News Release

SCI Corporate Communications
Phone: 1-844-220-4408
Email: Press.Room@sci-us.com
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Service Corporation International Announces Second Quarter 2008 Financial Results

- Conference call on Thursday, August 7, 2008, at 9:00 a.m. Central Daylight Time.

HOUSTON, Aug. 6 /PRNewswire-FirstCall/ -- Service Corporation International (NYSE: SCI), a provider of deathcare products and services, today reported results for the second quarter 2008. Our unaudited condensed consolidated financial statements can be found at the end of this press release. The table below summarizes our key financial results:



    (In millions, except for     Three Months Ended        Six Months Ended
     per share amounts)               June 30,                 June 30,
                                -------------------     ---------------------
                                  2008         2007         2008         2007
                                ------       ------     --------     --------
    Revenues                    $548.8       $565.5     $1,122.2     $1,173.0
    Operating income             $83.5        $82.8       $182.9       $180.9
    Net income                   $31.4        $15.2        $72.9        $52.8
    Diluted earnings per share    $.12         $.05         $.28         $.18
    Earnings from continuing
     operations excluding
     special items(1)            $36.4        $32.4        $88.2        $84.1
    Diluted earnings per share
     from continuing operations
     excluding special items(1)   $.14         $.11         $.33         $.28
    Diluted weighted average
     shares outstanding          262.6        296.1        263.7        297.5
    Net cash provided by
     operating activities        $70.2        $63.7       $116.5       $191.6
    Net cash provided by
     operating activities
     excluding special items(1)  $70.2        $86.1       $209.8       $222.5


    (1) Earnings from continuing operations excluding special items, diluted
        earnings per share from continuing operations excluding special items,
        and net cash provided by operating activities excluding special items
        are non-GAAP financial measures. A reconciliation to net income,
        diluted earnings per share, and net cash provided by operating
        activities computed in accordance with GAAP can be found later in this
        press release under the heading "Non-GAAP Financial Measures".


    Highlights:

    * Diluted earnings per share from continuing operations excluding special
      items increased 27% to $0.14 compared to $0.11.

    * Revenues decreased $16.7 million, or 3.0%, as a result of significant
      divestiture activity throughout 2007 which included the sale of
      approximately 400 locations that generated more than $400 million of
      proceeds.

    * Despite a difficult economic environment, comparable average revenue per
      funeral service increased 4.4%.  Comparable funeral services performed
      decreased 2.6%.

    * Improved sales and marketing efforts led to a comparable preneed funeral
      production increase of 20.3% and a comparable cemetery property sales
      production increase of 2.6%.

    * SCI returned more than $50.0 million in capital to shareholders in the
      second quarter of 2008 through a combination of dividends and share
      repurchases, bringing the year-to-date total capital returned to
      shareholders to $100.0 million in the first half of 2008.

    * SCI today reconfirmed all of the annual guidance provided on
      February 28, 2008.

Tom Ryan, the Company's President and Chief Executive Officer, commented on the second quarter of 2008:

"We continue to make significant progress, particularly with sales production in both our funeral and cemetery operations. In the face of difficult economic conditions, we saw increases in both our comparable preneed funeral sales production and our comparable cemetery property sales production. These results reflect our commitment to providing the appropriate sales infrastructure and the dedication of our hard-working employees," said Tom Ryan, President and Chief Executive Officer.


    CONSOLIDATED SEGMENT RESULTS
    The following table reflects our consolidated segment results.

                                                        Three Months Ended
    (In millions)                                             June 30,
                                                      ---------------------
                                                        2008           2007
                                                      ------         ------
    Funeral
    Revenues                                          $363.3         $375.9
    Gross Profit                                       $72.4          $70.5
    Gross Margin Percentage                            19.9%          18.8%

    Cemetery
    Revenues                                          $185.5         $189.6
    Gross Profit                                       $35.0          $32.7
    Gross Margin Percentage                            18.9%          17.3%


    REVIEW OF RESULTS FOR SECOND QUARTER 2008

    Comparable Funeral Results

The table below details comparable funeral results of operations ("same store"). We consider comparable operations as those owned for the entire period beginning January 1, 2007 and ending June 30, 2008.


