TREVOSE, Pa., Aug. 08, 2019 (GLOBE NEWSWIRE) -- StoneMor Partners L.P. (NYSE: STON) (“StoneMor” or the “Partnership”), a leading owner and operator of cemeteries and funeral homes, today reported operating and financial results for the 2019 second quarter and six-month period ended June 30, 2019.  Investors are encouraged to read the Partnership's quarterly report on Form 10-Q when it is filed with the Securities and Exchange Commission (the “SEC”).  That report, which StoneMor expects to file on August 9, 2019, will contain additional detail, and will be able to be found at

  • Revenues for the three months ended June 30, 2019 were $78.5 million compared to $81.6 million in the prior year period.  Six-month revenues were $150.0 million compared to $159.5 million in the prior year period.  

  • Second quarter net loss was $34.4 million compared to $17.0 million in the prior year period.  Six months net loss was $56.9 million compared to $34.9 million in the prior year period.  The reported net loss for the second quarter included a charge of $8.5 million for loss on extinguishment of debt in connection with the Partnership's recently completed equity and debt recapitalization, and income tax expense of $6.4 million due to section 382 limitations on pre-2018 net operating loss carryforward assets resulting from those transactions, which reduced the amount of deferred tax liabilities that were offset by these assets.    

  • Cemetery segment operating profit for the second quarter was $4.8 million compared to $4.1 million for the prior year period.  Six-month segment operating profit was $7.6 million compared to $6.3 million in the prior year period. 

  • Funeral segment operating profit was $1.8 million for the second quarter compared to $2.5 million in the prior year period.  Six-month segment operating profit was $3.3 million compared to $4.5 million in the prior year period. 

  • Corporate overhead expense was $13.1 million for the second quarter compared to $15.2 million in the prior year period. 

  • Cash used in operating activities for the first six months of 2019 was $31.6 million compared to cash provided by operations in the prior year period of $15.4 million.  The reduction in cash from operating activities was primarily due to a decline in sales production, non-recurring working capital initiatives in the prior year period, a decline in accounts payable and accrued expenses, increased debt service costs and increased costs associated with consulting and professional fees arising from the potential C-Corporation conversion, debt refinancing, various employee severance obligations and other ongoing initiatives.

  • Merchandise trust value at June 30, 2019 was $519.4 million compared to $488.2 million at December 31, 2018. 

  • Deferred revenue at June 30, 2019 was $944.1 million compared to $914.3 million at December 31, 2018. 

  • As of June 30, 2019, the Partnership had $41.9 million of unrestricted cash and cash equivalents, $20.1 million of restricted cash related to the cash collateralization of letters of credit with proceeds from the recapitalization, and $358.2 million of total debt.

  • On June 27, 2019, the Partnership completed a $447.5 million recapitalization transaction, consisting of a private placement of $62.5 million of convertible preferred securities and a concurrent private placement consisting of $385.0 million of Senior Secured Notes due 2024. 

Joe Redling, StoneMor’s President and Chief Executive Officer said, “Our second quarter results reflect continued pressure on pre-need production as our sales force adjusts to initiatives we launched in the first quarter of 2019.  We believe we have identified the primary drivers of our sales productivity and pre-need sales issues.  While our initiatives are in the early stages, we remain focused on improving our sales process and training, and optimizing staffing levels across our asset base.

“We are also beginning to see early signs of improvement in sales production with a strong sequential rebound of net interment rights sold and pre-need contracts written from the first quarter of 2019 to the current quarter.  At the same time, we saw a reduction in corporate overhead net of non-recurring expenses on a year-over-year basis.  As we have previously disclosed, we’ve targeted a minimum of $30 million of cost reductions across corporate, G&A, sales and field operations.  After a careful review of labor efficiencies across our properties, at the beginning of July 2019, we implemented a reduction of approximately 6% of our field workforce as part of these cost reduction initiatives. 

“The June 27, 2019 announcement of the closing of our $447.5 million recapitalization not only represented a major step in providing us with a meaningful liquidity improvement to execute our turnaround strategy, but also demonstrated both the strong underlying value of our asset base as well as investor confidence in our management team’s ability to execute our turnaround plan, including the next phase of our performance improvement plans.”  

