10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

    x     Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended July 31, 2012

or

    ¨     Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from          to         

Commission File Number: 1-15449

STEWART ENTERPRISES, INC.

(Exact name of registrant as specified in its charter)

LOUISIANA	72-0693290
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1333 South Clearview Parkway Jefferson, Louisiana	70121
(Address of principal executive offices)	(Zip Code)

(504) 729-1400

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes   x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes   x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨	Accelerated filer	x
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.)    Yes  ¨    No  x

The number of shares of the registrant’s Class A common stock, no par value per share, and Class B common stock, no par value per share, outstanding as of August 31, 2012, was 81,828,448 and 3,555,020, respectively.

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

INDEX

			Page
Part I.	Financial Information
	Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Statements of Earnings — Three Months Ended July 31, 2012 and 2011			3
	Condensed Consolidated Statements of Earnings — Nine Months Ended July 31, 2012 and 2011			4
	Condensed Consolidated Balance Sheets — July 31, 2012 and October 31, 2011			5
	Condensed Consolidated Statement of Shareholders’ Equity — Nine Months Ended July 31, 2012			7
	Condensed Consolidated Statements of Cash Flows — Nine Months Ended July 31, 2012 and 2011			8
	Notes to Condensed Consolidated Financial Statements			9
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		47
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk		60
	Item 4.	Controls and Procedures		60
Part II.	Other Information
	Item 1.	Legal Proceedings		61
	Item 1A.	Risk Factors		61
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		61
	Item 6.	Exhibits		61
	Signatures			63

2

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

(Dollars in thousands, except per share amounts)

	Three Months Ended July 31,
	2012			2011
Revenues:
Funeral	$	68,883		$	68,761
Cemetery		60,356			55,596
		129,239			124,357
Costs and expenses:
Funeral		53,128			54,380
Cemetery		49,125			48,225
		102,253			102,605
Gross profit		26,986			21,752
Corporate general and administrative expenses		(7,326	)		(6,704	)
Restructuring and other charges		(305	)		—
Hurricane related recoveries, net		—			12,349
Net gain on dispositions		—			11
Other operating income, net		191			512
Operating earnings		19,546			27,920
Interest expense		(5,873	)		(5,500	)
Loss on early extinguishment of debt		—			(73	)
Investment and other income, net		57			30
Earnings from continuing operations before income taxes		13,730			22,377
Income taxes		3,834			10,146
Earnings from continuing operations		9,896			12,231
Discontinued operations:
Loss from discontinued operations before income taxes		(380	)		(365	)
Income tax benefit		(122	)		(120	)
Loss from discontinued operations		(258	)		(245	)
Net earnings	$	9,638		$	11,986
Basic earnings per common share:
Earnings from continuing operations	$	.11		$	.13
Loss from discontinued operations		—			—
Net earnings	$	.11		$	.13
Diluted earnings per common share:
Earnings from continuing operations	$	.11		$	.13
Loss from discontinued operations		—			—
Net earnings	$	.11		$	.13
Weighted average common shares outstanding (in thousands):
Basic		85,798			90,182
Diluted		86,178			90,741
Dividends declared per common share	$	.040		$	.035

See accompanying notes to condensed consolidated financial statements.

3

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

(Dollars in thousands, except per share amounts)

	Nine Months Ended July 31,
	2012			2011
Revenues:
Funeral	$	213,646		$	215,601
Cemetery		173,015			167,685
		386,661			383,286
Costs and expenses:
Funeral		160,685			162,784
Cemetery		144,456			144,754
		305,141			307,538
Gross profit		81,520			75,748
Corporate general and administrative expenses		(20,264	)		(19,548	)
Restructuring and other charges		(2,852	)		—
Hurricane related recoveries, net		—			12,245
Net gain (loss) on dispositions		332			(389	)
Other operating income, net		773			1,193
Operating earnings		59,509			69,249
Interest expense		(17,544	)		(16,968	)
Loss on early extinguishment of debt		—			(1,884	)
Investment and other income, net		148			394
Earnings from continuing operations before income taxes		42,113			50,791
Income taxes		13,773			20,262
Earnings from continuing operations		28,340			30,529
Discontinued operations:
Loss from discontinued operations before income taxes		(2,065	)		(810	)
Income tax benefit		(644	)		(309	)
Loss from discontinued operations		(1,421	)		(501	)
Net earnings	$	26,919		$	30,028
Basic earnings per common share:
Earnings from continuing operations	$	.32		$	.33
Loss from discontinued operations		(.01	)		—
Net earnings	$	.31		$	.33
Diluted earnings per common share:
Earnings from continuing operations	$	.32		$	.33
Loss from discontinued operations		(.01	)		—
Net earnings	$	.31		$	.33
Weighted average common shares outstanding (in thousands):
Basic		86,295			90,497
Diluted		86,619			91,058
Dividends declared per common share	$	.115		$	.095

See accompanying notes to condensed consolidated financial statements.

4

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Dollars in thousands, except per share amounts)

	July 31, 2012		October 31, 2011
ASSETS
Current assets:
Cash and cash equivalents	$	78,077	$	65,688
Restricted cash and cash equivalents		6,250		6,250
Marketable securities		727		662
Receivables, net of allowances		50,379		49,146
Inventories		36,384		35,859
Prepaid expenses		6,220		5,055
Deferred income taxes, net		17,624		29,768
Total current assets		195,661		192,428
Receivables due beyond one year, net of allowances		70,929		67,979
Preneed funeral receivables and trust investments		428,604		409,296
Preneed cemetery receivables and trust investments		220,629		216,582
Goodwill		249,584		247,038
Cemetery property, at cost		400,697		396,014
Property and equipment, at cost:
Land		47,652		46,538
Buildings		356,651		353,688
Equipment and other		203,022		197,766
		607,325		597,992
Less accumulated depreciation		318,258		305,708
Net property and equipment		289,067		292,284
Deferred income taxes, net		85,110		79,793
Cemetery perpetual care trust investments		259,440		240,392
Other assets		14,153		15,292
Total assets	$	2,213,874	$	2,157,098

(continued)

5

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Dollars in thousands, except per share amounts)

	July 31, 2012			October 31, 2011
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current maturities of long-term debt	$	6		$	5
Accounts payable and accrued expenses		21,539			24,547
Accrued payroll and other benefits		19,417			18,181
Accrued insurance		22,452			22,398
Accrued interest		4,310			2,129
Estimated obligation to fund cemetery perpetual care trust		12,064			12,017
Other current liabilities		9,733			10,013
Income taxes payable		4,074			1,173
Total current liabilities		93,595			90,463
Long-term debt, less current maturities		320,850			317,821
Deferred income taxes, net		5,509			5,104
Deferred preneed funeral revenue		240,648			240,286
Deferred preneed cemetery revenue		265,635			259,237
Deferred preneed funeral and cemetery receipts held in trust		580,147			558,194
Perpetual care trusts’ corpus		257,706			238,980
Other long-term liabilities		20,427			19,337
Total liabilities		1,784,517			1,729,422
Commitments and contingencies
Shareholders’ equity:
Preferred stock, $1.00 par value, 5,000,000 shares authorized; no shares issued		—			—
Common stock, $1.00 stated value:
Class A authorized 200,000,000 shares; issued and outstanding 82,281,197 and 84,421,416 shares at July 31, 2012 and October 31, 2011, respectively		82,281			84,421
Class B authorized 5,000,000 shares; issued and outstanding 3,555,020 shares at July 31, 2012 and October 31, 2011; 10 votes per share convertible into an equal number of Class A shares		3,555			3,555
Additional paid-in capital		492,153			515,274
Accumulated deficit		(148,673	)		(175,592	)
Accumulated other comprehensive income:
Unrealized appreciation of investments		41			18
Total accumulated other comprehensive income		41			18
Total shareholders’ equity		429,357			427,676
Total liabilities and shareholders’ equity	$	2,213,874		$	2,157,098

See accompanying notes to condensed consolidated financial statements.

6

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

(Unaudited)

(Dollars in thousands, except per share amounts)

	Common Stock(1)			Additional Paid-In Capital			Accumulated Deficit			Unrealized Appreciation of Investments		Total Shareholders’ Equity
Balance October 31, 2011	$	87,976		$	515,274		$	(175,592	)	$	18	$	427,676
Comprehensive income:
Net earnings		—			—			26,919			—		26,919
Other comprehensive income:
Unrealized appreciation of investments, net of deferred tax expense of ($13)		—			—			—			23		23
Total other comprehensive income		—			—			—			23		23
Total comprehensive income		—			—			26,919			23		26,942
Restricted stock activity		407			677			—			—		1,084
Issuance of common stock		109			545			—			—		654
Stock options exercised		287			929			—			—		1,216
Stock option expense		—			1,076			—			—		1,076
Tax benefit associated with stock activity		—			(261	)		—			—		(261	)
Purchase and retirement of common stock		(2,943	)		(16,132	)		—			—		(19,075	)
Dividends ($.115 per share)		—			(9,955	)		—			—		(9,955	)
Balance July 31, 2012	$	85,836		$	492,153		$	(148,673	)	$	41	$	429,357

⁽¹⁾  Amount includes 82,281 and 84,421 shares (in thousands) of Class A common stock with a stated value of $1 per share as of July 31, 2012 and October 31, 2011, respectively, and includes 3,555 shares (in thousands) of Class B common stock.

See accompanying notes to condensed consolidated financial statements.

7

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(Dollars in thousands, except per share amounts)

	Nine Months Ended July 31,
	2012			2011
Cash flows from operating activities:
Net earnings	$	26,919		$	30,028
Adjustments to reconcile net earnings to net cash provided by operating activities:
Net loss on dispositions		539			389
Loss on early extinguishment of debt		—			1,884
Non-cash restructuring charge		1,236			—
Premiums paid on early extinguishment of debt		—			(850	)
Depreciation and amortization		19,859			20,308
Non-cash interest and amortization of discount on senior convertible notes		4,127			3,957
Provision for doubtful accounts		3,041			3,859
Share-based compensation		2,630			2,275
Excess tax benefits from share-based payment arrangements		(23	)		(154	)
Provision for deferred income taxes		6,935			16,566
Estimated obligation to fund cemetery perpetual care trust		567			72
Other		90			(206	)
Changes in assets and liabilities:
Increase in receivables		(7,380	)		(14,014	)
Increase in prepaid expenses		(1,165	)		(1,359	)
Increase in inventories and cemetery property		(5,636	)		(2,844	)
Federal income tax refunds		—			1,698
Increase (decrease) in accounts payable and accrued expenses		1,307			(2,029	)
Net effect of preneed funeral production and maturities:
Decrease in preneed funeral receivables and trust investments		1,703			4,683
Increase (decrease) in deferred preneed funeral revenue		503			(4,082	)
Decrease in deferred preneed funeral receipts held in trust		(2,959	)		(1,098	)
Net effect of preneed cemetery production and deliveries:
(Increase) decrease in preneed cemetery receivables and trust investments		409			(5,342	)
Increase (decrease) in deferred preneed cemetery revenue		6,398			(1,503	)
Increase (decrease) in deferred preneed cemetery receipts held in trust		(695	)		8,959
Increase (decrease) in other		334			(730	)
Net cash provided by operating activities		58,739			60,467
Cash flows from investing activities:
Proceeds from sales of certificates of deposit and marketable securities and release of restricted funds		2,006			10,000
Deposits of restricted funds and purchases of restricted cash equivalents and marketable securities		(2,036	)		(6,912	)
Proceeds from sale of assets		533			332
Purchase of subsidiaries and other investments, net of cash acquired		(3,113	)		(9,110	)
Additions to property and equipment		(16,215	)		(15,688	)
Other		87			103
Net cash used in investing activities		(18,738	)		(21,275	)
Cash flows from financing activities:
Proceeds of long term debt		—			200,000
Repayments of long-term debt		(4	)		(200,004	)
Debt refinancing costs		(34	)		(5,933	)
Issuance of common stock		1,433			1,386
Purchase and retirement of common stock		(19,075	)		(15,622	)
Dividends		(9,955	)		(8,662	)
Excess tax benefits from share-based payment arrangements		23			154
Net cash used in financing activities		(27,612	)		(28,681	)
Net increase in cash		12,389			10,511
Cash and cash equivalents, beginning of period		65,688			56,060
Cash and cash equivalents, end of period	$	78,077		$	66,571
Supplemental cash flow information:
Cash paid during the period for:
Income taxes, net	$	2,542		$	2,215
Interest	$	11,452		$	13,613
Non-cash investing and financing activities:
Issuance of common stock to directors	$	437		$	456
Issuance of restricted stock, net of forfeitures	$	1,084		$	924

See accompanying notes to condensed consolidated financial statements.

8

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(1) Basis of Presentation

(a) The Company

Stewart Enterprises, Inc. (the “Company”) is a provider of funeral and cemetery products and services in the death care industry in the United States and Puerto Rico. Through its subsidiaries, the Company offers a complete line of funeral and cremation merchandise and services, along with cemetery property, merchandise and services, both at the time of need and on a preneed basis. As of July 31, 2012, the Company owned and operated 217 funeral homes and 141 cemeteries in 24 states within the United States and Puerto Rico. The Company has three operating and reportable segments consisting of a funeral segment, a cemetery segment and a corporate trust management segment.

(b) Principles of Consolidation

The accompanying condensed consolidated financial statements include the Company and its subsidiaries. All significant intercompany balances and transactions have been eliminated.

(c) Interim Disclosures

The information as of July 31, 2012, and for the three and nine months ended July 31, 2012 and 2011, is unaudited but, in the opinion of management, reflects all adjustments, which are of a normal recurring nature, necessary to a fair statement of the results for the interim periods. The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2011 (the “2011 Form 10-K”).

The October 31, 2011 condensed consolidated balance sheet data was derived from audited financial statements in the Company’s 2011 Form 10-K, but does not include all disclosures required by accounting principles generally accepted in the United States of America, which are presented in the Company’s 2011 Form 10-K.

The results of operations for the three and nine months ended July 31, 2012 are not necessarily indicative of the results to be expected for the fiscal year ending October 31, 2012.

(d) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s significant estimates are disclosed in Note 2 in the Company’s 2011 Form 10-K.

(e) Share-Based Compensation

The Company has share-based compensation plans, which are described in more detail in Note 18 to the consolidated financial statements in the Company’s 2011 Form 10-K. Stock option expense is reflected in corporate general and administrative expenses in the condensed consolidated statements of earnings and amounted to $358 and $281 for the three months ended July 31, 2012 and 2011, respectively, and $1,076 and $842 for the nine months ended July 31, 2012 and 2011, respectively. As of July 31, 2012, there was $3,305 of total unrecognized compensation costs related to stock options that is expected to be recognized over a weighted-average period of 2.8 years. Total stock option expense for fiscal year 2012 is expected to be $1,385. The expense related to restricted stock is reflected in corporate general and administrative expenses in the condensed consolidated statements of earnings and amounted to $385 and $333 for the three months ended July 31, 2012 and 2011,

9

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(1) Basis of Presentation—(Continued)

respectively, and $1,117 and $977 for the nine months ended July 31, 2012 and 2011, respectively. As of July 31, 2012, there was $1,311 of remaining future restricted stock expense to be recognized. Total restricted stock expense for fiscal year 2012 is expected to be $1,539.

During the nine months ended July 31, 2012, the Company issued 67,853 shares of Class A common stock and paid approximately $133 in cash to the independent directors of the Company. The expense related to this stock grant amounted to $437 and was recorded in corporate general and administrative expenses during the first quarter of fiscal year 2012. During the nine months ended July 31, 2011, the Company issued 82,160 shares of Class A common stock and paid approximately $114 in cash to the independent directors of the Company. The expense related to this stock grant amounted to $456 and was recorded in corporate general and administrative expenses during the first quarter of fiscal year 2011. Each of the shares issued has a restriction requiring each independent director to hold the respective shares until completion of service as a member of the Company’s Board of Directors.

The table below presents all stock options and restricted stock granted to employees during the nine months ended July 31, 2012:

Grant Type	Number of Shares Granted		Weighted Average Price per  Share		Vesting Period	Vesting Condition
Stock options		1,215,000	$	6.26	Equal one-fourth portions over 4 years		Service condition
Restricted stock		449,500	$	6.26	Equal one-third portions over 3 years		Market condition

The fair value of the Company’s service based stock options granted in fiscal year 2012 is the estimated present value at the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions for the nine months ended July 31, 2012: expected dividend yield of 2.2 percent; expected volatility of 37.8 percent; risk-free interest rate of 1.5 percent; and an expected term of 6.3 years. During the nine months ended July 31, 2012, the Company granted 449,500 shares of restricted stock with market conditions based on achieving certain specified target stock prices in the fiscal years 2012, 2013 and 2014. The Company records the expense over the requisite service period.

(f) Purchase and Retirement of Common Stock

Share repurchases are recorded at stated value with the amount in excess of stated value recorded as a reduction to additional paid-in capital. Share repurchases reduce the weighted average number of common shares outstanding during each period.

On September 19, 2007, the Company announced a stock repurchase program, authorizing the investment of up to $25,000 in the repurchase of the Company’s common stock. Repurchases under the program are limited to the Company’s Class A common stock, and can be made in the open market or in privately negotiated transactions at such times and in such amounts as management deems appropriate, depending upon market conditions and other factors. The program was increased by $25,000 in December 2007, June 2008, June 2011 and September 2011, resulting in a $125,000 program. During the nine months ended July 31, 2012, the Company repurchased 2,942,840 shares of its Class A common stock for $18,994 at an average price of $6.45 per share. As of July 31, 2012, the Company has repurchased 14,844,763 shares of its Class A common stock since the start of the program for $100,235 at an average price of $6.75 per share and has $24,765 still authorized under this program.

10

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(1) Basis of Presentation—(Continued)

(g) Dividends

In March 2005, the Company announced that its Board of Directors approved the initiation of a quarterly cash dividend of two and one-half cents per share of Class A and B common stock. In September 2009, June 2011 and March 2012, the Company announced that it had increased its quarterly dividend rate by one half cent per share. Effective March 2012, the quarterly dividend rate is four cents per share of Class A and B common stock. Although the Company intends to pay regular quarterly cash dividends for the foreseeable future, the declaration and payment of future dividends are discretionary and will be subject to determination by the Board of Directors each quarter after its review of the Company’s financial performance. For the nine months ended July 31, 2012, and 2011, the Company paid $9,955 and $8,662, respectively, in dividends.

(h) Receivables and Allowance for Doubtful Accounts

The Company establishes an allowance for uncollectible installment contracts and trade accounts based on a range of percentages applied to accounts receivable aging categories. These percentages are based on an analysis of the Company’s historical collection and write-off experience. At-need funeral and other receivables are considered past due after 30 days. The Company records an allowance on its interest accruals similar to the corresponding principal aging categories. For accounts that are greater than 90 days past due, interest continues to be accrued, however, an allowance is established to fully reserve this interest receivable. Interest income on these receivables is recognized only to the extent the account becomes less than 90 days past due and then only on the non-reserved portion. Accounts are restored to normal accrual status only when interest and principal payments are brought current and future payments are reasonably assured.

