SECURITY NATIONAL FINANCIAL CORP

Previous wording

The following table shows the condensed financial results of the insurance operations for the three and six month periods ended June 30, 2026, and 2025. See Note 16 to the condensed consolidated financial statements.

Current wording

The following table shows the condensed financial results of the insurance operations for the three and nine month periods ended September 30, 2026, and 2025. See Note 16 to the condensed consolidated financial statements.

Previous wording

Profitability for the six-month period ended June 30, 2026 decreased due to (a) a $5,221,000 decrease in net investment income, (b) a $2,405,000 decrease in insurance premiums and other considerations, (c) a $283,000 decrease in other revenues, and (d) a $62,000 increase in amortization of deferred policy acquisition costs, which were partially offset by (i) a $2,266,000 increase in gains on investments and other assets, (ii) a $2,114,000 decrease in policyholder benefits and claims, (iii) a $892,000 decrease in selling, general and administrative expenses, (iv) a $571,000 decrease in income tax expense, (v) a $113,000 decrease in interest expense, (vi) a $57,000 decrease in intersegment expenses, and (vii) a $54,000 increase in intersegment revenue.

Current wording

Profitability for the nine-month period ended September 30, 2026 decreased due to (a) a $4,774,000 decrease in net investment income, (b) a $3,860,000 decrease in insurance premiums and other considerations, (c) a $988,000 decrease in intersegment revenue (d) a $293,000 decrease in other revenues, and (e) a $38,000 increase in amortization of deferred policy acquisition costs, which were partially offset by (i) a $3,050,000 decrease in policyholder benefits and claims, (ii) a $2,218,000 increase in gains on investments and other assets, (iii) an $874,000 decrease in income tax expense, (iv) a $366,000 decrease in selling, general and administrative expenses, (v) a $130,000 decrease in interest expense, and (vi) a $63,000 decrease in intersegment expenses.

Previous wording

The following table shows the condensed financial results of the funeral home and cemetery operations for the three and six month periods ended June 30, 2026, and 2025. See Note 16 to the condensed consolidated financial statements.

Current wording

The following table shows the condensed financial results of the funeral home and cemetery operations for the three and nine month periods ended September 30, 2026, and 2025. See Note 16 to the condensed consolidated financial statements.

Previous wording

Profitability in the six-month period ended June 30, 2026 increased due to (a) a $978,000 increase in gains on investments and other assets, (b) a $408,000 increase in cemetery pre-need sales, (c) a $306,000 increase in net investment income, (d) a $212,000 increase in funeral home at-need sales, (e) a $155,000 increase in cemetery at-need sales, (f) a $14,000 decrease in intersegment expenses, and (g) a $2,000 decrease in cost of goods and services sold, which were partially offset by (i) a $715,000 increase in selling, general and administrative expenses, primarily attributable to a $461,000 increase in personnel expenses, (ii) a $306,000 increase in income tax expense, (iii) a $184,000 increase in amortization of deferred policy acquisition costs, and (iv) a $19,000 decrease in other revenues.

Current wording

Profitability in the nine-month period ended September 30, 2026 increased due to (a) a $581,000 increase in gains on investments and other assets, (b) a $527,000 increase in cemetery pre-need sales, (c) a $478,000 increase in cemetery at-need sales, (d) a $446,000 increase in net investment income, (e) a $387,000 increase in funeral home at-need sales, and (f) a $22,000 decrease in intersegment expenses, which were partially offset by (i) a $1,307,000 increase in selling, general and administrative expenses, primarily attributable to a $688,000 increase in personnel expenses, (ii) a $258,000 decrease in other revenues, (iii) a $191,000 increase in amortization of deferred policy acquisition costs, (iv) a $172,000 increase in income tax expense, (v) a $39,000 increase in cost of goods and services sold, and (vi) a $4,000 increase in interest expense.

