Carriage Services, Inc. (Carriage) is a provider of funeral and cemetery services and merchandise in the United States.
As of December 31, 2024, the company operated 162 funeral homes in 26 states, and 31 cemeteries in 11 states. The company is a market leader in most of its markets.
The company provides funeral and cemetery services and products on both an ‘atneed’ (time of death) and ‘preneed’ (planned prior to death) basis.
Divestitures
During the year ended December 31, 2024, the company...
Carriage Services, Inc. (Carriage) is a provider of funeral and cemetery services and merchandise in the United States.
As of December 31, 2024, the company operated 162 funeral homes in 26 states, and 31 cemeteries in 11 states. The company is a market leader in most of its markets.
The company provides funeral and cemetery services and products on both an ‘atneed’ (time of death) and ‘preneed’ (planned prior to death) basis.
Divestitures
During the year ended December 31, 2024, the company sold six funeral homes, one cemetery, and real property.
Segments
The company operates in two business segments: Funeral Home Operations and Cemetery Operations.
Funeral Home and Cemetery Operations
The funeral home and cemetery businesses provide products and services to families in three principal areas: ceremony and tribute, generally in the form of a funeral or memorial service; disposition of remains, either through burial or cremation; and memorialization, generally through monuments, markers, or inscriptions.
The company’s funeral homes offer a complete range of services to meet a family’s funeral needs, including consultation, the removal and preparation of remains, the sale of caskets and related funeral merchandise, the use of funeral home facilities for visitation and memorial services, and transportation services. Most of the company’s funeral homes have a non-denominational chapel on the premises, which permits family visitation and services to take place at one location, and thereby reduces transportation costs and inconvenience to the family.
The company’s cemeteries provide interment rights (primarily grave sites, lawn crypts, mausoleum spaces, and niches), related cemetery merchandise (such as memorial markers, outer burial containers, and monuments), and services (interments, inurnments, and installation of cemetery merchandise).
Preneed Programs
Funeral and cemetery arrangements sold prior to death occurring are referred to as preneed contracts. The company markets funeral and cemetery services and products on a preneed basis at the local level. Preneed funeral or cemetery contracts enable families to establish, in advance, the type of service to be performed, the products to be used, and the cost of such products and services. Preneed contracts permit families to eliminate the burden of making deathcare plans at the time of need and allow input from other family members before the death occurs. The company guarantees the price and performance of the preneed contracts to the customer.
Approximately 15% of the company’s funeral services performed are funded through preneed contracts, which are usually secured by placing the funds collected in trust for the benefit of the customer, or by the purchase of a life insurance policy, the proceeds of which will pay for such services at the time of need. Insurance-funded contracts allow the company to earn commission income to improve its near-term cash flow and offset a significant amount of the up-front costs associated with preneed sales. In 2023, the company entered into an exclusive partnership agreement with a national insurance provider to market and sell prearranged funeral services.
In markets that depend on preneed sales for market share, the company supplements the arrangements written by its local funeral directors with sales sourced by its own sales counselors and by third-party sellers. The company sold 10,750 preneed funeral contracts, net of cancellations, during the year ended December 31, 2024.
In addition to preneed funeral contracts, the company offers ‘pre-planned’ funeral arrangements whereby a customer determines in advance substantially all of the details of a funeral service without any financial commitment or other obligation on the part of the customer until the actual time of need. Pre-planned funeral arrangements permit a family to avoid the burden of making deathcare plans at the time of need and enable a funeral home to establish relationships with a customer that may eventually lead to an atneed sale.
The company is focused on educating and providing its cremation customers with additional services and products that are available. All of the company’s funeral homes offer cremation products and services. While the average revenue for a cremation service is generally lower than that of an average traditional burial service, the company has found that this revenue can be substantially enhanced by offering additional services and merchandise, including video tributes, flowers, burial garments, and memorial items, such as urns, keepsake jewelry, and other items that hold a portion of the cremated remains.
Approximately 63% of the company’s cemetery operating revenue is derived from preneed property sales. The company’s preneed cemetery strategy is to build family heritage in its cemeteries by selling property and interment rights prior to death through full-time, highly motivated, and entrepreneurial local sales teams.
Trust Funds and Insurance Contracts
The company has established a variety of trusts in connection with funeral home and cemetery operations as required under applicable state laws. Such trusts include preneed funeral trusts, preneed cemetery merchandise and service trusts, and cemetery perpetual care trusts. These trusts are typically administered by independent financial institutions that the company selects. Investment management and advisory services are provided either by the company’s wholly owned registered investment advisory firm (‘CSV RIA’), or by independent financial advisors. As of December 31, 2024, CSV RIA provided these services to approximately 80% of its trust assets, for a fee based on the market value of trust assets. Under state trust laws, the company is allowed to charge the trust a fee for advising on the investment of the trust assets, and these fees are recognized as income in the period in which services are provided. The investment advisors establish an investment policy that provides guidance on asset allocation, investment requirements, investment manager selection, and performance monitoring.
Business Strategy
The company’s operations and business strategy are founded on the shared values of honesty, integrity and a belief in the power of people.
The company’s strategies include enhanced local brands; maximized evolving preferences; strategic mergers and acquisitions; preneed funeral and cemetery sales; relentless improvement; passion for service and ‘Wow’ playbook; and ‘Trinity,’ the company’s digital transformation project.
Regulation
The company’s funeral home operations are comprehensively regulated by the Federal Trade Commission (‘FTC’) under Section 5 of the Federal Trade Commission Act and a trade regulation rule for the funeral industry promulgated thereunder referred to as the ‘Funeral Rule.’
The company is subject to the requirements of the federal Occupational Safety and Health Act, as amended (‘OSHA’), and comparable state statutes whose purpose is to protect the health and safety of workers. In addition, the OSHA hazard communication standard, the Emergency Planning and Community Right to Know Act, and implementing regulations, as well as similar state statutes and regulations, require that the company organizes and/or discloses information about hazardous materials used or produced in its operations, and that this information be provided to employees, state and local governmental authorities, and citizens. The company is in compliance with all applicable laws and regulations relating to worker health and safety.
History
Carriage Services, Inc. was founded in 1991. The company was incorporated in the state of Delaware in 1993.