As of July 31, 2012 and October 31, 2011, the Company’s receivables and related allowances were as follows:

	Receivables as of July 31, 2012		Receivables as of October 31, 2011
	Ending Balance Collectively Evaluated for Impairment		Ending Balance Collectively Evaluated for Impairment
Current receivables – at-need funeral	$	8,651	$	8,317
Current receivables – other		45,777		45,455
Receivables, due beyond one year – other		76,234		75,097
Preneed funeral receivables		44,069		43,457
Preneed cemetery receivables		29,057		30,270
Total	$	203,788	$	202,596
Total current receivables		54,428		53,772
Total noncurrent receivables		149,360		148,824
Total	$	203,788	$	202,596

11

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(1) Basis of Presentation—(Continued)

Other receivables are comprised primarily of receivables related to the sale of preneed property interment rights but also include income tax receivables and trade and other receivables.

	Allowance for Doubtful Accounts and Cancellations as of July 31, 2012			Allowance for Doubtful Accounts and Cancellations as of October 31, 2011
	Ending Balance Collectively Evaluated for Impairment			Ending Balance Collectively Evaluated for Impairment
Current receivables – at-need funeral and other	$	(4,049	)	$	(4,626	)
Receivables, due beyond one year – other		(5,305	)		(7,118	)
Preneed funeral receivables		(10,728	)		(11,359	)
Preneed cemetery receivables		(2,138	)		(3,366	)
Total	$	(22,220	)	$	(26,469	)
Total current receivables		(4,049	)		(4,626	)
Total noncurrent receivables		(18,171	)		(21,843	)
Total	$	(22,220	)	$	(26,469	)

	Allowance for Doubtful Accounts and Cancellations Rollforward
	Balance – October 31, 2011		Charged to costs and expenses		Write-offs			Balance – July 31, 2012
Current receivables – at-need funeral and other	$	4,626		1,316		(1,893	)	$	4,049
Receivables, due beyond one year – other		7,118		1,725		(3,538	)		5,305
	$	11,744		3,041		(5,431	)	$	9,354

	Allowance for Doubtful Accounts and Cancellations Rollforward
	Balance – October 31, 2010		Charged to costs and expenses		Write-offs			Balance – July 31, 2011
Current receivables – at-need funeral and other	$	5,738		1,568		(2,013	)	$	5,293
Receivables, due beyond one year – other		8,324		2,291		(2,883	)		7,732
	$	14,062		3,859		(4,896	)	$	13,025

The Company establishes allowances for preneed funeral and cemetery merchandise and services trust receivables. Changes in these allowances have no effect on the condensed consolidated statement of earnings but are recorded as reductions in preneed receivables and preneed deferred revenue in the condensed consolidated balance sheet.

12

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(1) Basis of Presentation—(Continued)

The following summarizes the Company’s receivables aging analysis:

	Receivables Aging Analysis as of July 31, 2012
	1 to 30 Days		31 to 60 Days		61 to 90 Days		Greater than 90  Days		Total
Receivables – at-need funeral	$	5,045	$	1,215	$	450	$	1,941	$	8,651
Receivables – other		104,096		4,156		2,147		11,612		122,011
Preneed funeral receivables		31,817		867		370		11,015		44,069
Preneed cemetery receivables		24,943		1,036		519		2,559		29,057
	$	165,901	$	7,274	$	3,486	$	27,127	$	203,788

(i) Reclassifications

Certain reclassifications have been made to the 2011 condensed consolidated financial statements in order for these periods to be comparable due to the reclassification of discontinued operations. These reclassifications had no effect on the Company’s net earnings, total shareholders’ equity or cash flows.

(2) New Accounting Principles

In January 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-06, which requires additional fair value disclosures. This guidance requires reporting entities to disclose transfers in and out of Levels 1 and 2 and requires gross presentation of purchases, sales, issuances and settlements in the Level 3 reconciliation of the three-tier fair value hierarchy. The guidance on transfers in and out of Levels 1 and 2 was effective for interim and annual reporting periods beginning after December 15, 2009 and was adopted by the Company as of its second fiscal quarter ended April 30, 2010. The disclosures on gross presentation of Level 3 purchases, sales, issuances and settlements are effective for fiscal years beginning after December 15, 2010 and for interim periods within those fiscal years and was effective for the Company’s fiscal year beginning November 1, 2011. The adoption of this guidance by the Company had no impact on the Company’s consolidated financial statements.

In December 2010, the FASB issued ASU No. 2010-28 regarding the goodwill impairment test for reporting units with zero or negative carrying amounts. The guidance clarifies the steps to be performed to determine whether goodwill has been impaired and addresses the steps for reporting units with zero or negative carrying amounts. This guidance is effective for fiscal years (and interim periods within such years) beginning after December 15, 2010, which corresponds to the Company’s first fiscal quarter beginning November 1, 2011. The adoption of this guidance had no impact on the Company’s consolidated financial statements.

In May 2011, the FASB issued ASU No. 2011-04 regarding fair value measurements and disclosures. This new guidance clarifies the application of existing fair value measurement guidance and revises certain measurement and disclosure requirements to achieve convergence with International Financial Reporting Standards. This guidance is effective for the first interim or annual period beginning after December 15, 2011, which corresponded to the Company’s second fiscal quarter beginning February 1, 2012. The adoption of this guidance by the Company had no impact on its consolidated financial statements.

In June 2011, the FASB issued ASU No. 2011-05 regarding the presentation of comprehensive income. This new guidance amends the previous application of comprehensive income and the requirements regarding presentation in the financial statements. It requires the disclosure of the components of comprehensive income, which the Company currently discloses in other sections of its filings, to be presented as part of one statement of comprehensive income, or as a separate statement of comprehensive income following the statement of earnings. In

13

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(2) New Accounting Principles—(Continued)

December 2011, the FASB issued ASU No. 2011-12 which temporarily defers those changes in ASU No. 2011-05 that relate to the presentation of reclassification adjustments out of accumulated other comprehensive income. This guidance is effective for fiscal years (and interim periods within such years) beginning after December 15, 2011, which corresponds to the Company’s first fiscal quarter beginning November 1, 2012. The Company is currently evaluating the impact the adoption of this guidance will have on its consolidated financial statements.

In December 2011, the FASB issued ASU No. 2011-11 regarding disclosures about offsetting assets and liabilities. This new guidance requires an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. This guidance is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods, which corresponds to the Company’s first fiscal quarter beginning November 1, 2013. The Company is currently evaluating the impact the adoption of this guidance will have on its consolidated financial statements.

In July 2012, the FASB issued ASU No. 2012-02 regarding subsequent measurement guidance for long lived intangibles. This guidance is meant to reduce the cost and complexity of performing an impairment test for indefinite- lived intangible assets. This guidance is effective for annual and interim tests performed for fiscal years beginning after September 15, 2012, which corresponds to the Company’s first fiscal quarter beginning November 1, 2013. The Company is currently evaluating the impact the adoption of this guidance will have on its consolidated financial statements.

(3) Preneed Funeral Activities

The Company maintains three types of trust and escrow accounts: (1) preneed funeral merchandise and services, (2) preneed cemetery merchandise and services and (3) cemetery perpetual care. The activity of these trust and escrow accounts is detailed below and in Notes 4 and 5.

Preneed Funeral Receivables and Trust Investments

Preneed funeral receivables and trust investments represent trust assets and customer receivables related to unperformed, price-guaranteed trust-funded preneed funeral contracts. The components of preneed funeral receivables and trust investments in the condensed consolidated balance sheets as of July 31, 2012 and October 31, 2011 are as follows:

	July 31, 2012			October 31, 2011
Trust assets	$	395,263		$	377,198
Receivables from customers		44,069			43,457
		439,332			420,655
Allowance for cancellations		(10,728	)		(11,359	)
Preneed funeral receivables and trust investments	$	428,604		$	409,296

14

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(3) Preneed Funeral Activities—(Continued)

The cost basis and market values associated with preneed funeral merchandise and services trust assets as of July 31, 2012 are detailed below.

	July 31, 2012
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	23,131	$	—	$	—		$	23,131
U.S. Government, agencies and municipalities		1,658		87		—			1,745
Corporate bonds		20,064		1,592		(1	)		21,655
Preferred stocks		34,896		641		(671	)		34,866
Common stocks		200,896		3,152		(43,071	)		160,977
Mutual funds:
Equity		19,249		839		(1,839	)		18,249
Fixed income		95,687		2,936		(802	)		97,821
Commodity		13,428		—		(2,836	)		10,592
Real estate investment trusts		8,737		813		(1	)		9,549
Master limited partnerships		2,860		—		(56	)		2,804
Insurance contracts and other long-term investments		12,344		215		—			12,559
Trust investments	$	432,950	$	10,275	$	(49,277	)	$	393,948
Market value as a percentage of cost										91.0	%
Accrued investment income									1,315
Trust assets								$	395,263

The estimated maturities and market values of debt securities included above are as follows:

	July 31, 2012
Due in one year or less	$	5,657
Due in one to five years		14,367
Due in five to ten years		2,856
Thereafter		520
	$	23,400

15

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(3) Preneed Funeral Activities—(Continued)

The cost basis and market values associated with preneed funeral merchandise and services trust assets as of October 31, 2011 are detailed below.

	October 31, 2011
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	30,714	$	—	$	—		$	30,714
U.S. Government, agencies and municipalities		2,094		60		(2	)		2,152
Corporate bonds		21,856		1,079		(8	)		22,927
Preferred stocks		36,382		362		(3,358	)		33,386
Common stocks		202,451		791		(55,830	)		147,412
Mutual funds:
Equity		23,591		980		(2,018	)		22,553
Fixed income		78,509		902		(1,417	)		77,994
Commodity		11,844		8		(1,450	)		10,402
Real estate investment trusts		15,075		37		(338	)		14,774
Master limited partnerships		136		4		—			140
Insurance contracts and other long-term investments		13,486		39		—			13,525
Trust investments	$	436,138	$	4,262	$	(64,421	)	$	375,979
Market value as a percentage of cost										86.2	%
Accrued investment income									1,219
Trust assets								$	377,198

The Company periodically manages a covered call program on its equity securities within the preneed funeral merchandise and services trust in order to provide an opportunity for additional income. As of July 31, 2012 and October 31, 2011, the Company had outstanding covered calls with a market value of $466 and $0, respectively. Covered calls are included at market value in the balance sheet line “preneed funeral receivables and trust investments.” For the three months ended July 31, 2012 and 2011, the Company realized trust earnings of approximately $180 and $75, respectively, related to the covered call program. For the nine months ended July 31, 2012 and 2011, the Company realized trust earnings (losses) of $336 and ($152), respectively, related to the covered call program. These trust earnings and losses are accounted for in the same manner as other funeral merchandise and services trust earnings and losses and flow through funeral revenue in the condensed consolidated statements of earnings. Although the Company realized losses associated with the covered call program for the nine months ended July 31, 2011, it continued to hold the underlying securities against which these covered calls were issued; these underlying securities appreciated in value by $1,983 for the nine months ended July 31, 2011.

Where quoted prices are available in an active market, investments held by the trusts are classified as Level 1 investments pursuant to the three-level valuation hierarchy. The Company’s Level 1 investments include cash, money market and other short-term investments, common stocks and mutual funds.

Where quoted market prices are not available for the specific security, then fair values are estimated by using quoted prices of securities with similar characteristics. These investments are primarily U. S. Government, agencies and municipalities, corporate bonds, convertible bonds and preferred stocks, all of which are classified within Level 2 of the valuation hierarchy.

16

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(3) Preneed Funeral Activities—(Continued)

The Company’s Level 3 investments include insurance contracts and partnership investments purchased within the trusts. The valuation of insurance contracts and partnership investments requires significant management judgment due to the absence of quoted prices, inherent lack of liquidity and the long-term nature of such assets. The fair market value of the insurance contracts is based upon the current face value of the contracts according to the respective insurance carriers, which is deemed to approximate fair market value. The fair market value of the partnership investments was determined by using their most recent audited financial statements and assessing the market value of the underlying securities within the partnership.

The inputs into the fair value of the Company’s preneed funeral merchandise and services trust investments are categorized as follows:

	Quoted Market Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Market Value
Trust investments—July 31, 2012	$	329,918	$	58,268	$	5,762	$	393,948
Trust investments—October 31, 2011	$	311,463	$	58,648	$	5,868	$	375,979

The change in the Company’s preneed funeral merchandise and services trust investments with significant unobservable inputs (Level 3) is as follows:

	Three Months Ended July 31,					Nine Months Ended July 31,
	2012		2011			2012			2011
Fair market value, beginning balance	$	5,698	$	6,075		$	5,868		$	6,784
Total unrealized gains (losses) included in other comprehensive income (1)		56		(590	)		56			(590	)
Distributions and other, net		8		558			(162	)		(151	)
Fair market value, ending balance	$	5,762	$	6,043		$	5,762		$	6,043

⁽¹⁾  All gains (losses) recognized in other comprehensive income for funeral trust investments are attributable to the Company’s preneed customers and are offset by a corresponding increase (decrease) in deferred preneed funeral receipts held in trust.

Activity related to preneed funeral trust investments is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Purchases	$	22,182		$	45,026		$	56,092		$	117,074
Sales		14,587			48,397			51,669			119,026
Realized gains from sales of investments		1,320			3,058			4,491			7,467
Realized losses from sales of investments and other		(1,605	)		(1,335	)		(2,709	)		(2,015	)
Interest income, dividends and other ordinary income		2,952			3,107			10,914			9,920
Deposits (1)		6,462			5,770			18,828			15,800
Withdrawals (1)		10,905			10,017			29,995			32,332

17

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(3) Preneed Funeral Activities—(Continued)

⁽¹⁾  The Company historically sold a significant portion of its preneed funeral sales through trust-funded price-guaranteed contracts. Over time, the mix has shifted to a more significant portion being sold using insurance, particularly in states where the trusting requirements are high.

The following tables show the gross unrealized losses and fair value of the preneed funeral merchandise and services trust investments with unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of July 31, 2012 and October 31, 2011.

	July 31, 2012
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
Corporate bonds	$	115	$	(1	)	$	—	$	—		$	115	$	(1	)
Preferred stocks		1,424		(32	)		14,154		(639	)		15,578		(671	)
Common stocks		16,734		(349	)		97,603		(42,722	)		114,337		(43,071	)
Mutual funds:
Equity		1,179		(10	)		6,478		(1,829	)		7,657		(1,839	)
Fixed income		8,150		(213	)		2,387		(589	)		10,537		(802	)
Commodity		5,593		(693	)		4,998		(2,143	)		10,591		(2,836	)
Real estate investment trusts		34		—			62		(1	)		96		(1	)
Master limited partnerships		2,804		(56	)		—		—			2,804		(56	)
Total	$	36,033	$	(1,354	)	$	125,682	$	(47,923	)	$	161,715	$	(49,277	)

	October 31, 2011
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	498	$	(2	)	$	—	$	—		$	498	$	(2	)
Corporate bonds		6,398		(8	)		—		—			6,398		(8	)
Preferred stocks		548		(2	)		19,065		(3,356	)		19,613		(3,358	)
Common stocks		5,564		(58	)		128,478		(55,772	)		134,042		(55,830	)
Mutual funds:
Equity		3		(1	)		8,481		(2,017	)		8,484		(2,018	)
Fixed income		43,688		(707	)		5,015		(710	)		48,703		(1,417	)
Commodity		10,175		(1,450	)		—		—			10,175		(1,450	)
Real estate investment trusts		12,941		(338	)		—		—			12,941		(338	)
Total	$	79,815	$	(2,566	)	$	161,039	$	(61,855	)	$	240,854	$	(64,421	)

The unrealized losses in the preneed funeral merchandise and services trust portfolio are not considered to be other than temporary. For a discussion of the Company’s policies for determining whether a security is other-than-temporarily impaired, see Note 2(k) to the consolidated financial statements in the Company’s 2011 Form 10-K. Of the total unrealized losses at July 31, 2012, 87 percent, or $43,071, were generated by investments in common stock. Most of the common stock investments are part of the S&P 500 Index. The Company generally expects its portfolio performance to improve if the performance of the overall financial market improves, but would also expect its performance to deteriorate if the overall financial market declines. The Company believes it has the intent and ability to hold these investments until they recover in value.

The Company’s policy for recognizing trust income follows the allocation of trust earnings to individual contracts as stipulated in the Company’s respective trust agreements. In substantially all of the Company’s trusts, trust earnings, which include dividends and interest earned and net capital gains and losses (including losses from other-than-temporary impairments of securities) realized by preneed funeral trust or escrow accounts net of fees, are

18

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(3) Preneed Funeral Activities—(Continued)

allocated to individual contracts as earned or realized. In these trusts, unrealized gains and losses are not allocated to the underlying contracts. The trust earnings allocated to individual contracts are recognized as components of revenue along with the original contract sales price when the underlying service or merchandise is actually performed or delivered. Principal and earnings are withdrawn only as the merchandise or services are delivered or contracts are cancelled, except in jurisdictions that permit trust earnings to be withdrawn currently.

Cash flows from preneed funeral contracts are presented as operating cash flows in the Company’s condensed consolidated statements of cash flows.

(4) Preneed Cemetery Merchandise and Service Activities

Preneed Cemetery Receivables and Trust Investments

Preneed cemetery receivables and trust investments represent trust assets and customer receivables for contracts sold in advance of when the merchandise or service is needed. The receivables related to the sale of preneed property interment rights are included in the Company’s current and long-term receivables. The components of preneed cemetery receivables and trust investments in the condensed consolidated balance sheets as of July 31, 2012 and October 31, 2011 are as follows:

	July 31, 2012			October 31, 2011
Trust assets	$	193,710		$	189,678
Receivables from customers		29,057			30,270
		222,767			219,948
Allowance for cancellations		(2,138	)		(3,366	)
Preneed cemetery receivables and trust investments	$	220,629		$	216,582

The cost basis and market values associated with the preneed cemetery merchandise and services trust assets as of July 31, 2012 are detailed below.

	July 31, 2012
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	9,065	$	—	$	—		$	9,065
U.S. Government, agencies and municipalities		1,883		127		—			2,010
Corporate bonds		2,006		143		(3	)		2,146
Preferred stocks		12,540		146		(292	)		12,394
Common stocks		107,520		942		(29,350	)		79,112
Mutual funds:
Equity		23,526		108		(7,068	)		16,566
Fixed income		53,870		1,106		(312	)		54,664
Commodity		8,693		—		(1,970	)		6,723
Master limited partnerships		6,797		—		(132	)		6,665
Real estate investment trusts		2,986		54		—			3,040
Other long-term investments		637		—		—			637
Trust investments	$	229,523	$	2,626	$	(39,127	)	$	193,022
Market value as a percentage of cost										84.1	%
Accrued investment income									688
Trust assets								$	193,710

19

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(4) Preneed Cemetery Merchandise and Service Activities—(Continued)

The estimated maturities and market values of debt securities included above are as follows:

	July 31, 2012
Due in one year or less	$	103
Due in one to five years		2,244
Due in five to ten years		1,397
Thereafter		412
	$	4,156

The cost basis and market values associated with the preneed cemetery merchandise and services trust assets as of October 31, 2011 are detailed below.