    (In millions, except funeral services performed,
    total preneed funeral contracts sold, and average     Three Months Ended
    revenue per funeral service or per contract sold)          June 30,
                                                        ---------------------
                                                          2008           2007
                                                        ------         ------
    Comparable funeral revenue:
      Atneed revenue                                    $234.7         $235.5
      Recognized preneed revenue                         110.0          103.8
      Other revenue(1)                                    17.1           13.7
                                                        ------         ------
    Total comparable funeral revenues                   $361.8         $353.0

    Comparable funeral gross profit                      $73.0          $73.2
    Comparable funeral gross margin percentage           20.2%          20.7%

    Comparable funeral services performed:
      Preneed                                           22,956         22,137
      Atneed                                            44,860         47,524
                                                        ------         ------
      Total                                             67,816         69,661

    Comparable average revenue per funeral service      $5,083         $4,871


    Comparable preneed funeral sales production:
      Sales                                             $122.9         $102.2
      Total preneed funeral contracts sold              22,185         18,620
      Average revenue per contract sold                 $5,540         $5,489


    (1) Other revenue consists primarily of General Agency (GA) revenues,
        which are commissions we receive from third-party insurance companies
        for life insurance policies or annuities sold to preneed customers for
        the purpose of funding preneed funeral arrangements.


    Comparison of Second Quarter 2008 vs. 2007 Comparable Funeral Results
    * Comparable funeral revenue increased $8.8 million, or 2.5%, driven by a
      4.4% increase in the average revenue per funeral service and higher GA
      revenue due to increased preneed funeral sales production.  These
      increases were partially offset by a 2.6% decline in comparable funeral
      services performed.   We believe this decline in volume is consistent
      with trends in our relevant markets and also reflects a continued
      decline in highly discounted, low-service cremation activities due to
      the implementation of our strategic pricing initiative.

    * Comparable funeral gross profit and gross margin percentage were down
      slightly as the increased revenue described above was offset by higher
      selling costs resulting from increased preneed funeral sales production,
      investments in new marketing initiatives, and a $1.8 million increase in
      energy-related costs in the second quarter of 2008.

    * In the face of a difficult economic environment, comparable preneed
      funeral sales production increased $20.7 million, or 20.3%.  This was
      accomplished through an increase in the number of sales counselors as
      well as enhanced productivity from training and development initiatives.


    Comparable Cemetery Results

The table below details comparable cemetery results of operations ("same store"). We consider comparable operations for those owned for the entire period beginning January 1, 2007 and ending June 30, 2008.


                                                          Three Months Ended
    (In millions)                                              June 30,
                                                        ---------------------
                                                          2008           2007
                                                        ------         ------
    Comparable cemetery revenue:
      Atneed revenue                                     $65.5          $67.5
      Recognized preneed revenue                          96.4           86.8
      Other revenue (1)                                   23.3           24.6
                                                        ------         ------
    Total comparable cemetery revenues                  $185.2         $178.9

    Comparable cemetery gross profit                     $35.0          $32.1
    Comparable cemetery gross margin percentage          18.9%          18.0%

    Comparable preneed and atneed cemetery sales
     production:
      Preneed and atneed sales                          $173.3         $170.6
      Recognition rate (2)                               93.4%          90.4%


    (1) Other cemetery revenue is primarily related to endowment care trust
        fund income and interest and finance charges earned from customer
        receivables on preneed installments contracts.
    (2) Represents the ratio of current period revenue recognition stated as a
        percentage of current period sales production.


    Comparison of Second Quarter 2008 vs. 2007 Comparable Cemetery Results
    * Comparable cemetery revenues increased $6.3 million, or 3.5%, primarily
      due to increased cemetery sales production and higher property and
      merchandise recognition rates. These increases were partially offset by
      a decline in new cemetery property construction revenue as several large
      construction projects were completed in 2007 and not repeated in 2008,
      as well as $2.3 million less in cemetery perpetual care trust fund
      income.

    * Comparable cemetery gross profit was up $2.9 million, or 9.0% and gross
      margins improved to 18.9% from 18.0%.  The increase in revenue described
      above was partially offset by a rise in energy-related costs of $1.0
      million and higher selling costs related to additional sales counselors
      that resulted in improvements in sales production levels.

