Security National Financial Corporation, the Salt Lake City company that competes in the to the consumer funeral and cemetery business reported that their corporate “after tax” earnings from operations increased 15.8% year over year from 2017 and 2016.  Those earnings came on a roughly 9% system wide decrease in revenues.  Pre-tax earnings were less than the prior year — indicating that the new tax law may have helped the after tax earnings equation. The earnings were released this week.  You can see their press release here.

Security National Financial competes in three business segments — Life Insurance, Cemeteries and Mortuaries, and Mortgages.  Overall, revenues declined about 9% year over year with a 5.3% increase in Life Insurance revenues, a 3.9% increase in funeral/cemetery revenues, and a 16.9% decline in mortgage revenues.  The company did $276.9 million in revenue in 2017 as compared to $304.3 million in 2016.

CEO Scott Quist commented in the press release, “The interest rate backdrop remains challenging, rates rising enough to quell mortgage volumes industry wide, but not enough to increase substantially the return on our invested assets.”

Funeral Director Daily take:  From our point of view, we at FDD are most interested in how the funeral/cemetery portion of the company performed.  We noticed revenue increased to $13.4 million in 2017 from $12.8 million in 2016 – an increase of 3.9% in that portion of SNFC’s business.  Furthermore, we saw earnings before taxes in the funeral/cemetery division increase to $1.698 million in 2017 over $1.219 million in 2016 — that’s an increase of 39%.  In our opinion, that shows an improvement in the operational structure of the segment.

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