<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 30, 1996
THE LOEWEN GROUP INC.
(Exact name of registrant as specified in its charter)
British Columbia, Canada 0-18429 98-0121376
- ---------------------------- ----------------------- -------------------
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
4126 Norland Avenue, Burnaby, British Columbia V5G 3S8
- ----------------------------------------------------------------
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code 604-299-9321
N/A
(Former name of former address, if changed since last report)
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Item 5. Other Events
THE LOEWEN GROUP INC.
Unaudited Pro-Forma Consolidated Statement of Operations
During the six months ended June 30, 1996, the Company acquired control of
78 funeral homes, 57 cemeteries and two insurance companies in the United
States, and five funeral homes and one cemetery in Canada for a total
consideration of $361,748,000. Included in these acquisitions is the purchase
of certain net assets from SI Acquisition Associates L.P. ("S.I.") for
approximately $145,000,000. The following statement reflects, on an unaudited
pro-forma basis, the consolidated results of the Company's operations as if all
acquisitions that occurred during the six months ended June 30, 1996 had taken
place at January 1, 1996. Appropriate adjustments have been made to reflect
the preliminary purchase price allocations used in recording these
acquisitions. This pro-forma information does not purport to be indicative of
the results of operations that would have resulted had the acquisitions been in
effect for the entire period, and is not intended to be a projection of future
results or trends.
The unaudited pro-forma consolidated statement of operations has been
expressed in United States dollars and in accordance with accounting principles
generally accepted in Canada. The unaudited pro-forma consolidated statement
of operations should be read in conjunction with the notes thereto.
Unaudited Pro-Forma Consolidated Statement of Operations
Six Months Ended June 30, 1996
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Businesses
Acquired Pro-forma Pro-forma
Historical (Note A) Adjustments Total
----------- ---------- ------------ ---------
<S> <C> <C> <C> <C>
Revenue $416,240 $ 35,525 $ 95 B $451,860
Costs and expenses 262,143 33,459 (175) B
(2,246) C
229 D 293,410
-------- -------- -------- --------
154,097 2,066 2,287 158,450
General and administrative 33,859 --- --- 33,859
Depreciation and amortization 24,702 1,127 1,127 D
(1,127) E 25,829
-------- -------- -------- --------
Earnings from operations 95,536 939 2,287 98,762
Interest on long-term debt 39,546 700 (700) F
4,550 G 44,096
-------- -------- -------- --------
Earnings (loss) before
dividends on preferred
securities of subsidiary
and income taxes 55,990 239 (1,563) 54,666
Dividends on preferred
securities of subsidiary 3,544 --- --- 3,544
-------- -------- -------- --------
Earnings (loss) before
income taxes 52,446 239 (1,563) 51,122
Income taxes 15,734 205 (237) H 15,702
-------- -------- -------- --------
Net earnings (loss) for
the period $36,712 $ 34 $ (1,326) $ 35,420
======== ======== ========= ========
Earnings per share:
Basic earnings per share $ 0.60 $ 0.56
Fully diluted earnings
per share $ 0.60 $ 0.56
Weighted average number
of shares used for
the computation of basic
and fully diluted
earnings per share
(thousands of shares):
Basic 54,445 54,638
Fully diluted 55,200 55,393
</TABLE>
See accompanying notes to unaudited pro-forma consolidated statement of
operations.
Page 1
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THE LOEWEN GROUP INC.
Notes to Unaudited Pro-Forma Consolidated Statement of Operations
Six Months Ended June 30, 1996
(A) To record the historical statements of operations for the period from
January 1, 1996 to the date of acquisition. Results of operations
subsequent to the acquisition date have been included in the Company's
consolidated statement of operations.
(B) To adjust the amortization of realized and unrealized gains and losses on
insurance invested assets and the change in insurance policy liabilities
as if the acquisition occurred on January 1, 1996.
(C) To eliminate certain operating expenses, including officer salaries,
rental expense, professional fees and insurance that would not be
incurred if the businesses had been owned by the Company.
(D) To adjust cost of sales and depreciation and amortization expense
resulting from the Company's cost basis in the acquired businesses.
(E) To eliminate historical depreciation and amortization of the acquired
businesses.
(F) To eliminate historical interest expense on debt which was repaid upon
acquisition.
(G) For purposes of the unaudited pro-forma statement of operations and
pro-forma adjustments, the Company has assumed that acquisitions were
financed by common shares to the extent actually issued for specific
acquisitions, $80 million of borrowings from the issuance of senior
guaranteed notes, the issuance of 8,800,000 Series C Convertible First
Preferred Shares and the remainder through borrowings from the
Company's revolving credit facility.