    * Comparable preneed and atneed cemetery property sales production
      increased $2.4 million, or 2.6% despite a difficult economic
      environment.


    Other Financial Results
    * General and administrative expenses decreased $8.5 million for the three
      months ended June 30, 2008 due to $5.6 million of one-time transition
      and other expenses related to the acquisition of Alderwoods incurred in
      the second quarter of 2007, as well as a decrease in employee benefit
      expenses.

    * Interest expense decreased $2.9 million for the three months ended June
      30, 2008 as a result of the repayment of $100 million of a bank term
      loan in the second quarter of 2007 and $50 million of our Series A
      Senior Notes in the fourth quarter of 2007.


    Cash Flow and Capital Spending

Net cash provided by operating activities in the first half of 2008 was $116.5 million compared to $191.6 million in the first half of 2007. Included in the first half of 2008 were $3.3 million of Alderwoods transition costs and a federal tax payment of $90.0 million. Included in the first half of 2007 was $11.4 million of premiums paid on early extinguishment of debt and $19.5 million of Alderwoods transition costs. Excluding these items mentioned above, our operating cash flows decreased $12.7 million in the first half of 2008. As anticipated, this decrease reflects the sale of Mayflower Insurance Co., which contributed $17.3 million of operating cash flows from discontinued operations in the first half of 2007. After taking into account the sale of Mayflower, our operating cash flows were slightly above prior year and in line with our expectations.

    A summary of our capital expenditures is set forth below:


    (In millions)                                       Capital Expenditures
                                                     ------------------------
                                                     Six Months Ended June 30,
                                                     ------------------------
                                                          2008           2007
                                                     ---------      ---------
    Capital improvements at existing locations           $37.1          $41.6
    Development of cemetery property                      23.0           22.4
    Construction of new funeral home facilities and
     other growth capital                                  7.9            1.4
                                                     ---------      ---------
    Total capital expenditures                           $68.0          $65.4
                                                     =========      =========


    TRUST FUND PERFORMANCE
    A summary of our U.S. trust fund performance as of June 30, 2008 is set
forth below:

                                                       3 Months       6 Months
                                                       --------       --------
    Preneed Funeral                                       1.3%         (4.0)%
    Preneed Cemetery                                      1.3%         (4.7)%
    Cemetery Perpetual Care                             (1.7)%         (4.4)%
                                                       --------       --------
    Combined Trust Funds                                  0.4%         (4.4)%



    NON-GAAP FINANCIAL MEASURES

Earnings from continuing operations excluding special items, diluted earnings per share from continuing operations excluding special items, and net cash provided by operating activities excluding special items are all non-GAAP financial measures. We believe these non-GAAP financial measures provide a consistent basis for comparison between quarters and better reflect the performance of our core operations, as they are not influenced by certain income, expense, and cash items not affecting continuing operations. We also believe these measures help facilitate comparisons to our competitors' operating results.

Set forth below is a reconciliation of earnings from continuing operations excluding special items to our reported net income and diluted earnings per share from continuing operations excluding special items to our reported diluted EPS. We do not intend for this information to be considered in isolation or as a substitute for other measures of performance prepared in accordance with GAAP.


    (In millions, except diluted EPS)          Three Months Ended June 30,
                                           -----------------------------------
                                                2008              2007
                                           ----------------   ----------------
                                             Net    Diluted     Net    Diluted
                                           Income      EPS    Income      EPS
                                           ------   -------   ------   -------
    Net income, as reported                 $31.4     $.12     $15.2     $.05

    After-tax reconciling items:
      Losses on divestitures and
       impairment charges, net                4.6      .02       9.7      .03
      Loss on early extinguishment of debt      -        -       7.0      .03
      Alderwoods transition and other costs     -        -       2.7      .01
      Discontinued operations                 0.4        -      (2.2)    (.01)
                                           ------   -------   ------   -------

    Earnings from continuing operations
     excluding special items                $36.4     $.14     $32.4     $.11
                                           ======   =======   ======   =======