Previous wording

SecurityNational Mortgage receives fees from borrowers that are involved in mortgage loan originations and refinancings, and secondary fees earned from third party investors that purchase the mortgage loans. Mortgage loans are generally sold with mortgage servicing rights (“MSRs”) released to third-party investors or retained by SecurityNational Mortgage. SecurityNational Mortgage currently retains the mortgage servicing rights on approximately 1.59% of its loan origination volume. These mortgage loans are serviced by either SecurityNational Mortgage or an approved third-party sub-servicer.

Current wording

SecurityNational Mortgage receives fees from borrowers that are involved in mortgage loan originations and refinancings, and secondary fees earned from third party investors that purchase the mortgage loans. Mortgage loans are generally sold with mortgage servicing rights (“MSRs”) released to third-party investors or retained by SecurityNational Mortgage. SecurityNational Mortgage currently retains the mortgage servicing rights on approximately 2% of its loan origination volume. These mortgage loans are serviced by either SecurityNational Mortgage or an approved third-party sub-servicer.

Previous wording

For the three and six month periods ended June 30, 2026, and 2025, SecurityNational Mortgage originated 3,011 loans ($1,036,088,000 total loan volume principal amount) and 3,375 loans ($1,134,783,000 total loan volume principal amount), respectively.

Current wording

For the nine month periods ended September 30, 2026, and 2025, SecurityNational Mortgage originated 4,426 loans ($1,506,112,000 total loan volume principal amount) and 5,216 loans ($1,756,289,000 total loan volume principal amount), respectively.

Previous wording

The following table shows the condensed financial results of the mortgage operations for the three and six month periods ended June 30, 2026, and 2025. See Note 16 to the condensed consolidated financial statements.

Current wording

The following table shows the condensed financial results of the mortgage operations for the three and nine month periods ended September 30, 2026, and 2025. See Note 16 to the condensed consolidated financial statements.

Previous wording

Total revenues decreased by $5,615,000, or 6.3%, to $83,926,000 for the three-month period ended June 30, 2026, from $89,541,000 for the comparable period in 2025. Contributing to this decrease in total revenues was a $4,152,000 decrease in net investment income, a $3,688,000 decrease in mortgage fee income, a $1,481,000 decrease in insurance premiums and other considerations, and a $74,000 decrease in other revenues, which were partially offset by a $3,438,000 increase in gains on investments and other assets and a $342,000 increase in net funeral home and cemetery sales.

Current wording

Total revenues decreased by $9,384,000, or 10.5%, to $79,942,000 for the three-month period ended September 30, 2026, from $89,326,000 for the comparable period in 2025. Contributing to this decrease in total revenues was an $8,322,000 decrease in mortgage fee income, a $1,455,000 decrease in insurance premiums and other considerations, a $536,000 decrease in gains on investments and other assets, and a $279,000 decrease in other revenues, which were partially offset by a $617,000 increase in net funeral home and cemetery sales and a $591,000 increase in net investment income.

Previous wording

Insurance premiums and other considerations decreased by $1,481,000, or 4.9%, to $28,705,000 for the three-month period ended June 30, 2026, from $30,186,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $1,820,000 in first year premiums because of a decrease in sales, which was partially offset by an increase of $339,000 in renewal premiums.

Current wording

Insurance premiums and other considerations decreased by $1,455,000, or 4.9%, to $28,426,000 for the three-month period ended September 30, 2026, from $29,881,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $1,655,000 in first year premiums because of a decrease in sales, which was partially offset by an increase of $200,000 in renewal premiums.

Previous wording

Mortgage fee income decreased by $3,688,000, or 12.5%, to $25,797,000, for the three-month period ended June 30, 2026, from $29,485,000 for the comparable period in 2025. This decrease was primarily due to a $3,290,000 decrease in secondary gains from mortgage loans sold to third-party investors into the secondary market reflecting lower overall loan volume and less favorable pricing conditions, and a $638,000 decrease in income from loan originations, and a $498,000 decrease in the fair value of loan commitments, which were partially offset by a $738,000 increase in the fair value of loans held for sale.

