Service Corp (NYSE: SCI) reported Q1 EPS of $1.32, $0.33 better than the analyst estimate of $0.99. Revenue for the quarter came in at $1.08 billion versus the consensus estimate of $955.1 million.

First Quarter Highlights:

• Revenue grew $275 million over the prior year quarter to $1.1 billion.
• GAAP earnings per share were $1.33.
• Adjusted earnings per share grew $0.89 over the prior year quarter to $1.32.
• Funeral preneed sales grew $35 million, or 16%.
• Cemetery preneed sales grew $130 million, or 67%.
• Comparable funeral gross profit grew 82% and margin expanded 1,030 basis points to 31.0%.
• Comparable cemetery gross profit grew 147% and margin expanded 1,540 basis points to 40.7%.

"Today we are reporting earnings per share of $1.33 and net cash provided by operating activities of $298 million for the quarter. The $0.88 growth in earnings per share in the quarter was primarily driven by increased comparable preneed cemetery sales production and continued elevated COVID-19 mortality, which resulted in an increase in both funeral services performed and burials in our cemeteries. Comparable preneed cemetery sales production grew $130 million, or 67%, during the quarter driven by an increase in sales velocity, sales averages, and large sales activity. Net cash provided by operating activities grew approximately $118 million over the prior year quarter, primarily due to increased operating profit.

Based on our first quarter results, we are raising the midpoint of our full year adjusted earnings per share guidance fifteen cents to $2.85 and the midpoint of our adjusted operating cash flow guidance to $687.5 million. Our long-term earnings growth framework remains in place, we will maintain focus on our core strategies of growing revenue by remaining relevant to our client families, leveraging our scale, and maximizing our capital deployment opportunities in a disciplined and balanced manner.

The health, safety and well-being of our SCI family remains a top priority as our dedicated teams continue to provide essential services for our client families. I would like to thank our entire SCI family, particularly our frontline associates, for your continued courage and resolve, but also for focusing on what we do best, which is helping our client families gain closure and healing through the process of grieving, remembrance, and celebration."

GUIDANCE:

Service Corp sees FY2021 EPS of $2.70-$3.00, versus the consensus of $2.68.

The guidance provided below has a wider range than usual for the twelve month period due to the continued uncertainty around the impact of the COVID-19 pandemic. Our outlook for net cash provided by operating activities excluding special items reflects an estimated $20 million of payroll tax payments in 2021 that were deferred from 2020 as allowed under the CARES Act. We will also incur normal payroll taxes in 2021 of approximately $40 million (which we were able to defer in 2020). These combined items represent a $60 million of additional cash outflows when compared to 2020.

For earnings history and earnings-related data on Service Corp (SCI) click here.