Financial Report of Loewen Group Inc.
Financial Report of Loewen Group Inc.
The Loewen Group Inc. was founded in 1969. The company has two major headquarters in North America, one in Burnaby, British Colombia and a second in
Cincinnati, Ohio. Loewen Group Inc. (L.G.I.) is the largest funeral services enterprise in Canada and is the second largest company in the North American
Funeral Services Industry. L.G.I. owns 918 funeral homes and 269 cemeteries and also engages in the pre-need selling of funeral services including cemetery and cremation services. The company strives on respecting its Eagle Principle, which is displayed on the first page of its 1995 Annual Report:
"To soar to heights of possibilities one needs two equally healthy, strong wings - one being that of people or service concerns, the other that of responsible planning and fiscal management. It is the balance of these wings that enables the eagle to soar beyond all heights"1
In 1995, the company defended itself against two major lawsuits, as well as continued to negotiate acquisition agreements. The Loewen Group Inc. stresses that once an acquisition has been completed, local management is encouraged to remain and offers long term contracts to its key employees, rarely dismissing the other employees. L.G.I. provides many services to its acquired companies including offering training to new employees on its management information systems and covering costs for any renovations which are needed on the acquired locations. Each funeral home and cemetery is operated as a distinct profit centre, with monthly and annual financial performance monitored by regional and corporate management in accordance with budgeted projections.
This report includes a study of The Canadian Funeral Services Industry practices, a review of the take-over attempt by Service Corporation
International, an analysis of the Loewen Group Inc. 1995 Annual Report for the period ending December 31, 1995, and examination of the revenue recognition
The Loewen Group Inc. was founded in 1969. The company has two major headquarters in North America, one in Burnaby, British Colombia and a second in
Cincinnati, Ohio. Loewen Group Inc. (L.G.I.) is the largest funeral services enterprise in Canada and is the second largest company in the North American
Funeral Services Industry. L.G.I. owns 918 funeral homes and 269 cemeteries and also engages in the pre-need selling of funeral services including cemetery and cremation services. The company strives on respecting its Eagle Principle, which is displayed on the first page of its 1995 Annual Report:
"To soar to heights of possibilities one needs two equally healthy, strong wings - one being that of people or service concerns, the other that of responsible planning and fiscal management. It is the balance of these wings that enables the eagle to soar beyond all heights"1
In 1995, the company defended itself against two major lawsuits, as well as continued to negotiate acquisition agreements. The Loewen Group Inc. stresses that once an acquisition has been completed, local management is encouraged to remain and offers long term contracts to its key employees, rarely dismissing the other employees. L.G.I. provides many services to its acquired companies including offering training to new employees on its management information systems and covering costs for any renovations which are needed on the acquired locations. Each funeral home and cemetery is operated as a distinct profit centre, with monthly and annual financial performance monitored by regional and corporate management in accordance with budgeted projections.
This report includes a study of The Canadian Funeral Services Industry practices, a review of the take-over attempt by Service Corporation
International, an analysis of the Loewen Group Inc. 1995 Annual Report for the period ending December 31, 1995, and examination of the revenue recognition
References: 1. Loewen Group Incorporated, "The Loewen Group Inc. 1995 Annual Report", H. Series Inc., 1994. Gibbins, Michael, Financial Accounting: An Integrated Approach, 2nd Edition, Scarborough, Nelson Canada, 1995. Heimbecker, John, Final Purchase, Growing Demand, The Canadian Funeral Services Industry, Ottawa, Statistics Canada, 1995. The Loewen Group Inc., The Loewen Group Inc. 1995 Annual Report, Burnaby B.C.: H. MacDonald Printing, 1996. The Loewen Group International Inc., [online] Available @ http://www.sec.gov/archives/edgar/data/845577/0000950109/09-96- Total revenue 599939 417328 REV Net income (76684) 38494 NI ROE (return on equity) (76684) / 614682 = (0.125) 38494 / 411139 = 0.094 NI / E SR (sales return before interest) [(76684) + 70311] / 599939 = (0.011) [38494 + 22608] / 417328 = 0.146 [NI + ATI] / REV ROA (return on assets) [(76684) + 70311] / 2262980 = (0.003) [38494 + 22608] / 1326275 = 0.046 [NI + ATI] / A