Management's Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements
Certain statements made herein or elsewhere by or on behalf of the Company that are not historical facts are intended to be forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

As previously announced, the Company recently revised its short- and medium-term outlook and goals. The Company currently anticipates that fiscal year 2000 will be a year of transition, from a period of rapid growth, fueled primarily by acquisitions, to a period of moderate growth, driven primarily by internal growth strategies and a more intense focus on improving the operations of businesses acquired. In this regard, management's current goal is to grow revenue in fiscal year 2000 at about 1 percent from 1999 amounts with relatively flat, to slightly down, earnings before interest, taxes, depreciation and amortization (EBITDA) from 1999 amounts. Management's current earnings per share goal for fiscal year 2000 is in the $.68 - $.72 range. Fiscal year 2000 goals also include spending $25 million on internal growth initiatives. The current tax rate anticipated for fiscal year 2000 is 36.5 percent, and the Company's weighted average cost of debt as of October 31, 1999, was 6.1 percent.

The Company's current goal for annual earnings per share growth after fiscal year 2000 is 10 percent. The Company's goal is to attain that growth primarily by achieving 2 percent to 4 percent growth in revenues, keeping cost increases in the 1 percent to 3 percent range and improving cash flow to reduce debt. The Company's cash flow from operations is expected to improve, as its fiscal year 2000 estimates include only $25 million in internal growth initiatives, and cemetery revenue, which is the principal driver for increases in installment receivables, is anticipated to be relatively flat.

The Company anticipates implementing cash flow initiatives for 2000 which include analysis and possible re-deployment of excess cemetery property, under-performing assets and real estate that would be more valuable if converted to another use.

In response to changes in the acquisition market discussed above under the heading "Introduction," the Company has not included acquisitions in its growth expectations for fiscal year 2000 and beyond.

Forward-looking statements are based on assumptions about future events and are therefore inherently uncertain; actual results may differ materially from those projected. See "Cautionary Statements" below.