The low-speculative-grade rating on Houston, Texas-based Carriage Services Inc. reflects the funeral home operator's significant financial burden in an industry that, though fairly predictable, is subject to operating uncertainties. The Carriage network of 131 funeral homes in 27 states and 28 cemeteries in 11 states makes the company the fourth-largest rated operator in North America. Carriage is focused on increasing its net revenues per funeral and improving margins, rather than on aggressive expansion (as it was in the past). The company continues to face challenging industry trends that could impede its progress. North America has been experiencing relatively flat death rates and, therefore, flat funeral volume and cemetery and merchandise sales trends. Cremation services have been rising and should continue