Current wording

Mortgage fee income decreased by $8,322,000, or 28.6%, to $20,817,000, for the three-month period ended September 30, 2026, from $29,139,000 for the comparable period in 2025. This decrease was primarily due to a $4,375,000 decrease in secondary gains from mortgage loans sold to third-party investors into the secondary market reflecting lower overall loan volume and less favorable pricing conditions, a $2,048,000 decrease in the fair value of loans held for sale, and a $2,024,000 decrease in income from loan originations, which were partially offset by a $125,000 increase in the fair value of loan commitments.

Previous wording

Net investment income decreased by $4,853,000, or 12.2%, to $34,930,000 for the six-month period ended June 30, 2026, from $39,783,000 for the comparable period in 2025. This decrease was primarily attributable to a $5,806,000 decrease in mortgage loan interest resulting from a decline in the average balance of the mortgage loan portfolio held for investment, a $548,000 decrease in insurance assignment income, a $113,000 decrease in interest on cash and cash equivalents, a $29,000 decrease in policy loan interest, and an $11,000 decrease in fixed maturity securities income, which were partially offset by a $1,364,000 decrease in investment expenses, a $269,000 increase in other investment income, a $20,000 increase in real estate income, and a $1,000 increase in equity securities income.

Current wording

Net investment income increased by $591,000, or 2.9%, to $20,701,000 for the three-month period ended September 30, 2026, from $20,110,000 for the comparable period in 2025. This increase was primarily attributable to a $1,338,000 increase in other investment income, a $767,000 increase in interest on cash and cash equivalents, a $4,000 increase in equity securities income, and a $1,000 increase in policy loan interest, which were partially offset by a $1,111,000 decrease in mortgage loan interest resulting from a decline in the average balance of the mortgage loan portfolio held for investment, a $297,000 increase in investment expenses, a $49,000 decrease in insurance assignment income, a $49,000 decrease in real estate income, and a $13,000 decrease in fixed maturity securities income.

Previous wording

Gains on investments and other assets increased by $3,438,000 to $4,580,000 for the three-month period ended June 30, 2026, from $1,142,000 for the comparable period in 2025. This increase in gains on investments and other assets was primarily due to a $3,065,000 increase in gains on equity securities primarily attributable to increases in the fair value of these equity securities and a $628,000 increase in gains on real estate, which were partially offset by a $210,000 decrease in gains on fixed maturity securities and a $45,000 decrease in gains on other assets.

Current wording

Gains on investments and other assets decreased by $536,000 to $1,436,000 for the three-month period ended September 30, 2026, from $1,972,000 for the comparable period in 2025. This decrease in gains on investments and other assets was primarily due to a $1,010,000 decrease in gains on equity securities primarily attributable to decreases in the fair value of these equity securities, which was partially offset by a $347,000 increase in gains on other assets, a $94,000 increase in gains on real estate, and a $33,000 increase in gains on fixed maturity securities.

Previous wording

Other revenues decreased by $74,000, or 8.3%, to $815,000 for the three-month period ended June 30, 2026, from $889,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $74,000 in other miscellaneous revenues.

Current wording

Other revenues decreased by $279,000, or 25.8%, to $804,000 for the three-month period ended September 30, 2026, from $1,083,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $279,000 in other miscellaneous revenues.

Previous wording

Policyholder benefits and claims decreased by $1,198,000 or 4.7%, to $24,317,000 for the three-month period ended June 30, 2026, from $25,515,000 for the comparable period in 2025. This decrease was primarily the result of a $941,000 decrease in future policy benefits and a $335,000 decrease in death benefits, which were partially offset by a $78,000 increase in surrender and other policy benefits.

