Analyst / Investor Day
November 18, 2013
Confidential
2
This presentation contains certain statements that may be deemed to be forward-looking
statements within the meaning of the Securities Acts. All statements, other than statements of
historical facts, that address activities, events or developments that the Partnership expects,
projects, believes or anticipates will or may occur in the future, including, without limitation, the
outlook for population growth and death rates, general industry conditions including future
operating results of the Partnerships properties, capital expenditures, asset sales, expansion and
growth opportunities, bank borrowings, financing activities and other such matters, are forward-
looking statements. Although the Partnership believes that its expectations stated in this
presentation are based on reasonable assumptions, actual results may differ from those
projected in the forward-looking statements. For a more detailed discussion of risk factors,
please refer to the annual Report on Form 10-K and quarterly reports on form 10-Q filed with the
SEC and the prospectus and the prospectus supplement relating to this offering.
In addition, the projected impact of acquisitions reflect managements projections as to possible
future results based on a number of assumptions that are inherently uncertain, including without
limitation the organic growth of the Partnership, the availability of acquisition targets, the
purchase prices for the targets, the availability of debt or equity financing from either third parties
or the targets and the Partnership’s ability to integrate and manage such acquisitions. The
assumptions involve significant elements of subjective judgment and analysis, and no
representation is made as to their or the projections attainability.
3
Presenters
StoneMor Partners L.P.
Name Title
Lawrence Miller Chairman, President and Chief Executive Officer
Timothy Yost Chief Financial Officer
William R. Shane Vice-Chairman
Raymond Smith Vice-President Marketing
John C. McNamara Director of Investor Relations
David Spungen CEO Hillview Capital Advisors
Lawrence Miller
President & CEO
Company Overview
StoneMor Partners L.P.
5
StoneMor is the second largest owner and operator of cemeteries in
the US
• 277 cemeteries and 90 funeral homes, diversely located across 28 states and
Puerto Rico
• As of 12/31/2012, over 12,300 acres of land, equivalent to an aggregate weighted
average sales life of 246 years
6
Pre-need At- need
Burial Lots
Mausoleums
Burial Vaults and Crypts
Grave Markers
Grave Opening and Closing Fees
Caskets
(Funeral Homes only)
Cemetery Revenues – Major Products Sold
Diverse Geographic Exposure
7
As of November 1,
2013
277 Cemeteries
+ 90 Funeral Homes
= 367 Total Locations
WA
OR
CACO
KS
IA
IL
MO
AR
IN
MI
OH
PA
WV
KY
TN
VA
NC
SC
GAALMS
FL
Washington
3 Cemeteries
2 Funeral Homes
Oregon
6 Cemeteries
12 Funeral Homes
California
6 Cemeteries
10 Funeral Homes
Colorado
2 Cemeteries
Kansas
3 Cemeteries
2 Funeral Homes
Hawaii
1 Cemeteries
Iowa
1 Cemeteries
Illinois
8 Cemeteries
22Funeral Homes
Indiana
11 Cemeteries
5 Funeral Homes Michigan
13 Cemeteries
Kentucky
2 Cemeteries
Ohio
14 Cemeteries
2 Funeral HomesRhode Island
2 Cemeteries
Pennsylvania
52 Cemeteries
8 Funeral Homes
New Jersey
6 Cemeteries
Delaware
1 Cemeteries
Maryland
10 Cemeteries
1 Funeral Homes
West Virginia
33 Cemeteries
2 Funeral Homes
Virginia
31 Cemeteries
2 Funeral Homes
North Carolina
16 CemeteriesSouth Carolina
8 Cemeteries
3 Funeral Homes
Puerto Rico
7 Cemeteries