	October 31, 2011
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	9,844	$	—	$	—		$	9,844
U.S. Government, agencies and municipalities		2,052		90		(2	)		2,140
Corporate bonds		2,596		131		(3	)		2,724
Preferred stocks		12,518		66		(1,662	)		10,922
Common stocks		112,010		920		(32,761	)		80,169
Mutual funds:
Equity		25,374		348		(6,791	)		18,931
Fixed income		46,258		305		(586	)		45,977
Commodity		8,780		—		(892	)		7,888
Real estate investment trusts		9,866		74		(193	)		9,747
Master limited partnerships		97		—		(2	)		95
Other long-term investments		596		—		—			596
Trust investments	$	229,991	$	1,934	$	(42,892	)	$	189,033
Market value as a percentage of cost										82.2	%
Accrued investment income									645
Trust assets								$	189,678

The Company periodically manages a covered call program on its equity securities within the preneed cemetery merchandise and services trust in order to provide an opportunity for additional income. As of July 31, 2012 and October 31, 2011, the Company had outstanding covered calls with a market value of $152 and $0, respectively. Covered calls are included at market value in the balance sheet line “preneed cemetery receivables and trust investments.” For the three months ended July 31, 2012 and 2011, the Company realized trust earnings of approximately $89 and $61, respectively, related to the covered call program. For the nine months ended July 31, 2012 and 2011, the Company realized trust earnings (losses) of $203 and ($69), respectively, related to the covered call program. These trust earnings and losses are accounted for in the same manner as other cemetery merchandise and services trust earnings and losses and flow through cemetery revenue in the condensed consolidated statements of earnings. Although the Company realized losses associated with the covered call program for the nine months ended July 31, 2011, it continued to hold the underlying securities against which these covered calls were issued; these underlying securities appreciated in value by $732 for the nine months ended July 31, 2011.

20

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(4) Preneed Cemetery Merchandise and Service Activities—(Continued)

Where quoted prices are available in an active market, investments held by the trusts are classified as Level 1 investments pursuant to the three-level valuation hierarchy. The Company’s Level 1 investments include cash, money market and other short-term investments, common stocks and mutual funds.

Where quoted market prices are not available for the specific security, then fair values are estimated by using quoted prices of securities with similar characteristics. These investments are U. S. Government, agencies and municipalities, corporate bonds, convertible bonds and preferred stocks, all of which are classified within Level 2 of the valuation hierarchy.

There are no Level 3 investments in the preneed cemetery merchandise and services trust investment portfolio.

The inputs into the fair value of the Company’s preneed cemetery merchandise and services trust investments are categorized as follows:

	Quoted Market Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Market Value
Trust investments—July 31, 2012	$	176,321	$	16,701	$	—	$	193,022
Trust investments—October 31, 2011	$	173,127	$	15,906	$	—	$	189,033

Activity related to preneed cemetery merchandise and services trust investments is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Purchases	$	17,953		$	27,460		$	29,186		$	79,354
Sales		5,480			27,557			31,144			75,330
Realized gains from sales of investments		653			2,165			3,001			5,488
Realized losses from sales of investments and other		(176	)		(658	)		(381	)		(1,207	)
Interest income, dividends and other ordinary income		1,978			1,897			6,285			5,307
Deposits		4,127			4,451			12,769			12,459
Withdrawals		8,601			5,341			19,847			14,813

The following tables show the gross unrealized losses and fair value of the preneed cemetery merchandise and services trust investments aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of July 31, 2012 and October 31, 2011.

21

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(4) Preneed Cemetery Merchandise and Service Activities—(Continued)

	July 31, 2012
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
Corporate bonds	$	56	$	(3	)	$	—	$	—		$	56	$	(3	)
Preferred stocks		587		(13	)		5,889		(279	)		6,476		(292	)
Common stocks		13,197		(1,050	)		51,323		(28,300	)		64,520		(29,350	)
Mutual funds:
Equity		—		—			12,910		(7,068	)		12,910		(7,068	)
Fixed income		10,722		(311	)		1,590		(1	)		12,312		(312	)
Commodity		2,403		(285	)		4,320		(1,685	)		6,723		(1,970	)
Master limited partnerships		6,665		(132	)		—		—			6,665		(132	)
Total	$	33,630	$	(1,794	)	$	76,032	$	(37,333	)	$	109,662	$	(39,127	)

	October 31, 2011
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	313	$	(2	)	$	—	$	—		$	313	$	(2	)
Corporate bonds		117		(3	)		—		—			117		(3	)
Preferred stocks		—		—			7,609		(1,662	)		7,609		(1,662	)
Common stocks		5,385		(707	)		59,506		(32,054	)		64,891		(32,761	)
Mutual funds:
Equity		—		—			14,376		(6,791	)		14,376		(6,791	)
Fixed income		34,325		(586	)		—		—			34,325		(586	)
Commodity		7,887		(892	)		—		—			7,887		(892	)
Real estate investment trusts		5,775		(193	)		—		—			5,775		(193	)
Master limited partnerships		—		—			95		(2	)		95		(2	)
Total	$	53,802	$	(2,383	)	$	81,586	$	(40,509	)	$	135,388	$	(42,892	)

The unrealized losses in the preneed cemetery merchandise and services trust portfolio are not considered to be other than temporary. For a discussion of the Company’s policies for determining whether a security is other-than-temporarily impaired, see Note 2(k) to the consolidated financial statements in the Company’s 2011 Form 10-K. Of the total unrealized losses at July 31, 2012, 93 percent, or $36,418, were generated by common stock and mutual fund-equity investments. Most of the common stock investments are part of the S&P 500 Index, and the mutual fund-equity investments are invested in small-cap, mid-cap and international mutual funds that are highly diversified. The Company generally expects its portfolio performance to improve if the performance of the overall financial market improves, but would also expect its performance to deteriorate if the overall financial market declines. The Company believes it has the intent and ability to hold these investments until they recover in value.

The Company’s policy for recognizing trust income follows the allocation of trust earnings to individual contracts as stipulated in the Company’s respective trust agreements. In substantially all of the Company’s trusts, trust earnings, which include dividends and interest earned and net capital gains and losses (including losses from other-than-temporary impairments of securities) realized by preneed cemetery trust or escrow accounts net of fees, are allocated to individual contracts as earned or realized. In these trusts, unrealized gains and losses are not allocated to the underlying contracts. The trust earnings allocated to individual contracts are recognized as components of revenue along with the original contract sales price when the underlying service or merchandise is actually performed or delivered. Principal and earnings are withdrawn only as the merchandise or services are delivered or contracts are cancelled, except in jurisdictions that permit trust earnings to be withdrawn currently.

22

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(4) Preneed Cemetery Merchandise and Service Activities—(Continued)

Cash flows from preneed cemetery merchandise and services contracts are presented as operating cash flows in the Company’s condensed consolidated statements of cash flows.

(5) Cemetery Interment Rights and Perpetual Care Trusts

Earnings from cemetery perpetual care trust investments that the Company is legally permitted to withdraw are recognized as current cemetery revenues and are used to defray cemetery maintenance costs which are expensed as incurred. Recognized earnings related to these cemetery perpetual care trust investments were $1,815 and $1,988 for the three months ended July 31, 2012 and 2011, respectively, and $7,098 and $5,981 for the nine months ended July 31, 2012 and 2011, respectively.

The cost basis and market values of the trust investments held by the cemetery perpetual care trusts as of July 31, 2012 are detailed below.

	July 31, 2012
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	15,359	$	—	$	—		$	15,359
U.S. Government, agencies and municipalities		5,643		265		(63	)		5,845
Corporate bonds		25,837		1,212		(874	)		26,175
Preferred stocks		33,519		438		(2,662	)		31,295
Common stocks		91,967		2,894		(19,905	)		74,956
Mutual funds:
Equity		15,001		1,115		(583	)		15,533
Fixed income		73,758		1,768		(1,178	)		74,348
Commodity		5,727		4		(471	)		5,260
Real estate investment trusts		8,818		866		—			9,684
Other long-term investments		98		—		(51	)		47
Trust investments	$	275,727	$	8,562	$	(25,787	)	$	258,502
Market value as a percentage of cost										93.8	%
Accrued investment income									938
Trust assets								$	259,440

The estimated maturities and market values of debt securities included above are as follows:

	July 31, 2012
Due in one year or less	$	4,689
Due in one to five years		14,339
Due in five to ten years		8,826
Thereafter		4,166
	$	32,020

23

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(5) Cemetery Interment Rights and Perpetual Care Trusts—(Continued)

The cost basis and market values of the trust investments held by the cemetery perpetual care trusts as of October 31, 2011 are detailed below.

	October 31, 2011
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	20,654	$	—	$	—		$	20,654
U.S. Government, agencies and municipalities		6,928		375		(57	)		7,246
Corporate bonds		27,166		1,044		(876	)		27,334
Preferred stocks		38,211		155		(6,927	)		31,439
Common stocks		82,750		1,751		(24,410	)		60,091
Mutual funds:
Equity		13,478		601		(807	)		13,272
Fixed income		61,740		706		(1,990	)		60,456
Commodity		6		5		—			11
Real estate investment trusts		8,834		6		(210	)		8,630
Master limited partnerships		10,248		16		(61	)		10,203
Other long-term investments		277		—		(12	)		265
Trust investments	$	270,292	$	4,659	$	(35,350	)	$	239,601
Market value as a percentage of cost										88.6	%
Accrued investment income									791
Trust assets								$	240,392

The Company periodically manages a covered call program on its equity securities within the cemetery perpetual care trust in order to provide an opportunity for additional income. As of July 31, 2012 and October 31, 2011, the Company had outstanding covered calls with a market value of $170 and $0, respectively. Covered calls are included at market value in the balance sheet line “cemetery perpetual care trust investments.” For the three months ended July 31, 2012 and 2011, the Company realized trust earnings of approximately $73 and $37, respectively, related to the covered call program. For the nine months ended July 31, 2012 and 2011, the Company realized trust earnings (losses) of approximately $147 and ($81), respectively, related to the covered call program. These trust earnings and losses are accounted for in the same manner as other cemetery perpetual care trust earnings and losses and flow through cemetery revenue in the condensed consolidated statements of earnings. Although the Company realized losses associated with the covered call program for the nine months ended July 31, 2011, it continued to hold the underlying securities against which these covered calls were issued; these underlying securities appreciated in value by $700 for the nine months ended July 31, 2011.

Where quoted prices are available in an active market, investments held by the trusts are classified as Level 1 investments pursuant to the three-level valuation hierarchy. The Company’s Level 1 investments include cash, money market and other short-term investments, common stocks and mutual funds.

Where quoted market prices are not available for the specific security, then fair values are estimated by using quoted prices of securities with similar characteristics. These investments are primarily U. S. Government, agencies and municipalities, corporate bonds, convertible bonds and preferred stocks, all of which are classified within Level 2 of the valuation hierarchy.

The Company’s Level 3 investments include an investment in a partnership. The valuation of partnership investments requires significant management judgment due to the absence of quoted prices, inherent lack of

24

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(5) Cemetery Interment Rights and Perpetual Care Trusts—(Continued)

liquidity and the long-term nature of such assets. The fair market value of the partnership investment was determined by using its most recent audited financial statements and assessing the market value of the underlying securities within the partnership.

The inputs into the fair value of the Company’s cemetery perpetual care trust investments are categorized as follows:

	Quoted Market Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Market Value
Trust investments—July 31, 2012	$	195,140	$	63,315	$	47	$	258,502
Trust investments—October 31, 2011	$	173,317	$	66,236	$	48	$	239,601

The change in the Company’s preneed funeral merchandise and services trust investments with significant unobservable inputs (Level 3) is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Fair market value, beginning balance	$	48		$	88		$	48		$	88
Total unrealized losses included in other comprehensive income(1)		(1	)		(24	)		(1	)		(24	)
Fair market value, ending balance	$	47		$	64		$	47		$	64

⁽¹⁾  All gains (losses) recognized in other comprehensive income for perpetual care trust investments are attributable to the Company’s preneed customers and are offset by a corresponding increase (decrease) in perpetual care trusts’ corpus.

In states where the Company withdraws and recognizes capital gains in its cemetery perpetual care trusts, if it realizes subsequent net capital losses (i.e., losses in excess of capital gains in the trust) and the fair market value of the trust assets is less than the aggregate amounts required to be contributed to the trust, some states may require the Company to make cash deposits to the trusts or may require the Company to stop withdrawing earnings until future earnings restore the initial corpus. As of July 31, 2012 and October 31, 2011, the Company had a liability recorded for the estimated probable funding obligation to restore the net realized losses of $12,064 and $12,017, respectively. The Company recorded an additional $567 and $72 for the estimated probable funding obligation to restore the net realized losses in the cemetery perpetual care trust for the nine months ended July 31, 2012 and 2011, respectively. The additional funding obligation in fiscal year 2012 is related to the bankruptcy of Eastman Kodak. The Company had earnings of $520 and $918 for the nine months ended July 31, 2012 and 2011, within the trusts that it did not withdraw from the trusts in order to satisfy a portion of its estimated probable funding obligation. In those states where realized net capital gains have not been withdrawn, the Company believes it is reasonably possible but not probable that additional funding obligations may exist with an estimated amount of $2,006; no charge has been recorded for these amounts as of July 31, 2012.

25

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(5) Cemetery Interment Rights and Perpetual Care Trusts—(Continued)

Activity related to preneed cemetery perpetual care trust investments is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Purchases	$	19,529		$	29,705		$	83,809		$	110,949
Sales		18,313			27,560			75,211			80,094
Realized gains from sales of investments		660			1,112			4,715			2,044
Realized losses from sales of investments and other		(963	)		(72	)		(2,902	)		(510	)
Interest income, dividends and other ordinary income		2,523			2,171			7,958			7,495
Deposits		2,180			2,024			6,849			5,424
Withdrawals		2,299			1,374			7,211			5,018

During the three months ended July 31, 2012 and 2011, cemetery revenues were $60,356 and $55,596, respectively, of which $2,373 and $2,334, respectively, were required to be placed into perpetual care trusts and were recorded as revenues and expenses. During the nine months ended July 31, 2012 and 2011, cemetery revenues were $173,015 and $167,685, respectively, of which $6,701 and $6,640, respectively, were required to be placed into perpetual care trusts and were recorded as revenues and costs.

The following tables show the gross unrealized losses and fair value of the cemetery perpetual care trust investments with unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of July 31, 2012 and October 31, 2011.

	July 31, 2012
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	—	$	—		$	61	$	(63	)	$	61	$	(63	)
Corporate bonds		2,445		(173	)		1,674		(701	)		4,119		(874	)
Preferred stocks		2,255		(58	)		15,051		(2,604	)		17,306		(2,662	)
Common stocks		6,519		(184	)		38,021		(19,721	)		44,540		(19,905	)
Mutual funds:
Equity		1,011		(43	)		1,076		(540	)		2,087		(583	)
Fixed income		8,772		(224	)		16,745		(954	)		25,517		(1,178	)
Commodity		5,243		(471	)		—		—			5,243		(471	)
Other long-term investments		—		—			47		(51	)		47		(51	)
Total	$	26,245	$	(1,153	)	$	72,675	$	(24,634	)	$	98,920	$	(25,787	)

	October 31, 2011
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	213	$	(1	)	$	71	$	(56	)	$	284	$	(57	)
Corporate bonds		5,959		(150	)		1,341		(726	)		7,300		(876	)
Preferred stocks		3,611		(91	)		20,921		(6,836	)		24,532		(6,927	)
Common stocks		1,027		(108	)		50,539		(24,302	)		51,566		(24,410	)
Mutual funds:
Equity		106		(113	)		1,967		(694	)		2,073		(807	)
Fixed income		39,397		(1,742	)		1,606		(248	)		41,003		(1,990	)
Real estate investment trusts		7,659		(210	)		—		—			7,659		(210	)
Master limited partnerships		7,936		(61	)		—		—			7,936		(61	)
Other long-term investments		—		—			48		(12	)		48		(12	)
Total	$	65,908	$	(2,476	)	$	76,493	$	(32,874	)	$	142,401	$	(35,350	)

26

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(5) Cemetery Interment Rights and Perpetual Care Trusts—(Continued)

The unrealized losses in the cemetery perpetual care trust portfolio are not considered to be other than temporary. For a discussion of the Company’s policies for determining whether a security is other-than-temporarily impaired, see Note 2(k) to the consolidated financial statements in the Company’s 2011 Form 10-K. Of the total unrealized losses at July 31, 2012, 87 percent, or $22,567, were generated by common stock and preferred stock investments. Most of the common stock investments are part of the S&P 500 Index, and all preferred stocks had a rating of investment grade at the time of purchase. The Company generally expects its portfolio performance to improve if the performance of the overall financial market improves, but would also expect its performance to deteriorate if the overall financial market declines. The Company believes it has the intent and ability to hold these investments until they recover in value.

Cash flows from cemetery perpetual care contracts are presented as operating cash flows in the Company’s condensed consolidated statements of cash flows.

27

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(6) Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts’ Corpus

The components of deferred preneed funeral and cemetery receipts held in trust in the condensed consolidated balance sheet at July 31, 2012 are as follows:

	Deferred Receipts Held in Trust
	Preneed      Funeral			Preneed     Cemetery			Total
Trust assets at market value	$	395,263		$	193,710		$	588,973
Less:
Pending withdrawals		(6,290	)		(5,801	)		(12,091	)
Pending deposits		2,059			1,206			3,265
Deferred receipts held in trust	$	391,032		$	189,115		$	580,147

The components of perpetual care trusts’ corpus in the condensed consolidated balance sheet at July 31, 2012 are as follows:

	Perpetual Care Trusts’ Corpus
Trust assets at market value	$	259,440
Less:
Pending withdrawals		(2,083	)
Pending deposits		349
Perpetual care trusts’ corpus	$	257,706

Investment and other income, net

The components of investment and other income, net in the condensed consolidated statements of earnings for the three and nine months ended July 31, 2012 and 2011 are detailed below.