Current wording

Policyholder benefits and claims decreased by $936,000 or 3.8%, to $23,587,000 for the three-month period ended September 30, 2026, from $24,523,000 for the comparable period in 2025. This decrease was primarily the result of an $888,000 decrease in future policy benefits, a $206,000 decrease in death benefits, and a $44,000 decrease in surrender and other policy benefits, which were partially offset by a $202,000 increase in interest credited to policyholder account balances.

Previous wording

Amortization of deferred policy and pre-need acquisition costs and value of business acquired increased by $247,000, or 4.4%, to $5,917,000 for the six-month period ended June 30, 2026, from $5,670,000 for the comparable period in 2025. This increase is due to a $265,000 increase in the amortization of deferred policy and pre-need acquisition costs due to an increase in the average outstanding balance, which was partially offset by an $18,000 decrease in the amortization of value of business acquired due to no new deferrals and a decreasing average outstanding balance.

Current wording

Amortization of deferred policy and pre-need acquisition costs and value of business acquired decreased by $18,000, or 0.6%, to $2,977,000 for the three-month period ended September 30, 2026, from $2,995,000 for the comparable period in 2025. Amortization of value of business acquired decreased by $14,000 because of a declining average outstanding balance, with no additions from new acquisitions. Amortization of deferred policy and pre-need acquisition costs decreased by $4,000, reflecting a relatively stable average outstanding balance between periods.

Previous wording

Selling, general and administrative expenses decreased by $5,231,000, or 10.9%, to $42,730,000 for the three-month period ended June 30, 2026, from $47,961,000 for the comparable period in 2025. This decrease was primarily the result of a $3,148,000 decrease in commissions, a $1,665,000 decrease in personnel expenses, a $282,000 decrease in costs related to funding mortgage loans, a $210,000 decrease in advertising expense, a $151,000 decrease in rent and rent related expenses, and a $12,000 decrease in depreciation on property and equipment, which were partially offset by a $237,000 increase in other expenses.

Current wording

Selling, general and administrative expenses decreased by $4,041,000, or 8.7%, to $42,484,000 for the three-month period ended September 30, 2026, from $46,526,000 for the comparable period in 2025. This decrease was primarily the result of a $4,267,000 decrease in commissions, a $1,731,000 decrease in personnel expenses, a $375,000 decrease in costs related to funding mortgage loans, a $250,000 decrease in advertising expense, a $185,000 decrease in rent and rent related expenses, and a $21,000 decrease in depreciation on property and equipment, which were partially offset by a $2,789,000 increase in other expenses.

Previous wording

Interest expense decreased by $189,000, or 14.6%, to $1,105,000 for the three-month period ended June 30, 2026, from $1,293,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $98,000 in interest expense on bank loans and $91,000 in interest expense on mortgage warehouse lines of credit for loans held for sale.

Current wording

Interest expense increased by $450,000, or 42.2%, to $1,516,000 for the three-month period ended September 30, 2026, from $1,066,000 for the comparable period in 2025. This increase was primarily due to a $465,000 increase in interest expense on mortgage warehouse lines of credit for loans held for sale, which was partially offset by a decrease of $15,000 in interest expense on bank loans.

Previous wording

Funeral home and cemetery cost of goods and services sold increased by $18,000, or 1.6%, to $1,177,000 for the three-month period ended June 30, 2026, from $1,159,000 for the comparable period in 2025. This increase was primarily due to an increase of $22,000 in pre-need sales, which was partially offset by a decrease of $4,000 in at-need sales.

Current wording

Funeral home and cemetery cost of goods and services sold increased by $40,000, or 3.6%, to $1,154,000 for the three-month period ended September 30, 2026, from $1,113,000 for the comparable period in 2025. This increase was primarily due to an increase of $44,000 in at-need sales, which was partially offset by a decrease of $4,000 in pre-need sales.