5 Funeral Homes
Georgia
7 Cemeteries
Florida
4 Cemeteries
17 Funeral Homes
Tennessee
11 Cemeteries
5 Funeral Homes
Alabama
9 Cemeteries
6 Funeral Homes
Mississippi
2 Cemeteries
1 Funeral Homes
Arkansas
2 Funeral Homes
Missouri
6 Cemeteries
5 Funeral Homes
Investment Highlights
10%* yield superior to most MLPs**
Strong historical performance
Proven acquisition record
Favorable demographic trends
High barriers to entry
Experienced management
8 *Source: Barrons
**As of November 11, 2013
9
Attractive Yield
10% Yield vs. 6% Average MLP Yield*
Has increased 30% since 2004 IPO
37 consecutive quarterly distributions
Distribution Per Unit
$2.16
$2.22$2.25
$2.33$2.36
$2.39
$2.00
$2.05
$2.10
$2.15
$2.20
$2.25
$2.30
$2.35
$2.40
$2.45
2008 2009 2010 2011 2012 2013TTM
*Source: Barrons
Historical Performance
10
($ in millions)($ in millions)
REVENUE OPERATING PROFIT
$183 $181 $197
$228 $243 $243
$209 $218
$247
$281 $296
$314
$-
$50
$100
$150
$200
$250
$300
$350
2008 2009 2010 2011 2012 2013TTM
GAAP Accrual
$17 $13
$3
$10 $14
$6
$32 $36
$38
$49
$54 $58
$-
$10
$20
$30
$40
$50
$60
$70
2008 2009 2010 2011 2012 2013 TTM
GAAP Accrual
Diversified Revenue Streams
11
STONEMOR BUSINESS MIX BY REVENUE – TWELVE MONTHS ENDED DECEMBER 31, 2012
StoneMor’s +800 person sales team creates an unparalleled advantage
in pre-need sales performance
~60% of StoneMor’s
revenue is generated
through highly
predictable at-need
business
Pre-need Sales, 40.0%
At-need Sales, 30.8%
Investment Income, 9.9%
Interest Income, 2.8%
Funeral Home Revenues,
14.7%
Other Cemetery Revenues,
1.8%
Proven Growth and Acquisition Strategy
StoneMor has demonstrated a consistent track record of growth and
financial performance
• 145 cemeteries and 85 funeral homes acquired since 2004 IPO
• Revenue (GAAP) has increased from $145 million in 2007 to $243 million in 2013
(TTM)
o 10.8% ’07-’12 CAGR
• Adjusted operating profits have increased from $27 million in 2007 to $58.0 million
in 2013 (TTM)
o 15.1% ’07-’12 CAGR
12
Favorable Demographics
Aging of the Baby Boom Generation will accelerate the death rate
and expand our target pre-need market
13
Source: Department of Health and Human Services.
ANNUAL BIRTHS IN THE UNITED STATES 1930-1960
Favorable Demographics
Sharply increasing population in our target pre-need market
14
Pro
jecte
d U
.S. P
op
ula
tion
(in thousands)
Source: U.S. Department of Commerce Census Bureau.
PROJECTED U.S. POPULATION IN 55-65 YEAR OLD CATEGORY
Target Market More
Resilient to
Economic
Downturns
Target 55 to 65 age range
Near retirement – low unemployment risk
Mortgage paid-off (or almost) – minimal debt obligations
Adult children – no tuition costs
Substantial Industry and Financial Barriers to Entry
Scarcity and cost of real estate near densely populated areas
Zoning restrictions
Initial capital requirements
Strength of family tradition and heritage
Administratively complex business for new entrants
Deferred revenue accounting (SAB 101) makes cemetery
acquisitions unattractive to “C-corps” valued on EPS and EBITDA,
keeping consolidators out of the market
15
Barriers to Entry
Because of the barriers to entry, there are few new cemeteries built. The only way to enter
the industry is to buy an existing cemetery
16
Highly Fragmented Industry
Cemeteries, 9,600, 30%
Funeral Homes,
22,000, 70%
$11 billion
$6 billion
___________________________Source: National Directory of Morticians; Public Filings.
___________________________Source: ABN Amro Research; Public Filings.
(1) Includes StoneMor, SCI, Stewart, Carriage and Loewen.
