Park Lawn year-end sees mixed results

 

 

 

Park Lawn Corporation (PLC) released their 2022 4th Quarter and 2022 Year-End reports last week.  In doing so they announced that their Revenue numbers for both the quarter and the year increased while their Net Earnings decreased in comparison to the 2021 4th Quarter and 2021 Year-End.  You can see the press release here.

 

As for the actual numbers, PLC reported a 4th Quarter 2022 Revenue amount of $86.1 million with Net Earnings for that time period of $5.29 million.  That compares to 4Q 2021 numbers of $78.9 million in Revenue for an increase of about 9.1% and to 2021 4Q Net Earnings of $7.1 million for a decrease in Net Earnings of about 25.6%.

 

When it comes to full year 2022 numbers, Park Lawn Corporation reported Year End 2022 Revenue of $326.1 million as compared to the Year of 2021 when they brought in $294.7 million in Revenue.  That’s an increase in yearly revenue of about 10.6% year over year.  Net Earnings for Year End 2022 came in at $25.1 million as compared to FY21 Net Earnings of $27.8 million. . . a decrease of about 9.7%.

 

Here’s what Park Lawn Corporation President and CEO J. Bradley Green said of these results in the press release, “We are pleased with our fourth quarter 2022 year-end operating results as compared to the heavily COVID-19 impacted fourth quarter and year-end 2021. While the Centers for Disease Control and Prevention identified a sharp decline in the U.S. national death(s) during the year, our decrease in call volume was notably less than the national decline, as well as that of our peers.”

 

It should also be noted that Adjusted EBITDA margins dropped slightly in the comparison periods.

 

CEO Green also made these comments in the company’s Earnings Call, which you can access here:

 

“Our fourth quarter operating results were better than expected, especially as it relates to the comparable quarter of Q4 2021, which was heavily impacted by COVID-19.  During the quarter, our revenue continued to grow, increasing 9.1%, principally as a result of acquired operations, while adjusted EBITDA was consistent with the prior period. This occurred in spite of the unprecedented decline in the death rate.”

 

According to the press release Park Lawn Corporation and its subsidiaries own and operate businesses including cemeteries, crematoria, funeral homes, chapels, planning offices and a transfer service. PLC operates in three Canadian provinces and eighteen U.S. states.

 

Funeral Director Daily take:  While some of their peers saw revenue decreases in the 4th Quarter of 2022 as compared to the highly covid death rates and revenues of 4Q 2021, Park Lawn Corporation actually had an increase in revenue during that time period.  As CEO Green mentioned in his comments he states that the increase came “principally as a result of acquired operations“.

 

In that same vein, it should be noted that, at least from my opinion, Park Lawn Corporation was aggressive in their acquisition business during 2022.  In the Earnings Call, Green states, “On the M&A (mergers and acquisitions) side, we had an extremely active fourth quarter in 6 different transactions consisting of 13 funeral homes and 4 cemeteries, including 2 on-site. We finished the year with a total of approximately $94 million in acquisitions, which falls right in the middle of our previously disclosed expected pace of acquisitions.”

 

As you are trying to manage your own funeral homes for as good of a margin as you can get between revenues and expenses, here’s what Park Lawn’s CFO Daniel Millett said about the company’s expenses, .”our comparable operations continue to experience inflationary pressures on items such as labor and utilities. . . “

 

Disclaimer ––  The author of this article holds a stock position in Park Lawn Corporation

 

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