Previous wording

Income tax expense increased by $309,000, or 13.1%, to $2,677,000 for the three-month period ended June 30, 2026, from $2,368,000 for the comparable period in 2025. This increase was primarily due to an increase in earnings before income taxes for 2026 compared to 2025. The Company’s overall effective tax rate increased from 22.1% for 2025 to 23.0% in 2026, a 0.9% increase in the effective tax rate or a 4.1% change. This increase was primarily due to certain permanent tax adjustments that are higher when compared to the prior year.

Current wording

Income tax expense decreased by $997,000, or 32.6%, to $2,057,000 for the three-month period ended September 30, 2026, from $3,054,000 for the comparable period in 2025. This decrease was primarily due to a decrease in earnings before income taxes for 2026 compared to 2025. The Company’s overall effective tax rate increased from 23.3% for 2025 to 25.0% in 2026, a 1.7 percentage point increase in the effective tax rate or a 7.3% change. This increase was primarily due to certain permanent tax adjustments that are higher when compared to the prior year.

Previous wording

Total revenues decreased by $8,626,000, or 5.0%, to $163,655,000 for the six-month period ended June 30, 2026, from $172,281,000 for the comparable period in 2025. Contributing to this decrease in total revenues was a $5,007,000 decrease in mortgage fee income, a $4,853,000 decrease in net investment income, a $2,405,000 decrease in insurance premiums and other considerations, and a $338,000 decrease in other revenues, which were partially offset by a $3,202,000 increase in gains on investments and other assets and a $775,000 increase in net funeral home and cemetery sales.

Current wording

Total revenues decreased by $18,010,000, or 6.9%, to $243,596,000 for the nine-month period ended September 30, 2026, from $261,607,000 for the comparable period in 2025. Contributing to this decrease in total revenues was a $13,329,000 decrease in mortgage fee income, a $4,262,000 decrease in net investment income, a $3,860,000 decrease in insurance premiums and other considerations, and a $617,000 decrease in other revenues, which were partially offset by a $2,666,000 increase in gains on investments and other assets and a $1,392,000 increase in net funeral home and cemetery sales.

Previous wording

Insurance premiums and other considerations decreased by $2,405,000, or 4.0%, to $57,560,000 for the six-month period ended June 30, 2026, from $59,965,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $2,785,000 in first year premiums because of a decrease in sales, which was partially offset by an increase of $380,000 in renewal premiums.

Current wording

Insurance premiums and other considerations decreased by $3,860,000, or 4.3%, to $85,986,000 for the nine-month period ended September 30, 2026, from $89,846,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $4,441,000 in first year premiums because of a decrease in sales, which was partially offset by an increase of $581,000 in renewal premiums.

Previous wording

Mortgage fee income decreased by $5,007,000, or 9.2%, to $49,287,000, for the six-month period ended June 30, 2026, from $54,294,000 for the comparable period in 2025. This decrease was primarily due to a $3,830,000 decrease in secondary gains from mortgage loans sold to third-party investors into the secondary market reflecting lower overall loan volume and less favorable pricing conditions, a $1,507,000 decrease in the fair value of loans held for sale, and an $82,000 decrease in income from loan originations, which were partially offset by a $412,000 increase in the fair value of loan commitments.

Current wording

Mortgage fee income decreased by $13,329,000, or 16.0%, to $70,104,000, for the nine-month period ended September 30, 2026, from $83,433,000 for the comparable period in 2025. This decrease was primarily due to an $8,205,000 decrease in secondary gains from mortgage loans sold to third-party investors into the secondary market reflecting lower overall loan volume and less favorable pricing conditions, a $3,555,000 decrease in the fair value of loans held for sale, and a $2,107,000 decrease in income from loan originations, which were partially offset by a $538,000 increase in the fair value of loan commitments.

