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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 9, 1999
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)
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ITEM 5. OTHER EVENTS
On March 9, 1999 the Company issued the following press release.
CONTACT: Kenneth C. Budde
Stewart Enterprises, Inc.
110 Veterans Memorial Boulevard
Metairie, Louisiana 70005
504/837-5880
FOR IMMEDIATE RELEASE
STEWART ENTERPRISES REPORTS FIRST QUARTER FISCAL YEAR 1999 RESULTS --
EARNINGS PER SHARE INCREASE 23 PERCENT, REVENUES INCREASE 23 PERCENT
Metairie, Louisiana, March 9, 1999. . . Stewart Enterprises, Inc. (Nasdaq
NMS: STEI) today announced that revenues for the first quarter of 1999 as
compared to the first quarter of 1998 increased 23 percent to $182.9 million
from $149.3 million, net earnings increased 21 percent to $26.5 million from
$21.9 million, and diluted earnings per share increased 23 percent to $.27
from $.22. All share and per-share information reflects the Company's
two-for-one stock split effective April 24, 1998.
Joseph P. Henican, III, Chief Executive Officer, commented, "We are pleased
to report another solid quarter, with significant increases in revenues, net
earnings and earnings per share. We believe that we are, first and
foremost, owners and operators of funeral homes and cemeteries. We believe
that our strong performance, quarter after quarter and year after year, is
the result of our tradition of serving families one at a time and our
commitment to the principles of quality, service and value."
Mr. Henican added, "The strong results we achieved in the first quarter were
due, to a great extent, to our fundamental principles of disciplined and
balanced growth, which combine our strong acquisition program with our
innovative internal growth strategies. Because of our commitment to this
balanced and disciplined growth strategy, we expect both acquisitions and
our internal growth initiatives to remain vital parts of our overall
business growth in the future."
Mr. Henican went on to state, "In order to continue to grow our company, in
January 1999 we returned to the financial markets with a public offering of
Class A Common Stock. The offering was oversubscribed and the underwriters
exercised their overallotment option. We issued a total of 13,627,500
shares generating approximately $219 million in net proceeds which will be
used to fund our continuing acquisition program and for general corporate
purposes."
William E. Rowe, President and Chief Operating Officer, commented, "We have
continued to achieve strong financial results by maintaining the disciplined
and balanced operation of our businesses. During the quarter, our gross
margin increased 130 basis points, to 32.2%, and our operating margin
increased 190 basis points, to 30.1%, from 30.9% and 28.2%, respectively,
reported for the comparable period in 1998. We attribute these results to
the ongoing improvements in our core businesses and contributions from
recent acquisitions."
Mr. Rowe continued, "Thus far in fiscal year 1999, we have acquired or
committed to acquire 92 businesses for an aggregate purchase price of
approximately $150 million. These businesses are expected to generate
annualized revenues of approximately $67 million and serve over 20,000
families worldwide. During the last 45 days, we renegotiated several
pending acquisitions to better reflect current pricing and market conditions
resulting in purchase price reductions. Further, we terminated negotiations
with respect to one large transaction and added a number of additional
commitments at lower pricing."
"We maintain our opportunistic approach to acquisitions, but our focus
continues to be domestic acquisitions, principally in the West and Midwest.
Our current year domestic acquisitions and commitments include businesses
which will serve approximately 14,000 families on an annual basis, including
our commitment to acquire the largest independent funeral firm in the
Midwest as well as one of the largest independent cemeteries in the Midwest,
which together serve approximately 9,000 families. Internationally, we have
expanded our presence in Europe with current year acquisitions
and commitments to acquire 34 properties, bringing the total families served
annually in European markets to over 23,000."
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 593 funeral homes and 143 cemeteries in North America,
South America, Europe and the Pacific Rim.
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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, 1998.
The Company assumes no obligation to update information contained herein.
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STEWART ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended January 31,
______________________________
1999 1998
_____________ ___________
<S> <C> <C>
Revenues:
Funeral $ 111,483 $ 86,918
Cemetery 71,438 62,391
_____________ ___________
Total revenues 182,921 149,309
_____________ ___________
Costs and expenses:
Funeral 73,258 58,861
Cemetery 50,673 44,331
_____________ ___________
Total costs and expenses 123,931 103,192
_____________ ___________
Gross profit 58,990 46,117
Corporate general and administrative expenses 4,015 4,024
_____________ ___________
Operating earnings 54,975 42,093
Interest expense (14,400) (9,946)
Investment and other income 1,184 1,358
_____________ ___________
Earnings before income taxes 41,759 33,505
Income taxes 15,242 11,559
_____________ ___________
Net earnings $ 26,517 $ 21,946
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Earnings per share:
Basic $ 0.27 $ 0.23 (a)
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Diluted $ 0.27 $ 0.22 (a)
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Weighted average shares outstanding (in thousands):
Basic 98,045 97,401 (a)
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Diluted 98,721 98,134 (a)
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Dividends per share $ 0.02 $ 0.01 (a)
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</TABLE>
(a) Restated to reflect the Company's two-for-one stock split
effective April 24, 1998.
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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 thereunto duly authorized.
STEWART ENTERPRISES, INC.
March 9, 1999 /s/ KENNETH C. BUDDE
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Kenneth C. Budde
Executive Vice President
Chief Financial Officer
