( 56 ) 1,197 ( 1,955 ) 409

$ — $ — $ — $ —

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

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Purchases $ ( 33,083 ) $ ( 6,211 ) ( 36,455 ) ( 10,214 )

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

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Cemetery perpetual care trust investments, at market value $ 87,066 $ 87,337

4 unchanged sentences

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):

The following table reflects the cost and market values associated with the trust investments held in perpetual care trust funds at June 30, 2025 (in thousands):

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

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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

The following table summarizes our fixed income securities (excluding mutual funds) within our perpetual care trust investment in an unrealized loss position at June 30, 2025, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

June 30, 2025

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

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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,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Realized gains $ 1,028 $ 113 1,279 1,419

2 unchanged sentences

Net change in care trusts’ corpus 1,101 ( 1,290 ) 363 3,899

$ — $ — $ — $ —

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

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Investment income $ 2,420 $ 3,495 $ 4,907 $ 6,624

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

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Purchases $ ( 35,774 ) $ ( 5,464 ) $ ( 38,896 ) $ ( 9,113 )

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

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Preneed funeral trust funds, at cost $ 22,733 $ 23,063

3 unchanged sentences

Receivables from preneed funeral trusts, net $ 22,024 $ 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 March 31, 2025 and December 31, 2024.

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 trust funds at March 31, 2025 is as follows (in thousands):

The composition of the preneed trust funds at June 30, 2025, is as follows (in thousands):

Historical Cost Basis Fair Value

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Total $ 23,063 $ 22,827

INTANGIBLE AND OTHER NON-CURRENT ASSETS

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

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

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

$ 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

We capitalize sales commissions and other direct selling costs related to preneed cemetery merchandise and services and preneed funeral trust contracts as these costs are incremental and recoverable costs of obtaining a contract with a customer.

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 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 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,

Remainder of 2025 $ 834 $ 281 $ 1,032 $ 381

2026 790 262 1,363 467

2027 739 142 1,362 60

2028 668 78 1,164 —

2029 572 38 1,109 —

Thereafter 1,170 13 277 —

Total amortization expense $ 4,773 $ 814 $ 6,307 $ 908

CREDIT FACILITY AND ACQUISITION DEBT

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

At June 30, 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.

2 unchanged sentences

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;

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;

(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;

(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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(v) the removal of certain mandatory prepayments arising from the issuance of either Equity Interests or Debt (as both are defined by the Credit Facility);

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.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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

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:

At June 30, 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 March 31, 2025.

We were in compliance with all of the covenants contained in our Credit Facility at June 30, 2025.

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

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Credit Facility $ 112,900 $ 137,000

5 unchanged sentences

Total acquisition debt, net of current portion $ 4,817 $ 4,895

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

At June 30, 2025, we had outstanding borrowings under the Credit Facility of $ 112.9 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 March 31, 2025, we had $ 127.8 million of availability under the Credit Facility.

At June 30, 2025, we had $ 134.9 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 March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Credit Facility interest expense 2,102 3,523 $ 4,601 $ 7,439

Credit Facility amortization of debt issuance costs 89 138 177 276

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.

At June 30, 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 June 30, 2025, the prime rate margin was equivalent to 1.125 % and the SOFR term margin was 2.125 %.

The weighted average interest rate on our Credit Facility was 6.8 % and 8.7 % for the three months ended June 30, 2025 and 2024, respectively, and 6.9 % and 8.8 % for the six months ended June 30, 2025 and 2024, respectively.

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

2 unchanged sentences

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

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Acquisition debt imputed interest expense $ 93 $ 103 187 207

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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

June 30, 2025 December 31, 2024

Principal amount $ 400,000 $ 400,000

4 unchanged sentences

Carrying value of the Senior Notes $ 396,954 $ 396,597

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

At June 30, 2025, the fair value of the Senior Notes, which are Level 2 measurements, was $ 378.3 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 interest expense and amortization of debt discount and debt issuance costs related to our Senior Notes are as follows (in thousands):

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Senior Notes interest expense 4,250 4,250 $ 8,500 $ 8,500

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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 47 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 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 March 31,

Income Statement Classification 2025 2024

Operating lease cost Facilities and grounds expense (1)

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

Variable lease cost Facilities and grounds expense (1)

Finance lease cost:

Depreciation of leased assets Depreciation and amortization (2)

Interest on lease liabilities Interest expense 188 125

Total finance lease cost 335 251

Total lease cost $ 1,324 $ 1,351

(1) Facilities and grounds expense is included within Cost of service and General, administrative and other on our Consolidated Statements of Operations.

(2) Depreciation and amortization expense is included within Field depreciation expense and General, administrative and other on our Consolidated Statements of Operations.