$17 Billion Market
Large Death Care Industry Highly Fragmented Industry Revenue
Owned by Consolidators
20%
Independent Operators,
80%
(1)
Economies of scale and consolidation opportunities provide competitive advantages
Cemeteries
Funeral Homes Ratio
SCI 374 1,431 1:3.8
StoneMor 277 90 3:1
Stewart 141 217 1:1.5
Carriage 32 167 1:5.2
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Municipal, Military,
Religious, Non-Profit, 13,000, 58%
For Profit, 9,600, 42%
22,600 U.S. Cemeteries Largest For-Profit Cemetery Operators
StoneMor has a unique focus on
ownership and operation of cemetery
assets
Unique Cemetery Focus
(1)
(2)
(3)
(4)
(1)From page 38 of SCI’s 9/30/13 10-Q
(2) From page 5 of StoneMor’s 9/30/13 10-Q
(3) From page10 of Stewart’s 7/31/13 10-Q
(4) From page 9 of Carriage’s 9/30/13 10-Q
Experienced Management Team
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StoneMor Partners L.P.
Name Title Years of Industry Experience
Lawrence MillerChairman, President and Chief
Executive Officer40
Timothy Yost Chief Financial Officer 22(1)
Michael StacheSenior Vice President and Chief
Operating Officer24
Ken LeeVice President of Funeral Home
Operations32
Frank MillesVice President Administration,
Trust & Due Diligence35
Gregg StromSenior Vice President of Business
Development25
(1) Reflects total experience.
19
Total Return
Indexed Total Return of StoneMor Units vs. NYSE Index
Tim Yost
Chief Financial Officer
Financial Overview
2013 Highlights
Acquired Florida based Seawind Funeral Homes
• Paid $15 million in cash, units and debt
• 6 homes, 2 with cremation facilities
Increased distribution to $0.60 per unit
Raised approximately $40 million through 1.61 million unit offering
Cash tender for outstanding 10.25% Senior Notes due 2017
Priced $175 million in senior notes due 2021 at 7.875%
Acquired Forest Lawn Cemetery in Richmond, Virginia
• Paid $5 Million
• More than 500 interments per year
Operating Agreement with Archdiocese of Philadelphia
21
2013 9-Month Operational Performance Highlights
Increased Distributable Free Cash Flow 34.3%
Increased Production Based Revenue by 7.8%
Increased Value of Pre-Need Contracts by 6.0%
Increased Funeral Home Revenues by 36.4%
Increased Adjusted Operating Profits by 11.1%
22
StoneMor’s Master Limited Partnership Structure
StoneMor makes distributions to its unitholders on
a quarterly basis
• Paid from available cash after debt service and other
expenses
MLP structure is predominantly tax free
At least 90% of gross income must be “qualifying
income”
• Qualifying income comprised of sale of real property (burial
lots, lawn and mausoleum crypts), cremation niches, interest
and dividends
Non-qualifying income, such as caskets, markers
and funeral home sales, are operated through tax-
subject subsidiaries
23
MLP
Overview
Tax Status
24
Cemetery Accounting – GAAP vs. Accrual
GAAP requires that cemetery product revenue be deferred until (i) the product is
purchased, (ii) the product is specifically identified to the customer, and (iii) title is
transferred
Management uses “accrual” accounting to monitor its performance, recognizing
revenue at the time a contract is finalized
The timing differences between GAAP criteria for recognition and the time sales are
made create significant disparities in financial results across the two methods
• Cemetery operations are particularly affected due to the high level of pre-need
sales
SEC now requires the Company to show both accrual and GAAP-based MD&A in
its filings
CEMETERY AND FUNERAL HOME BUSINESS MIX
Cemetery focus
requires use of
accrual
accounting
Cemeteries
Funeral Homes Ratio
SCI 374 1,431 1:3.8
StoneMor 277 90 3:1
Stewart 141 217 1:1.5
