Security National Financial Corporation's Latest Earnings Insights
Security National Financial Corporation's Earnings Report
Security National Financial Corporation (SNFC) reported its financial results for the quarter ending June 30, 2025. There has been a notable decline in after-tax earnings compared to the previous year. SNFC's earnings have decreased by 10%, from $7,271,000 in 2024 to $6,506,000 in 2025 for the quarter. Additionally, for the first six months of 2025, the earnings decreased by 26% to $10,845,000 from $14,746,000 in 2024.
Scott M. Quist’s Perspective
Scott M. Quist, President of SNFC, addressed the performance challenges during this period, emphasizing that while their annualized return on equity (ROE) stands at 8%, it is below their typical average of 13.3%. He reassured stakeholders that this decrease should be viewed within the context of significant troubles within the mortgage industry, which constitutes about one-third of SNFC's revenue. He recognized the efforts of the team in facing these challenges and affirmed their commitment to returning to higher averages.
Strategic Financial Outlook
Quist illustrated that if the mortgage segment were to break even, it could positively impact their ROE by 2%. The company is actively increasing life insurance premium rates, with expectations for a further 1.5% boost to ROE in the shorter term. Additionally, improvements in their death care sales are anticipated to contribute positively, demonstrating SNFC’s strategic focus on long-term performance despite short-term setbacks.
Quarterly Analysis
Considering the year-on-year performance, Quist noted that the earnings downturn was significant in Q1, where $4 million of the $5.1 million total decline occurred. Q2 showed stronger resilience with only $1.1 million declining from the previous year. This indicates a trend towards stabilization within the company's financials.
Public Trust in Life Segment
During this period, the Life Segment experienced a profit increase of $1 million over Q2 2024, derived mainly from enhanced investment income. However, SNFC is observing challenges in the real estate market, particularly with starter homes, which may dampen expected profits. The company plans to invest an additional $50 million in residential land, steering away from immediate returns to secure future growth.
Cemetery and Mortuary Segment Performance
The Cemetery and Mortuary segment reported a decline of $1.2 million compared to the first half of 2024. Notably, Q2 was stronger, with only a $300,000 decrease. Trends indicate an increased preference for cremation services, which impact revenue; thus, implementing enhanced sales strategies to improve service value is critical. Reorganization of sales teams aims to better meet market demands and improve profitability.
Mortgage Segment Challenges
The Mortgage Segment has faced tougher conditions, showing a $1.8 million decline in Q2 versus 2024. Increased commission expenses, partly due to recruitment initiatives, have strained profitability. Nevertheless, improvements in loan production metrics indicate competitiveness in the sector. SNFC’s restructuring involving a significant portion of its executive sales management aims to navigate these adverse market conditions effectively.
Solidifying Financial Foundations
The company's business segments contribute collectively to its overall success, and investments in its life insurance and mortgage operations can bolster performance across its portfolio. SNFC’s management continues to express belief in achieving significant operational synergy that capitalizes on the strengths of its various segments.
Stock Performance Summary
As of June 30, 2025, net earnings per common share were $0.42 compared to $0.52 in the previous year. The book value per common share has risen to $14.35. Currently, SNFC holds two classes of common stock, Class A and Class C, with 24,713,575 Class A equivalent shares outstanding.
Earnings Call Information
Shareholders can join the upcoming earnings call for a detailed review of the Q2 results and updates from the business segments, scheduled for 1 PM MDT. Access will be available through SNFC's Investor Relations webpage.
Contact Details
For further inquiries, stakeholders can reach out to Mr. Garrett S. Sill or Mr. Scott Quist at the following address:
Security National Financial Corporation
P.O. Box 57250
Salt Lake City, Utah 84157
Phone (801) 264-1060
Fax (801) 264-8430
Frequently Asked Questions
What were Security National's earnings for the latest quarter?
In the latest quarter ending June 30, 2025, Security National's earnings were $6,506,000.
How does the current ROE compare to previous averages?
The current ROE is 8%, which is below the 10-year average of 13.3%.
What are the major challenges faced by the Mortgage Segment?
The Mortgage Segment is struggling with increased commission expenses affecting profitability.
How have investments in the Life Segment performed?
The Life Segment showed a profit of $1 million more compared to the same quarter last year.
What is the outlook for the Company's growth strategy?
SNFC is focusing on long-term profitability by investing in emerging market opportunities.
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