SERVICE CORP INTERNATIONAL
For the period ended Jun 30, 2024. Filed Aug 1, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 1, 2024
SCI$73.74-2.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-02.
0000089089-24-000093
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe CompanyFinancial Condition, Liquidity, and Capital ResourcesCash FlowResults of Operations - Three Months EndedCritical Accounting PoliciesCautionary Statement on Forward-Looking StatementsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-01.
0000089089-24-000137
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe CompanyFinancial Condition, Liquidity, and Capital ResourcesCash FlowResults of Operations - Three and Six Months EndedCritical Accounting PoliciesCautionary Statement on Forward-Looking StatementsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 164 previous paragraphs and 203 current paragraphs.
111 unchanged; 48 reworded; 36 added; 4 removed; 1 previous and 8 current paragraphs rearranged.
Tables are not compared: 8 previous and 11 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (36)
Current report
•a $9.7 million increase in payments for certain legal matters.
Current report
•a $9.8 million increase in other investing activities primarily for investments in renewable energy tax credits,
Current report
As of June 30, 2024, we had an increase of $161.7 million in surety bonds supporting preneed funeral obligations related to certain legal matters discussed in Part I, Item 1. Financial Statements, Note 9.
Current report
Consolidated revenue from funeral operations was $565.8 million for the three months ended June 30, 2024 compared to $565.4 million for the same period in 2023. This $0.4 million increase is primarily attributable to the $5.6 million increase in revenue from acquired and newly constructed properties, partially offset by the $5.1 million decrease in comparable revenue.
Current report
The core funeral revenue decreased by $6.6 million, or 1.4%, primarily due to a 2.7% decrease in core funeral services performed partially offset by a favorable 1.3% increase in core average revenue. The core cremation rate increased 60 basis points to 56.9%. Non-funeral home preneed sales revenue decreased by $7.0 million, or 19.5%, primarily due to operational changes in certain markets with respect to timing of merchandise deliveries. This decrease is partially offset by an increase in general agency revenue as we continue to shift from trust-funded to insurance-funded contracts. Core general agency and other revenue grew $6.8 million, primarily due to increased core general agency revenue from higher comparable core preneed funeral insurance production.
Current report
Consolidated funeral gross profit decreased $15.1 million, or 13.1%, for the three months ended June 30, 2024 compared to the same period in 2023. This decrease is primarily attributable to the decrease in comparable funeral gross profit of $16.4 million, or 14.2%. Comparable funeral gross profit decreased $16.4 million to $99.4 million and the comparable gross profit percentage decreased from 20.6% to 17.8%. This decrease is primarily due to the decline in revenue described above and the timing of incentive compensation costs compared to the prior year quarter.
Current report
The $11.9 million, or 2.7%, increase in comparable cemetery revenue was primarily due to a $6.9 million increase in core revenue and a $5.0 million increase in other revenue. The increase in core revenue was driven by a $7.5 million increase in total recognized preneed revenue, primarily due to the growth in recognized merchandise and service preneed revenue. Other revenue was higher by $5.0 million, or 16.4%, compared to the prior year quarter primarily from an increase in endowment care trust fund income related to the expansion of our total return investment strategy in certain states.
Current report
Corporate general and administrative expenses increased $4.1 million to $39.0 million for the second quarter of 2024 compared to the second quarter of 2023 primarily related to the timing of incentive compensation costs versus the prior year quarter.
Current report
Gains on Divestitures and Impairment Charges, Net
Current report
We recognized a $1.9 million net pre-tax gain on asset divestitures and impairments in the second quarter of 2024 compared to a $7.0 million net pre-tax gain in the second quarter of 2023 on asset divestitures associated with non-strategic funeral and cemetery locations in the United States and Canada.
Current report
Interest expense increased $4.9 million to $64.4 million for the three months ended June 30, 2024 primarily due to higher balances combined with a slightly higher interest rate on our Bank Credit Facility.
Current report
Six Months Ended June 30, 2024 and 2023
Current report
In addition to the above items, the decrease from the prior year is primarily due to lower funeral gross profit on lower services performed which was offset by a slightly higher cemetery gross profit. Also, fewer shares outstanding and a lower tax rate helped to partially offset the impact of higher interest expense.