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Realized gains from sales of investments	$	2,633		$	6,335		$	12,207		$	14,999
Realized losses from sales of investments and other		(2,744	)		(2,065	)		(5,992	)		(3,732	)
Interest income, dividends and other ordinary income		7,453			7,175			25,157			22,722
Trust expenses and income taxes		(2,966	)		(2,808	)		(8,792	)		(7,737	)
Net trust investment income		4,376			8,637			22,580			26,252
Reclassification to deferred preneed funeral and cemetery receipts held in trust		(3,112	)		(6,319	)		(15,802	)		(19,876	)
Reclassification to perpetual care trusts’ corpus		(1,264	)		(2,318	)		(6,778	)		(6,376	)
Total deferred preneed funeral and cemetery receipts held in trust and perpetual care trusts’ corpus		—			—			—			—
Investment and other income, net (1)		57			30			148			394
Total investment and other income, net	$	57		$	30		$	148		$	394

⁽¹⁾  Investment and other income, net generally consists of interest income primarily on the Company’s cash, cash equivalents and marketable securities not held in trust. For the nine months ended July 31, 2011, the balance includes approximately $327 of interest income related to the resolution of an audit by the Internal Revenue Service.

28

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(7) Commitments and Contingencies

Litigation

The Company is a defendant in a variety of litigation matters that have arisen in the ordinary course of business, which are covered by insurance or otherwise not considered to be material. The Company carries insurance with coverages and coverage limits that it believes to be adequate.

Other Commitments and Contingencies

In those states where the Company has withdrawn realized net capital gains in the past from its cemetery perpetual care trusts, regulators may seek replenishment of subsequent realized net capital losses either by requiring a cash deposit to the trust or by prohibiting or restricting withdrawals of future earnings until they cover the loss. As of July 31, 2012, the Company had $12,064 recorded as a liability for the estimated probable funding obligation. As of July 31, 2012, the Company had net unrealized losses of approximately $28,243 in the cemetery perpetual care trusts in these states that could be subject to a future funding obligation. Because some of these trusts currently have assets with a fair market value less than the aggregate amounts required to be contributed to the trust, any additional realized net capital losses in these trusts may result in an additional corresponding funding liability and increase in cemetery costs.

From time to time, contracts are presented to the Company relating to contracts sold prior to the time the Company acquired certain businesses and for which the Company was previously unaware. In addition, from time to time, the Company has identified in its backlog, certain contracts in which services or merchandise have previously been delivered but the revenue was not yet recognized. Using historical trends and statistical analyses, the Company has recorded an estimated net debit (credit) for these items of approximately $0.3 million and ($2.0) million as of July 31, 2012 and October 31, 2011, respectively.

The Company is required to maintain a bond ($23,456 as of July 31, 2012) to guarantee its obligations relating to funds the Company withdrew in fiscal year 2001 from its preneed funeral trusts in Florida. This amount would become senior secured debt if the Company was required to borrow funds under the senior secured revolving credit facility and return to the trusts the amounts it previously withdrew that relate to the remaining undelivered preneed contracts in lieu of this bond.

During the second quarter of fiscal year 2012, the Company entered into an agreement to purchase within a year the land and building of an existing business that it currently leases for $2,800.

29

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(8) Reconciliation of Basic and Diluted Per Share Data

	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Three Months Ended July 31, 2012
Earnings from continuing operations	$	9,896
Allocation of earnings to nonvested restricted stock		(87	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	9,809			85,798	$	.11
Effect of dilutive securities:
Stock options assumed exercised					380
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	9,809			86,178	$	.11
	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Three Months Ended July 31, 2011
Earnings from continuing operations	$	12,231
Allocation of earnings to nonvested restricted stock		(105	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	12,126			90,182	$	.13
Effect of dilutive securities:
Stock options assumed exercised					559
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	12,126			90,741	$	.13
	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Nine Months Ended July 31, 2012
Earnings from continuing operations	$	28,340
Allocation of earnings to nonvested restricted stock		(251	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	28,089			86,295	$	.32
Effect of dilutive securities:
Stock options assumed exercised					324
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	28,089			86,619	$	.32

30

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(8) Reconciliation of Basic and Diluted Per Share Data—(Continued)

	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Nine Months Ended July 31, 2011
Earnings from continuing operations	$	30,529
Allocation of earnings to nonvested restricted stock		(267	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	30,262			90,497	$	.33
Effect of dilutive securities:
Stock options assumed exercised					561
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	30,262			91,058	$	.33

During the three months ended July 31, 2012, options to purchase 390,290 shares of common stock at prices ranging from $6.83 to $8.47 per share were outstanding but were not included in the computation of diluted earnings per share because the exercise prices of the options were greater than the average market price of the common shares for that period. Additionally, weighted-average shares outstanding for the three months ended July 31, 2012 exclude the effect of approximately 2,140,192 options because such options were not dilutive. These options expire between January 8, 2014 and May 5, 2022.

During the nine months ended July 31, 2012, options to purchase 877,683 shares of common stock at prices ranging from $6.33 to $8.47 per share were outstanding but were not included in the computation of diluted earnings per share because the exercise prices of the options were greater than the average market price of the common shares for that period. Additionally, weighted-average shares outstanding for the nine months ended July 31, 2012 exclude the effect of approximately 1,936,384 options because such options were not dilutive. These options expire between January 8, 2014 and December 6, 2021.

Options to purchase 435,253 shares of common stock at prices ranging from $7.57 to $8.47 per share for the three months ended July 31, 2011 and options to purchase 500,573 shares of common stock at prices ranging from $7.31 to $8.47 per share for the nine months ended July 31, 2011 were outstanding but were not included in the computation of diluted earnings per share because the exercise prices of the options were greater than the average market price of the common shares for those periods. Additionally, weighted average shares outstanding for the three months ended July 31, 2011 exclude the effect of approximately 1,086,000 options because such options were not dilutive.

For the three and nine months ended July 31, 2012, all of the outstanding 94,500 market based stock options were dilutive as the respective market conditions had been previously achieved. For the three and nine months ended July 31, 2011, all of the outstanding 214,500 market based stock options were dilutive as the respective market conditions had been previously achieved.

For the three and nine months ended July 31, 2012, a maximum of 13,153,500 shares of the Company’s Class A common stock related to the senior convertible notes and a maximum of 10,637,882 shares of Class A common stock under the common stock warrants associated with the June 2007 senior convertible debt transaction were not dilutive, as the average prices of the Company’s stock for the three and nine months ended July 31, 2012

31

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(8) Reconciliation of Basic and Diluted Per Share Data—(Continued)

were less than the conversion price of the senior convertible notes and the strike price of the warrants. For the three and nine months ended July 31, 2011, a maximum of 13,153,500 shares of the Company’s Class A common stock related to the senior convertible notes and a maximum of 10,522,798 shares of Class A common stock under the associated common stock warrants were also not dilutive.

The Company includes Class A and Class B common stock in its diluted shares calculation. As of July 31, 2012, the Company’s Chairman, Frank B. Stewart, Jr., was the record holder of all of the Company’s shares of Class B common stock. The Company’s Class A and B common stock are substantially identical, except that holders of Class A common stock are entitled to one vote per share, and holders of Class B common stock are entitled to ten votes per share. Each share of Class B common stock is automatically converted into one share of Class A common stock upon transfer to persons other than certain affiliates of Frank B. Stewart, Jr.

(9) Segment Data

The Company has determined that management’s approach to operating the business indicates that there are three operating and reportable segments: a funeral segment, a cemetery segment and a corporate trust management segment. The Company does not aggregate its operating segments. Therefore, its operating and reportable segments are the same. The tables below present information about reported segments for the three and nine months ended July 31, 2012 and 2011 for the Company’s continuing operations.

	Total Revenue				Total Revenue
	Three Months Ended July 31, 2012		Three Months Ended July 31, 2011		Nine Months Ended July 31, 2012		Nine Months Ended July  31, 2011
Funeral	$	65,468	$	64,846	$	201,960	$	203,254
Cemetery(1)		57,918		53,544		165,809		161,370
Corporate Trust Management(2)		5,853		5,967		18,892		18,662
Total	$	129,239	$	124,357	$	386,661	$	383,286

	Total Gross Profit				Total Gross Profit
	Three Months Ended July 31, 2012		Three Months Ended July 31, 2011		Nine Months Ended July 31, 2012		Nine Months Ended July  31, 2011
Funeral	$	12,628	$	10,703	$	41,973	$	41,139
Cemetery(1)		9,061		5,544		22,019		17,255
Corporate Trust Management(2)		5,297		5,505		17,528		17,354
Total	$	26,986	$	21,752	$	81,520	$	75,748

⁽¹⁾  Perpetual care trust earnings are included in the revenues and gross profit of the cemetery segment and amounted to $1,815 and $1,988 for the three months ended July 31, 2012 and 2011, respectively, and $7,098 and $5,981 for the nine months ended July 31, 2012 and 2011, respectively.

⁽²⁾  Corporate trust management consists of trust management fees and funeral and cemetery merchandise and service trust earnings recognized with respect to preneed contracts delivered during the period. Trust management fees are established by the Company at rates consistent with industry norms based on the fair market value of the assets managed and are paid by the trusts to the Company’s subsidiary, Investors Trust, Inc. The trust earnings represent the amount of distributable earnings as stipulated by the Company’s respective trust agreements that are generated by the trusts over the life of the preneed contracts and allocated to those products and services delivered during the relevant periods. Trust management fees included in funeral revenue for the three months ended July 31, 2012 and 2011 were $1,335 and $1,201, respectively, and funeral trust earnings recognized with respect to preneed contracts delivered included in funeral revenue for the three months ended July 31, 2012 and 2011 were $2,080 and $2,714, respectively. Trust management fees included in cemetery

32

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(9) Segment Data—(Continued)

revenue for the three months ended July 31, 2012 and 2011 were $1,555 and $1,349, respectively, and cemetery trust earnings recognized with respect to preneed contracts delivered included in cemetery revenue for the three months ended July 31, 2012 and 2011 were $883 and $703, respectively.

Trust management fees included in funeral revenue for the nine months ended July 31, 2012 and 2011 were $3,993 and $3,614, respectively, and funeral trust earnings for the nine months ended July 31, 2012 and 2011 were $7,693 and $8,733, respectively. Trust management fees included in cemetery revenue for the nine months ended July 31, 2012 and 2011 were $4,649 and $4,000, respectively, and cemetery trust earnings for the nine months ended July 31, 2012 and 2011 were $2,557 and $2,315, respectively.

A reconciliation of total segment gross profit to total earnings from continuing operations before income taxes for the three and nine months ended July 31, 2012 and 2011 is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Gross profit for reportable segments	$	26,986		$	21,752		$	81,520		$	75,748
Corporate general and administrative expenses		(7,326	)		(6,704	)		(20,264	)		(19,548	)
Restructuring and other charges		(305	)		—			(2,852	)		—
Hurricane related recoveries, net		—			12,349			—			12,245
Net gain (loss) on dispositions		—			11			332			(389	)
Other operating income, net		191			512			773			1,193
Interest expense		(5,873	)		(5,500	)		(17,544	)		(16,968	)
Loss on early extinguishment of debt		—			(73	)		—			(1,884	)
Investment and other income, net		57			30			148			394
Earnings from continuing operations before income taxes	$	13,730		$	22,377		$	42,113		$	50,791

The table below presents total net preneed merchandise and services sales for the three and nine months ended July 31, 2012 and 2011.

	Total Net Preneed Merchandise and Service Sales(1)				Total Net Preneed Merchandise and Service Sales(1)
	Three Months Ended July 31, 2012		Three Months Ended July 31, 2011		Nine Months Ended July 31, 2012		Nine Months Ended July 31, 2011
Funeral	$	28,013	$	26,283	$	79,714	$	70,287
Cemetery		12,949		13,162		38,109		37,380
Total	$	40,962	$	39,445	$	117,823	$	107,667

⁽¹⁾  Preneed sales amounts represent total preneed funeral trust and insurance sales and cemetery service and merchandise trust sales generated in the applicable period, net of cancellations. Preneed funeral and cemetery merchandise and service sales are deferred until a future period and have no impact on current revenues.

33

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(10) Supplementary Information

The detail of certain income statement accounts is as follows for the three and nine months ended July 31, 2012 and 2011.

	Three Months Ended July 31,				Nine Months Ended July 31,
	2012		2011		2012		2011
Service revenue
Funeral	$	47,688	$	47,078	$	146,675	$	146,096
Cemetery		14,459		14,642		45,706		45,266
		62,147		61,720		192,381		191,362
Merchandise revenue
Funeral		19,333		19,816		61,265		63,808
Cemetery		42,781		37,479		117,514		112,031
		62,114		57,295		178,779		175,839
Other revenue
Funeral		1,862		1,867		5,706		5,697
Cemetery		3,116		3,475		9,795		10,388
		4,978		5,342		15,501		16,085
Total revenue	$	129,239	$	124,357	$	386,661	$	383,286
Service costs
Funeral	$	16,535	$	16,722	$	50,032	$	48,838
Cemetery		11,024		11,313		31,891		32,084
		27,559		28,035		81,923		80,922
Merchandise costs
Funeral		13,292		13,414		41,216		41,650
Cemetery		24,181		23,197		70,266		69,981
		37,473		36,611		111,482		111,631
Facility expenses
Funeral		23,301		24,244		69,437		72,296
Cemetery		13,920		13,715		42,299		42,689
		37,221		37,959		111,736		114,985
Total costs	$	102,253	$	102,605	$	305,141	$	307,538

Service revenue includes funeral service revenue, funeral trust earnings, insurance commission revenue, burial site openings and closings and perpetual care trust earnings. Merchandise revenue includes funeral merchandise revenue, flower sales, cemetery property sales revenue, cemetery merchandise delivery revenue and merchandise trust earnings. Other revenue consists of finance charge revenue and trust management fees. Service costs include the direct costs associated with service revenue and preneed selling costs associated with preneed service sales. Merchandise costs include the direct costs associated with merchandise revenue and preneed selling costs associated with preneed merchandise sales.

34

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(11) Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes

The following tables present the condensed consolidating historical financial statements as of July 31, 2012 and October 31, 2011 and for the three and nine months ended July 31, 2012 and 2011, for the direct and indirect domestic subsidiaries of the Company that serve as guarantors of the Company’s 6.50 percent senior notes and its 3.125 percent and 3.375 percent senior convertible notes, and the financial results of the Company’s subsidiaries that do not serve as guarantors. Non-guarantor subsidiaries of the 6.50 percent senior notes and senior convertible notes include the Puerto Rican subsidiaries, Investors Trust, Inc. and certain immaterial domestic subsidiaries, which are not 100 percent owned, or are prohibited by law from guaranteeing the 6.50 percent senior notes and senior convertible notes. The guarantor subsidiaries of the 6.50 percent senior notes and senior convertible notes are 100 percent-owned directly or indirectly by the Company. The guarantees are full and unconditional and joint and several. In the condensed consolidating statements of earnings and other comprehensive income, corporate general and administrative expenses and interest expense of the parent are presented net of amounts charged to the guarantor and non-guarantor subsidiaries.

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Three Months Ended July 31, 2012
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	63,813		$	5,070		$	—		$	68,883
Cemetery		—			54,252			6,104			—			60,356
		—			118,065			11,174			—			129,239
Costs and expenses:
Funeral		—			49,452			3,676			—			53,128
Cemetery		—			44,372			4,753			—			49,125
		—			93,824			8,429			—			102,253
Gross profit		—			24,241			2,745			—			26,986
Corporate general and administrative expenses		(7,326	)		—			—			—			(7,326	)
Restructuring and other charges		(305	)		—			—			—			(305	)
Other operating income, net		10			126			55			—			191
Operating earnings (loss)		(7,621	)		24,367			2,800			—			19,546
Interest expense		(1,869	)		(3,669	)		(335	)		—			(5,873	)
Investment and other income, net		57			—			—			—			57
Equity in subsidiaries		15,417			607			—			(16,024	)		—
Earnings from continuing operations before income taxes		5,984			21,305			2,465			(16,024	)		13,730
Income tax expense (benefit)		(3,654	)		6,411			1,077			—			3,834
Earnings from continuing operations		9,638			14,894			1,388			(16,024	)		9,896
Discontinued operations:
Loss from discontinued operations before income taxes		—			(380	)		—			—			(380	)
Income tax benefit		—			(122	)		—			—			(122	)
Loss from discontinued operations		—			(258	)		—			—			(258	)
Net earnings		9,638			14,636			1,388			(16,024	)		9,638
Other comprehensive income, net		15			—			15			(15	)		15
Comprehensive income	$	9,653		$	14,636		$	1,403		$	(16,039	)	$	9,653

35

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(11) Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes—(Continued)

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Three Months Ended July 31, 2011
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	63,745		$	5,016		$	—		$	68,761
Cemetery		—			49,599			5,997			—			55,596
		—			113,344			11,013			—			124,357
Costs and expenses:
Funeral		—			51,102			3,278			—			54,380
Cemetery		—			43,764			4,461			—			48,225
		—			94,866			7,739			—			102,605
Gross profit		—			18,478			3,274			—			21,752
Corporate general and administrative expenses		(6,704	)		—			—			—			(6,704	)
Hurricane related recoveries, net		4,174			6,683			1,492			—			12,349
Net gain on dispositions		—			11			—			—			11
Other operating income, net		13			419			80			—			512
Operating earnings (loss)		(2,517	)		25,591			4,846			—			27,920
Interest expense		(764	)		(4,247	)		(489	)		—			(5,500	)
Loss on early extinguishment of debt		(73	)		—			—			—			(73	)
Investment and other income, net		30			—			—			—			30
Equity in subsidiaries		12,156			218			—			(12,374	)		—
Earnings from continuing operations before income taxes		8,832			21,562			4,357			(12,374	)		22,377
Income tax expense (benefit)		(3,154	)		11,605			1,695			—			10,146
Earnings from continuing operations		11,986			9,957			2,662			(12,374	)		12,231
Discontinued operations:
Loss from discontinued operations before income taxes		—			(365	)		—			—			(365	)
Income tax benefit		—			(120	)		—			—			(120	)
Loss from discontinued operations		—			(245	)		—			—			(245	)
Net earnings		11,986			9,712			2,662			(12,374	)		11,986
Other comprehensive loss, net		(3	)		—			(3	)		3			(3	)
Comprehensive income	$	11,983		$	9,712		$	2,659		$	(12,371	)	$	11,983

36

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(11) Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes—(Continued)

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Nine Months Ended July 31, 2012
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	198,789		$	14,857		$	—		$	213,646
Cemetery		—			155,460			17,555			—			173,015
		—			354,249			32,412			—			386,661
Costs and expenses:
Funeral		—			150,421			10,264			—			160,685
Cemetery		—			131,144			13,312			—			144,456
		—			281,565			23,576			—			305,141
Gross profit		—			72,684			8,836			—			81,520
Corporate general and administrative expenses		(20,264	)		—			—			—			(20,264	)
Restructuring and other charges		(1,616	)		(1,071	)		(165	)		—			(2,852	)
Net gain on dispositions		—			332			—			—			332
Other operating income, net		67			529			177			—			773
Operating earnings (loss)		(21,813	)		72,474			8,848			—			59,509
Interest expense		(5,212	)		(11,296	)		(1,036	)		—			(17,544	)
Investment and other income, net		148			—			—			—			148
Equity in subsidiaries		42,487			1,161			—			(43,648	)		—
Earnings from continuing operations before income taxes		15,610			62,339			7,812			(43,648	)		42,113
Income tax expense (benefit)		(11,309	)		22,224			2,858			—			13,773
Earnings from continuing operations		26,919			40,115			4,954			(43,648	)		28,340
Discontinued operations:
Loss from discontinued operations before income taxes		—			(2,065	)		—			—			(2,065	)
Income tax benefit		—			(644	)		—			—			(644	)
Loss from discontinued operations		—			(1,421	)		—			—			(1,421	)
Net earnings		26,919			38,694			4,954			(43,648	)		26,919
Other comprehensive income, net		23			—			23			(23	)		23
Comprehensive income	$	26,942		$	38,694		$	4,977		$	(43,671	)	$	26,942

