Company Report ? Alderwoods Group, Inc.
Introduction
The funeral industry is comprised of thousands of independent operators and a few large corporations that each own and manage hundreds of funeral homes, cemeteries and crematoriums. Alderwoods Group, Inc. is a company that came into the funeral service industry in 2002 after the restructuring of the now bankrupt Loewen Group, Inc. (Financial Post). The price earnings ratio as of October, 2005 is seventeen times its earnings per share (Yahoo! Finance). In the next ten years both revenues and market cap is expected to increase at Alderwoods due to the aging baby boom generation and the fact that Alderwoods has aggressively been disposing of its debt by selling off many of its assets (which include cemeteries and funeral homes).
Funeral homes, cemeteries and crematories are businesses that service the post-life activities for families. The industry covers everything from casket manufacturers and lab equipment makers (suppliers), funeral homes (providers) to the ultimate final resting place in a cemetery (plots, vaults, headstones, internment vaults, mausoleums) or in the case of cremation, ovens, loaders and ultimately, urns. Within the industry there are four major competitors on a national scale: Service Corporation International (SCI), Alderwoods Group, Inc., Carriage Services, Inc. and, Stewart Enterprises, Inc. They are all public companies that manage funeral homes, cemeteries and crematoriums throughout North America.
As of January 1, 2005, the Alderwoods Group "employs approximately 8,500 people at 648 funeral homes, 79 cemeteries and 63 combinations funeral home and cemeteries throughout North America (Alderwoods 2004 Annual Report)." These totals are significantly down from the 1990's ...