===============================================================================
UNITED STATES 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): March 10, 1998
STEWART ENTERPRISES, INC.
(Exact name of registrant as specified in its charter)
LOUISIANA 0-19508 72-0693290
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
110 Veterans Memorial Boulevard
Metairie, Louisiana 70005
(Address of principal executive offices) (Zip Code)
(504) 837-5880
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
===============================================================================
Item 5. Other Events
On March 10, 1998 the Company issued the following press
release for the quarter ended January 31, 1998.
CONTACT: Ronald H. Patron
Stewart Enterprises, Inc.
110 Veterans Memorial Boulevard
Metairie, LA 70005
504/837-5880
FOR IMMEDIATE RELEASE
STEWART ENTERPRISES REPORTS FIRST QUARTER FISCAL YEAR 1998
RESULTS - EARNINGS INCREASE 46 PERCENT, EARNINGS PER SHARE
INCREASE 29 PERCENT
Metairie, Louisiana, March 10, 1998. . . Stewart Enterprises,
Inc. (Nasdaq NMS:STEI) today announced that earnings increased 46
percent to $21.9 million, and diluted earnings per share
increased 29 percent to $.45, for the first quarter ended January
31, 1998, from $15.0 million and $.35, respectively, for the
corresponding period in fiscal year 1997, excluding the $2.3
million, or $.05 per share, charge for the cumulative effect of
the change in accounting principles recorded during the first
quarter of fiscal year 1997. Basic earnings per share increased
25 percent, to $.45 from $.36 for the first quarter of fiscal
year 1997, excluding the $.06 per share charge for the cumulative
effect of the accounting changes.
For the quarter, revenues increased 22 percent, to $149.3 million
from $122.7 million for the comparable period last fiscal year,
and operating earnings increased 34 percent, to $42.1 million
from $31.4 million in 1997. All financial information presented
reflects the Company's accounting methods adopted November 1,
1996.
First quarter 1998 per-share performance reflects a 16 percent
increase in the weighted average number of shares outstanding,
from 42.4 million to 49.1 million (diluted) and from 41.9 million
to 48.7 million (basic), due principally to the Company's June
1997 equity offering.
Joseph P. Henican, III, Chief Executive Officer, commented, "Once
again, we are pleased to report another solid quarter, with
significant increases in revenues, earnings and earnings per
share. We believe we have laid the foundation that will enable
us to continue the excellent earnings per share growth that we
have enjoyed over the last few years. Stewart Enterprises
continues to be an industry leader and a premier death care
provider. We are committed to our guiding principles of quality,
service and value, with the ultimate goal of enhancing
shareholder value."
William E. Rowe, President and Chief Operating Officer, stated,
"During the first quarter, our gross margin expanded 210 basis
points, to 30.9%, and our operating margin increased 260 basis
points, to 28.2%, from 28.8% and 25.6%, respectively, for the
corresponding period in fiscal year 1997. This performance once
again demonstrates our focus on improving the performance of our
core businesses, the maturation of recent acquisitions and our
strategy of controlling costs."
Mr. Rowe commented further, "Thus far in fiscal year 1998, we
have acquired or committed to acquire 74 businesses for an
aggregate purchase price of approximately $110 million. These
businesses are expected to generate annualized revenues of
approximately $59 million and serve more than 24,000 families
annually. Included in these acquisitions and commitments is our
entry into the Netherlands with the acquisition of five funeral
businesses, further expanding our presence in Europe, and the
acquisition of a fine funeral business in the Chicago area,
marking our entrance into Illinois. This level of acquisition
activity is the result of our enhanced Corporate Development
team, and it is in line with our estimate of total acquisition
spending of $200-$225 million for fiscal year 1998."
Founded in 1910, Stewart Enterprises is the third largest
provider of products and services in the death care industry in
North America, currently owning and operating 428 funeral homes
and 132 cemeteries in North America, Europe and the Pacific Rim.
-----------------------------------------------------------------
Statements made herein that are not historical facts are
forward-looking statements. The Company's actual results could
differ materially due to several important factors including the
following: the Company's ability to sustain recent levels of
acquisition activity and enter new markets; the economy, death
rate and competition in the Company's markets; financial market
conditions, including stock and bond prices and interest rates;
the Company's ability to achieve economies of scale and manage
growth; and the performance of acquired businesses. Such
factors, and others, are more fully described in Item 7 of the
Company's Form 10-K for the fiscal year ended October 31, 1997.
The Company assumes no obligation to update information contained
herein.
-----------------------------------------------------------------
#####
STEWART ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(Dollars in thousands, except per share amounts)
Three Months Ended January 31,
--------------------------------
1998 1997
------------- --------------
Revenues:
Funeral $ 86,918 $ 66,576
Cemetery 62,391 56,136
------------- --------------
Total revenues 149,309 122,712
------------- --------------
Costs and expenses:
Funeral 58,861 46,405
Cemetery 44,331 41,010
------------- --------------
Total costs and expenses 103,192 87,415
------------- --------------
Gross profit 46,117 35,297
Corporate general and
administrative expenses 4,024 3,855
------------- --------------
Operating earnings 42,093 31,442
Interest expense (9,946) (8,962)
Investment and other income 1,358 785
------------- --------------
Earnings before income taxes and
cumulative effect of change
in accounting principles 33,505 23,265
Income taxes 11,559 8,258
------------- --------------
Earnings before cumulative effect
of change in accounting principles 21,946 15,007
Cumulative effect of change in accounting
principles, net of a $2,230 income tax
benefit - (2,324)
------------- --------------
Net earnings $ 21,946 $ 12,683
============= ==============
Basic earnings per share:
Earnings before cumulative effect
of change in accounting principles $ 0.45 $ 0.36
Cumulative effect of change
in accounting principles - (0.06)
------------- --------------
Net earnings $ 0.45 $ 0.30
============= ==============
Diluted earnings per share:
Earnings before cumulative effect
of change in accounting principles $ 0.45 $ 0.35
Cumulative effect of change in
accounting principles - (0.05)
------------- --------------
Net earnings $ 0.45 $ 0.30
============= ==============
Weighted average shares outstanding
(in thousands):
Basic 48,736 41,853
============= ==============
Diluted 49,103 42,403
============= ==============
Dividends per share $ 0.02 $ 0.02
============= ==============
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 thereunto duly authorized.
STEWART ENTERPRISES, INC.
March 10, 1998 /s/ KENNETH C. BUDDE
-----------------------------
Kenneth C. Budde
Senior Vice President-Finance
Secretary and Treasurer
(Principal Accounting Officer)