37

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(11) Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes—(Continued)

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Nine Months Ended July 31, 2011
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	200,353		$	15,248		$	—		$	215,601
Cemetery		—			149,980			17,705			—			167,685
		—			350,333			32,953			—			383,286
Costs and expenses:
Funeral		—			152,849			9,935			—			162,784
Cemetery		—			131,239			13,515			—			144,754
		—			284,088			23,450			—			307,538
Gross profit		—			66,245			9,503			—			75,748
Corporate general and administrative expenses		(19,548	)		—			—			—			(19,548	)
Hurricane related recoveries, net		4,070			6,683			1,492			—			12,245
Net loss on dispositions		—			(389	)		—			—			(389	)
Other operating income, net		141			853			199			—			1,193
Operating earnings (loss)		(15,337	)		73,392			11,194			—			69,249
Interest expense		(2,599	)		(12,968	)		(1,401	)		—			(16,968	)
Loss on early extinguishment of debt		(1,884	)		—			—			—			(1,884	)
Investment and other income, net		394			—			—			—			394
Equity in subsidiaries		36,718			605			—			(37,323	)		—
Earnings from continuing operations before income taxes		17,292			61,029			9,793			(37,323	)		50,791
Income tax expense (benefit)		(12,736	)		26,458			6,540			—			20,262
Earnings from continuing operations		30,028			34,571			3,253			(37,323	)		30,529
Discontinued operations:
Loss from discontinued operations before income taxes		—			(810	)		—			—			(810	)
Income tax benefit		—			(309	)		—			—			(309	)
Loss from discontinued operations		—			(501	)		—			—			(501	)
Net earnings		30,028			34,070			3,253			(37,323	)		30,028
Other comprehensive income, net		6			—			6			(6	)		6
Comprehensive income	$	30,034		$	34,070		$	3,259		$	(37,329	)	$	30,034

38

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(11) Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes—(Continued)

Condensed Consolidating Balance Sheets

	July 31, 2012
	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	75,361	$	1,164	$	1,552	$	—		$	78,077
Restricted cash and cash equivalents		6,250		—		—		—			6,250
Marketable securities		—		—		727		—			727
Receivables, net of allowances		1,838		41,770		6,771		—			50,379
Inventories		203		33,599		2,582		—			36,384
Prepaid expenses		1,569		2,983		1,668		—			6,220
Deferred income taxes, net		3,000		13,612		1,012		—			17,624
Intercompany receivables		1,457		—		—		(1,457	)		—
Total current assets		89,678		93,128		14,312		(1,457	)		195,661
Receivables due beyond one year, net of allowances		—		59,314		11,615		—			70,929
Preneed funeral receivables and trust investments		—		419,159		9,445		—			428,604
Preneed cemetery receivables and trust investments		—		213,535		7,094		—			220,629
Goodwill		—		229,749		19,835		—			249,584
Cemetery property, at cost		—		364,886		35,811		—			400,697
Property and equipment, at cost		62,707		500,030		44,588		—			607,325
Less accumulated depreciation		49,459		248,300		20,499		—			318,258
Net property and equipment		13,248		251,730		24,089		—			289,067
Deferred income taxes, net		8,564		69,615		6,931		—			85,110
Cemetery perpetual care trust investments		—		245,639		13,801		—			259,440
Other assets		8,566		4,434		1,153		—			14,153
Intercompany receivables		629,010		—		—		(629,010	)		—
Equity in subsidiaries		38,062		11,141		—		(49,203	)		—
Total assets	$	787,128	$	1,962,330	$	144,086	$	(679,670	)	$	2,213,874
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current maturities of long-term debt	$	6	$	—	$	—	$	—		$	6
Accounts payable, accrued expenses and other current liabilities		17,974		71,312		4,303		—			93,589
Intercompany payables		—		—		1,457		(1,457	)		—
Total current liabilities		17,980		71,312		5,760		(1,457	)		93,595
Long-term debt, less current maturities		320,850		—		—		—			320,850
Deferred income taxes, net		—		4,929		580		—			5,509
Intercompany payables		—		615,339		13,671		(629,010	)		—
Deferred preneed funeral revenue		—		193,683		46,965		—			240,648
Deferred preneed cemetery revenue		—		236,478		29,157		—			265,635
Deferred preneed funeral and cemetery receipts held in trust		—		571,984		8,163		—			580,147
Perpetual care trusts’ corpus		—		243,921		13,785		—			257,706
Other long-term liabilities		18,941		1,486		—		—			20,427
Total liabilities		357,771		1,939,132		118,081		(630,467	)		1,784,517
Common stock		85,836		102		376		(478	)		85,836
Other		343,480		23,096		25,588		(48,684	)		343,480
Accumulated other comprehensive income		41		—		41		(41	)		41
Total shareholders’ equity		429,357		23,198		26,005		(49,203	)		429,357
Total liabilities and shareholders’ equity	$	787,128	$	1,962,330	$	144,086	$	(679,670	)	$	2,213,874

39

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(11) Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes—(Continued)

Condensed Consolidating Balance Sheets

	October 31, 2011
	Parent		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	62,388	$	1,937		$	1,363	$	—		$	65,688
Restricted cash and cash equivalents		6,250		—			—		—			6,250
Marketable securities		—		—			662		—			662
Receivables, net of allowances		2,040		40,405			6,701		—			49,146
Inventories		318		32,926			2,615		—			35,859
Prepaid expenses		1,214		2,289			1,552		—			5,055
Deferred income taxes, net		14,815		13,696			1,257		—			29,768
Intercompany receivables		1,762		—			—		(1,762	)		—
Total current assets		88,787		91,253			14,150		(1,762	)		192,428
Receivables due beyond one year, net of allowances		—		55,847			12,132		—			67,979
Preneed funeral receivables and trust investments		—		399,731			9,565		—			409,296
Preneed cemetery receivables and trust investments		—		209,284			7,298		—			216,582
Goodwill		—		227,203			19,835		—			247,038
Cemetery property, at cost		—		359,678			36,336		—			396,014
Property and equipment, at cost		59,688		495,089			43,215		—			597,992
Less accumulated depreciation		45,705		240,906			19,097		—			305,708
Net property and equipment		13,983		254,183			24,118		—			292,284
Deferred income taxes, net		4,947		68,939			5,907		—			79,793
Cemetery perpetual care trust investments		—		227,428			12,964		—			240,392
Other assets		9,539		4,728			1,025		—			15,292
Intercompany receivables		660,246		—			—		(660,246	)		—
Equity in subsidiaries		15,812		9,980			—		(25,792	)		—
Total assets	$	793,314	$	1,908,254		$	143,330	$	(687,800	)	$	2,157,098
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current maturities of long-term debt	$	5	$	—		$	—	$	—		$	5
Accounts payable, accrued expenses and other current liabilities		14,320		71,505			4,633		—			90,458
Intercompany payables		—		—			1,762		(1,762	)		—
Total current liabilities		14,325		71,505			6,395		(1,762	)		90,463
Long-term debt, less current maturities		317,821		—			—		—			317,821
Deferred income taxes, net		—		4,521			583		—			5,104
Intercompany payables		—		646,588			13,658		(660,246	)		—
Deferred preneed funeral revenue		—		193,452			46,834		—			240,286
Deferred preneed cemetery revenue		—		230,291			28,946		—			259,237
Deferred preneed funeral and cemetery receipts held in trust		—		550,010			8,184		—			558,194
Perpetual care trusts’ corpus		—		226,042			12,938		—			238,980
Other long-term liabilities		17,996		1,341			—		—			19,337
Negative equity in subsidiaries		15,496		—			—		(15,496	)		—
Total liabilities		365,638		1,923,750			117,538		(677,504	)		1,729,422
Common stock		87,976		102			376		(478	)		87,976
Other		339,682		(15,598	)		25,398		(9,800	)		339,682
Accumulated other comprehensive income		18		—			18		(18	)		18
Total shareholders’ equity		427,676		(15,496	)		25,792		(10,296	)		427,676
Total liabilities and shareholders’ equity	$	793,314	$	1,908,254		$	143,330	$	(687,800	)	$	2,157,098

40

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(11) Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes—(Continued)

Condensed Consolidating Statements of Cash Flows

	Nine Months Ended July 31, 2012
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Net cash provided by operating activities	$	7,049		$	45,188		$	6,502		$	—	$	58,739
Cash flows from investing activities:
Proceeds from sales of marketable securities and release of restricted funds		1,756			—			250			—		2,006
Deposits of restricted funds and purchases of marketable securities		(1,756	)		—			(280	)		—		(2,036	)
Proceeds from sale of assets		—			533			—			—		533
Purchase of subsidiaries and other investments, net of cash acquired		(100	)		(3,013	)		—			—		(3,113	)
Additions to property and equipment		(2,669	)		(12,319	)		(1,227	)		—		(16,215	)
Other		—			87			—			—		87
Net cash used in investing activities		(2,769	)		(14,712	)		(1,257	)		—		(18,738	)
Cash flows from financing activities:
Repayments of long-term debt		(4	)		—			—			—		(4	)
Intercompany receivables (payables)		36,305			(31,249	)		(5,056	)		—		—
Debt refinancing costs		(34	)		—			—			—		(34	)
Issuance of common stock		1,433			—			—			—		1,433
Purchase and retirement of common stock		(19,075	)		—			—			—		(19,075	)
Dividends		(9,955	)		—			—			—		(9,955	)
Excess tax benefits from share-based payment arrangements		23			—			—			—		23
Net cash provided by (used in) financing activities		8,693			(31,249	)		(5,056	)		—		(27,612	)
Net increase (decrease) in cash		12,973			(773	)		189			—		12,389
Cash and cash equivalents, beginning of period		62,388			1,937			1,363			—		65,688
Cash and cash equivalents, end of period	$	75,361		$	1,164		$	1,552		$	—	$	78,077

41

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(11) Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes—(Continued)

Condensed Consolidating Statements of Cash Flows

	Nine Months Ended July 31, 2011
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Net cash provided by operating activities	$	13,590		$	41,931		$	4,946		$	—	$	60,467
Cash flows from investing activities:
Proceeds from sales of certificates of deposit		10,000			—			—			—		10,000
Purchases of restricted cash equivalents and marketable securities		(6,250	)		—			(662	)		—		(6,912	)
Proceeds from sale of assets		—			332			—			—		332
Purchase of subsidiaries, net of cash acquired		—			(9,110	)		—			—		(9,110	)
Additions to property and equipment		(1,730	)		(12,920	)		(1,038	)		—		(15,688	)
Other		—			103			—			—		103
Net cash provided by (used in) investing activities		2,020			(21,595	)		(1,700	)		—		(21,275	)
Cash flows from financing activities:
Proceeds from long-term debt		200,000			—			—			—		200,000
Repayments of long-term debt		(200,004	)		—			—			—		(200,004	)
Intercompany receivables (payables)		16,249			(12,429	)		(3,820	)		—		—
Debt refinancing costs		(5,933	)		—			—			—		(5,933	)
Issuance of common stock		1,386			—			—			—		1,386
Purchase and retirement of common stock		(15,622	)		—			—			—		(15,622	)
Dividends		(8,662	)		—			—			—		(8,662	)
Excess tax benefits from share based payment arrangements		154			—			—			—		154
Net cash used in financing activities		(12,432	)		(12,429	)		(3,820	)		—		(28,681	)
Net increase (decrease) in cash		3,178			7,907			(574	)		—		10,511
Cash and cash equivalents, beginning of period		48,270			6,055			1,735			—		56,060
Cash and cash equivalents, end of period	$	51,448		$	13,962		$	1,161		$	—	$	66,571

42

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(12) Acquisitions and Dispositions

Acquisitions

During the nine months ended July 31, 2012, the Company acquired a new funeral business for approximately $3,013. This acquisition was accounted for under the purchase method, and the acquired assets and liabilities (primarily goodwill of approximately $2,564 and property, plant and equipment of approximately $670) were valued at their estimated fair values. The results of operations for this business, which are considered immaterial, have been included in consolidated results since the acquisition date.

Dispositions

During the nine months ended July 31, 2012 and 2011, the Company recorded net gains (losses) on dispositions of $332 and ($389), respectively. The amount recorded for the nine months ended July 31, 2012 includes a $343 net gain on disposition due to the sale of a funeral home.

In April 2012, the Company designated a business as held for sale, recorded impairment charges related to the business and classified its operations as discontinued operations for all periods presented. The Company recorded net losses on dispositions of $31 and $871 in discontinued operations during the three and nine months ended July 31, 2012, respectively. The loss from discontinued operations before income taxes for the three months ended July 31, 2012 and 2011 were $380 and $365, respectively, and for the nine months ended July 31, 2012 and 2011 were $2,065 and $810, respectively.

Goodwill and changes to goodwill by operating segment from October 31, 2011 to July 31, 2012 is presented below:

	October 31, 2011		Changes			July 31, 2012
Funeral	$	198,317	$	2,546	(1)	$	200,863
Cemetery		48,721		—			48,721
Total	$	247,038	$	2,546		$	249,584

⁽¹⁾  The change is due to the purchase of a funeral home and the sale of a funeral home during the nine months ended July 31, 2012.

43

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(13) Consolidated Comprehensive Income

Consolidated comprehensive income for the three and nine months ended July 31, 2012 and 2011 is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Net earnings	$	9,638		$	11,986		$	26,919		$	30,028
Other comprehensive income (loss):
Unrealized appreciation (depreciation) of investments, net of deferred tax (expense) benefit of ($9), $2, ($13), and ($3), respectively		15			(3	)		23			6
(Increase) reduction in net unrealized losses associated with available-for-sale securities of the trusts		3,737			(31,772	)		39,080			11,209
Reclassification of the net unrealized losses activity attributable to the deferred preneed funeral and cemetery receipts held in trust and perpetual care trusts’ corpus		(3,737	)		31,772			(39,080	)		(11,209	)
Total other comprehensive income (loss)		15			(3	)		23			6
Total comprehensive income	$	9,653		$	11,983		$	26,942		$	30,034

(14) Restructuring and Other Charges

In April 2012, the Company announced an organizational restructuring as well as a separate workforce reduction. The announcement was made following a comprehensive evaluation to identify Best-in-Class sales practices, additional opportunities to further integrate operations and sales and additional efficiencies realized from the Company’s ongoing continuous improvement initiative. The organizational changes include a restructure of the sales organization and realignment of the Company’s geographic regions and regional management. The new organization reduced the layers of sales management. As a result of the organizational changes the Company has made, as well as the investments made in technology over the last couple of years, the Company has been able to improve processes and procedures allowing for this restructuring and reorganization. As a result, the Company also eliminated approximately 60 positions in its corporate support services. The organizational change was made to improve customers’ experiences by strengthening the relationship between the operations and sales teams, and positioning management closer to the customer. Total expenses related to the organizational restructuring and workforce reduction consist primarily of separation pay and termination benefits and other non-cash asset impairments associated with the sales restructuring. The restructuring is expected to be completed during the Company’s fourth quarter of fiscal year 2012. The Company recorded $305 and $2,852 in charges related to the restructuring and workforce reduction during the three and nine months ended July 31, 2012, respectively. These charges are in the “restructuring and other charges” line in the condensed consolidated statements of earnings. As of July 31, 2012, the Company does not expect to incur any material additional costs related to the restructuring. The following table summarizes the activity related to the restructuring as of July 31, 2012:

44

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(14) Restructuring and Other Charges—(Continued)

	Employee Termination Costs			Non-cash Asset Impairment and Other Costs			Total
Costs incurred	$	990		$	1,862		$	2,852
Cash payments		(990	)		(537	)		(1,527	)
Non-cash items		—			(1,236	)		(1,236	)
Restructuring liability as of July 31, 2012	$	—		$	89		$	89

(15) Long-term Debt

	July 31, 2012		October 31, 2011
Long-term debt:
3.125% senior convertible notes due 2014, net of unamortized discount of $5,484 and $7,611 as of July 31, 2012 and October 31, 2011, respectively	$	80,932	$	78,805
3.375% senior convertible notes due 2016, net of unamortized discount of $5,276 and $6,183 as of July 31, 2012 and October 31, 2011, respectively		39,843		38,936
Senior secured revolving credit facility		—		—
6.50% senior notes due 2019		200,000		200,000
Other, principally seller financing of acquired operations or assumption upon acquisition, weighted average interest rate of 8.0% as of July 31, 2012 and October 31, 2011, partially secured by assets of subsidiaries, with maturities through 2022		81		85
Total long-term debt		320,856		317,826
Less current maturities		6		5
	$	320,850	$	317,821

Fair Value

As of July 31, 2012, the carrying values of the Company’s 3.125 percent senior convertible notes due 2014 (the “2014 Notes”) and 3.375 percent senior convertible notes due 2016 (the “2016 Notes”), including accrued interest, were $81,051 and $39,911, respectively, compared to fair values of $86,282 and $44,223, respectively. The aggregate principal amounts outstanding of the 2014 Notes and 2016 Notes as of July 31, 2012 were $86,416 and $45,119, respectively. As of July 31, 2012, the carrying value of the Company’s 6.50 percent senior notes, including accrued interest, was $203,792 compared to a fair value of $213,802. Fair values were determined using quoted market prices for those securities and are classified within Level 1 of the three-level valuation hierarchy.

(16) Income Taxes

Income tax expense for the three and nine months ended July 31, 2012 was positively impacted by $1,125 and $2,075, respectively, overall reductions in the tax valuation allowance due to the reduction of a portion of the valuation allowance related to capital losses associated with the Company’s trust portfolio, as a result of the positive performance of the portfolio during those periods. Realized capital losses in the trusts for which the Company is the grantor, in which insufficient offsetting capital gains are expected, can require the Company to record a valuation allowance against the related deferred tax asset (capital loss carryforward). Reductions in the valuation allowance result when the Company realizes capital gains, which has been the case for the three and nine months ended July 31, 2012. As of July 31, 2012, the Company had a $2,900 valuation allowance remaining on $6,905 of realized capital losses.

