Stonemor Partners (STON) Set to Open Lower Following Distribution Cut

October 28, 2016 9:08 AM EDT

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StoneMor Partners L.P. (NYSE: STON) shares were poised to open lower Friday after it cut its distribution 50%.

Press Release:

StoneMor Partners L.P. (NYSE: STON) (“StoneMor” or the “Partnership”) today announced a quarterly cash distribution of $0.33 per common unit for the 3rd quarter 2016. This represents a reduction of 50% from the prior year 3rd quarter. Larry Miller, President and CEO of StoneMor, commented, “As previously discussed, we are working to re-grow our sales force, increasing both its quality and size. To accomplish this, we have recently engaged a national recruiting firm, increased our in-house recruiting efforts, and hired a national vice-president of sales, all of which we expect will yield significant improvements in the months ahead. However, previous efforts to accomplish our salesforce goals have meaningfully lagged our expectations, resulting in a negative impact on our revenue. While 3rd quarter 2016 results are not yet final, preliminary data has led the General Partner and the Board of Directors to temporarily reduce the quarterly cash distribution to $0.33 per unit. This distribution level, along with previously announced cost savings measures totaling $7 million annually, will enhance StoneMor’s liquidity by approximately $12 million in quarterly cash savings.”

Robert B. Hellman, Jr., lead director of the Board of Directors and Chairman of the General Partner, added, “The General Partner strongly believes that this reduction, while disappointing, will protect and position the Partnership to achieve our longer-term expectations for future growth of the business. During this temporary transition period, the General Partner remains committed to providing necessary resources and support to the Partnership, including the funding of acquisitions that are immediately cash accretive, while it strengthens its sales force.”

Larry Miller continued, “While we are striving to accelerate the timeline of hiring and training additional sales talent, we estimate that this could take up to an additional six to nine months to attain the level of productivity we expect. We intend to provide monthly updates on the sales team expansion for greater visibility on our progress to the levels we are targeting. At that time, we will reassess the distribution and will look to reset it at the appropriate level.”

The 3rd quarter 2016 cash distribution is payable on November 14, 2016 to common unit holders of record as of the close of business on November 7, 2016.

StoneMor plans to hold an investors' conference call to discuss its 3rd quarter financial results (which will be released before this call) on Wednesday, November 9, 2016 at 11:00 AM ET. The conference call can be accessed by calling (800) 668-9550. An audio replay of the conference call will be available by calling (800) 633-8284 through 1:00 PM ET on November 23, 2016. The reservation number for the audio replay is: 21821108. The audio replay of the conference call will also be archived on StoneMor's website at www.stonemor.com.

StoneMor will also host a live webcast of this conference call. Investors may access the live webcast via the Investors page of the StoneMor website under Events & Presentations.



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