Service Corporation International - Company History

Company History

Robert L. Waltrip, a licensed funeral director who grew up in his family’s funeral business, founded the company in 1962. SCI began as a small network of funeral homes and cemeteries in the Houston area.

As SCI grew its offshore presence, it continued to acquire businesses in North America—a marketplace that, by the late 1990s, had become extremely competitive among companies seeking to buy death care businesses. SCI, Alderwoods Group and Stewart Enterprises emerged from this period as the three largest companies in the industry. On December 31, 1999, SCI owned and operated 3,823 funeral service locations, 525 cemeteries, 198 crematoria and two insurance operations located in 20 countries on five continents.

In 1999, SCI also introduced Dignity Memorial, the first transcontinental brand of death care services and products in North America. By unifying its network of funeral homes and cemeteries under one brand name, SCI believed it could establish recognizable and communicable brand values.

In 2000, poor market conditions forced SCI to reevaluate operations. While foreign operations had once shown promise, nearly 70 percent of SCI’s revenue was generated by operations in the United States and Canada. The company decided to divest many of its offshore businesses, in addition to many North American funeral homes and cemeteries.

Between 2002 and 2006, SCI reduced its net debt (total debt minus cash) by more than $1.0 billion, increased operating cash flow, and simplified its field management organization to enhance efficiency, performance, and accountability. It also changed business and sales processes, tightened internal controls, strengthened corporate governance standards, and established the a new training and development system. For its shareholders, SCI returned value through more than $335 million in share repurchases, and it resumed payment of a regular quarterly dividend in early 2005, the first since 1999.

In 2006, SCI merged with Alderwoods Group, its nearest competitor in terms of size. The Federal Trade Commission (FTC) blocked the merger, citing concerns over consumer choice. After agreeing to divest funeral home and cemetery locations in several markets and end licensing agreements with other funeral homes, the FTC allowed the merger to continue. By 2007, the integration of Alderwoods's locations and operations was complete.

In 2009 SCI put in a bid to purchase Keystone North America for $208 million. This purchase was completed in 2010 and integrated approximately 200 additional locations into the SCI portfolio.