Previous wording

Net investment income decreased by $4,152,000, or 20.2%, to $16,429,000 for the three-month period ended June 30, 2026, from $20,581,000 for the comparable period in 2025. This decrease was primarily attributable to a $6,116,000 decrease in mortgage loan interest resulting from a decline in the average balance of the mortgage loan portfolio held for investment, a $260,000 decrease in insurance assignment income, a $59,000 decrease in fixed maturity securities income, a $26,000 decrease in policy loan interest, and a $14,000 decrease in equity securities income, which were partially offset by a $1,923,000 decrease in investment expenses, a $242,000 increase in interest on cash and cash equivalents, a $115,000 increase in other investment income, and a $41,000 increase in real estate income.

Current wording

Net investment income decreased by $4,262,000, or 7.1%, to $55,631,000 for the nine-month period ended September 30, 2026, from $59,893,000 for the comparable period in 2025. This decrease was primarily attributable to a $6,917,000 decrease in mortgage loan interest resulting from a decline in the average balance of the mortgage loan portfolio held for investment, a $597,000 decrease in insurance assignment income, a $29,000 decrease in real estate income, a $28,000 decrease in policy loan interest, and a $24,000 decrease in fixed maturity securities income, which were partially offset by a $1,606,000 increase in other investment income, a $1,067,000 decrease in investment expenses, a $655,000 increase in interest on cash and cash equivalents, and a $6,000 increase in equity securities income.

Previous wording

Gains on investments and other assets increased by $3,202,000 to $4,931,000 for the six-month period ended June 30, 2026, from $1,729,000 for the comparable period in 2025. This increase in gains on investments and other assets was primarily due to a $2,639,000 increase in gains on equity securities primarily attributable to increases in the fair value of these equity securities, a $784,000 increase in gains on real estate, and a $10,000 increase in gains on other assets, which were partially offset by a $231,000 decrease in gains on fixed maturity securities.

Current wording

Gains on investments and other assets increased by $2,666,000, or 72%, to $6,367,000 for the nine-month period ended September 30, 2026, from $3,701,000 for the comparable period in 2025. This increase in gains on investments and other assets was primarily due to a $1,628,000 increase in gains on equity securities primarily attributable to increases in the fair value of these equity securities, a $879,000 increase in gains on real estate, and a $357,000 increase in gains on other assets, which were partially offset by a $198,000 decrease in gains on fixed maturity securities.

Previous wording

Other revenues decreased by $338,000, or 17.3%, to $1,613,000 for the six-month period ended June 30, 2026, from $1,951,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $338,000 in other miscellaneous revenues.

Current wording

Other revenues decreased by $617,000, or 20.3%, to $2,417,000 for the nine-month period ended September 30, 2026, from $3,034,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $617,000 in other miscellaneous revenues.

Previous wording

Policyholder benefits and claims decreased by $2,114,000 or 4.1%, to $48,857,000 for the six-month period ended June 30, 2026, from $50,971,000 for the comparable period in 2025. This decrease was primarily the result of a $1,619,000 decrease in future policy benefits, a $491,000 decrease in death benefits, and a $4,000 decrease in surrender and other policy benefits.

Current wording

Policyholder benefits and claims decreased by $3,050,000 or 4.0%, to $72,444,000 for the nine-month period ended September 30, 2026, from $75,494,000 for the comparable period in 2025. This decrease was primarily the result of a $2,546,000 decrease in future policy benefits, a $697,000 decrease in death benefits, and a $48,000 decrease in surrender and other policy benefits, which were partially offset by a $241,000 increase in interest credited to policyholder account balances.

Previous wording

Amortization of deferred policy and pre-need acquisition costs and value of business acquired increased by $64,000, or 2.2%, to $2,938,000 for the three-month period ended June 30, 2026, from $2,874,000 for the comparable period in 2025. This increase is due to a $74,000 increase in the amortization of deferred policy and pre-need acquisition costs due to an increase in the average outstanding balance, which was partially offset by a $10,000 decrease in the amortization of value of business acquired due to no new deferrals and a decreasing average outstanding balance.