Carriage 32 167 1:5.2
*
*
(*)
(*)
*See slide 17 for sources
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There are significant timing differences for cemetery product revenue recognition
between GAAP and accrual accounting
Cemetery Product GAAP Revenue Recognition Accrual Revenue Recognition
Burial Lots 10% of selling price collected
• Recognized when the
customer and StoneMor
finalize a contract for a
particular product or
service
• Revenue is recorded less
a 10% bad debt reserve
(historically 8.8%)
• Expenses are accrued
• Receivables are booked
Mausoleums
(Pre-Constructed)
% of completion basis, once 10%
of selling price collected
Mausoleums
(Existing)
10% of selling price collected
Burial Vaults and
Crypts
When installed in the ground
(0 to 18 months)
Grave Markers When stored in a warehouse
owned by a 3rd party
(0 to 18 months)
Caskets When stored in a warehouse
owned by a 3rd party
(0 to 18 months)
Grave Opening (initial) When vault is installed
(0 to 18 months)
Grave Opening (final) When customer is dead & buried
(~25 years)
Cemetery Revenue –Accounting Recognition
Historical Performance
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($ in millions)($ in millions)
REVENUE OPERATING PROFIT
$183 $181 $197
$228 $243 $243
$209 $218
$247
$281 $296
$314
$-
$50
$100
$150
$200
$250
$300
$350
2008 2009 2010 2011 2012 2013TTM
GAAP Accrual
$17 $13
$3
$10 $14
$6
$32 $36
$38
$49
$54 $58
$-
$10
$20
$30
$40
$50
$60
$70
2008 2009 2010 2011 2012 2013 TTM
GAAP Accrual
27
Conservative Financial Profile
Adjusted Operating Profits (Accrual) Exceed Distributions
Adjusted Operating Profit, or the Accrual
method, is the measure by which
management operates the business
GAAP Operating Profit
Distributions
Adj. Operating Profit / Accrual*
$-
$10
$20
$30
$40
$50
$60
20092010
20112012
2013 TTM
$13
$3
$10 $14
$6
$27
$32
$45 $47 $51
$36 $38
$49
$54 $58
GAAP Operating Profit Distributions Adj. Operating Profit / Accrual*
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Condensed Consolidated Balance Sheet
(in thousands) September 30, December 31, 2013 2012
Assets
Cash $ 19,984 $ 7,946 Accounts Receivable 128,247 123,416 Cemetery Property 316,522 309,980 Property and Equipment 85,282 79,740 Trust Funds 718,121 658,286
Deferred Costs and Expenses 94,034 85,936 Goodwill and other 86,625 78,421
Total Assets $1,448,815 $ 1,343,725
Liabilities and Partners' Capital
Accounts Payable and Accrued Liabilities $ 39,325 $ 30,806 Long-term Debt 281,092 254,949 Deferred Revenues 557,973 497,861 Merchandise Liability 129,922 125,869
Perpetual Care Trust Corpus 302,766 282,313 Deferred Taxes and other 13,610 16,745
1,324,688 1,208,543
Partners' Capital 124,127 135,182
Total Liabilities and Partners' Capital $1,448,815 $ 1,343,725
Strong Balance Sheet & Recovery Profile
Balance sheet with low-risk, marketable assets providing full debt protection
Additional Value from Cemetery Property and Perpetual Care Trusts
• Cemetery Property
o $316.5 million book value as of September 30, 2013
o Approximately 12,300 acres, weighted average estimated sales life of over 246 years
• Perpetual Care Trusts
o Future maintenance costs are funded through perpetual trusts, with assets of $302.8 million
as of September 30, 2013
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(1)
$564
$119
$34
$130
$281
$0
$100
$200
$300
$400
$500
$600
Cash, AR andMerchandise Trust
AP and AccruedLiabilities
MerchandiseLiability
Debt Excess Cash andAssets
Sustained Business Growth While Maintaining Stable Credit Profile
Asset base has grown while total leverage has remained steady
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Total Assets, Debt and Partners’ Capital Total Debt / Accrual EBITDA