45

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except per share amounts)

(16) Income Taxes—(Continued)

In January 2011, the government of Puerto Rico signed into law corporate tax rate changes that decreased the top tax rate for businesses from 39 percent to 30 percent. The Company will benefit from this reduced rate when paying taxes in the future. However, as a result of this change, the Company was required to revalue its previously recorded Puerto Rican-related deferred tax asset using the 30 percent current top tax rate. During the nine months ended July 31, 2011, the Company recorded a one-time, non-cash charge of $2,915 ($4,484 charge less a federal tax benefit of $1,569) in order to decrease the Puerto Rican deferred tax asset balance. The Puerto Rican deferred tax asset balance decreased from approximately $19,427 at the previously required 39 percent tax rate to approximately $14,943 at the newly-enacted 30 percent tax rate. This change in deferred tax assets increased the Company’s income tax expense for the nine months ended July 31, 2011 by $2,915. Income tax expense for the three months ended July 31, 2011 was impacted by a $1,625 increase in the tax valuation allowance for capital losses. Income tax expense for the nine months ended July 31, 2011 was also positively impacted by a $1,812 overall reduction in the tax valuation allowance primarily due to the reduction in the portion of the valuation allowance related to capital losses associated with the Company’s trust portfolio, as a result of the positive performance of the portfolio during that period.

(17) Subsequent Events

In August 2012, the Company received approval from the Internal Revenue Service for a change in tax accounting method resulting in the deferral of approximately $52,000 in revenue, thereby increasing the Company’s net operating loss carryforward. This increase in the net operating loss will result in approximately $21,000 of reduced future tax payments in 2012 and 2013.

On August 29, 2012, Hurricane Isaac made landfall in southern Louisiana. Although impacted by the event, the Company’s corporate headquarters building and its New Orleans funeral homes and cemeteries were able to restore operations shortly thereafter. The Company’s buildings and operations are insured against damages resulting from such events subject to standard deductibles.

As of August 31, 2012, the fair market value of the Company’s preneed funeral and cemetery merchandise and services trusts and cemetery perpetual care trusts increased 1.2 percent, or approximately $10,449, from July 31, 2012.

Subsequent to July 31, 2012 through August 31, 2012, the Company purchased an additional 465,499 shares of its Class A common stock for approximately $3,222 at an average price of $6.92 per share. As of August 31, 2012, there is a $21,543 remaining available under the Company’s $125,000 stock repurchase program.

46

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with our MD&A and Risk Factors contained in our Form 10-K for the fiscal year ended October 31, 2011 (the “2011 Form 10-K”) and in conjunction with our consolidated financial statements included in this report and in our 2011 Form 10-K.

This report contains forward-looking statements that are generally identifiable through the use of words such as “believe,” “expect,” “intend,” “plan,” “estimate,” “anticipate,” “project,” “will” and similar expressions. These forward-looking statements rely on assumptions, estimates and predictions that could be inaccurate and that are subject to risks and uncertainties that could cause actual results to differ materially. Important factors that may cause our actual results to differ materially from expectations reflected in our forward-looking statements include those described in Risk Factors included in Item 1A in our 2011 Form 10-K and in this report. Forward-looking statements speak only as of the date of this report, and we undertake no obligation to update or revise such statements to reflect new circumstances or unanticipated events as they occur.

Overview

General

We are the second largest provider of funeral and cemetery products and services in the death care industry in the United States and Puerto Rico. As of July 31, 2012, we owned and operated 217 funeral homes and 141 cemeteries in 24 states within the United States and Puerto Rico. We sell cemetery property and funeral, cremation and cemetery products and services both at the time of need and on a preneed basis. Our revenues in each period are derived primarily from at-need sales, preneed sales delivered out of our backlog during the period (including the accumulated trust earnings or build-up in the face value of insurance contracts related to these preneed deliveries), preneed cemetery property sales and other items such as perpetual care trust earnings, finance charges on installment sales contracts and trust management fees. We also earn commissions on the sale of insurance-funded preneed funeral contracts that will be funded by life insurance or annuity contracts issued by third-party insurers when we act as an agent on the sale. For a more detailed discussion of our accounting for preneed sales and trust and escrow account earnings, see MD&A included in Item 7 in our 2011 Form 10-K.

Financial Summary

For the third quarter of 2012, we achieved a 3.9 percent increase in revenue, a 23.9 percent increase in gross profit and a 340 basis point improvement in gross profit margin. Total revenue increased to $129.3 million for the third quarter of 2012, compared to $124.4 million for the same period of the prior year, and total gross profit increased to $27.0 million for the third quarter of 2012, compared to $21.8 million for the prior year period. Our cemetery segment generated a 51.4 percent improvement in cemetery gross profit and a 520 basis point improvement in cemetery gross profit margin compared to the third quarter of 2011. Our funeral segment generated a 9.7 percent improvement in funeral gross profit and a 200 basis point improvement in funeral gross profit margin compared to the same period of last year.

We reported net earnings of $9.6 million and earnings from continuing operations of $9.9 million, or $.11 per share for the third quarter of 2012. We reported net earnings of $12.0 million and earnings from continuing operations of $12.2 million, or $.13 per share for the third quarter of 2011. Earnings from continuing operations for the three months ended July 31, 2011 include a $12.4 million insurance settlement related to the successful resolution of our litigation related to Hurricane Katrina damages, which increased net earnings for the third quarter of 2011 by approximately $7.3 million.

Cemetery revenue improved $4.8 million, or 8.6 percent, to $60.4 million for the quarter ended July 31, 2012. This increase is primarily due to a $2.6 million improvement in revenue due to an increase in construction on various cemetery projects, coupled with a $1.5 million improvement in cemetery property revenue due to revenue recognition requirements for cemetery property sales being met. In addition, we experienced a $0.3 million improvement in the reserve for cancellations and a $0.3 million improvement in cemetery services performed. Cemetery property sales increased $0.3 million, or 1.0 percent compared to the third quarter of 2011. We generated $68.9 million in funeral revenue during the third quarter of 2012, a $0.1 million increase from the third quarter of 2011. This

47

increase is primarily attributable to a 0.5 percent increase in same-store funeral services performed, which we believe compares favorably to industry-wide data in our markets. The increase was partially offset by a 0.2 percent decrease in same-store average revenue per funeral service. Our net preneed funeral sales increased 6.6 percent during the third quarter of 2012 compared to the third quarter of 2011. Preneed funeral sales are deferred until a future period and have no impact on current revenue.

Cemetery gross profit increased $3.8 million, or 51.4 percent, to $11.2 million for the third quarter of 2012 and funeral gross profit increased $1.4 million, or 9.7 percent, to $15.8 million for the third quarter of 2012, due to our continuing focus on effectively controlling our costs. Cemetery gross profit margin increased 520 basis points to 18.5 percent for the third quarter of 2012, while funeral gross profit margin increased 200 basis points to 22.9 percent for the third quarter of 2012.

During the third quarter of 2012, we repurchased 1.0 million shares of our Class A common stock for $7.4 million under our stock repurchase program. As of July 31, 2012, we had $24.8 million remaining under the $125.0 million program authorized by the Board of Directors.

During the nine months ended July 31, 2012, we maintained our strong balance sheet while generating the highest nine-month revenue and gross profit in four years. For the first nine months of fiscal year 2012, we reported net earnings of $26.9 million, earnings from continuing operations of $28.3 million, or $.32 per share, total revenue of $386.7 million and total gross profit of $81.5 million. Our earnings from continuing operations for the first nine months of 2012 include a $2.9 million ($1.8 million after-tax) charge due to the organizational restructuring and a separate reduction in workforce occurring primarily in the second quarter of fiscal year 2012. In addition, we decided to hold one of our e-commerce businesses for sale resulting in a net loss from discontinued operations of $1.4 million. For the first nine months of 2011, we reported net earnings of $30.0 million, earnings from continuing operations of $30.5 million, or $.33 per share, total revenue of $383.3 million and total gross profit of $75.7 million. Earnings from continuing operations for the nine months ended July 31, 2011 include a $12.4 million ($7.3 million after-tax) insurance settlement related to the successful resolution of our litigation related to Hurricane Katrina damages. Our earnings from continuing operations for the first nine months of 2011 also included a $1.9 million ($1.1 million after-tax) charge for the early extinguishment of debt as a result of the refinancing of our senior notes and revolving credit facility in April 2011.

Cemetery revenue improved $5.3 million, or 3.2 percent, to $173.0 million for the nine months ended July 31, 2012. Cemetery property sales improved $3.6 million, or 4.8 percent, compared to the first nine months of 2011. In addition, we experienced a $2.0 million increase in revenue related to trust activities and a $0.7 million improvement in the reserve for cancellations. These improvements were partially offset by a $1.2 million decline in finance charges as a result of reduced interest rates in this low interest rate environment. We generated $213.7 million in funeral revenue during the first nine months of 2012, a $1.9 million decline from the same period of 2011. The decrease is primarily due to a 1.8 percent decline in same-store funeral services performed, which we believe is generally consistent with industry-wide data in our markets, coupled with a $0.6 million decline in revenue related to trust activities. The decline in funeral services was partially offset by a 0.5 percent improvement in same-store average revenue per funeral service. In addition, we experienced a $0.6 million, or 5.1 percent, improvement in insurance commission revenue, primarily due to the increase in net preneed funeral sales. Our net preneed funeral sales increased 13.4 percent during the first nine months of 2012 compared to the same period of 2011. Preneed funeral sales are deferred until a future period and have no impact on current revenue.

Cemetery gross profit increased $5.6 million, or 24.5 percent, to $28.5 million for the nine months ended July 31, 2012, primarily due to the increase in cemetery revenue, coupled with our continuing focus on effectively controlling our costs. Cemetery gross profit margin improved 280 basis points to 16.5 percent for the first nine months of 2012. Funeral gross profit increased $0.2 million, or 0.4 percent, to $53.0 million for the nine months ended July 31, 2012, primarily as a result of our continuing focus on effectively controlling our costs. Funeral gross profit margin improved 30 basis points to 24.8 percent for the first nine months of fiscal year 2012.

During the first nine months of 2012, we repurchased 2.9 million shares of our outstanding Class A common stock for $19.0 million. As a result of our stock repurchase program, our weighted average diluted shares outstanding decreased to 86.6 million shares for the nine months ended July 31, 2012 compared to 91.1 million shares for the same period of 2011. This decrease is primarily a result of our stock repurchase program, which yielded a positive impact on our earnings per share. Purchases of Class A common stock under our share repurchase program have resulted in a 4.9 percent decrease in total shares outstanding in the last twelve months. In June 2011 and March 2012, we announced that we had increased our quarterly dividend rate by one-half cent per share. We declared dividends of $0.04 per share in the third quarter of 2012.

48

Cash flow provided by operating activities for the first nine months of 2012 was $58.7 million compared to $60.5 million for the same period of last year. During the first nine months of 2012, we invested $16.2 million in several cemetery inventory development projects, compared to $11.6 million for the same period of last year. This spending includes a $7.2 million investment in our cremation inventory development projects during the first nine months of fiscal 2012, or a $5.2 million increase over the same period of last year. In addition, we experienced changes in working capital during the first nine months of 2012, partly driven by the timing of trust withdrawals and deposits.

We are planning to develop cremation gardens and other cremation projects in our cemeteries over the next few years. We have successfully completed 24 cremation projects, and we currently have 12 projects either under construction or expected to begin construction this fiscal year and approximately 20 additional projects currently under feasibility review. We are working to complete a number of these projects in fiscal year 2012 and expect to spend approximately $10 million to $12 million in fiscal year 2012. For the nine months ended July 31, 2012, we have spent $7.2 million in our cremation inventory development projects, compared to spending $2.0 million during the first nine months of fiscal year 2011. Cemetery cremation sales improved 20.0 percent during the nine months ended July 31, 2012 compared to the same period of last year, highlighting the positive returns of our ongoing cremation initiative.

During the third quarter of 2012, our Board of Directors appointed Dr. John B. Elstrott, Jr. to the newly created position of lead independent director. Among his primary responsibilities as lead independent director, Dr. Elstrott will act as the principal liaison between the independent directors and the CEO, assist the CEO and the Chairman of the Board with developing Board agendas and preside at Board meetings and executive sessions of the independent directors.

Supplemental Trust Portfolio Information

During the third quarter of fiscal year 2012, we continued to experience positive trends in the overall financial markets and in our preneed and perpetual care trusts. Specifically, our preneed funeral and cemetery merchandise and services trusts (“preneed trusts”) experienced a three month total return, including both realized and unrealized gains and losses, of 1.0 percent, and our cemetery perpetual care trusts experienced a total return, including both realized and unrealized gains and losses, of 2.4 percent. For the nine month period ended July 31, 2012, we experienced a total return, including both realized and unrealized gains and losses, of 9.1 percent in our preneed trusts and a 10.6 percent total return in our cemetery perpetual care trusts. As of July 31, 2012, the fair market value of our preneed trusts and our cemetery perpetual care trusts was $845.5 million, an improvement of 5.1 percent, or $40.9 million, from October 31, 2011.

As of July 31, 2012 and October 31, 2011, the fair market values of the investments in our preneed trusts were $75.5 million and $101.1 million, respectively, lower than our cost basis. In our cemetery perpetual care trusts, as of July 31, 2012 and October 31, 2011, the fair market values of our investments were $17.2 million and $30.7 million, respectively, lower than our cost basis.

The preneed contracts we manage are long-term in nature, and we believe that the trust investments will appreciate in value over the long-term. We continue to monitor our investment portfolio closely. As of July 31, 2012 and October 31, 2011, we had $187.6 million and $179.0 million, respectively, in trust earnings, net of losses that have been realized and allocated to contracts that will be recognized in the future as the underlying contracts are performed.

As of August 31, 2012, the fair market value of our preneed trusts and our cemetery perpetual care trusts improved 1.2 percent, or approximately $10.4 million from July 31, 2012, which is consistent with the overall financial markets.

The sectors in which our trust investment portfolio is invested have not materially changed from that disclosed in our 2011 Form 10-K. The following table presents the material sectors in which our trust portfolio is invested and the percentage of each sector to the total trust portfolio as of July 31, 2012 (in millions):

	Preneed Trusts					Cemetery Perpetual Care Trusts
Sector	Fair Market Value		Percentage of Portfolio			Fair Market Value		Percentage of Portfolio
Cash and mutual funds	$	256.6		44	%	$	117.4		45	%
Financial Services	$	66.5		11	%	$	43.5		17	%
Information Technology	$	52.2		9	%	$	12.7		5	%

49

Issuer specific investments in the financial services sector represent $66.5 million of the fair market value of our preneed trust portfolio as of July 31, 2012, of which 61 percent related to investments in preferred stock, 22 percent related to common stock and 17 percent related to fixed-income securities. Issuer specific investments in the financial services sector represented $43.5 million of the fair market value of our cemetery perpetual care trust portfolio as of July 31, 2012, of which 69 percent related to investments in preferred stock, 24 percent related to fixed-income securities and 7 percent related to common stock.

Issuer specific investments in the information technology sector represent $52.2 million of the fair market value of our preneed trust portfolio as of July 31, 2012, of which 97 percent related to investments in common stock and 3 percent related to fixed-income securities. Issuer specific investments in the information technology sector represent $12.7 million of the fair market value of our cemetery perpetual care trust portfolio as of July 31, 2012, of which 93 percent related to investments in common stock and 7 percent related to fixed-income securities.

The following table presents the material sectors in which our trust portfolio currently has unrealized losses and the percentage of each sector to the total unrealized losses as of July 31, 2012 (in millions):

	Preneed Trusts					Cemetery Perpetual Care Trusts
Sector	Unrealized Losses		Percentage of Total Unrealized Losses			Unrealized Losses		Percentage of Total Unrealized Losses
Financial Services	$	4.3		5	%	$	2.2		9	%
Information Technology	$	33.0		37	%	$	8.1		31	%

Each quarter we perform a separate analysis to determine whether our preneed contracts are in a loss position and whether a charge to earnings to record a liability for any expected losses is required. No charge has ever been required. For additional information, see Note 2(m) to the consolidated financial statements included in Item 8. and “Overview of Critical Accounting Policies” in the 2011 Form 10-K.

In states where we withdraw and recognize capital gains in our cemetery perpetual care trusts, if we realize subsequent net capital losses (i.e., losses in excess of capital gains in the trust) and the fair market value of the trust assets are less than the aggregate amounts required to be contributed to the trust, some states may require us to make cash deposits to the trusts or may require us to stop withdrawing earnings until future earnings restore the initial corpus. As of July 31, 2012 and October 31, 2011, we had a liability recorded for the estimated probable funding obligation to restore the net realized losses of $12.1 million and $12.0 million, respectively. We recorded an additional $0.6 million and $0.1 million for the estimated probable funding obligation to restore the net realized losses in the cemetery perpetual care trust for the nine months ended July 31, 2012 and 2011, respectively. The additional funding obligation in fiscal year 2012 is primarily related to the bankruptcy of Eastman Kodak Company.

For additional information regarding our preneed trusts and our cemetery perpetual care trusts, including further information on the estimated probable funding obligation, see Notes 3, 4 and 5 to the condensed consolidated financial statements included in Item 1.

50

The following table presents our trust portfolio total returns including realized and unrealized gains and losses:

	Funeral and Cemetery Merchandise and Services Trusts(1)			Cemetery Perpetual Care Trusts(1)
For the quarter ended July 31, 2012		1.0	%		2.4	%
For the nine months ended July 31, 2012		9.1	%		10.6	%
For the last three years ended July 31, 2012		10.5	%		11.5	%
For the last five years ended July 31, 2012		2.0	%		4.2	%

⁽¹⁾  Periods less than a year represent actual returns. Periods of one year or more represent average annualized returns.

Critical Accounting Policies

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which require us to make estimates and assumptions (see Note 1(d) to the condensed consolidated financial statements). Our critical accounting policies are those that are both important to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective and complex judgment. These critical accounting policies are discussed in MD&A in our 2011 Form 10-K. There have been no significant changes to our critical accounting policies since the filing of our 2011 Form 10-K.

Results of Operations

The following discussion segregates our financial results into our various segments, grouped by our funeral and cemetery operations. For a discussion of our segments, see Note 9 to the condensed consolidated financial statements included herein.