Garry Herdler, Senior Vice President and Chief Financial Officer added, “In mid-April 2019, we outlined our turnaround strategy focused on four key goals: cash flow and liquidity, capital structure, balance sheet/portfolio review, and performance improvement through cost reductions and revenue enhancement.  Our results reflect the efforts of our initial 100-day plan, which included significant progress on improving liquidity and capital structure.  We believe we have identified additional expense reduction opportunities in the next phase of this operational turnaround strategy.

“We continue to work towards process improvements to better align our cost structure with our revenues and performance improvement efforts.  These efforts and the contemplated C-Corporation conversion are important steps to revitalizing our business and positioning us for future success.  Since joining the team and gaining a better understanding of StoneMor’s business, I am more confident in the execution plans we are developing for the next phase of our turnaround plan to address our near-in challenges and opportunities, with the commitment to set a clear strategic roadmap for the future.”

Updated Unit Count

As of June 30, 2019, the Partnership had 39.53 million units outstanding.  As part of the debt and equity recapitalization, the Partnership issued 52.08 million of Series A Preferred units which are convertible to common units on a 1:1 basis (subject to anti-dilution adjustments) no later than upon the completion of the previously announced C-Corporation conversion.  The outstanding unit count at June 30, 2019, pro forma for the recapitalization transactions, was 91.62 million units. 

In connection with the C-Corporation conversion, and as previously disclosed, StoneMor anticipates issuing an additional 2.95 million common units.  Pro forma outstanding unit count as of June 30, 2019, after giving effect to the matters noted above and the C-Corporation conversion is expected to be approximately 94.57 million units.

Conference Call Information

StoneMor will conduct a conference call to discuss this news release today, August 8, 2019 at 4:30 p.m. ET.   The conference call can be accessed by calling (800) 926-7385.  No reservation number is necessary.  StoneMor will also host a live webcast of this conference call.  Investors may access the live webcast via the Investors page of the StoneMor website under Events & Presentations.

About StoneMor Partners L.P.

StoneMor Partners L.P., headquartered in Trevose, Pennsylvania, is an owner and operator of cemeteries and funeral homes in the United States, with 321 cemeteries and 90 funeral homes in 27 states and Puerto Rico.

StoneMor is the only publicly traded death care company structured as a partnership. StoneMor’s cemetery products and services, which are sold on both a pre-need (before death) and at-need (at death) basis, include: burial lots, lawn and mausoleum crypts, burial vaults, caskets, memorials, and all services which provide for the installation of this merchandise. For additional information about StoneMor Partners L.P., please visit StoneMor’s website, and the investors section, at

CONTACT:John McNamara
 Director - Investor Relations
 StoneMor Partners L.P.
 (215) 826-2945

Cautionary Note Regarding Forward-Looking Statements

Certain statements contained in this press release, including, but not limited to, the expected timing of filing the Quarterly Report on Form 10-Q for the Quarter Ending June 30, 2019 and the related investor call together with the implementation and achievement of operational and reporting improvements, are forward-looking statements. Generally, the words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “project,” “expect,” “predict,” “focus,” “review,” “cash flow,” “confident,” “filed timely,” and similar expressions identify these forward-looking statements.  These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements are based on management’s current expectations and estimates. These statements are neither promises nor guarantees and are made subject to certain risks and uncertainties that could cause actual results to differ materially from the results stated or implied in this press release. StoneMor’s major risks are related to our substantial secured and unsecured indebtedness, our ability to refinance our secured indebtedness in the near term, uncertainties associated with the cash flow from pre-need and at-need sales, trusts and financings, which may impact StoneMor’s ability to meet its financial projections, service its debt and resume paying distributions, as well as with StoneMor’s ability to maintain an effective system of internal control over financial reporting and disclosure controls and procedures.