Current report
Comparable revenue from funeral operations was $1,157.5 million for the six months ended June 30, 2024 compared to $1,171.1 million for the same period in 2023. The $13.6 million decrease was due to a $19.3 million decrease in non-funeral home preneed sales revenue, partially offset by an increase of $5.0 million in core general agency and other revenue.
Current report
Funeral Gross Profit
Current report
Consolidated revenue from our cemetery operations increased $41.9 million, or 4.8%, for the six months ended June 30, 2024 compared to the same period in 2023 primarily due to a $33.0 million, or 3.8%, increase in comparable cemetery revenue and a $9.7 million increase in revenue contributed by newly constructed and acquired properties.
Current report
Cemetery Gross Profit
Current report
Consolidated cemetery gross profit increased $14.2 million for the six months ended June 30, 2024 compared to the same period in 2023, which is primarily attributable to a $7.7 million increase in comparable cemetery gross profit and a $6.7 million increase in gross profit contributed by newly constructed and acquired properties. Comparable cemetery gross profit increased from $285.9 million to $293.6 million, while the gross profit percentage decreased from 33.0% to 32.6%. Although we experienced revenue growth, we continue to see increases in our fixed costs, primarily due to maintenance and salaries and wages compared to the prior year.
Current report
Other Financial Statement Items
Current report
Corporate General and Administrative Expenses
Current report
Corporate general and administrative expenses increased $1.2 million to $80.3 million for the six months ended June 30, 2024 primarily due to an increase in salaries and wages, partially offset by a decrease in incentive compensation costs versus the prior year.
Current report
Gains on Divestitures and Impairment Charges, Net
Current report
We recognized a $1.2 million net pre-tax gain on asset divestitures and impairments in the six months ended June 30, 2024 compared to a $7.6 million net pre-tax gain in 2023 on asset divestitures associated with non-strategic funeral and cemetery locations in the United States and Canada.
Current report
Interest expense increased $15.3 million to $128.7 million for the six months ended June 30, 2024 primarily due to higher interest rates and higher balances on our Bank Credit Facility.
Current report
Provision for Income Taxes
Current report
Weighted Average Shares
Removed paragraphs (4)
Previous report
Corporate general and administrative expenses decreased $2.8 million to $41.3 million for the three months ended March 31, 2024. The decrease was primarily related to prior year accelerated compensation expenses upon the retirement of certain executives and the timing of lower long-term incentive compensation costs versus the prior year quarter.
Previous report
Interest expense increased $10.4 million to $64.4 million for the three months ended March 31, 2024 primarily due to higher interest and a higher balance on our floating rate debt. During the three months ended March 31, 2024, our floating rate debt carried a weighted average rate of 7.4%, which is more than 140 basis points higher than the weighted average rate for our floating rate debt in the first quarter of 2023.
Previous report
36 Service Corporation International
Reworded paragraphs (48)
Previous wording
We are North America’s largest provider of deathcare products and services, with a network of funeral service locations and cemeteries unequaled in geographic scale and reach. At March 31, 2024, we operated 1,485 funeral service locations and 490 cemeteries (including 306 funeral service/cemetery combination locations), which are geographically diversified across 44 states, eight Canadian provinces, the District of Columbia, and Puerto Rico. Our funeral and cemetery operations consist of funeral service locations, cemeteries, funeral service/cemetery combination locations, crematoria, and other related businesses, which enable us to serve a wide array of customer needs. We sell cemetery property and funeral and cemetery merchandise and services at the time of need and on a preneed basis. We strive to offer families exceptional service in planning life celebrations and personalized remembrances. Our Dignity Memorial® brand serves approximately 600,000 families each year with professionalism, compassion, and attention to detail.
Current wording
We are North America’s largest provider of deathcare products and services, with a network of funeral service locations and cemeteries unequaled in geographic scale and reach. At June 30, 2024, we operated 1,490 funeral service locations and 492 cemeteries (including 306 funeral service/cemetery combination locations), which are geographically diversified across 44 states, eight Canadian provinces, the District of Columbia, and Puerto Rico. Our funeral and cemetery operations consist of funeral service locations, cemeteries, funeral service/cemetery combination locations, crematoria, and other related businesses, which enable us to serve a wide array of customer needs. We sell cemetery property and funeral and cemetery merchandise and services at the time of need and on a preneed basis. Our financial position is enhanced by our $15.4 billion backlog of future revenue from both trust and insurance-funded preneed sales at June 30, 2024. Preneed selling provides us with a strategic opportunity to gain future market share. We also believe it adds to the stability and predictability of our revenue and cash flows. While revenue on the majority of preneed merchandise and service sales is deferred until the time of need, sales of preneed cemetery property provide opportunities for full current revenue recognition to the extent that the property is developed and available for use.