    (In millions, except diluted EPS)           Six Months Ended June 30,
                                           -----------------------------------
                                                2008              2007
                                           ----------------   ----------------
                                             Net    Diluted     Net    Diluted
                                           Income      EPS    Income      EPS
                                           ------   -------   ------   -------
    Net income, as reported                 $72.9     $.28     $52.8     $.18

    After-tax reconciling items:
      Losses on divestitures and
       impairment charges, net               14.2      .05      18.3      .06
      Loss on early extinguishment of debt      -        -       8.4      .03
      Alderwoods transition and other costs   0.7        -       9.7      .03
      Discontinued operations                 0.4        -      (5.1)    (.02)
                                           ------   -------   ------   -------

    Earnings from continuing operations
     excluding special items                $88.2     $.33     $84.1     $.28
                                           ======   =======   ======   =======

Set forth below is a reconciliation of net cash provided by operating activities excluding special items to our reported net cash provided by operating activities prepared in accordance with GAAP. We do not intend for this information to be considered in isolation or as a substitute for other measures of liquidity prepared in accordance with GAAP.


    (In millions)                         Three Months Ended  Six Months Ended
                                                June 30,           June 30,
                                          -----------------   ----------------
                                             2008      2007     2008      2007
                                          -------    ------   ------    ------
    Net cash provided by operating
     activities, as reported                $70.2     $63.7   $116.5    $191.6
    One-time Alderwoods transition and
     other costs                                -      11.7      3.3      19.5
    Premiums paid on extinguishment of
     debt                                       -      10.7        -      11.4
    United States federal transaction-
     related tax payment                        -         -     90.0         -
                                          -------    ------   ------    ------
    Net cash provided by operating
     activities, excluding special items    $70.2     $86.1   $209.8    $222.5
                                          =======    ======   ======    ======


    Conference Call and Webcast

We will host a conference call on Thursday, August 7, 2008, at 9:00 a.m. Central Daylight Time. A question and answer session will follow a brief presentation made by management. The conference call dial-in number is (617) 597-5347 with the passcode of 72280018. In conjunction with the conference call, management will refer to supplemental information posted on our website. A webcast of the live conference call and the supplemental information can be accessed through our website at http://www.sci-corp.com in the Investors section. A replay of the conference call will be available through August 14, 2008 and can be accessed at (617) 801-6888 with the passcode of 65044791. Additionally, a replay of the conference call will be available on our website for approximately ninety days in the Investors section under the subheading "Webcasts/Presentations".

Cautionary Statement on Forward-Looking Statements

The statements in this press release that are not historical facts are forward-looking statements made in reliance on the "safe harbor" protections provided under the Private Securities Litigation Reform Act of 1995. These statements may be accompanied by words such as "believe," "estimate," "project," "expect," "anticipate" or "predict," that convey the uncertainty of future events or outcomes. These statements are based on assumptions that we believe are reasonable; however, many important factors could cause our actual results in the future to differ materially from the forward-looking statements made herein and in any other documents or oral presentations made by us, or on our behalf. Important factors, which could cause actual results to differ materially from those in forward-looking statements include, among others, the following:

    * Changes in general economic conditions, both domestically and
      internationally, impacting financial markets (e.g., marketable security
      values, access to capital markets, as well as currency and interest
      rate fluctuations) that could negatively affect us, particularly, but
      not limited to, levels of trust fund income, interest expense, and
      negative currency translation effects.
    * Changes in operating conditions such as supply disruptions and labor
      disputes.
    * Our inability to achieve the level of cost savings, productivity
      improvements or earnings growth anticipated by management, whether due
      to significant increases in energy costs (e.g., electricity, natural gas
      and fuel oil), costs of other materials, employee-related costs or other
      factors.
    * Inability to complete acquisitions, divestitures or strategic alliances
      as planned or to realize expected synergies and strategic benefits.
    * The outcomes of pending lawsuits, proceedings, and claims against us and
      the possibility that insurance coverage is deemed not to apply to these
      matters or that an insurance carrier is unable to pay any covered
      amounts to us.
    * Allegations regarding compliance with laws, regulations, industry
      standards, and customs regarding burial procedures and practices.
    * The amounts payable by us with respect to our outstanding legal matters
      exceed our established reserves.
    * The outcome of pending Internal Revenue Service audits.  We maintain
      accruals for tax liabilities which relate to uncertain tax matters.  If
      these tax matters are unfavorably resolved, we will make any required
      payments to tax authorities.  If these tax matters are favorably
      resolved, the accruals maintained by us will no longer be required, and
      these amounts will be reversed through the tax provision at the time of
      resolution.
    * Our ability to manage changes in consumer demand and/or pricing for our
      products and services due to several factors, such as changes in numbers
      of deaths, cremation rates, competitive pressures, and local economic
      conditions.
    * Changes in domestic and international political and/or regulatory
      environments in which we operate, including potential changes in tax,
      accounting, and trusting policies.
    * Changes in credit relationships impacting the availability of credit and
      the general availability of credit in the marketplace.
    * Our ability to successfully access surety and insurance markets at a
      reasonable cost.
    * Our ability to successfully leverage our substantial purchasing power
      with certain of our vendors.
    * The effectiveness of our internal control over financial reporting, and
      our ability to certify the effectiveness of the internal controls and to
      obtain an unqualified attestation report of our auditors regarding the
      effectiveness of our internal control over financial reporting.
    * The possibility that our credit agreement and privately placed debt
      securities may prevent us from engaging in certain transactions.
    * Our ability to buy our common stock under our share repurchase programs
      which could be impacted by, among others, restrictive covenants in our
      bank agreements, unfavorable market conditions, the market price of our
      common stock, the nature of other investment opportunities presented to
      us from time to time, and the availability of funds necessary to
      continue purchasing common stock.

For further information on these and other risks and uncertainties, see our Securities and Exchange Commission filings, including our 2007 Annual Report on Form 10-K. Copies of this document as well as other SEC filings can be obtained from our website at http://www.sci-corp.com. We assume no obligation to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by us, whether as a result of new information, future events or otherwise.

About Service Corporation International

Service Corporation International (NYSE: SCI), headquartered in Houston, Texas, is North America's leading provider of deathcare products and services. At June 30, 2008, we owned and operated more than 1,300 funeral homes and 350 cemeteries (of which over 200 are combination locations) in 43 states, eight Canadian provinces, the District of Columbia and Puerto Rico. Through our businesses, we market the Dignity Memorial(R) brand which offers assurance of quality, value, caring service, and exceptional customer satisfaction. For more information about Service Corporation International, please visit our website at http://www.sci-corp.com. For more information about Dignity Memorial(R), please visit http://www.dignitymemorial.com.


    For additional information contact:

    Investors: Debbie Young - Director / Investor Relations     (713) 525-9088

    Media:     Lisa Marshall - Managing Director /
               Corporate Communications                         (713) 525-3066



                      SERVICE CORPORATION INTERNATIONAL
                CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                                 (UNAUDITED)
                   (In thousands, except per share amounts)