StoneMor’s additional risks and uncertainties include, but are not limited to: StoneMor’s ability to successfully implement its strategic plan relating to achieving operating improvements, including driving asset-level accountability and profitability, improving sales productivity and effectiveness, reducing operating expenses and improving financial reporting efficiencies; the effect of economic downturns; the impact of StoneMor’s significant leverage on its operating plans; the decline in the fair value of certain equity and debt securities held in StoneMor’s trusts; StoneMor’s ability to attract, train and retain an adequate number of sales people; uncertainties associated with the volume and timing of pre-need sales of cemetery services and products; increased use of cremation; changes in the death rate; changes in the political or regulatory environments, including potential changes in tax accounting and trusting policies; StoneMor’s ability to successfully compete in the cemetery and funeral home industry; litigation or legal proceedings that could expose StoneMor to significant liabilities and damage StoneMor’s reputation, including but not limited to litigation and governmental investigations or proceedings arising out of or related to accounting and financial reporting matters; the effects of cyber security attacks due to StoneMor’s significant reliance on information technology; uncertainties relating to the financial condition of third-party insurance companies that fund StoneMor’s pre-need funeral contracts; and various other uncertainties associated with the death care industry and StoneMor’s operations in particular.

When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements set forth in StoneMor’s Annual Report on Form 10-K for the Year Ended December 31, 2018 and the other reports that StoneMor files with the Securities and Exchange Commission, from time to time. Except as required under applicable law, StoneMor assumes no obligation to update or revise any forward-looking statements made herein or any other forward-looking statements made by it, whether as a result of new information, future events or otherwise.


  June 30,  December 31, 
  2019  2018 
Current assets:        
Cash and cash equivalents, excluding restricted cash $41,859  $18,147 
Restricted cash  20,095    
Accounts receivable, net of allowance  59,550   57,928 
Prepaid expenses  8,942   4,475 
Other current assets  17,231   17,766 
Total current assets  147,677   98,316 
Long-term accounts receivable, net of allowance  83,775   87,148 
Cemetery property  329,760   330,841 
Property and equipment, net of accumulated depreciation  110,655   112,716 
Merchandise trusts, restricted, at fair value  519,382   488,248 
Perpetual care trusts, restricted, at fair value  343,308   330,562 
Deferred selling and obtaining costs  112,916   112,660 
Deferred tax assets  67   86 
Goodwill  24,862   24,862 
Intangible assets  56,877   61,421 
Other assets  33,536   22,241 
Total assets $1,762,815  $1,669,101 
Liabilities, Redeemable Convertible Preferred Units and Partners’ Deficit        
Current liabilities:        
Accounts payable and accrued liabilities $55,063  $59,035 
Accrued interest  312   1,967 
Current portion, long-term debt  591   798 
Total current liabilities  55,966   61,800 
Long-term debt, net of deferred financing costs  357,575   320,248 
Deferred revenues  944,142   914,286 
Deferred tax liabilities  12,883   6,675 
Perpetual care trust corpus  343,308   330,562 
Other long-term liabilities  52,385   42,108 
Total liabilities  1,766,259   1,675,679 
Commitments and contingencies        
Redeemable convertible preferred units:        
Series A  57,500    
Total redeemable convertible preferred units  57,500    
Partners’ deficit :        
General partner interest  (4,597)  (4,008)
Common limited partners’ interest  (56,347)  (2,570)
Total partners’ deficit  (60,944)  (6,578)
Total liabilities, redeemable convertible preferred units and partners’ deficit $1,762,815  $1,669,101 

See Notes to the Unaudited Condensed Consolidated Financial Statements to be included in the Partnership’s Form 10-Q
Report for the Quarter Ended June 30, 2019 (the “Second Quarter 10-Q”).

(in thousands, except per unit data)

  Three Months Ended June 30,
 Six Months Ended June 30, 
Interments $20,995  $20,789  $36,939  $40,414 
Merchandise  17,315   17,116   33,856   33,743 
Services  17,365   17,737   33,332   34,228 
Investment and other  9,953   12,038   19,411   21,538 
Funeral home:                
Merchandise  6,073   6,522   12,348   13,951 
Services  6,794   7,369   14,078   15,642 
Total revenues  78,495   81,571   149,964   159,516 
Costs and Expenses:                
Cost of goods sold  10,843   13,086   20,586   26,521 
Cemetery expense  21,636   21,007   38,883   38,421 
Selling expense  15,497   17,166   30,230   33,422 
General and administrative expense  10,958   10,163   22,397   21,121 
Corporate overhead  13,137   15,165   26,550   26,992 
Depreciation and amortization  2,716   3,071   5,473   6,116 
Funeral home expenses:                
Merchandise  1,014   1,108   3,331   3,586 
Services  5,459   5,582   11,012   11,100 
Other  3,994   3,961   7,624   9,001 
Total costs and expenses  85,254   90,309   166,086   176,280 
Other losses  (3,429)     (3,429)  (5,205)
Operating loss  (10,188)  (8,738)  (19,551)  (21,969)
Interest expense  (9,346)  (8,107)  (22,517)  (15,220)
Loss on debt extinguishment  (8,478)     (8,478)   
Loss from operations before income taxes  (28,012)  (16,845)  (50,546)  (37,189)
Income tax benefit (expense)  (6,386)  (172)  (6,386)  2,249 
Net loss $(34,398) $(17,017) $(56,932) $(34,940)
Accretion of redeemable convertible preferred units            
Net loss attributable to common unit holders $(34,398) $(17,017) $(56,932) $(34,940)
General partner’s interest $(357) $(177) $(592) $(364)
Limited partners’ interest $(34,041) $(16,840) $(56,340) $(34,576)
Net loss per limited partner unit (basic and diluted) $(1.44) $(0.44) $(1.44) $(0.91)
Weighted average number of limited partners’ units outstanding
  (basic and diluted)
  39,329   37,958   39,115   37,958 