($ in millions)
3.6x
3.8x
3.1x
2.8x
3.4x
3.6x
0.0x
1.0x
2.0x
3.0x
4.0x
5.0x
2008 2009 2010 2011 2012 TTM Q3
$738
$859
$1,147
$1,249
$1,344
$1,448
$161 $183 $220 $195
$255 $281
$119 $112 $128 $180 $135 $124
$0
$300
$600
$900
$1,200
$1,500
2008 2009 2010 2011 2012 3Q '13
Total Assets Total Debt Total Partners' Capital
31
Financial Summary
Accounting not representative of current sales activity
Continuing operational performance and growth
Strong balance sheet with solid assets
Cash and investments far in excess of all liabilities
Uniquely positioned to take advantage of rising interest rate
environment
William R. Shane
Vice-Chairman
Growth Through Acquisitions
33
Acquisitions have contributed to strong corporate growth
Discipline in selecting target -- “Never break the model”
Focus on acquisitions that generate incremental cash flow in
excess of financing costs
Accretive from day one
Disciplined Acquisition Philosophy
Acquisition Track Record
34
Since Our IPO in September 2004
Assets Cemeteries Funeral Homes Purchase Price(1)(2)
2005 Purchases 23 6 $16.0
2006 Purchases 23 14 17.0
2007 Purchases 48 30 81.9
2008 Purchases 7 2 2.1
2009 Purchases 3 0 7.3
2010 Purchases 22 5 49.4
2011 Purchases 17 11 16.2
2012 Purchases 5 17 34.9
2013 Purchases (YTD) 1 6 22.8
149 91 $247.6
(1) Includes transaction costs(2) In millions
Acquisition Contributions
36
Acquisitions Contribute to Overall Corporate Growth
Selected Information 2004 (000’s) 2012 (000’s) % Increase
Cemetery Property $151,215 $309,980 106%
Trust Funds $242,474 $658,286 171%
Total Assets $494,467 $1,343,725 172%
Total Revenues (GAAP) $89,248 $242,606 172%
# Cemeteries 132 276 109%
# Funeral Homes 7 86 1,129%
Funeral Home Growth
2004 2012
Funeral Homes 7 86
Revenues $1,953 $35,679
Expense $1,712 $28,725
Operating Profit $241 $6,954
Funeral home revenue increased from 2% to 15% of total
GAAP revenue
Funeral homes generally generate positive cash flow
without the need to fund capital growth
36
37
Acquisition Criteria
Internal rate of return greater than cost of capital
• 10 year discounted cash flow
• Terminal value equal to 5 times year-10 cash flow
Positive cash flow after repaying acquisition price over a 10 year
period
Generate cash flow toward an increased distribution
Cemetery property must have minimum of 25 years sales life at
projected rate
Reasonably be able to fit within the companies debt leverage
calculation
38
Large trust funds
Significant available inventory for sale
Proximity to metropolitan market areas
Historical interments in excess of 200 annually
Significant at-need historical volume
Properties that meet the preceding criteria generally have:
Major Improvements Post Acquisition
Institute pre-need sales program
Seasoned, professional management
Significantly reduce product costs
Consolidate office functions into home office
Professional trust fund management which improves trust fund
returns
Price increases do not support purchase price
39
Working Capital Borrowings
Cemetery Acquisitions generally require working capital
borrowings to finance growth as indicated by:
• Build in Accounts Receivable
• Deposits into Merchandise Trust Funds
• Construction of lawn crypts, mausoleums & niches
Borrowing requirement greatest in years 1 & 2 after acquisition
Borrowing needs are generally eliminated after year 4
Acquisition criteria require all borrowings to be repaid by year-10
Borrowings represent deferred acquisition price
40
41
Acquisitions
Acquisition philosophy has helped company to:
Increase distribution from $1.85 per unit in 2004 to $2.40 per unit in 2013
Increase assets over $800 million while increasing long term debt only
$172 million
Thank You