                                Three months ended          Six months ended
                                      June 30,                  June 30,
                              ---------------------   -----------------------
                                  2008         2007         2008         2007
                              --------    ---------   ----------   ----------
    Revenues                  $548,782     $565,492   $1,122,233   $1,173,047
    Costs and expenses        (441,422)    (462,253)    (877,276)    (928,825)
                              --------    ---------   ----------   ----------
    Gross profit               107,360      103,239      244,957      244,222
    General and
     administrative expenses   (21,658)     (30,159)     (46,733)     (65,387)
    (Loss) gain on
     divestitures and
     impairment charges, net    (3,858)       9,743      (15,904)       2,063
    Other operating income,
      net                        1,691            -          585            -
                              --------    ---------   ----------   ----------
    Operating income            83,535       82,823      182,905      180,898
    Interest expense           (33,311)     (36,165)     (67,380)     (73,762)
    Loss on early
     extinguishment of debt          -      (12,122)           -      (14,480)
    Equity in earnings of
     unconsolidated
     subsidiaries                    -        5,559            -        6,270
    Other income (expense),
     net                         1,945        1,755        3,117        1,138
                              --------    ---------   ----------   ----------
    Income from continuing
     operations before income
     taxes                      52,169       41,850      118,642      100,064
    Provision for income
     taxes                     (20,395)     (28,941)     (45,364)     (52,438)
                              --------    ---------   ----------   ----------
    Income from continuing
     operations                 31,774       12,909       73,278       47,626
    (Loss) income from
     discontinued operations,
     net of income tax benefit/
     (provision) of $195,
     ($1,223), $195, and
     ($1,960), respectively       (377)       2,209         (362)       5,134
                              --------    ---------   ----------   ----------
         Net income            $31,397      $15,118      $72,916      $52,760
                              ========    =========   ==========   ==========
    Basic earnings per share:
      Income from continuing
       operations                 $.12         $.04         $.28         $.16
      Income from discontinued
       operations, net of tax        -          .01            -          .02
                              --------    ---------   ----------   ----------
         Net income               $.12         $.05         $.28         $.18
                              ========    =========   ==========   ==========
    Diluted earnings per share:
      Income from continuing
       operations                 $.12         $.04         $.28         $.16
      Income from discontinued
       operations, net of tax        -          .01            -          .02
                              --------    ---------   ----------   ----------
         Net income               $.12         $.05         $.28         $.18
                              ========    =========   ==========   ==========
    Basic weighted average
     number of shares          259,034      290,577      259,919      291,941
                              ========    =========   ==========   ==========
    Diluted weighted average
     number of shares          262,575      296,124      263,712      297,480
                              ========    =========   ==========   ==========
    Dividends declared per
     share                        $.04         $.03         $.08         $.06
                              ========    =========   ==========   ==========



                      SERVICE CORPORATION INTERNATIONAL
                     CONDENSED CONSOLIDATED BALANCE SHEET
                                 (UNAUDITED)
                     (In thousands, except share amounts)

                                                      June 30,    December 31,
                                                        2008           2007
                                                    ----------     ----------
    Assets
    Current assets:
      Cash and cash equivalents                       $104,700       $168,594
      Receivables, net                                  90,936        113,793
      Inventories                                       33,008         36,203
      Deferred tax asset                                73,182         73,182
      Current assets held for sale                       1,805          2,294
      Other                                             27,480         27,261
                                                    ----------     ----------
        Total current assets                           331,111        421,327
                                                    ----------     ----------
    Preneed funeral receivables and trust
     investments                                     1,398,503      1,434,403
    Preneed cemetery receivables and trust
     investments                                     1,407,287      1,428,057
    Cemetery property, at cost                       1,458,945      1,451,666
    Property and equipment, net                      1,559,090      1,569,534
    Non-current assets held for sale                   120,999        122,626
    Goodwill                                         1,227,624      1,198,153
    Deferred charges and other assets                  441,141        400,734
    Cemetery perpetual care trust investments          863,284        905,744
                                                    ----------     ----------
                                                    $8,807,984     $8,932,244
                                                    ==========     ==========
    Liabilities & Stockholders' Equity
    Current liabilities:
      Accounts payable and accrued liabilities        $294,707       $343,392
      Current maturities of long-term debt              51,289         36,594
      Current liabilities held for sale                    201            149
      Income taxes                                         262         46,305
                                                    ----------     ----------
        Total current liabilities                      346,459        426,440
                                                    ----------     ----------
    Long-term debt                                   1,828,511      1,820,106
    Deferred preneed funeral revenues                  579,476        526,668
    Deferred preneed cemetery revenues                 765,275        753,876
    Deferred income taxes                              147,776        140,623
    Non-current liabilities held for sale               89,654         91,928
    Other liabilities                                  388,605        383,642
    Non-controlling interest in funeral and cemetery
     trusts                                          2,334,152      2,390,288
    Non-controlling interest in cemetery perpetual
     care trusts                                       871,667        906,590
    Commitments and contingencies
    Stockholders' equity:
      Common stock, $1 per share par value,
       500,000,000 shares authorized, 257,164,644
       and 262,858,169, issued and outstanding
       (net of 8,896,829 and 1,961,300 treasury
       shares, at par)                                 257,165        262,858
      Capital in excess of par value                 1,814,724      1,874,600
      Accumulated deficit                             (750,923)      (797,965)
      Accumulated other comprehensive income           135,443        152,590
                                                    ----------     ----------
        Total stockholders' equity                   1,456,409      1,492,083
                                                    ----------     ----------
                                                    $8,807,984     $8,932,244
                                                    ==========     ==========