Previous wording
We rely on cash flow from operations as a significant source of liquidity. Our cash flow from operating activities provided $220.1 million in the first three months of 2024. As of March 31, 2024, we had $706.0 million in remaining borrowing capacity under our Bank Credit Facility.
Current wording
We rely on cash flow from operations as a significant source of liquidity. Our cash flow from operating activities provided $417.0 million in the first six months of 2024. As of June 30, 2024, we had $606.0 million in remaining borrowing capacity under our Bank Credit Facility.
Previous wording
Investing in Acquisitions and Building New Funeral Service and Cemetery Locations. We manage our footprint by focusing on strategic acquisitions and building new funeral service locations where the expected returns are attractive and exceed our weighted average cost of capital by a meaningful margin. We target businesses with favorable customer dynamics and/or where we can achieve additional economies of scale. We continue to pursue strategic acquisitions and build new funeral service locations in areas that provide us with the potential for scale.
Current wording
Investing in Acquisitions and Building New Funeral Service and Cemetery Locations. We manage our footprint by focusing on strategic acquisitions and building new funeral service and cemetery locations where the expected returns are attractive and exceed our weighted average cost of capital by a meaningful margin. We target businesses with favorable customer dynamics and/or where we can achieve additional economies of scale. We continue to pursue strategic acquisitions and build new funeral service and cemetery locations in areas that provide us with the potential for scale.
Previous wording
Net cash provided by operating activities was $220.1 million and $219.6 million for the for the three months ended March 31, 2024 and 2023, respectively.
Current wording
Net cash provided by operating activities was $417.0 million and $363.6 million for the for the six months ended June 30, 2024 and 2023, respectively.
Previous wording
The $0.5 million increase in operating cash flows from 2023 comprises:
Current wording
The $53.4 million increase in operating cash flows from 2023 comprises:
Previous wording
•a $3.5 million increase in General Agency (GA) commission and other receipts, partially offset by
Current wording
•a $12.6 million increase in General Agency (GA) commission and other receipts, and
Previous wording
•a $12.7 million decrease in employee compensation payments,
Current wording
•a $1.1 million decrease in employee compensation payments, partially offset by
Previous wording
Cash flows from investing activities used $96.8 million and $94.9 million for the three months ended March 31, 2024 and 2023, respectively. The $1.9 million increased outflow in 2024 over 2023 is primarily due to the following:
Current wording
Cash flows from investing activities used $235.8 million and $211.1 million for the six months ended June 30, 2024 and 2023, respectively. The $24.7 million increased outflow in 2024 over 2023 is primarily due to the following:
Previous wording
•a $1.2 million decrease in cash receipts from divestitures and asset sales, partially offset by
Current wording
•a $9.2 million decrease in cash receipts from divestitures and asset sales,
Previous wording
•a $9.7 million decrease in cash spent on real estate acquisitions.
Current wording
•a $4.7 million increase in cash spent on real estate acquisitions, and
Previous wording
•a $1.4 million increase in net repayments for Company-owned life insurance policies,
Current wording
•a $3.0 million decrease in net proceeds for Company-owned life insurance policies, partially offset by
Previous wording
•a $1.9 million increase in total capital expenditures which comprises:
Current wording
•a $1.1 million decrease in total capital expenditures which comprises:
Previous wording
•$0.4 million increase in maintenance capital expenditures:
Current wording
•a $2.9 million decrease in maintenance capital expenditures:
Previous wording
•a $7.4 million decrease in expenditures for digital investments and corporate.
Current wording
•a $10.2 million decrease in expenditures for digital investments and corporate,
Previous wording
•a $5.7 million increase in expenditures for cemetery property development,
Current wording
•a $7.6 million increase in expenditures for cemetery property development, and
Previous wording
•a $2.1 million increase in expenditures for capital improvements at existing field locations, and
Current wording
•a $0.3 million decrease in expenditures for capital improvements at existing field locations.