Current wording

Amortization of deferred policy and pre-need acquisition costs and value of business acquired increased by $229,000, or 2.6%, to $8,894,000 for the nine-month period ended September 30, 2026, from $8,665,000 for the comparable period in 2025. Amortization of deferred policy and pre-need acquisition costs increased by $262,000 because of a higher average outstanding balance. This increase was partially offset by a $33,000 decrease in amortization of value of business acquired, reflecting a declining average outstanding balance with no additions from new acquisitions.

Previous wording

Interest expense decreased by $312,000, or 12.9%, to $2,101,000 for the six-month period ended June 30, 2026, from $2,413,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $201,000 in interest expense on mortgage warehouse lines of credit for loans held for sale and a decrease of $111,000 in interest expense on bank loans.

Current wording

Interest expense increased by $137,000, or 4.0%, to $3,617,000 for the nine-month period ended September 30, 2026, from $3,479,000 for the comparable period in 2025. This increase was primarily due to an increase of $264,000 in interest expense on mortgage warehouse lines of credit for loans held for sale, which was partially offset by a decrease of $127,000 in interest expense on bank loans.

Previous wording

Funeral home and cemetery cost of goods and services sold decreased by $1,000, or 0.1%, to $2,411,000 for the six-month period ended June 30, 2026, from $2,412,000 for the comparable period in 2025. This decrease was primarily due to a decrease of $22,000 in at-need sales, which was partially offset by an increase of $21,000 in pre-need sales.

Current wording

Funeral home and cemetery cost of goods and services sold increased by $39,000, or 1.1%, to $3,565,000 for the nine-month period ended September 30, 2026, from $3,526,000 for the comparable period in 2025. This increase was primarily due to an increase of $22,000 in at-need sales and an increase of $17,000 in pre-need sales.

Previous wording

Income tax expense increased by $523,000, or 12.4%, to $4,728,000 for the six-month period ended June 30, 2026, from $4,205,000 for the comparable period in 2025. This increase was primarily due to an increase in earnings before income taxes for 2026 compared to 2025. The Company’s overall effective tax rate increased from 22.1% for 2025 to 22.8% in 2026, a 0.7% increase in the effective tax rate or a 3.1% change. This increase was primarily due to certain permanent tax adjustments that are higher when compared to the prior year.

Current wording

Income tax expense decreased by $474,000, or 6.5%, to $6,785,000 for the nine-month period ended September 30, 2026, from $7,259,000 for the comparable period in 2025. This decrease was primarily due to a decrease in earnings before income taxes for 2026 compared to 2025. The Company’s overall effective tax rate increased from 22.6% for 2025 to 23.5% in 2026, a 0.9 percentage point increase in the effective tax rate or a 3.7% change. This increase was primarily due to certain permanent tax adjustments that are higher when compared to the prior year.

Previous wording

During the six-month periods ended June 30, 2026, and 2025, the Company’s operations provided cash of approximately $36,934,000 and of approximately $1,905,000, respectively. The increase in cash provided by operations was due primarily to a decrease in originations of loans held for sale and an increase in net earnings.

Current wording

During the nine-month periods ended September 30, 2026, and 2025, the Company’s operations provided cash of approximately $93,387,000 and of approximately $27,553,000, respectively. The increase in cash provided by operations was due primarily to a decrease in originations of loans held for sale.

Previous wording

The Company expects to pay out liabilities under its funeral plans over the long term given the nature of those plans. Funeral plans are small face value life insurance policies that payout upon a person’s death to cover funeral burial costs; policyholders generally keep these policies in force until, and do not surrender prior to, death. Because of the long-term nature of these liabilities, the Company can hold to maturity or for the targeted investment period its corresponding bond, real estate, and mortgage loan investments, thus reducing the risk of liquidating these long-term investments because of any sudden changes in their fair values.