                      SERVICE CORPORATION INTERNATIONAL
                CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                 (UNAUDITED)
                                (In thousands)

                                                          Six months ended
                                                              June 30,
                                                      -----------------------
                                                         2008           2007
                                                      --------       --------
    Cash flows from operating activities:
      Net income                                       $72,916        $52,760
      Adjustments to reconcile net income to net cash
       provided by operating activities:
        Loss (income) from discontinued operations,
         net of tax                                        362         (5,134)
        Loss on early extinguishment of debt                 -         14,480
        Premiums paid on early extinguishment of debt        -        (11,368)
        Depreciation and amortization                   68,008         73,799
        Amortization of cemetery property               16,526         17,800
        Amortization of loan costs                       1,863          3,617
        Provision for doubtful accounts                  3,915          6,688
        Provision for deferred income taxes             28,079         38,024
        Loss (gain) on divestitures and impairment
         charges, net                                   15,904         (2,063)
        Share-based compensation                         5,256          5,980
        Excess tax benefits from share-based awards     (2,170)        (4,123)
        Equity in earnings of unconsolidated
         subsidiaries                                        -         (6,270)
        Other operating income, net                       (585)             -
      Change in assets and liabilities, net of effects
       from acquisitions and divestitures:
        Decrease (increase) in receivables               6,484         (5,222)
        Increase in other assets                       (10,069)       (12,196)
        Decrease in payables and other liabilities    (128,320)       (40,626)
        Net effect of preneed funeral productions
         and maturities                                 11,294         13,004
        Net effect of preneed cemetery productions
         and maturities                                 27,049         35,455
        Other                                                -           (329)
                                                      --------       --------
    Net cash provided by operating activities from
     continuing operations                             116,512        174,276
    Net cash provided by operating activities from
     discontinued operations                                 -         17,279
                                                      --------       --------
    Net cash provided by operating activities          116,512        191,555
    Cash flows from investing activities:
      Capital expenditures                             (68,035)       (65,392)
      Proceeds from divestitures and sales of property
       and equipment                                    12,831        214,494
      Acquisitions                                      (7,871)          (212)
      Net deposits of restricted funds and other       (21,477)          (238)
                                                      --------       --------
    Net cash (used in) provided by investing
     activities from continuing operations             (84,552)       148,652
    Net cash provided by (used in) investing
     activities from discontinued operations               858         (8,546)
                                                      --------       --------
    Net cash (used in) provided by investing
     activities                                        (83,694)       140,106
    Cash flows from financing activities:
      Proceeds from the issuance of long-term debt      72,000        398,996
      Debt issuance costs                                    -         (6,443)
      Payments of debt                                 (54,367)        (2,152)
      Principal payments on capital leases             (12,013)       (13,807)
      Early extinguishment of debt                           -       (422,641)
      Purchase of Company common stock                 (79,470)      (103,598)
      Proceeds from exercise of stock options            3,596         13,189
      Excess tax benefits from share-based awards        2,170          4,123
      Payments of dividends                            (20,879)       (17,645)
      Bank overdrafts and other                         (6,714)         2,211
                                                      --------       --------
    Net cash used in financing activities from
     continuing operations                             (95,677)      (147,767)
    Net cash used in financing activities from
     discontinued operations                                 -         (2,113)
                                                      --------       --------
    Net cash used in financing activities              (95,677)      (149,880)
    Effect of foreign currency                          (1,035)         1,124
                                                      --------       --------
    Net (decrease) increase in cash and cash
     equivalents                                       (63,894)       182,905
    Cash and cash equivalents at beginning of period   168,594         39,880
                                                      --------       --------
    Cash and cash equivalents at end of period        $104,700       $222,785
                                                      ========       ========

SOURCE Service Corporation International

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Investors
Debbie Young
Director, Investor Relations
+1-713-525-9088
or
Media
Lisa Marshall
Managing Director, Corporate Communications
+1-713-525-3066
both of Service Corporation International

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http://www.sci-corp.com