Previous wording
•a $1.5 million increase in expenditures for growth capital expenditures/construction of new funeral service locations, and
Current wording
•a $1.8 million increase in expenditures for growth capital expenditures/construction of new funeral service locations.
Previous wording
•a $7.1 million increase in cash spent on business acquisitions,
Current wording
•a $0.9 million decrease in cash spent on business acquisitions.
Previous wording
Financing activities used $134.0 million for the three months ended March 31, 2024 compared to using $163.1 million for the same period in 2023. The $29.1 million decreased outflow from 2024 over 2023 is primarily due to the following:
Current wording
Financing activities used $215.2 million for the six months ended June 30, 2024 compared to using $181.6 million for the same period in 2023. The $33.6 million increased outflow from 2024 over 2023 is primarily due to the following:
Previous wording
•a $91.9 million increase in debt repayments, net of proceeds,
Current wording
•a $111.0 million increase in debt repayments, net of proceeds, and
Current wording
•a $5.3 million increase in payments of dividends, partially offset by
Previous wording
•a $116.5 million decrease in purchase of Company common stock, and
Current wording
•a $75.7 million decrease in purchase of Company common stock,
Previous wording
•a $8.5 million increase in proceeds from exercises of stock options, partially offset by
Current wording
•a $3.3 million increase in proceeds from exercises of stock options.
Previous wording
Where permitted by state or provincial law, we may sell a life insurance or annuity policy from third-party insurance companies, for which we earn a commission as general sales agent for the insurance company. These general agency revenues are based on a percentage per contract sold and are recognized as funeral revenue when the insurance purchase transaction between the preneed purchaser and third-party insurance provider is complete. All selling costs incurred pursuant to the sale of insurance-funded preneed contracts are expensed as incurred. We do not reflect the unfulfilled insurance-funded preneed contract amounts in our unaudited Condensed Consolidated Balance Sheet. The proceeds of the life insurance policies or annuity contracts will be reflected in funeral revenue as we perform these funerals.
Current wording
Where permitted by state or provincial law, we may sell a life insurance or annuity policy from third-party insurance companies, for which we earn a commission as general sales agent for the insurance company. These general agency revenues are based on a percentage per contract sold and are recognized as funeral revenue when the insurance purchase transaction between the preneed purchaser and third-party insurance provider is complete. All selling costs incurred pursuant to the sale of insurance-funded preneed contracts are expensed as incurred. We do not reflect the unfulfilled insurance-funded preneed contract amounts in our unaudited Condensed Consolidated Balance Sheet. The proceeds of the life insurance policies or annuity contracts will be reflected in funeral revenue as we perform these funerals. Subsequent to June 30, 2024, we finalized our agreement to change our preferred preneed insurance provider in the United States, which will allow us to further utilize our scale and streamline our processes across our network.
Previous wording
The fair value of our trust investments was based on a combination of quoted market prices, observable inputs such as interest rates or yield curves, and appraisals. As of March 31, 2024, the difference between the backlog and asset market amounts represents $0.18 billion related to contracts for which we have posted surety bonds as financial assurance in lieu of trusting, $1.33 billion collected from customers that were not required to be deposited into trusts, and $0.19 billion in allowable cash distributions from trust assets partially offset by $1.51 billion in amounts due on delivered property and merchandise. As of March 31, 2024, the fair value of the total backlog comprised $4.38 billion related to cemetery contracts and $10.83 billion related to funeral contracts. As of March 31, 2024, the fair value of the assets associated with the backlog of trust-funded deferred revenue comprised $4.40 billion related to cemetery contracts and $2.72 billion related to funeral contracts. As of March 31, 2024, the backlog of insurance-funded contracts of $7.90 billion was equal to the proceeds we expect to receive from the associated insurance policies when the corresponding contract is serviced.