Current wording

The Company expects to pay out liabilities under its funeral plans over the long term given the nature of those plans. Funeral plans are small face value life insurance policies that pay out upon a person’s death to cover funeral and burial costs; policyholders generally keep these policies in force until, and do not surrender prior to, death. Because of the long-term nature of these liabilities, the Company can hold to maturity or for the targeted investment period its corresponding bond, real estate, and mortgage loan investments, thus reducing the risk of liquidating these long-term investments because of any sudden changes in their fair values.

Previous wording

The Company’s investment policy is also to invest predominantly in fixed maturity securities, real estate, mortgage loans, and warehousing of mortgage loans. The warehoused mortgage loans are typically held for sale on a short-term basis before selling the loans to investors in accordance with the requirements and laws governing the Company’s life insurance subsidiaries. Bonds owned by the insurance subsidiaries amounted to $363,471,000 (at estimated fair value) and $365,986,000 (at estimated fair value) as of June 30, 2026, and December 31, 2025, respectively. This represented 40.1% and 35.2% of the total investments of the Company as of June 30, 2026, and December 31, 2025, respectively. Generally, all bonds owned by the life insurance subsidiaries are rated by the National Association of Insurance Commissioners. Under this rating system, there are six categories used for the rating of bonds. As of June 30, 2026, 1.6% (or $5,966,000) and as of December 31, 2025, 1.6% (or $5,825,000) of the Company’s total bond investments were invested in bonds in rating categories three through six, which are considered non-investment grade.

Current wording

The Company’s investment policy is also to invest predominantly in fixed maturity securities, real estate, mortgage loans, and warehousing of mortgage loans. The warehoused mortgage loans are typically held for sale on a short-term basis before selling the loans to investors in accordance with the requirements and laws governing the Company’s life insurance subsidiaries. Bonds owned by the insurance subsidiaries amounted to $360,448,000 (at estimated fair value) and $365,986,000 (at estimated fair value) as of September 30, 2026, and December 31, 2025, respectively. This represented 34.5% and 35.2% of the total investments of the Company as of September 30, 2026, and December 31, 2025, respectively. Generally, all bonds owned by the life insurance subsidiaries are rated by the National Association of Insurance Commissioners. Under this rating system, there are six categories used for the rating of bonds. As of September 30, 2026, 1.7% (or $6,036,000) and as of December 31, 2025, 1.6% (or $5,825,000) of the Company’s total bond investments were invested in bonds in rating categories three through six, which are considered non-investment grade.

Previous wording

The Company’s total capitalization of stockholders’ equity, bank and other loans payable was $555,266,000 as of June 30, 2026, as compared to $508,757,000 as of December 31, 2025. This increase was primarily due to an increase of $22,667,000 in stockholders’ equity and an increase of $23,842,000 in bank and other loans payable. Stockholders’ equity as a percentage of total capitalization was 78.0% and 80.7% as of June 30, 2026, and December 31, 2025, respectively.

Current wording

The Company’s total capitalization of stockholders’ equity, bank and other loans payable was $608,130,000 as of September 30, 2026, as compared to $508,757,000 as of December 31, 2025. This increase was primarily due to an increase of $58,224,000 in stockholders’ equity and an increase of $41,149,000 in bank and other loans payable. Stockholders’ equity as a percentage of total capitalization was 77.1% and 80.7% as of September 30, 2026, and December 31, 2025, respectively.

Previous wording

The combined statutory capital and surplus of the Company’s life insurance subsidiaries was approximately $144,894,000 and $139,068,000 as of June 30, 2026, and December 31, 2025, respectively. The life insurance subsidiaries cannot pay a dividend to their parent company without the approval of state insurance regulatory authorities.

Current wording

The combined statutory capital and surplus of the Company’s life insurance subsidiaries was approximately $146,702,000 and $139,068,000 as of September 30, 2026, and December 31, 2025, respectively. The life insurance subsidiaries cannot pay a dividend to their parent company without the approval of state insurance regulatory authorities.