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

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 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 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

Accumulated depreciation Property, plant and equipment, net ( 3,361 ) ( 3,214 )

Finance lease right-of-use assets, net $ 8,686 $ 5,350

Operating lease current liabilities Current portion of operating lease obligations $ 2,843 $ 2,810

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

Operating lease non-current liabilities Obligations under operating leases, net of current portion $ 13,432 $ 14,035

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, 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

Operating leases 6.9 8.1 %

Finance leases 18.8 8.4 %

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

Operating Finance

Lease payments due:

Remainder of 2025 $ 3,055 $ 989

2026 3,985 1,328

2027 3,743 1,338

2028 3,393 1,097

2029 2,970 1,031

Thereafter 3,906 16,693

Total lease payments $ 21,052 $ 22,476

Interest ( 4,777 ) ( 12,534 )

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

Restricted Stock

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

Three months ended March 31,

Shares Fair Value Shares Fair Value

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

Returned for payroll taxes 28,656 $ 1,168 16,315 $ 418

Cancelled — $ — 26,240 $ 841

(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 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 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 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.

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

Three months ended March 31,

Shares Cash Shares Cash

Exercised (1)

190,415 $ 321 — $ —

Returned for option price (2)

112,858 $ 4,493 — $ —

Returned for payroll taxes (3)

20,016 $ 799 — $ —

(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 $ 0.8 million and $ 0.2 million, for the three months ended March 31, 2025 and 2024, respectively.

Performance Awards

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 — $ —

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

Cancelled — $ — 80,276 $ 871

(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:

Three months ended March 31,

Shares Price Shares Price

ESPP 11,135 $ 32.94 16,296 $ 21.26

The fair value of the right (option) to purchase shares under the ESPP is estimated at the date of purchase with the four quarterly purchase dates using the following assumptions:

Dividend yield 1.16 %

Expected volatility 28.78 %

Risk-free interest rate 4.36 %, 4.25 %, 4.21 %, 4.17 %

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 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 March 31,

Shares Fair Value Shares Fair Value

11,958 $ 496 31,470 $ 790

(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

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

Three months ended March 31,

Shares Fair Value Shares Fair Value

Board of Directors (1)

1,866 $ 72 3,999 $ 108

Advisor to the Board (1)

129 $ 5 184 $ 5

(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.

The effective interest rates on the unamortized debt discount and the unamortized debt issuance costs for the Senior Notes for both the three and six months ended June 30, 2025 and 2024 were 4.42 % and 4.30 %, 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 months ended March 31, 2025 and 2024.

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

Cash Dividends

Our Board declared the following dividends payable on the dates below (in thousands, except per share amounts):

2025 Per Share Dollar Value

March 1st $ 0.1125 $ 1,722

2024 Per Share Dollar Value

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 March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

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 March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Antidilutive stock options 228 1,433 224 1,456

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SEGMENT REPORTING

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

Our Chief Operating Decision Maker (the “CODM”), who is the Chief Executive Officer, utilizes segment operating income (loss) for resource allocation across segments, particularly during the annual budgeting and forecasting processes.

The CODM examines variances on a monthly basis to make informed decisions regarding capital and personnel distribution among segments.

Additionally, the CODM employs segment gross profit for product pricing evaluation and uses segment adjusted operating profit to assess each segment’s performance by comparing results and return on assets against expected outcomes.

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), capital expenditures and number of operating locations by segment as follows, (in thousands, except number of operating locations) for the three and six months ended June 30, 2025 and 2024, respectively:

Three months ended June 30, 2025 Funeral Cemetery Corporate Total

Services $ 41,308 $ 5,202 $ — $ 46,510

4 unchanged sentences

Salaries, benefits and commission expenses 17,011 10,533 — 27,544

Cost of merchandise 6,847 1,368 — 8,215

Allocated overhead costs (1)

3,386 1,368 — 4,754

Facilities and grounds expenses 2,709 1,560 — 4,269

General and administrative expenses (2)

2,703 956 — 3,659

Other segment expenses (3)

10,912 6,858 11,938 29,708

Operating income (loss) $ 21,679 $ 14,257 $ ( 11,938 ) $ 23,998

Interest expense $ 404 $ 3 $ 6,627 $ 7,034

Depreciation and amortization $ 2,835 $ 2,694 $ 644 $ 6,173

Income (loss) before income taxes $ 21,798 $ 15,062 $ ( 20,003 ) $ 16,857

Income tax expense (benefit) $ 6,463 $ 4,279 $ ( 5,624 ) $ 5,118

(1) 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.

