Service Corporation International · NYSE:SCI
Service Corporation International — Q2 2002 Earnings Presentation
11 slides from Service Corporation International's earnings presentation, Aug 14, 2002
Slide 1: Service Corporation International Second Quarter 2002 Financial Update
Service Corporation International Second Quarter 2002 Financial Update
Slide 2: Second Quarter Financial Highlights
Second Quarter Financial Highlights $2,505.3 $118.5 $.25 $68.7 $1,104.7 $2,007.5 $110.2 $.25 $77.8 $1,121.2 Net Debt $57.7 $59.2 Recurring Free Cash Flow $.11 $.09 Diluted E.P.S. before nonrecurring $31.0 $28.1 Earnings before nonrecurring $537.4 $561.4 Comparable Revenues (Dollars in millions) NOTE
Slide 3: North America Operating Highlights
North America Operating Highlights FUNERAL Revenues $274.2 $274.6 $574.5 $572.9 Gross Profit $54.1 $57.4 $134.7 $133.4 Gross Margin 19.7% 20.9% 23.5% 23.3% Case Volume 67,503 68,963 142,410 143,638 Average Revenue $4,042 $3,955 $4,017 $3,963 CEMETERY Revenues $163.9 $143.9 $301.0 $290.8 Gross Profit
Slide 4: Key Financial Objectives
Reduce overhead Sell non-strategic & underperforming assets Increase cash flow Pay down debt Improve credit profile Key Financial Objectives
Slide 5: Reduce Overhead
(Dollars in millions) Goal: Reduce Overhead 3/31/00 6/30/00 9/30/00 12/31/00 3/31/01 6/30/01 9/30/01 12/31/01 3/31/02 6/30/02 Corporate G&A Expense 20113 19734 20185 19901 17979 18423 17049 16858 15731 15092 % of Revenues 0.029426 0.031 0.03278 0.031639 0.026526 0.029776 0.02924 0.02672 0.026855 0.0
Slide 6: Sell Non-Strategic Assets
(Dollars in millions) Goal: Sell Non-Strategic Assets Year Proceeds Description 2000 $489 Insurance companies; currency and finance portfolios 2001 $426 Australia, Spain and Portugal joint ventures; certain North American businesses; equity interest in Arbor 2002E $300-$400 United Kingdom joint vent
Slide 7: Increase Free Cash Flow
(Dollars in millions) Goal: Increase Free Cash Flow Total and Recurring Operating Free Cash Flow 12/31/2000 12/31/2001 12/31/02 Goal 12/31/03 Goal 6/30/01YTD 6/30/02YTD 62 $200 $220 $332 170 158 162 $160 - $180 118 110 131 14 $249 $124 NOTE: Recurring free cash flow is calculated by adjusting cash f
Slide 8: Cash Flow Components
Cash Flow Components EBITDA $103.6 $122.3 $243.0 $268.9 Cash Interest (63.3) (77.6) (85.5) (123.2) Cash Taxes (3.4) (3.4) (1.0) (6.8) Changes in Working Capital 37.2 22.9 (18.2) 12.6 Maintenance Cap Ex (14.9) (6.4) (28.1) (33.0) Recurring Free Cash Flow $59.2 $57.7 $110.2 $118.5 Growth Cap Ex (6.8)
Slide 9: Pay Down Debt
(Dollars in millions) Goal: Pay Down Debt NOTE: 3/31/02 and 12/31/01 Net Debt excludes approximately $110 million of debt associated with the restructure of a French subsidiary which was satisfied with noncash assets on 5/15/02. 12/31/99 12/31/00 12/31/01 3/31/02 6/30/02 12/31/02 Goal 0 Net Debt 400
Slide 10: Debt Maturities
(Dollars in millions) Debt Maturities Estimated as of August 5, 2002 2003 2004 2005 2006 2007 2008 2009 Thereafter Public Bonds 99 181 579 150 150 200 200 0 Other 13 17 26 28 15 20 8 23 Convertible Debt 0 0 0 0 0 345 0 $112 $199 $178 $165 $565 $208 $23 $605 NOTE: Excludes cash on hand of approximate
Slide 11: Goal: Improve Credit Profile
Goal: Improve Credit Profile 12/31/00 12/31/01 6/30/02 2002 Goal Revenues $2,565 $2,510 $2,366 EBITDA $489 $498 $472 EBITDA Margin 19.1% 19.8% 20.0% EBITDA/Interest Expense 1.7x 2.3x 2.6x Senior Net Debt/EBITDA 6.6x 4.3x 3.5x Less than 4 Senior Net Debt/Free Cash Flow 51.9x 12.6x 10.3x 10 or less (D
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