Security National reports 3Q 2020: Hitting on all cylinders

November 23, 2020/Finance/

We continue to roll out the earnings reports of the public death care companies and today is no exception. Today we tell you about one of the quieter companies that is starting to make a name for themselves as they grow.

That company is Utah based Security National Financial Corporation (SNFC) and divisions of the company are involved in mortuaries, cemeteries, funeral funding through insurance assignments, and preneed insurance. In essence, from our point of view, while still small by rooftop unit count of mortuaries, the company is growing quite steadily. To be fair, they also have a unit of their company involved in the mortgage business and that has been a steady division of revenue growth and profits as well.

We will let the President of the company, Scott M. Quist describe, in his words, the company’s 3rd Quarter. Here’s what he is quoted as saying in the SNFC 3rd Quarter press release, “For the quarter, revenues increased 94%, profitability increased 700%, and YTD we have a 26% return on equity. I believe our third quarter is the best operational third quarter ever for each of our business segments. Those are spectacular results that have been delivered in difficult circumstances. I applaud the efforts of all our teams in their considerable accomplishment. Every business segment delivered impressive results.”

You can access the Security National Financial Corporation press release here.

Last year Funeral Director Daily reported on SNFC’s acquisition of the Kilpatrick Life Insurance Company. You can read about that acquisition here.

Here’s what President Quist had to say about the integration of that company in the 3Q 2020 report, ” . . . Our Kilpatrick Life Insurance Company acquisition, which closed last December, has been integrated. Much of that work was accomplished in difficult COVID-related circumstances. While Kilpatrick experienced losses during the first four months of 2020, as was anticipated, it is now profitable and contributing beyond expectations. . . . .”

President Quist also issued a little warning on the life insurance portion of SNFC’s business by stating this, “. . . .obtaining necessary investment yields within acceptable risk tolerances is becoming more difficult in this low interest rate environment. We do not anticipate those economic circumstances changing over the near term.”

Finally, in President Quist’s remarks, he made these comments about their funeral and cemetery business which they call their Memorial segment, ““Our Memorial segment similarly delivered very solid Q3 and YTD result with revenues increasing 54% for the quarter and operational income increasing 100% YTD. Substantially contributing to those results is increased preneed cemetery sales, but mortuary and cemetery operations were also significant contributors. This excellent performance is not an isolated instance. It is instructive to note that our Memorial segment has achieved an average 24% compound annual growth rate in operational income over the last six years. In my view, such excellent financial results are the natural consequence of continuously providing superb customer care and consumer experience during very difficult times.”

For the 3rd Quarter 2020 Security National Financial Corporation recorded revenues of $146.2 million as compared to a 2019 3Q number of $75.38 million.
The Memorial segment recorded revenues of $5.4 million 3Q 2020 as compared to $3.5 million for 3Q 2019.
The Memorial segment recorded Earnings before Taxes of $1.32 million for 3Q 2020 as compared to $213,000 in 3Q 2019.
For the 9 month period through September 30, 2020 SNFC has recorded revenue of $344.4 million as compared to $205.3 million for the same period in 2019.
For the 9 month period through September 30, 2020 the Memorial segment has recorded revenue of $14.8 million as compared to $12.4 million for the same period in 2019.