Slide 1: Investor Presentation May 2018
Investor Presentation May 2018
Slide 2: Cautionary Statement on Forward Looking Statements and Disclosure of Non-GAAP Performance Measures
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Cautionary Statement on Forward Looking Statements and 2 Disclosure of Non-GAAP Performance Measures Certain statements made herein or elsewhere by, or on behalf of, the Company that are not historical facts are int
Slide 3: II. Company Overview
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation 11 II. Company Overview
Slide 4: Carriage Services Overview
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Carriage Services Overview 12 Business Overview Operating Segment Overview (LTM Mar-18)1 Carriage Services is a leading owner and consolidator of Revenue Field Level EBITDA2 funeral homes and cemeteries in the U.S.
Slide 5: History of Carriage: Evolution Into an Industry Leader
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation History of Carriage 13 Evolution Into an Industry Leader 1991 1996 1998 1999 2004 2005 2007 2008 2011 2012 2018 Founded as IPO: Last Stock Implemented Refinanced all Created Assumed Board and Launched First Launched
Slide 6: High Performance Culture Framework
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation High Performance Culture 14 Framework Innovative and powerful Standards Operating Model has led to industry leading operating and financial performance Entrepreneurial culture and empowerment attracts top industry t
Slide 7: Carriage Services' High Performance Culture Framework
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Carriage Services’ High Performance Culture Framework
Slide 8: Funeral Home Operations Segment Overview
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Funeral Home Operations 16 Segment Overview Total Funeral Home Operating Revenue & Funeral Field EBITDA Margin Operates 178 funeral homes in 29 states within the United States $ 191.8 $ 196.2 Offers a complete range
Slide 9: Cemetery Operations Segment Overview
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Cemetery Operations 17 Segment Overview Cemetery Operating Revenue & Cemetery Field EBITDA Margin Operates 32 cemeteries in 11 states within the United States Product and service offering includes: $ 46.7 $ 48.9 $ 4
Slide 10: Financial Earnings Preneed & Trust Overview
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Financial Earnings 18 Preneed & Trust Overview of Financial Earnings Financial Revenue & Financial EBITDA Margin Financial Revenue consists of 4 segments: $ 19.0 $ 19.4 $ 18.6 $ 17.5 $ 17.6 Preneed Funeral C
Slide 11: Financial Earnings Preneed & Trust: De-emphasize Preneed Funeral Sales
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Financial Earnings 19 Preneed & Trust Strategic Decision to De-emphasize Preneed Funeral Sales Believe in protecting pricing power of Atneed service; No evidence aggressive PNF sales grow local market share and cont
Slide 12: Strategic Acquisition Model
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Strategic Acquisition Model 20 Ten Year Vision: To affiliate with the best remaining independently owned funeral home and cemetery businesses in strategic markets where the potential for future revenue growth is the
Slide 13: III. Key Credit Highlights
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation 21 III. Key Credit Highlights
Slide 14: Key Credit Highlights
Key Credit Highlights 22 1 A Leader in the Fragmented Funeral and Cemetery Industry 2 Stable Industry With Favorable Trends 3 National Presence Focused on Local Strategic Markets 4 Standards Operating Model = Industry Leading Results 5 Impressive Financial Results Through the Cycle 6 Experienced and
Slide 15: A Leader in the Fragmented Funeral and Cemetery Industry
A Leader in the Fragmented 1 Funeral and Cemetery Industry 23 A Leader in a Fragmented Market Industry Revenue By Market Share The death care industry remains highly fragmented 20% 80% Estimated $18 billion in annual revenue¹ #1 #2 #3 #4+ 21,000 funeral homes and cemeteries in the United States SCI
Slide 16: Stable Industry With Favorable Trends
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Stable Industry With 2 Favorable Trends 24 Increasing annual deaths and a growing U.S. population provide tailwinds for Carriage Service’s long term growth outlook Favorable Secular Tailwinds… …Driven By An Aging Po