Three Months Ended July 31, 2012 Compared to Three Months Ended July 31, 2011

Funeral Operations

	Three Months Ended July 31,
	2012		2011		Increase     (Decrease)
			(In millions)
Funeral Revenue:
Funeral Home Locations	$	65.5	$	64.9	$	.6
Corporate Trust Management (1)		3.4		3.9		(.5	)
Total Funeral Revenue	$	68.9	$	68.8	$	.1
Funeral Costs:
Funeral Home Locations	$	52.9	$	54.2	$	(1.3	)
Corporate Trust Management (1)		.2		.2		—
Total Funeral Costs	$	53.1	$	54.4	$	(1.3	)
Funeral Gross Profit:
Funeral Home Locations	$	12.6	$	10.7	$	1.9
Corporate Trust Management (1)		3.2		3.7		(.5	)
Total Funeral Gross Profit	$	15.8	$	14.4	$	1.4

51

Same-Store Analysis for the Three Months Ended July 31, 2012 and 2011

Change in Average Revenue Per Funeral Service	Change in Same-Store Funeral Services	Same-Store Cremation Rate
		2012	2011
(0.2)% (1)	0.5%	43.3%	43.1%

⁽¹⁾  Corporate trust management consists of the trust management fees and funeral merchandise and services trust earnings recognized with respect to preneed contracts delivered during the period. Trust management fees are established by the Company at rates consistent with industry norms based on the fair market value of assets managed and are paid by the trusts to our subsidiary, Investors Trust, Inc. The trust earnings represent the amount of distributable earnings as stipulated by our respective trust agreements that are generated by the trusts over the life of the preneed contracts and allocated to those products and services delivered during the relevant periods. See Notes 3 and 6 to the condensed consolidated financial statements included herein for information regarding the cost basis and market value of the trust assets and current performance of the trusts (i.e., current realized gains and losses, interest income and dividends). Trust management fees included in funeral revenue for the three months ended July 31, 2012 and 2011 were $1.3 million and $1.2 million, respectively. Funeral trust earnings recognized in funeral revenue for the three months ended July 31, 2012 and 2011 were $2.1 million and $2.7 million, respectively.

Funeral revenue increased $0.1 million, or 0.1 percent, to $68.9 million in the third quarter of 2012 from $68.8 million in the third quarter of 2011. Same-store services increased 0.5 percent, or 65 events, which we believe compares favorably to industry-wide data. This increase was partially offset by a 0.2 percent decrease in same-store average revenue per funeral service. The cremation rate for our same-store operations was 43.3 percent for the third quarter of 2012 compared to 43.1 percent for the third quarter of 2011.

Funeral gross profit increased $1.4 million, or 9.7 percent, to $15.8 million for the third quarter of 2012 compared to $14.4 million for the same period of 2011, primarily due to our continuing focus on effectively controlling our costs. Funeral gross profit margin improved 200 basis points to 22.9 percent for the third quarter of 2012 from 20.9 percent for the third quarter of 2011.

Cemetery Operations

	Three Months Ended July 31,
	2012		2011		Increase
			(In millions)
Cemetery Revenue:
Cemetery Locations	$	57.9	$	53.5	$	4.4
Corporate Trust Management (1)		2.5		2.1		.4
Total Cemetery Revenue	$	60.4	$	55.6	$	4.8
Cemetery Costs:
Cemetery Locations	$	48.9	$	48.0	$	.9
Corporate Trust Management (1)		.3		.2		.1
Total Cemetery Costs	$	49.2	$	48.2	$	1.0
Cemetery Gross Profit:
Cemetery Locations	$	9.0	$	5.5	$	3.5
Corporate Trust Management (1)		2.2		1.9		.3
Total Cemetery Gross Profit	$	11.2	$	7.4	$	3.8

⁽¹⁾  Corporate trust management consists of trust management fees and cemetery merchandise and services trust earnings recognized with respect to preneed contracts delivered during the period. Trust management fees are

52

established by the Company at rates consistent with industry norms based on the fair market value of assets managed and are paid by the trusts to our subsidiary, Investors Trust, Inc. The trust earnings represent the amount of distributable earnings as stipulated by our respective trust agreements that are generated by the trusts over the life of the preneed contracts and allocated to those products and services delivered during the relevant periods. See Notes 4 and 6 to the condensed consolidated financial statements included herein for information regarding the cost basis and market value of the trust assets and current performance of the trusts (i.e., current realized gains and losses, interest income and dividends). Trust management fees included in cemetery revenue for the three months ended July 31, 2012 and 2011 were $1.6 million and $1.4 million, respectively, and cemetery trust earnings included in cemetery revenue for the three months ended July 31, 2012 and 2011 were $0.9 million and $0.7 million, respectively. Perpetual care trust earnings were $1.8 million and $2.0 million for the three months ended July 31, 2012 and 2011, respectively, and are included in the revenues and gross profit of the cemetery segment. See Notes 5 and 6 to the condensed consolidated financial statements included herein for information regarding the cemetery perpetual care trusts.

Cemetery revenue increased $4.8 million, or 8.6 percent, to $60.4 million for the third quarter of 2012. This increase is primarily due to a $2.6 million improvement in revenue due to an increase in construction on various cemetery projects, coupled with a $1.5 million improvement in cemetery property revenue due to revenue recognition requirements for cemetery property sales being met. In addition, we experienced a $0.3 million improvement in the reserve for cancellations and a $0.3 million improvement in cemetery services performed. Cemetery property sales increased $0.3 million, or 1.0 percent, compared to the third quarter of 2011.

Cemetery gross profit increased $3.8 million, or 51.4 percent, to $11.2 million for the third quarter of 2012 compared to $7.4 million for the same period of 2011. This increase is primarily attributable to the increase in cemetery revenue, as previously noted, coupled with our continuing focus on effectively controlling our costs. Cemetery gross profit margin improved 520 basis points to 18.5 percent for the third quarter of 2012 from 13.3 percent for the same period of 2011.

Other

Corporate general and administrative expenses increased $0.5 million to $7.3 million for the third quarter of 2012, compared to $6.8 million for the same period of 2011. Due to the strong operating results for the third quarter of 2012, we increased our accrual for incentive compensation during the period. While we increased the accrual in the quarter, it is consistent with the incentive accrual for the nine months ended July 31, 2011.

Results for the third quarter of 2011 include $12.4 million related to the settlement of Hurricane Katrina insurance litigation. The settlement increased pre-tax earnings for the third quarter of 2011 by $12.4 million, net earnings by approximately $7.3 million and diluted earnings per share by $.08.

The effective tax rate for continuing operations for the quarter ended July 31, 2012 was 27.9 percent compared to 45.3 percent for the same period in 2011. The increased rate in the third quarter of 2011 was primarily due to a $1.6 million tax expense resulting from an increase in the valuation allowance for capital losses. In the third quarter of 2012, we recorded a tax benefit of $1.1 million resulting from a reduction in the valuation allowance for capital losses, associated with the improved performance of our trust portfolio.

During the third quarter of 2012, we repurchased 1.0 million shares of our Class A common stock for $7.4 million under our stock repurchase program.

Preneed Sales into the Backlog

Net preneed funeral sales increased 6.6 percent during the third quarter of 2012 compared to the corresponding period in 2011. Preneed funeral sales are deferred until a future period and have no impact on current revenue.

The revenues from our preneed funeral and cemetery merchandise and service sales are deferred into our backlog and are not included in our operating results presented above. We had $41.0 million in net preneed funeral and cemetery merchandise and services sales (including $21.3 million related to insurance-funded preneed funeral

53

contracts) during the third quarter of 2012 to be recognized in the future as these prepaid products and services are actually delivered, compared to net preneed funeral and cemetery merchandise and services sales of $39.4 million (including $20.7 million related to insurance-funded preneed funeral contracts) for the corresponding period in 2011. Insurance-funded preneed funeral contracts, which will be funded by life insurance or annuity contracts issued by third-party insurers, are not reflected in the condensed consolidated balance sheets.

Nine Months Ended July 31, 2012 Compared to Nine Months Ended July 31, 2011

Funeral Operations

	Nine Months Ended July 31,
	2012		2011		Increase (Decrease)
			(In millions)
Funeral Revenue:
Funeral Home Locations	$	202.0	$	203.3	$	(1.3	)
Corporate Trust Management (1)		11.7		12.3		(.6	)
Total Funeral Revenue	$	213.7	$	215.6	$	(1.9	)
Funeral Costs:
Funeral Home Locations	$	160.0	$	162.1	$	(2.1	)
Corporate Trust Management (1)		.7		.7		—
Total Funeral Costs	$	160.7	$	162.8	$	(2.1	)
Funeral Gross Profit:
Funeral Home Locations	$	42.0	$	41.2	$	.8
Corporate Trust Management (1)		11.0		11.6		(.6	)
Total Funeral Gross Profit	$	53.0	$	52.8	$	.2

Same-Store Analysis for the Nine Months Ended July 31, 2012 and 2011

Change in Average Revenue Per Funeral Service	Change in Same-Store Funeral Services	Same-Store Cremation Rate
		2012	2011
0.5% (1)	(1.8)%	43.0%	42.6%

⁽¹⁾  Corporate trust management consists of the trust management fees and funeral merchandise and services trust earnings recognized with respect to preneed contracts delivered during the period. Trust management fees are established by the Company at rates consistent with industry norms based on the fair market value of assets managed and are paid by the trusts to our subsidiary, Investors Trust, Inc. The trust earnings represent the amount of distributable earnings as stipulated by our respective trust agreements that are generated by the trusts over the life of the preneed contracts and allocated to those products and services delivered during the relevant periods. See Notes 3 and 6 to the condensed consolidated financial statements included herein for information regarding the cost basis and market value of the trust assets and current performance of the trusts (i.e., current realized gains and losses, interest income and dividends). Trust management fees included in funeral revenue for the nine months ended July 31, 2012 and 2011 were $4.0 million and $3.6 million, respectively. Funeral trust earnings recognized in funeral revenue for the nine months ended July 31, 2012 and 2011 were $7.7 million and $8.7 million, respectively.

Funeral revenue declined $1.9 million, or 0.9 percent, to $213.7 million for the first nine months of fiscal 2012. This decline is primarily due to a 1.8 percent decrease in same-store funeral services, which we believe is generally consistent with industry-wide data in our markets, coupled with a $0.6 million decline in revenue related to trust activities. This decrease was partially offset by a 0.5 percent improvement in same-store average revenue per funeral service. In addition, we experienced a $0.6 million, or 5.1 percent, improvement in insurance commission revenue, primarily due to the increase in net preneed funeral sales. The cremation rate for our same-store operations was 43.0 percent for the nine months ended July 31, 2012 compared to 42.6 percent for the same period in 2011.

54

Funeral gross profit increased $0.2 million, or 0.4 percent, to $53.0 million for the first nine months of fiscal 2012 compared to $52.8 million for the same period of 2011, primarily as a result of our continuing focus on effectively controlling our costs. Funeral gross profit margin increased 30 basis points to 24.8 percent for the nine months ended July 31, 2012 from 24.5 percent for the same period of 2011.

Cemetery Operations

	Nine Months Ended July 31,
	2012		2011		Increase (Decrease)
			(In millions)
Cemetery Revenue:
Cemetery Locations	$	165.8	$	161.4	$	4.4
Corporate Trust Management (1)		7.2		6.3		.9
Total Cemetery Revenue	$	173.0	$	167.7	$	5.3
Cemetery Costs:
Cemetery Locations	$	143.8	$	144.2	$	(.4	)
Corporate Trust Management (1)		.7		.6		.1
Total Cemetery Costs	$	144.5	$	144.8	$	(.3	)
Cemetery Gross Profit:
Cemetery Locations	$	22.0	$	17.2	$	4.8
Corporate Trust Management (1)		6.5		5.7		.8
Total Cemetery Gross Profit	$	28.5	$	22.9	$	5.6

⁽¹⁾  Corporate trust management consists of trust management fees and cemetery merchandise and services trust earnings recognized with respect to preneed contracts delivered during the period. Trust management fees are established by the Company at rates consistent with industry norms based on the fair market value of assets managed and are paid by the trusts to our subsidiary, Investors Trust, Inc. The trust earnings represent the amount of distributable earnings as stipulated by our respective trust agreements that are generated by the trusts over the life of the preneed contracts and allocated to those products and services delivered during the relevant periods. See Notes 4 and 6 to the condensed consolidated financial statements included herein for information regarding the cost basis and market value of the trust assets and current performance of the trusts (i.e., current realized gains and losses, interest income and dividends). Trust management fees included in cemetery revenue for the nine months ended July 31, 2012 and 2011 were $4.6 million and $4.0 million, respectively, and cemetery trust earnings recognized included in cemetery revenue for the nine months ended July 31, 2012 and 2011 were $2.6 million and $2.3 million, respectively. Perpetual care trust earnings were $7.1 million and $6.0 million for the nine months ended July 31, 2012 and 2011, respectively, and are included in the revenues and gross profit of the cemetery segment. See Notes 5 and 6 to the condensed consolidated financial statements included herein for information regarding the cemetery perpetual care trusts.

Cemetery revenue increased $5.3 million, or 3.2 percent, to $173.0 million for the first nine months of fiscal 2012. We experienced an increase in cemetery property sales of $3.6 million, or 4.8 percent, compared to the first nine months of 2011. In addition, cemetery revenue increased primarily due to a $2.0 million increase in revenue related to trust activities and a $0.7 million improvement in the reserve for cancellations. These improvements were partially offset by a $1.2 million decline in finance charges as a result of reduced interest rates in this low interest rate environment.

Cemetery gross profit increased $5.6 million, or 24.5 percent, to $28.5 million for the first nine months of 2012, primarily attributable to the increase in cemetery revenue, as previously noted, coupled with our continuing focus on effectively controlling our costs. Cemetery gross profit margin improved 280 basis points to 16.5 percent for the first nine months of 2012 from 13.7 percent for the same period of 2011.

55

Other

Corporate general and administrative expenses increased $0.7 million to $20.2 million for the first nine months of 2012, compared to $19.5 million for the same period of 2011. During the first nine months of 2012, we experienced an increase in spending in continuous improvement and third-party growth initiatives, compared to the same period of last year.

Results for the nine months ended July 31, 2011 include $12.4 million related to the settlement of Hurricane Katrina insurance litigation. The settlement increased prior year’s pre-tax earnings by $12.4 million and net earnings by $7.3 million.

We recorded $2.9 million in restructuring and other charges during the first nine months of fiscal year 2012. This charge was primarily related to separation pay, termination benefits and a non-cash asset impairment due to the restructuring of the sales and operations of the organization, as well as a separate reduction in workforce associated with our ongoing continuous improvement initiative. For the three and nine months ended July 31, 2012, the decline in costs associated with the restructuring of our sales and operations, as well as our reduction in force are consistent with our previously announced expectations of approximately $10 million on an annual basis. For additional information, see Note 14 to the condensed consolidated financial statements included in Item1.

As a result of the prior year refinancing of our senior notes and revolving credit facility in April 2011, we recorded a $1.9 million charge for the early extinguishment of debt during the nine months ended July 31,2011.

The effective tax rate for continuing operations for the nine months ended July 31, 2012 was 32.7 percent compared to 39.9 percent for the same period in 2011. For the nine months ended July 31, 2012, we recorded a benefit of $2.1 million resulting from a reduction in the valuation allowance for capital losses, associated with the positive performance of our trust portfolio. During the nine months ended July 31, 2011, we recorded a benefit of $1.8 million resulting primarily from a reduction in the valuation allowance for capital losses associated with the positive performance of the trust portfolio. This benefit was partially offset by a $2.9 million one-time, non-cash charge to income tax expense, as a result of the revaluation of its Puerto Rican deferred tax assets due to a change in Puerto Rican tax legislation.

During the nine months ended July 31, 2012, we acquired a new funeral business. This acquisition was accounted for under the purchase method, and the acquired assets and liabilities were valued at their estimated fair values. The results of operations for this business, which are considered immaterial, have been included in consolidated results since the acquisition date. For additional information, see Note 12 to the condensed consolidated financial statements included in Item 1.

During the first nine months of 2012, we decided to hold one of our e-commerce businesses for sale with the results of its operations and the related impairment included in discontinued operations.

During the first nine months of 2012, we repurchased 2.9 million shares of our Class A common stock for $19.0 million under our stock repurchase program. As of July 31, 2012, we have $24.8 million remaining under our $125.0 million program.

Our weighted average diluted shares outstanding decreased to 86.6 million shares for the nine months ended July 31, 2012 compared to 91.1 million shares for the same period of 2011. The decrease is primarily a result of our stock repurchase program, which has yielded a positive impact on our earnings per share.

Cash and cash equivalents increased $12.4 million from October 31, 2011 to July 31, 2012 primarily due to cash provided by operations, offset by $19.1 million in purchases made under our stock repurchase program, $16.2 million in additions to property, plant and equipment and $10.0 million of dividends paid. Current deferred income taxes decreased $12.1 million from October 31, 2011 to July 31, 2012 primarily due to the utilization of net operating losses. Goodwill increased $2.5 million from October 31, 2011 to July 31, 2012 primarily due to an acquisition made in the second quarter of 2012. Cemetery property increased $4.7 million from October 31, 2011 to July 31, 2012 primarily due to the continued investments in numerous construction projects. Long-term deferred taxes increased $5.3 million primarily due to an increase in our federal alternative minimum tax. Preneed funeral receivables and trust investments, preneed cemetery receivables and trust investments, cemetery perpetual care trust investments, deferred preneed funeral and cemetery receipts held in trust and perpetual care trusts’ corpus were all positively

56

impacted by the improvement in the market value of our trust assets during the nine months ended July 31, 2012. For additional information, see Notes 3, 4 and 5 to our condensed consolidated financial statements included herein.

Accounts payable decreased $3.0 million from October 31, 2011 to July 31, 2012 primarily due to the timing of payables related to property, plant and equipment and inventory. Accrued payroll increased $1.2 million from October 31, 2011 to July 31, 2012 primarily due to the timing of the payroll at quarter end. Income taxes payable increased $2.9 million from October 31, 2011 to July 31, 2012, primarily due to an increase in our federal alternative minimum tax.

Preneed Sales into the Backlog

Net preneed funeral sales increased 13.4 percent during the nine months ended July 31, 2012 compared to the corresponding period in 2011. Preneed funeral sales are deferred until a future period and have no impact on current revenue.

The revenues from our preneed funeral and cemetery merchandise and service sales are deferred into our backlog and are not included in our operating results presented above. We had $117.8 million in net preneed funeral and cemetery merchandise and services sales (including $60.0 million related to insurance-funded preneed funeral contracts) during the nine months ended July 31, 2012 to be recognized in the future as these prepaid products and services are actually delivered, compared to net preneed funeral and cemetery merchandise and services sales of $107.7 million (including $56.8 million related to insurance-funded preneed funeral contracts) for the corresponding period in 2011. Insurance-funded preneed funeral contracts, which will be funded by life insurance or annuity contracts issued by third-party insurers, are not reflected in the condensed consolidated balance sheets.

Liquidity and Capital Resources

General

We generate cash in our operations primarily from at-need sales, preneed sales that turn at-need, funds we are able to withdraw from our trusts and escrow accounts when preneed sales turn at-need, monies collected on preneed sales that are not required to be placed in trust and items such as cemetery perpetual care trust earnings and finance charges. Over the last five years, we have generated more than $60 million each year in cash flow from operations. We have historically satisfied our working capital requirements with cash flows from operations. We believe that our current level of cash on hand, projected cash flows from operations and available capacity under our $150.0 million senior secured revolving credit facility will be sufficient to meet our cash requirements for the foreseeable future.