See Notes to the Unaudited Condensed Consolidated Financial Statements to be included in the Second Quarter 10-Q

(in thousands)

  Six Months Ended June 30,
Cash Flows From Operating Activities:         
Net loss $(56,932) $(34,940) 
Adjustments to reconcile net loss to net cash provided by operating
Cost of lots sold  3,718   3,489  
Depreciation and amortization  5,473   6,116  
Provision for bad debt  4,219
Non-cash compensation expense  2,566   1,913  
Loss on debt extinguishment  8,478     
Non-cash interest expense  6,684   3,215  
Other losses, net  3,433   5,205  
Changes in assets and liabilities:         
Accounts receivable, net of allowance  (8,611)  1,195  
Merchandise trust fund  (9,482)  (4,181) 
Other assets  (4,522)  (1,395) 
Deferred selling and obtaining costs  (1,165)  (4,184) 
Deferred revenues  15,126   33,599  
Deferred taxes, net  6,227   (2,649) 
Payables and other liabilities  (6,784)  6,377  
Net cash (used in) provided by operating activities  (31,572)  15,404  
Cash Flows From Investing Activities:         
Cash paid for capital expenditures  (4,838)  (7,626) 
Cash paid for acquisitions     (833) 
Proceeds from divestitures  1,250     
Net cash used in investing activities  (3,588)  (8,459) 
Cash Flows From Financing Activities:         
Proceeds from issuance of redeemable convertible preferred units, net  57,500     
Proceeds from borrowings  406,087   16,880  
Repayments of debt  (366,470)  (12,896) 
Principal payment on finance leases  (713)    
Cost of financing activities  (17,437)  (2,771) 
Net cash provided by financing activities  78,967   1,213  
Net increase in cash, cash equivalents and restricted cash  43,807   8,158  
Cash, cash equivalents and restricted cash—Beginning of period  18,147   6,821  
Cash, cash equivalents and restricted cash—End of period $61,954  $14,979  
Supplemental disclosure of cash flow information:         
Cash paid during the period for interest $16,981  $12,865  
Cash paid during the period for income taxes  1,402   709  
Cash paid for amounts included in the measurement of lease liabilities:         
Operating cash flows from operating leases $1,858  $  
Operating cash flows from finance leases  238     
Financing cash flows from finance leases  713     
Non-cash investing and financing activities:         
Acquisition of assets by financing $1,731  $688  
Classification of assets as held for sale     543  

See Notes to the Unaudited Condensed Consolidated Financial Statements to be included in the Second Quarter 10-Q


 Three Months Ended June 30, Six Months Ended June 30,
 2019 2018 2019 2018
Interments performed13,543 14,102 26,538
Interment rights sold (1)       
Lots7,196 8,941 11,681 15,477
Mausoleum crypts (including pre-construction)342 301 557 847
Niches552 430 890 859
Net interment rights sold (1)8,090 9,672 13,128 17,183
Number of pre-need cemetery contracts written10,066 11,547 18,500 21,709
Number of at-need cemetery contracts written14,623 15,276 27,872 30,003
Number of cemetery contracts written24,689 26,823 46,372 51,712


  1. Net of cancellations. Sales of double-depth burial lots are counted as two sales