SEC Info - Stonemor Partners LP - ‘10-Q’ for 9/30/13

14.

SEGMENT INFORMATION

The Company is organized into five distinct reportable segments which are classified as Cemetery Operations – Southeast, Cemetery Operations – Northeast, Cemetery Operations – West, Funeral Homes, and Corporate.

The Company has chosen this level of organization of reportable segments due to the fact that a) each reportable segment has unique characteristics that set it apart from other segments; b) the Company has organized its management personnel at these operational levels; and c) it is the level at which the Company’s chief decision makers and other senior management evaluate performance.

The Cemetery Operations segments sell interment rights, caskets, burial vaults, cremation niches, markers and other cemetery related merchandise. The nature of the Company’s customers differs in each of its regionally based cemetery operating segments. Cremation rates in the West region are substantially higher than they are in the Southeast region. Rates in the Northeast region tend to be somewhere between the two. Statistics indicate that customers who select cremation services have certain attributes that differ from customers who select other methods of interment. The disaggregation of cemetery operations into the three distinct regional segments is primarily due to these differences in customer attributes along with the previously mentioned management structure and senior management analysis methodologies.

The Company’s Funeral Homes segment offers a range of funeral-related services such as family consultation, the removal of and preparation of remains and the use of funeral home facilities for visitation. These services are distinctly different than the cemetery merchandise and services sold and provided by the cemetery operations segments.

The Company’s Corporate segment includes various home office selling and administrative expenses that are not allocable to the other operating segments.

Segment information is as follows:

As of and for the three months ended September 30, 2013:


	Cemeteries						Funeral
	Southeast		Northeast		West		Homes		Corporate			Adjustment			Total
	(in thousands)
Revenues
Sales	$	24,304	$	8,963	$	10,440	$	—	$	—		$	(11,230	)	$	32,477
Service and other		9,200		7,078		8,494		—		—			(6,083	)		18,689
Funeral home		—		—		—		12,094		—			(1,721	)		10,373

Total revenues		33,504		16,041		18,934		12,094		—			(19,034	)		61,539

Costs and expenses
Cost of sales		4,929		1,811		2,202		—		—			(1,840	)		7,102
Cemetery		6,787		3,691		4,029		—		—			—			14,507
Selling		7,769		3,081		3,367		—		—			(2,525	)		11,692
General and administrative		4,064		1,582		2,256		—		—			—			7,902
Corporate overhead		—		—		—		—		7,997			—			7,997
Depreciation and amortization		575		224		548		859		172			—			2,378
Funeral home		—		—		—		9,161		—			(180	)		8,981
Acquisition related costs, net of recoveries		—		—		—		—		243			—			243

Total costs and expenses		24,124		10,389		12,402		10,020		8,412			(4,545	)		60,802

Operating profit	$	9,380	$	5,652	$	6,532	$	2,074	$	(8,412	)	$	(14,489	)	$	737

Total assets	$	557,308	$	306,577	$	418,119	$	131,750	$	35,061		$	—		$	1,448,815
Amortization of cemetery property	$	1,152	$	585	$	305	$	—	$	—		$	(132	)	$	1,910
Long lived asset additions	$	6,287	$	451	$	1,477	$	362	$	15		$	—		$	8,592
Goodwill	$	6,174	$	—	$	11,948	$	29,448	$	—		$	—		$	47,570

As of and for the nine months ended September 30, 2013:


	Cemeteries						Funeral
	Southeast		Northeast		West		Homes		Corporate			Adjustment			Total
	(in thousands)
Revenues
Sales	$	70,941	$	27,664	$	32,483	$	—	$	—		$	(36,332	)	$	94,756
Service and other		28,779		19,382		24,238		—		—			(16,049	)		56,350
Funeral home		—		—		—		36,904		—			(4,437	)		32,467

Total revenues		99,720		47,046		56,721		36,904		—			(56,818	)		183,573

Costs and expenses
Cost of sales		14,704		6,336		5,801		—		—			(5,737	)		21,104
Cemetery		19,746		10,809		12,145		—		—			—			42,700
Selling		22,913		9,675		10,128		—		833			(8,415	)		35,134
General and administrative		12,266		4,774		6,342		—		—			—			23,382
Corporate overhead		—		—		—		—		21,657			—			21,657
Depreciation and amortization		1,688		679		1,613		2,268		911			—			7,159
Funeral home		—		—		—		27,582		—			(501	)		27,081
Acquisition related costs, net of recoveries		—		—		—		—		901			—			901

Total costs and expenses		71,317		32,273		36,029		29,850		24,302			(14,653	)		179,118

Operating profit	$	28,403	$	14,773	$	20,692	$	7,054	$	(24,302	)	$	(42,165	)	$	4,455

Total assets	$	557,308	$	306,577	$	418,119	$	131,750	$	35,061		$	—		$	1,448,815
Amortization of cemetery property	$	3,182	$	1,943	$	866	$	—	$	—		$	(470	)	$	5,521
Long lived asset additions	$	8,613	$	1,710	$	2,735	$	9,287	$	763		$	—		$	23,108
Goodwill	$	6,174	$	—	$	11,948	$	29,448	$	—		$	—		$	47,570

As of and for the three months ended September 30, 2012:


	Cemeteries						Funeral
	Southeast		Northeast		West		Homes		Corporate			Adjustment			Total
	(in thousands)
Revenues
Sales	$	24,723	$	8,087	$	9,420	$	—	$	—		$	(8,107	)	$	34,123
Service and other		9,084		6,108		8,045		—		—			(3,989	)		19,248
Funeral home		—		—		—		9,603		—			(777	)		8,826