Current wording
The fair value of our trust investments was based on a combination of quoted market prices, observable inputs such as interest rates or yield curves, and appraisals. As of June 30, 2024, the difference between the backlog and asset market amounts represents $0.18 billion related to contracts for which we have posted surety bonds as financial assurance in lieu of trusting, $1.34 billion collected from customers that were not required to be deposited into trusts, and $0.19 billion in allowable cash distributions from trust assets partially offset by $1.53 billion in amounts due on delivered property and merchandise. As of June 30, 2024, the fair value of the total backlog comprised $4.41 billion related to cemetery contracts and $10.99 billion related to funeral contracts. As of June 30, 2024, the fair value of the assets associated with the backlog of trust-funded deferred revenue comprised $4.44 billion related to cemetery contracts and $2.75 billion related to funeral contracts. As of June 30, 2024, the backlog of insurance-funded contracts of $8.03 billion was equal to the proceeds we expect to receive from the associated insurance policies when the corresponding contract is serviced.
Previous wording
During the three months ended March 31, 2024, the Standard and Poor’s 500 Index increased 10.6% and the Bloomberg’s US Aggregate Bond Index decreased 0.8%. This compares to SCI trusts that increased 5.6% during the same period, which exceeded our internal custom benchmark. The SCI trusts have a diversified allocation of approximately 60% equities, 26% fixed income securities, 10% alternative and other investments with the remaining 4% available in money market funds.
Current wording
During the six months ended June 30, 2024, the Standard and Poor’s 500 Index increased 15.3% and the Bloomberg’s US Aggregate Bond Index decreased 0.7%. This compares to SCI trusts that increased 6.4% during the same period, which exceeded our internal custom benchmark. The SCI trusts have a diversified allocation of approximately 59% equities, 27% fixed income securities, 10% alternative and other investments with the remaining 4% available in money market funds.
Previous wording
Recognized trust fund income (realized and unrealized) related to our preneed trust investments was $42.7 million and $36.0 million for the three months ended March 31, 2024 and 2023, respectively. Recognized trust fund income (realized and unrealized) related to our cemetery perpetual care trust investments was $23.3 million and $22.0 million for the three months ended March 31, 2024 and 2023, respectively. The increase in recognized trust fund income is primarily due to the market returns experienced during 2023.
Current wording
Recognized trust fund income (realized and unrealized) related to our preneed trust investments was $88.6 million and $77.3 million for the six months ended June 30, 2024 and 2023, respectively. Recognized trust fund income (realized and unrealized) related to our cemetery perpetual care trust investments was $48.8 million and $43.4 million for the six months ended June 30, 2024 and 2023, respectively. The increase in recognized trust fund income is primarily due to the market returns experienced over the trailing twelve month period.
Previous wording
Results of Operations — Three Months Ended March 31, 2024 and 2023
Current wording
Results of Operations — Three and Six months ended June 30, 2024 and 2023
Previous wording
In addition to the above items, the decrease from the prior year was expected, as higher cemetery gross profit, a lower share count, and a lower tax rate was slightly overcome by lower funeral gross profit as well as higher interest expense.
Current wording
In addition to the above items, the decrease from the prior year is primarily due to lower funeral gross profit on lower services performed as well as higher interest expense and a higher tax rate. This was partially offset by higher cemetery gross profit, lower corporate general and administrative expenses, and a lower share count.
Previous wording
(1)We define comparable (or same store) operations as those funeral locations owned by us for the entire period beginning January 1, 2023 and ending March 31, 2024.
Current wording
(1) We define comparable (or same store) operations as those funeral locations owned by us for the entire period beginning January 1, 2023 and ending June 30, 2024.
Previous wording
Comparable revenue from funeral operations was $599.4 million for the three months ended March 31, 2024 compared to $607.9 million for the same period in 2023. The $8.5 million decrease was due to a $12.3 million decrease in non-funeral home preneed sales revenue slightly offset by an increase of $3.7 million in core funeral revenue. Core revenue increased by $3.7 million primarily due to a 3.9% increase in core average revenue partially offset by a 3.0% decrease in core funeral services performed. The core cremation rate increased 70 basis points to 56.6%.
Current wording
Comparable revenue from funeral operations was $558.1 million for the three months ended June 30, 2024 compared to $563.2 million for the same period in 2023. This $5.1 million, or 0.9%, decrease is primarily due to a $6.6 million decrease in core funeral revenue and $7.0 million decrease in non-funeral home preneed sales revenue, partially offset by a $6.8 million increase in core general agency revenue and other revenue.
Previous wording
(1)We define comparable (or same store) operations as those cemetery locations owned by us for the entire period beginning January 1, 2023 and ending March 31, 2024.
