In fiscal 1999, we reported to you that we had commissioned one of the country’s leading consulting firms to conduct a comprehensive national study of consumer preferences related to the death care industry. During fiscal 2000, we moved into the second phase of that effort, known as Project Catalyst. Working with the same consulting firm, our corporate development office and employee teams developed specific implementation-ready business models. During the current year, Project Catalyst will be an active program, one that you can look forward to hearing more about in the future.

Training employees to improve the manner in which they interact with customer families was one of our goals during the past year and the basis for creating our corporate training department. As mentioned earlier, the funeral arranger training program has already proven invaluable. Additional training programs are under way in other areas, such as customized funeral planning, and we expect similar results when the programs are completed.

STRENGTHENED LEADERSHIP
While we have many dedicated and professional employees working daily for our company’s success, it takes a strong management team to provide the leadership necessary to reach our goals. We believe that with the changes we made in senior management during the year, we have the leaders who will take us forward. In December 1999, Brian Marlowe was named chief operating officer. G. Kenneth Stephens, Jr. succeeded him as Eastern Division president. Leading the Western Division is Randall Stricklin and heading up the Central Division is Michael Crane, Sr. Brent Heffron continues as Southern Division president; Kenneth Budde remains chief financial officer and Corporate Division president; and Lawrence Hawkins is executive vice president and president of Investors Trust, Inc. In January 2000, we added a seat to our senior executive committee by appointing Everett Kendrick as president of the newly created Sales and Marketing Division. This division will centralize responsibility for our sales teams, standardize our sales efforts and improve the overall effectiveness of our sales operation. All of these leaders held key management positions within Stewart before assuming their current roles. We are proud to have these experienced professionals guiding our company as we intensify our focus on cash flow and operations.

CHANGE AND OPPORTUNITY
“Change brings opportunity brings change.” When we presented this theme to you a year ago, we reported on the changes taking place in our industry, in our company and among consumers. We assured you that Stewart Enterprises had a long history of creating opportunity from change, and that we would do so again.