(2) General and administrative expenses include:

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

(3) 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 June 30, 2024 Funeral Cemetery Corporate Total

Services $ 39,589 $ 4,844 $ — $ 44,433

Merchandise 19,664 4,483 — 24,147

Cemetery property — 25,443 — 25,443

Other revenue 4,342 3,953 — 8,295

Total revenue 63,595 38,723 — 102,318

Salaries, benefits and commission expenses 16,860 10,288 — 27,148

Cost of merchandise 6,698 1,201 — 7,899

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Income tax expense (benefit) $ 8,479 $ 6,444 $ ( 10,723 ) $ 4,200

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

(1) 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.

(2) General and administrative expenses include:

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Six months ended, June 30, 2025 Funeral Cemetery Corporate Total

Services $ 89,257 $ 10,263 $ — $ 99,520

Merchandise 39,820 8,369 — 48,189

Cemetery property — 43,910 — 43,910

Other revenue 10,789 6,808 — 17,597

Total revenue 139,866 69,350 — 209,216

Salaries, benefits and commission expenses

34,988 20,452 — 55,440

Cost of merchandise 14,979 2,699 — 17,678

Allocated overhead costs (1)

6,613 2,699 — 9,312

Facilities and grounds expenses 5,638 2,765 — 8,403

General and administrative expenses (2)

5,724 1,851 — 7,575

Other segment expenses (3)

22,058 9,202 23,986 55,246

Operating income (loss) $ 49,866 $ 29,682 $ ( 23,986 ) $ 55,562

Interest expense $ 684 $ 6 $ 13,642 $ 14,332

Depreciation and amortization $ 5,661 $ 5,018 $ 895 $ 11,574

Income (loss) before income taxes $ 51,867 $ 31,078 $ ( 39,834 ) $ 43,111

Income tax expense (benefit) $ 12,567 $ 7,530 $ ( 9,651 ) $ 10,446

Capital expenditures $ 1,258 $ 3,701 $ 1,049 $ 6,008

Number of operating locations at year end 159 28 — 187

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

(1) Allocated overhead costs include:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Three months ended March 31, 2024 Funeral Cemetery Corporate Total

Six months ended June 30, 2024 Funeral Cemetery Corporate Total

Services $ 84,396 $ 9,736 $ — $ 94,132

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Income tax expense (benefit) $ 16,475 $ 10,888 $ ( 19,414 ) $ 7,949

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

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

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

Capital expenditures $ 2,415 $ 4,472 $ 209 $ 7,096

Number of operating locations at year end 164 31 — 195

(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:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

SUPPLEMENTARY DATA

Balance Sheets

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

March 31, 2025 December 31, 2024

Prepaid and other current assets:

Prepaid expenses $ 4,230 $ 3,987

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

Current portion of debt and lease obligations:

Acquisition debt $ 581 $ 571

Finance lease obligations 790 533

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

Accrued and other liabilities:

Incentive compensation $ 2,707 $ 12,860

Insurance 4,308 3,584

Unrecognized tax benefit 3,493 3,471

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

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

Other long-term liabilities:

Incentive compensation $ 1,009 $ 996

Deferred compensation 49 —

Other long-term liabilities — 183

Total other long-term liabilities $ 1,058 $ 1,179

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

Three months ended March 31,

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

Cash paid for taxes 1,475 461

SUBSEQUENT EVENTS

On July 4, 2025, the One Big Beautiful Bill Act “(OBBBA”) was signed into law, which includes federal tax law revisions that may affect the Company’s ability to utilize certain tax attributes.

The Company is currently evaluating the impact of these changes.

On July 16, 2025, we sold three funeral homes and one cemetery that was included in held for sale at June 30, 2025, for an aggregate of $ 5.5 million.

CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

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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, 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, 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 acquisitions and 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;

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While we believe these assumptions concerning future events are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate.

All comments concerning our expectations for future revenue and operating results are based on our forecasts for our existing operations and do not include the potential impact of any future acquisitions.

Our forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause actual results to differ materially from our historical experience and our present expectations or projections.

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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;

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

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

• the effects of competition;

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• our level of indebtedness and the cash required to service our indebtedness;

• changes in federal income tax laws and regulations and the implementation and interpretation of these laws and regulations by the Internal Revenue Service;

• changes in federal income tax laws and regulations and the implementation and interpretation of these laws and regulations by the Internal Revenue Service, including changes and potential impacts, if any, resulting from the recently enacted One Big Beautiful Bill Act;

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

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• consolidation in the funeral and cemetery industry;

• 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;

• our ability to identify and consummate strategic acquisitions on commercially reasonable terms and on a timely basis, if at all, and successfully integrate acquired businesses with our existing businesses, including expected performance and financial improvements related thereto;

• our ability to successfully complete any non-core asset divestitures on commercially reasonable terms and o a timely basis, if at all, and the impact of any such divestitures on our Company, including any financial, operational, tax or other similar impacts related thereto;

• 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;

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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