Current wording
(1) We define comparable (or same store) operations as those cemetery locations owned by us for the entire period beginning January 1, 2023 and ending June 30, 2024.
Previous wording
Consolidated revenue from our cemetery operations increased $21.6 million, or 5.2%, for the three months ended March 31, 2024 compared to the same period in 2023 primarily due to a $21.1 million, or 5.0%, increase in comparable cemetery revenue and a $0.9 million increase in revenue contributed by newly constructed and acquired properties.
Current wording
Consolidated revenue from our cemetery operations increased $20.2 million, or 4.5%, for the three months ended June 30, 2024 compared to the same period in 2023 primarily due to a $11.9 million increase in comparable cemetery revenue and a $8.7 million increase in revenue contributed by newly constructed and acquired properties.
Previous wording
Consolidated cemetery gross profit increased $2.7 million for the three months ended March 31, 2024 compared to the same period in 2023, which is primarily attributable to the increase in comparable cemetery gross profit of $2.6 million. Comparable cemetery gross profit increased from $139.9 million to $142.5 million, and the gross profit percentage decreased from 33.4% to 32.4% primarily due to an increase in annual incentive compensation costs over the prior year quarter.
Current wording
Consolidated cemetery gross profit increased $11.6 million, or 8.0%, in the three months ended June 30, 2024 compared to the same period in 2023, which is primarily attributable to a $6.6 million increase in gross profit contributed by newly constructed and acquired properties and a $5.1 million increase in comparable cemetery gross profit. Comparable cemetery gross profit increased $5.1 million to $151.1 million, and the gross profit percentage increased to 32.9% from 32.6%. The growth is related to the higher revenue mentioned above somewhat offset by higher maintenance costs and the timing of incentive compensation costs versus the prior year quarter.
Showing the first 40 of 48 pairs. Open the source sections for the rest.
Rearranged current paragraphs (8)
Current report — wording carried from elsewhere
We strive to offer families exceptional service in planning life celebrations and personalized remembrances. Our Dignity Memorial® brand serves approximately 600,000 families each year with professionalism, compassion, and attention to detail.
Current report — wording carried from elsewhere
Three Months Ended June 30, 2024 and 2023
Current report — wording carried from elsewhere
In the second quarter of 2024, we reported consolidated net income attributable to common stockholders of $118.2 million ($0.81 per diluted share) compared to net income attributable to common stockholders in the second quarter of 2023 of $132.2 million ($0.86 per diluted share). These results were impacted by certain items including:
Current report — wording carried from elsewhere
(2) We calculate comparable average revenue per service by dividing comparable funeral revenue, excluding general agency revenue, recognized preneed revenue, and other revenue to avoid distorting our average of normal funeral services revenue, by the comparable number of funeral services performed during the period. Recognized preneed revenue is excluded from our calculation of comparable average revenue per service because the associated service has not yet been performed.
Current report — wording carried from elsewhere
(1) We define comparable (or same store) operations as those funeral locations owned by us for the entire period beginning January 1, 2023 and ending June 30, 2024.
Current report — wording carried from elsewhere
(1) We define comparable (or same store) operations as those cemetery locations owned by us for the entire period beginning January 1, 2023 and ending June 30, 2024.
Current report — wording carried from elsewhere
Our effective tax rate was 24.0% and 24.5% for the six months ended June 30, 2024 and 2023, respectively. The lower effective tax rate for the six months ended June 30, 2024 was primarily due to lower state and international tax expense. The effective tax rate for the six months ended June 30, 2024 was higher than the federal statutory tax rate of 21.0% primarily due to state tax expense.
Current report — wording carried from elsewhere
The diluted weighted average number of shares outstanding was 147.3 million for the six months ended June 30, 2024 compared to 154.2 million for the same period in 2023. The decrease primarily reflects the impact of shares repurchased under our share repurchase program.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Our financial position is enhanced by our $15.2 billion backlog of future revenue from both trust and insurance-funded preneed sales at March 31, 2024. Preneed selling provides us with a strategic opportunity to gain future market share. We also believe it adds to the stability and predictability of our revenue and cash flows. While revenue on the majority of preneed merchandise and service sales is deferred until the time of need, sales of preneed cemetery property provide opportunities for full current revenue recognition to the extent that the property is developed and available for use.