Slide 17: National Presence Focused on Local Strategic Markets
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation National Presence Focused on 3 Local Strategic Markets 25 A Nationwide Company With a Local Market Focus Carriage has a long term track record of growing in large strategic markets Provides Carriage with opportuniti
Slide 18: Standards Operating Model = Industry Leading Results
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Standards Operating Model = 4 Industry Leading Results 26 Standards Operating Model Funeral Standards Innovative operating model for the funeral and Qualitative Metrics —50% (long term) cemetery industry 30% — Marke
Slide 19: Standards Operating Model: Being the Best
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation 4 Standards Operating Model 27 “Being The Best” Funeral and Cemetery Operating Company BEING THE BEST STANDARDS OPERATING MODEL Group B C B C B C B C Funeral Funeral Contracts 125—250 251—400 125—250 251—400 125—250
Slide 20: Impressive Financial Results Through the Cycle
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Impressive Financial Results 5 Through the Cycle 28 Consistent long term growth and improved profitability of Carriage, even through the Recession of ‘08-’09 Revenue Consistency Driven By… EBITDA Margin 26% 22% 24%
Slide 21: Experienced and Proven Management Team
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Experienced and Proven 6 Management Team 29 Years of Industry Name Experience Background Co-founded Carriage in 1991 and only CEO in CSV history Extensive experience in other industries and roles including venture s
Slide 22: IV. Financial Overview
30 IV. Financial Overview
Slide 23: Historical Revenue Profile
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Historical Revenue Profile 31 Commentary Revenue by Segment Over past five years, Carriage has achieved a consistent $ 258.1 $ 263.4 and stable Revenue growth profile $ 242.5 $ 248.2 $ 226.1 Broad based growth acros
Slide 24: Historical EBITDA Profile
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Historical EBITDA Profile 32 Commentary Adjusted Consolidated EBITDA and Margin Key drivers of Field EBITDA Margin improvement include improved execution of our Standards $ 71.1 $ 73.7 $ 70.6 $ 61.7 $ 68.7 Operating
Slide 25: Historical Cash Flow Profile
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Historical Cash Flow Profile 33 Commentary Maintenance vs. Growth Capex High fixed asset base generates significant location-$ 29.7 level operating leverage and strong free cash flow Record Q1 2018 free cash flow of
Slide 26: Key Financial Highlights
Key Financial Highlights 34 Industry leading EBITDA Margins High and recurring Free Cash Flow generation Significant embedded Operating Leverage Ability to rapidly de-lever absent acquisition activity Track record of rapidly integrating highly accretive acquisitions Minimal capex and working capital
Slide 27: VI. Additional Materials
35 VI. Additional Materials
Slide 28: Reconciliation of Non-GAAP Measures: Net Income to Adjusted EBITDA
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Reconciliation of Non-GAAP Measures: 36 Net Income to Adjusted EBITDA EBITDA Adjustments Description of Key Adjustments FYE Ended December 31, LTM A. Recognized accretion of the discount of convertible ($ in million
Slide 29: Reconciliation of Non-GAAP Measures: Field EBITDA
IBD-NY\CARROTY2018\616232_1\10. Roadshow Presentation\Carriage Investor Presentation Reconciliation of Non-GAAP Measures: 37 Field EBITDA Funeral Field EBITDA FYE Ended December 31, LTM ($ in millions) 2014 2015 2016 2017 Mar-18 Gross Profit (GAAP) $ 54.1 $ 59.4 $ 61.6 $ 61.4 $ 62.1 Depreciation & A
Slide 30: Reconciliation of Non-GAAP Measures: Adjusted Free Cash Flow
Reconciliation of Non-GAAP Measures: 38 Adjusted Free Cash Flow FYE Ended December 31, LTM (US$ in millions) 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Mar-18 Cash flow from operations $ 19.6 $ 19.5 $ 16.1 $ 25.7 $ 31.0 $ 25.6 $ 39.8 $ 36.6 $ 51.5 $ 50.0 $ 45.2 $ 52.0 (-) Maint. Capex (7
Slide 31: Thank You For Your Time
THANK YOU FOR YOUR TIME CONTACT US 3040 Post Oak Blvd. #300 713-332-8400 Houston, TX 77056 InvestorRelations@CarriageServices.com