Service Corporation International (SCI) has reported an 8.44 percent fall in profit for the quarter ended Dec. 31, 2016. The company has earned $66.25 million, or $0.34 a share in the quarter, compared with $72.35 million, or $0.36 a share for the same period last year. On the other hand, Earnings from continuing operations excluding special items for the quarter stood at $90.30 million, or $0.47 a share compared with $73.50 million or $0.37 a share, a year ago.
Revenue during the quarter grew 5.17 percent to $809.05 million from $769.28 million in the previous year period. Gross margin for the quarter expanded 164 basis points over the previous year period to 26.05 percent. Total expenses were 77.83 percent of quarterly revenues, down from 79.58 percent for the same period last year. This has led to an improvement of 175 basis points in operating margin to 22.17 percent.
Operating income for the quarter was $179.33 million, compared with $157.06 million in the previous year period.
Tom Ryan, the Company's Chairman and Chief Executive Officer, commented on the fourth quarter of 2016: "Our financial results accelerated in the fourth quarter with an impressive 27.3% improvement in adjusted earnings per share and a 19.7% increase in adjusted operating cash flow. Exceptional growth in our cemetery businesses coupled with reduced interest expense and fewer shares outstanding were the primary drivers of our double-digit growth in the quarter. Looking ahead to 2017, we believe we are well-positioned to deliver solid results, with expected adjusted earnings per share growth at the high end of our long term targeted growth range of 8%-12% after considering special items in 2016.
For financial year 2017, the company forecasts Diluted earnings per share from continuing operations excluding special items to be in the range of $1.29 to $1.43 on adjusted basis.
Operating cash flow falls marginally
Service Corp International has generated cash of $463.60 million from operating activities during the year, down 1.82 percent or $8.59 million, when compared with the last year.
The company has spent $216.13 million cash to meet investing activities during the year as against cash outgo of $166.42 million in the last year. It has incurred net capital expenditure of $152.14 million on net basis during the year, up 13.35 percent or $17.92 million from year ago.
The company has spent $188.93 million cash to carry out financing activities during the year as against cash outgo of $338.48 million in the last year period.
Cash and cash equivalents stood at $194.99 million as on Dec. 31, 2016, up 44.86 percent or $60.39 million from $134.60 million on Dec. 31, 2015.
Debt moves up
Service Corp International has witnessed an increase in total debt over the last one year. It stood at $3,286.59 million as on Dec. 31, 2016, up 5.19 percent or $162.16 million from $3,124.43 million on Dec. 31, 2015. Total debt was 27.30 percent of total assets as on Dec. 31, 2016, compared with 26.66 percent on Dec. 31, 2015. Debt to equity ratio was at 3 as on Dec. 31, 2016, up from 2.63 as on Dec. 31, 2015. Interest coverage ratio improved to 4.47 for the quarter from 3.65 for the same period last year.
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