Total revenues		33,807		14,195		17,465		9,603		—			(12,873	)		62,197

Costs and expenses
Cost of sales		5,208		2,156		1,628		—		52			(1,398	)		7,646
Cemetery		6,635		3,574		4,042		—		1			—			14,252
Selling		7,356		2,762		2,875		—		163			(1,866	)		11,290
General and administrative		3,694		1,486		1,828		—		7			—			7,015
Corporate overhead		—		—		—		—		6,546			—			6,546
Depreciation and amortization		513		220		551		529		386			—			2,199
Funeral home		—		—		—		7,161		—			(65	)		7,096
Acquisition related costs, net of recoveries		—		—		—		—		1,085			—			1,085

Total costs and expenses		23,406		10,198		10,924		7,690		8,240			(3,329	)		57,129

Operating profit	$	10,401	$	3,997	$	6,541	$	1,913	$	(8,240	)	$	(9,544	)	$	5,068

Total assets	$	512,446	$	297,736	$	393,685	$	104,914	$	21,156		$	—		$	1,329,937
Amortization of cemetery property	$	1,396	$	526	$	275	$	—	$	—		$	108		$	2,305
Long lived asset additions	$	6,641	$	1,133	$	684	$	8,023	$	64		$	—		$	16,545
Goodwill	$	6,174	$	—	$	11,948	$	22,105	$	—		$	—		$	40,227

As of and for the nine months ended September 30, 2012:


	Cemeteries						Funeral
	Southeast		Northeast		West		Homes		Corporate			Adjustment			Total
	(in thousands)
Revenues
Sales	$	69,415	$	26,090	$	29,743	$	—	$	—		$	(25,988	)	$	99,260
Service and other		27,867		19,820		22,940		—		—			(12,213	)		58,414
Funeral home		—		—		—		27,065		—			(1,447	)		25,618

Total revenues		97,282		45,910		52,683		27,065		—			(39,648	)		183,292

Costs and expenses
Cost of sales		14,471		5,857		5,031		—		104			(4,161	)		21,302
Cemetery		19,085		10,453		12,280		—		1			—			41,819
Selling		22,072		9,220		9,482		—		995			(5,569	)		36,200
General and administrative		11,130		4,499		5,751		—		23			—			21,403
Corporate overhead		—		—		—		—		20,905			—			20,905
Depreciation and amortization		1,559		660		1,666		1,667		1,207			—			6,759
Funeral home		—		—		—		20,648		—			(181	)		20,467
Acquisition related costs, net of recoveries		—		—		—		—		2,198			—			2,198

Total costs and expenses		68,317		30,689		34,210		22,315		25,433			(9,911	)		171,053

Operating profit	$	28,965	$	15,221	$	18,473	$	4,750	$	(25,433	)	$	(29,737	)	$	12,239

Total assets	$	512,446	$	297,736	$	393,685	$	104,914	$	21,156		$	—		$	1,329,937
Amortization of cemetery property	$	3,397	$	1,939	$	844	$	—	$	—		$	105		$	6,285
Long lived asset additions	$	11,435	$	2,490	$	3,889	$	8,361	$	670		$	—		$	26,845
Goodwill	$	6,174	$	—	$	11,948	$	22,105	$	—		$	—		$	40,227

Results of individual business units are presented based on our management accounting practices and management structure. There is no comprehensive, authoritative body of guidance for management accounting equivalent to GAAP; therefore, the financial results of individual business units are not necessarily comparable with similar information for any other company. The management accounting process uses assumptions and allocations to measure performance of the business units. Methodologies are refined from time to time as management accounting practices are enhanced and businesses change. Revenues and associated expenses are not deferred in accordance with SAB No. 104; therefore, the deferral of these revenues and expenses is provided in the adjustment column to reconcile the Company’s managerial financial statements to those prepared in accordance with GAAP. Pre-need sales revenues included within the sales category consist primarily of the sale of burial lots, burial vaults, mausoleum crypts, grave markers and memorials, and caskets. Management accounting practices included in the Southeast, Northeast, and Western Regions reflect these pre-need sales when contracts are signed by the customer and accepted by the Company. Pre-need sales reflected in the unaudited condensed consolidated financial statements, prepared in accordance with GAAP, recognize revenues for the sale of burial lots and mausoleum crypts when the product is constructed and at least 10% of the sales price is collected. With respect to the other products, the unaudited condensed consolidated financial statements prepared under GAAP recognize sales revenues when the criteria for delivery under SAB No. 104 are met. These criteria include, among other things, purchase of the product, delivery and installation of the product in the ground, and transfer of title to the customer. In each case, costs are accrued in connection with the recognition of revenues; therefore, the unaudited condensed consolidated financial statements reflect Deferred Cemetery Revenue, Net, and Deferred Selling and Obtaining Costs on the unaudited condensed consolidated balance sheet, whereas the Company’s management accounting practices exclude these items.

This ‘10-Q’ Filing	Date	Other Filings

Filed on:	11/7/13	8-K
For Period end:	9/30/13
	9/30/12	10-Q
		List all Filings

Stonemor Partners LP – ‘10-Q’ for 9/30/13 – ‘R20’

On: Thursday, 11/7/13, at 1:56pm ET · For: 9/30/13 · Accession #: 1193125-13-432439 · File #: 1-32270

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Quarterly Report — Form 10-Q — Sect. 13 / 15(d) – SEA’34
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