Security National Financial Corporation Q2 FY2025 earnings call

• Expressed appreciation to funeral home, cemetery, grounds, and operational support teams. - Noted net earnings before tax in 2025 were $1,790,000, down 14.2% from 2024. - Funeral home revenue up 1.2% with 3.3% increase in funeral sales average and cremation rate at 52.8%. - Cemetery revenue down 10% due to preneed land sales and interment volume decline. - Turned over 60% of cemetery sales team since January 2025, committed to investing in and developing cemeteries for burial and cremation options.

In the second quarter of 2025, total revenue was $8,140,000, down 1.7% from 2024. The funeral home division had earnings of $387,000 in 2025, slightly down from $394,000 in 2024, but revenue rose 1.2% to $3,260,000, driven by a 3.3% increase in funeral sales average and a 3.6% shift in sales mix towards cremation, with a cremation rate of 52.8% in Q2 2025. The cemetery division had earnings of $822,000 in 2025, down from $1,430,000 in 2024. Revenue declined 10% to $4,330,000, due to lagging preneed land sales, absent large land sales in 2025, and a 16.4% decrease in interment volumes. 60% of the cemetery sales team was turned over since January 2025, with 50% joining in the last six months.

• Remain optimistic as operating model is strong and core businesses have growth room. - Focus on talent development, technology, expense management, and sales culture for the remainder of 2025. - Deliberate investments in people, technology, and customer service innovation, combined with disciplined cost control, to strengthen competitive position and support future performance.

• Risk of less competitiveness and lower volume if mortgage margin is increased too much. - Premium increase poses mindset challenge for the salesforce in the life side. - Personnel cost increase due to market rate compensation adjustments and strategic investments. - Sales leadership issues affecting life sales initially. - Real estate investment subject to interest rates and market movements.

Q: Can you speak to the overall investment exposure to real estate and your relationships with builders?

A: Garrett Sill said they increased real estate investment by about $25 million but offset it with increased bond portfolio investment. Look at investments in buckets and review regularly. Jason Oberbaugh noted they work with high-quality builders with strong track records in growing markets with strong employment bases, and have acquired talented people with banking experience to ensure proper investment handling.