(H) To adjust income taxes to reflect the statutory rate, including the
effect of permanent differences.
<PAGE> 4
THE LOEWEN GROUP INC.
Unaudited Pro-Forma Consolidated Statement of Operations
During the six months ended June 30, 1996, the Company acquired control of
78 funeral homes, 57 cemeteries and two insurance companies in the United
States, and five funeral homes and one cemetery in Canada for a total
consideration of $361,748,000. Included in these acquisitions is the purchase of
certain net assets from SI Acquisition Associates L.P. ("S.I.") for
approximately $145,000,000. The following statement reflects, on an unaudited
pro-forma basis, the consolidated results of the Company's operations as if all
acquisitions that occurred during the six months ended June 30, 1996 had taken
place at January 1, 1995. Appropriate adjustments have been made to reflect the
preliminary purchase price allocations used in recording these
acquisitions. This pro-forma information does not purport to be indicative of
the results of operations that would have resulted had the acquisitions been
in effect for the entire period, and is not intended to be a projection of
future results or trends.
The unaudited pro-forma consolidated statement of operations has been
expressed in United States dollars and in accordance with accounting principles
generally accepted in Canada. The unaudited pro-forma consolidated statement
of operations should be read in conjunction with the notes thereto.
Unaudited Pro-Forma Consolidated Statement of Operations
For the Year Ended December 31, 1995
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Businesses
Acquired Pro-forma Pro-forma
Historical (Note A) Adjustments Total
---------- ---------- ----------- ---------
<S> <C> <C> <C> <C>
Revenue $ 599,939 $ 156,321 $ 1,460 B $ 757,720
Costs and expenses 373,131 138,077 (701)B
(8,210)C
874 D 503,171
--------- --------- --------- ---------
226,808 18,244 9,497 254,549
General and administrative 67,652 --- --- 67,652
Depreciation and amortization 40,103 5,375 6,145 D
(5,375)E 46,248
--------- --------- --------- ---------
Earnings from operations 119,053 12,869 8,727 140,649
Interest on long-term debt 50,913 3,728 (3,728)F
15,063 G 65,976
Litigation related finance
costs 19,914 --- --- 19,914
Legal settlements 165,000 --- --- 165,000
--------- --------- --------- ---------
Earnings (loss) before
dividends on preferred
securities of subsidiary
and income taxes (116,774) 9,141 (2,608) (110,241)
Dividends on preferred
securities of subsidiary 7,088 --- --- 7,088
--------- --------- --------- ---------
Earnings (loss) before
income taxes (123,862) 9,141 (2,608) (117,329)
Income taxes (47,178) 2,495 554 H (44,129)
--------- --------- --------- ---------
Net earnings (loss) for
the year $ (76,684) $ 6,646 $ (3,162) $ (73,200)
========= ========= ========= =========
Earnings per share:
Basic earnings (loss) per
share $ (1.69) $ (1.82)
Fully diluted earnings
(loss) per share $ (1.69) $ (1.82)
Weighted average number of shares
used for the computation
of basic and fully diluted
earnings per share
(thousands of shares):
Basic 45,291 45,599
Fully diluted 45,291 45,599
</TABLE>
See accompanying notes to unaudited pro-forma consolidated statement of
operations.
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THE LOEWEN GROUP INC.
Notes to Unaudited Pro-Forma Consolidated Statement of Operations
For the Year Ended December 31, 1995
(A) To record the historical statements of operations for the year ended
December 31, 1995.
(B) To adjust the amortization of realized and unrealized gains and losses
on insurance invested assets and the change in insurance policy
liabilities as if the acquisition occurred on January 1, 1995.
(C) To eliminate certain operating expenses, including officer salaries,
rental expense, professional fees and insurance that would not be
incurred if the businesses had been owned by the Company.
(D) To adjust cost of sales and depreciation and amortization expense
resulting from the Company's cost basis in the acquired businesses.
(E) To eliminate historical depreciation and amortization of the acquired
businesses.
(F) To eliminate historical interest expense on debt which was repaid upon
acquisition.
(G) For purposes of the unaudited pro-forma statement of operations and
pro-forma adjustments, the Company has assumed that acquisitions were
financed by common shares to the extent actually issued for specific
acquisitions, $80 million of borrowings from the issuance of senior
guaranteed notes, the issuance of 8,800,000 Series C Convertible First
Preferred Shares and the remainder through borrowings from the
Company's revolving credit facility.
(H) To adjust income taxes to reflect the statutory rate, including the
effect of permanent differences.
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Signature
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: September 4, 1996
THE LOEWEN GROUP INC.
By: /s/ PETER S. HYNDMAN
------------------------------------
Name: Peter S. Hyndman
Title: Corporate Secretary