As of July 31, 2012, we had no amounts drawn on the $150.0 million senior secured revolving credit facility, and our availability under the facility, after giving consideration to $0.8 million outstanding letters of credit and the $23.5 million Florida bond, was $125.7 million. In addition, we also have outstanding $131.5 million principal amount in senior convertible notes as of July 31, 2012, of which $86.4 million is scheduled to mature in 2014 and $45.1 million is scheduled to mature in 2016. We have outstanding $200.0 million principal amount in senior notes set to mature in 2019. See the table below under “Contractual Obligations and Commercial Commitments” for further information on our long-term debt obligations.

Beginning in the second quarter of fiscal year 2012, we increased our quarterly cash dividend on our Class A and B common stock from three and one-half cents per share to four cents per share. Dividends amounted to $10.0 million for the nine months ended July 31, 2012 compared to $8.7 million during the same period in fiscal year 2011. The declaration and payment of future dividends are discretionary and will be subject to determination by the Board of Directors each quarter after its review of our financial performance. In June 2011 and September 2011, we increased our stock repurchase program by $25.0 million resulting in a $125.0 million program. Under the program, we purchased 2.9 million shares of our Class A common stock for approximately $19.0 million during the nine months ended July 31, 2012. In August 2012, we purchased an additional 0.5 million shares of our Class A common stock for approximately $3.2 million and as of August 31, 2012 had $21.5 million remaining available under the program. Repurchases under the program are limited to our Class A common stock, and are made in the open market or in privately negotiated transactions at such times and in such amounts as management deems appropriate, depending upon market conditions and other factors.

57

We plan to continue to evaluate our options for deployment of cash flow as opportunities arise. We believe that the use of our cash to make acquisitions of or investments in death care or related businesses, construct funeral homes on existing cemeteries, cemeteries of unaffiliated third parties or in strategic locations, develop inventory including cremation projects, pay dividends and repurchase debt and stock are all attractive options. We believe that growing our organization through acquisitions and investments remains a good business strategy, as it will enable us to enjoy the important synergies and economies of scale from our existing infrastructure. We are continuing to invest in further improving our business processes. We are planning to develop cremation gardens and other cremation projects in our cemeteries over the next few years. We have successfully completed 24 cremation projects, and we currently have 12 projects either under construction or expected to begin construction this fiscal year and approximately 20 additional projects under feasibility review. We are working to complete a number of these projects in fiscal year 2012 and expect to spend approximately $10 million to $12 million in fiscal year 2012. Through the nine months ended July 31, 2012, we have spent $7.2 million to develop our cremation inventory projects. We regularly review acquisition and other strategic opportunities, which may require us to draw on our senior secured revolving credit facility or pursue additional debt or equity financing. We are also continuing to look at ways to improve our organization and cost structure.

In August 2012, we received approval from the Internal Revenue Service for a change in tax accounting method resulting in the deferral of approximately $52 million in revenue, thereby increasing our net operating loss carryforward. This increase in the net operating loss will result in approximately $21 million of reduced future tax payments. We are continuing to review all of our tax accounting methods to determine opportunities to further improve our current tax position. Several possible changes are being considered that could result in potential reductions in future tax payments. At this time, we cannot predict with certainty what, if any, reductions in future tax payments we will obtain. However, we currently do not expect that these potential reductions in future tax payments, if obtained, will be as substantial as those obtained in fiscal years 2009 through 2012, which resulted in a combination of refunds and reductions of federal income tax payments totaling in excess of $100 million. Based on the currently approved changes, we expect to have federal net operating losses and certain tax credits which will allow us to have nominal federal cash taxes in fiscal years 2012, 2013 and 2014.

Cash Flow

Cash flow provided by operating activities for the first nine months of fiscal year 2012 was $58.7 million compared to $60.5 million for the same period of last year. During the first nine months of fiscal year 2012, we invested $16.2 million in several cemetery inventory development projects, compared to $11.6 million for the same period of last year. This spending includes a $7.2 million investment in our cremation inventory development projects during the first nine months of fiscal 2012, or a $5.2 million increase over the same period of last year. In addition, we experienced changes in working capital during the first nine months of fiscal year 2012, partly driven by the timing of trust withdrawals and deposits.

Our investing activities resulted in a net cash outflow of $18.7 million for the nine months ended July 31, 2012, compared to a net cash outflow of $21.3 million for the comparable period in 2011. The change is primarily due to the fact that we purchased two funeral and cemetery businesses for $9.1 million during the nine months ended July 31, 2011 compared to purchasing one funeral business for $3.0 million during the nine months ended July 31, 2012. For the nine months ended July 31, 2012, capital expenditures amounted to $16.2 million, which included $11.4 million for maintenance capital expenditures, $1.7 million for the construction of new funeral homes, $1.3 million related to the implementation of new business systems and $1.8 million for the purchase of land and a new building for an existing business. For the nine months ended July 31, 2011, capital expenditures were $15.7 million, which included $12.9 million for maintenance capital expenditures, $2.1 million for the construction of new funeral homes and $0.7 million related to the implementation of new business systems.

Our financing activities resulted in a net cash outflow of $27.6 million for the nine months ended July 31, 2012, compared to a net cash outflow of $28.7 million for the comparable period in 2011. Stock repurchases during the nine months ended July 31, 2012 amounted to $19.1 million compared to $15.6 million in the same period of 2011. Dividends paid increased from $8.7 million in the first nine months of fiscal year 2011 to $10.0 million in the

58

first nine months of fiscal year 2012. In the second quarter of fiscal year 2012, we increased our quarterly cash dividend from three and one-half cents per share to four cents per share. During the nine months ended July 31, 2011, we issued $200.0 million of 6.50 percent senior notes due 2019 and repurchased and redeemed $200.0 million of 6.25 percent senior notes due 2013. We also paid $5.9 million in debt refinancing costs during the nine months ended July 31, 2011 related to the senior notes transactions and refinancing of the senior secured revolving credit facility.

Contractual Obligations and Commercial Commitments

We have contractual obligations requiring future cash payments under existing contractual arrangements. The following table details our known future cash payments (in millions) related to various contractual obligations as of July 31, 2012:

	Payments Due by Period
Contractual Obligations	Total		Less than 1 year		1 –3 years		3 –5 years		More than 5 years
Long-term debt obligations (1)	$	331.6	$	—	$	86.4	$	45.1	$	200.1
Interest on long-term debt (2)		109.0		17.2		31.8		27.5		32.5
Operating and capital lease obligations (3)		30.7		1.5		8.7		5.7		14.8
Non-competition and other agreements (4)		1.2		0.1		0.5		0.4		0.2
Purchase obligation (5)		2.8		2.8		—		—		—
Total	$	475.3	$	21.6	$	127.4	$	78.7	$	247.6

⁽¹⁾  As of July 31, 2012, our outstanding long-term debt obligations amounted to $331.6 million, consisting of $86.4 million of 3.125 percent senior convertible notes due 2014, $45.1 million of 3.375 percent senior convertible notes due 2016, $200.0 million of 6.50 percent senior notes due 2019 and $0.1 million of other debt. There were no amounts drawn on the senior secured revolving credit facility.

⁽²⁾  Includes contractual interest payments for our senior convertible notes, senior notes and third-party debt.

⁽³⁾  Our noncancellable operating leases are primarily for land and buildings and expire over the next one to 19 years, except for eight leases that expire between 2032 and 2039. This category also includes leases under our vehicle fleet leasing program. Our future minimum lease payments as of July 31, 2012 are $1.5 million, $4.8 million, $3.9 million, $3.1 million, $2.6 million and $14.8 million for the years ending October 31, 2012, 2013, 2014, 2015, 2016 and later years, respectively.

⁽⁴⁾  This category includes payments pursuant to non-competition agreements with prior owners and key employees of acquired businesses.

⁽⁵⁾  This category represents a purchase obligation related to an agreement we entered into to purchase the land and building of an existing business that we currently lease.

The following table details our known potential or possible future cash payments related to the contingent obligations specified below (in millions) as of July 31, 2012.

	Expiration by Period
Contingent Obligations	Total		Less than 1 year		1 –3 years		3 –5 years		More than 5 years
Cemetery perpetual care trust funding obligations (1)	$	12.1	$	12.1	$	—	$	—	$	—
Long-term obligations related to uncertain tax positions (2)		1.5		—		—		—		1.5
	$	13.6	$	12.1	$	—	$	—	$	1.5

⁽¹⁾  In those states where we have withdrawn realized net capital gains in the past from our cemetery perpetual care trusts, regulators may seek replenishment of the subsequent realized net capital losses either by requiring a cash

59

deposit to the trust or by prohibiting or restricting withdrawals of future earnings until they cover the loss. The estimated probable funding obligation in the cemetery perpetual care trusts in these states was $12.1 million as of July 31, 2012. As of July 31, 2012, we had net unrealized losses of $28.2 million in the trusts in these states that could be subject to a future funding obligation. Because some of these trusts currently have assets with a fair market value less than the aggregate amounts required to be contributed to the trust, any additional realized net capital losses in these trusts may result in a corresponding funding liability and increase in cemetery costs. In those states where realized net capital gains have not been withdrawn, we believe it is reasonably possible but not probable that additional funding obligations may exist with an estimated amount of approximately $2.0 million; no charge has been recorded for these amounts as of July 31, 2012.

⁽²⁾  In accordance with the required accounting guidance on uncertain tax positions, as of July 31, 2012, we have recorded $1.5 million of unrecognized tax benefits and related interest and penalties. Due to the uncertainty regarding the timing and completion of audits and possible outcomes, it is not possible to estimate the range of increase and decrease and the timing of any potential cash payments.

Off-Balance Sheet Arrangements

Our off-balance sheet arrangements as of July 31, 2012 consist of the following items:

(1) the $23.5 million bond we are required to maintain to guarantee our obligations relating to funds we withdrew in fiscal year 2001 from our preneed funeral trusts in Florida, which is discussed above and in Note 19 to the consolidated financial statements in our 2011 Form 10-K; and

(2) the insurance-funded preneed funeral contracts, which will be funded by life insurance or annuity contracts issued by third-party insurers, are not reflected in our condensed consolidated balance sheets, and are discussed in Note 2(i) to the consolidated financial statements in our 2011 Form 10-K.

Recent Accounting Standards

See Note 2 to the condensed consolidated financial statements included herein.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Quantitative and qualitative disclosure about market risk is presented in Item 7A in our 2011 Form 10-K, filed with the Securities and Exchange Commission (“SEC”) on December 15, 2011. There have been no material changes in the Company’s market risk from that disclosed in our 2011 Form 10-K. For a discussion of fair market value as of July 31, 2012 of investments in our trusts, see Notes 3, 4 and 5 to the condensed consolidated financial statements included herein.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate to allow timely decisions regarding required disclosure.

As of the end of the period covered by this report, the Company carried out an evaluation under the supervision and with the participation of the Company’s Disclosure Committee and management, including the CEO and CFO, of the effectiveness of the Company’s disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(b). Based upon this evaluation, the CEO and CFO concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report.

60

Changes in Internal Control over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting during the quarter ended July 31, 2012 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We and certain of our subsidiaries are parties to a number of legal proceedings that have arisen in the ordinary course of business. While the outcome of these proceedings cannot be predicted with certainty, we do not expect these matters to have a material adverse effect on our consolidated financial position, results of operations or cash flows.

We carry insurance with coverages and coverage limits that we believe to be adequate. Although there can be no assurance that such insurance is sufficient to protect us against all contingencies, we believe that our insurance protection is reasonable in view of the nature and scope of our operations.

Item 1A. Risk Factors

There have been no material changes from the risk factors previously disclosed in our 2011 Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(c) Purchases of Equity Securities by the Issuer and Affiliated Purchasers

Issuer Purchases of Equity Securities

Period	Total number of shares purchased		Average price paid per share		Total number of shares purchased as part of publicly- announced plans or programs		Maximum approximate dollar value of shares that may yet be purchased under the plans or programs(1)
May 1, 2012 through May 31, 2012		—	$	—		—	$	32,194,032
June 1, 2012 through June 30, 2012		59,000	$	6.79		59,000	$	31,793,235
July 1, 2012 through July 31, 2012		964,557	$	7.29		964,557	$	24,765,345
Total		1,023,557	$	7.26		1,023,557	$	24,765,345

⁽¹⁾  We announced a $25.0 million stock repurchase program in September 2007, which was increased by $25.0 million in December 2007, June 2008, June 2011 and September 2011, resulting in a $125.0 million program. As of July 31, 2012, we had repurchased 14.8 million shares for $100.2 million at an average price of $6.75 per share since the inception of the program in 2007. In August 2012, we repurchased an additional 0.5 million shares for $3.2 million at an average price of $6.92 per share and, as of August 31, 2012, had $21.5 million remaining available under the program.

Item 6. Exhibits

3.1 Amended and Restated Articles of Incorporation of the Company, as amended and restated as of April 3, 2008 (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended April 30, 2008)

61

3.2	By-laws of the Company, as amended and restated as of September 8, 2008 (incorporated by reference to Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2008)
4.1	See Exhibits 3.1 and 3.2 for provisions of the Company’s Amended and Restated Articles of Incorporation, as amended, and By-laws, as amended, defining the rights of holders of Class A and Class B common stock
4.2	Specimen of Class A common stock certificate (incorporated by reference to Exhibit 3 to the Company’s Registration Statement on Form 8-A/A filed with the Commission on June 21, 2007)
4.3	Third Amended and Restated Credit Agreement dated April 20, 2011 by and among the Company, Empresas Stewart-Cementerios and Empresas Stewart-Funerarias, as Borrowers, Bank of America, N.A., as Administrative Agent, Collateral Agent, Swing Line Lender and L/C Issuer and The Other Lenders party hereto (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed April 21, 2011)
4.4	Indenture dated as of April 18, 2011 by and among Stewart Enterprises, Inc., the Guarantors and U.S. Bank National Association, as Trustee, with respect to the 6.50 percent Senior Notes due 2019 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed April 19, 2011)
4.5	Form of 6.50 percent Senior Note due 2019 (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed April 19, 2011)
4.6	Indenture dated June 27, 2007 by and among Stewart Enterprises, Inc., the guarantors named therein and U.S. Bank National Association, as Trustee, with respect to 3.125 percent Senior Convertible Notes due 2014 (including Form of 3.125 percent Senior Convertible Notes due 2014) (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed June 27, 2007)
4.7	Indenture dated June 27, 2007 by and among Stewart Enterprises, Inc., the guarantors named therein and U.S. Bank National Association, as Trustee, with respect to 3.375 percent Senior Convertible Notes due 2016 (including Form of 3.375 percent Senior Convertible Notes due 2016) (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed June 27, 2007)
10.1	Amendment No. 2 to the Amended and Restated Stewart Enterprises, Inc. Supplemental Retirement and Deferred Compensation Plan effective June 1, 2012
10.2	Amended and Restated Stewart Enterprises, Inc. Retention Plan and Summary Plan Description
10.3	Amendment No. 3 to the Amended and Restated Stewart Enterprises, Inc. Supplemental Executive Retirement Plan effective June 20, 2012
31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of Thomas M. Kitchen, President and Chief Executive Officer
31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of Lewis J. Derbes, Jr., Senior Vice President, Chief Financial Officer and Treasurer
32.1	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of Thomas M. Kitchen, President and Chief Executive Officer, and Lewis J. Derbes, Jr., Senior Vice President, Chief Financial Officer and Treasurer
101	The following materials from Stewart Enterprises, Inc.’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2012 formatted in XBRL (Extensible Business Reporting Language): (i) Condensed Consolidated Statements of Earnings, (ii) Condensed Consolidated Balance Sheets, (iii) Condensed Consolidated Statement of Shareholders’ Equity, (iv) Condensed Consolidated Statements of Cash Flows and (v) Notes to Condensed Consolidated Financial Statements.

62

STEWART ENTERPRISES, INC.

AND SUBSIDIARIES

SIGNATURES

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.
September 5, 2012	/s/ Lewis J. Derbes, Jr.
	Lewis J. Derbes, Jr.
	Senior Vice President,
	Chief Financial Officer and Treasurer
September 5, 2012	/s/ Angela M. Lacour
	Angela M. Lacour
	Senior Vice President of Finance
	and Chief Accounting Officer

63

Exhibit Index

10.1	Amendment No. 2 to the Amended and Restated Stewart Enterprises, Inc. Supplemental Retirement and Deferred Compensation Plan effective June 1, 2012
10.2	Amended and Restated Stewart Enterprises, Inc. Retention Plan and Summary Plan Description
10.3	Amendment No. 3 to the Amended and Restated Stewart Enterprises, Inc. Supplemental Executive Retirement Plan effective June 20, 2012
31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of Thomas M. Kitchen, President and Chief Executive Officer
31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of Lewis J. Derbes, Jr., Senior Vice President, Chief Financial Officer and Treasurer
32.1	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of Thomas M. Kitchen, President and Chief Executive Officer, and Lewis J. Derbes, Jr., Senior Vice President, Chief Financial Officer and Treasurer
101	The following materials from Stewart Enterprises, Inc.’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2012 formatted in XBRL (Extensible Business Reporting Language): (i) Condensed Consolidated Statements of Earnings, (ii) Condensed Consolidated Balance Sheets, (iii) Condensed Consolidated Statement of Shareholders’ Equity, (iv) Condensed Consolidated Statements of Cash Flows and (v) Notes to Condensed Consolidated Financial Statements.

64

EX-10.1

Exhibit 10.1

AMENDMENT NO. 2 TO THE

AMENDED AND RESTATED

STEWART ENTERPRISES, INC.

SUPPLEMENTAL RETIREMENT

AND DEFERRED COMPENSATION PLAN

This Amendment No. 2 to the Stewart Enterprises, Inc. Supplemental Retirement and Deferred Compensation Plan (“Plan”) is effective as of June 1, 2012.

WHEREAS, the Compensation Committee of the Board of Directors of Stewart Enterprises, Inc. approved changes to the Plan’s eligibility provisions and a reduction of the compensation threshold above which elective deferrals can be made under the Plan, at its meeting on April 19, 2012;

NOW THEREFORE, the Plan is hereby amended effective June 1, 2012, as follows:

I.

Section 2.12, Eligible Employee, is restated to read as follows:

Section 2.12 Eligible Employee means:

(i) For any Plan Year, an employee of the Company named by the Administrator as eligible to participate, in accordance with the purposes of the Plan, and

(ii) In addition to (i) above, effective June 1, 2012, all employees of the Company covered under Section 16 of the Securities Exchange Act of 1934.

II.

Section 2.17 Plan Compensation:

(i) Prior to June 1, 2012, Plan Compensation means the annual compensation, as defined in the Basic Plan, of a Participant in excess of the limitation on compensation contained in Code Section 401(a)(17), taking into account cost of living adjustments that may be made pursuant to that Code Section, from time to time.

(ii) On and after June 1, 2012, Plan Compensation means the annual compensation, as defined in the Basic Plan, of a Participant in excess of $175,000. The previous sentence notwithstanding, Participants who became eligible for the Plan prior to June 1, 2012 shall be subject to the definition in subsection (i) above until January 1, 2013, at which time the definition in this subsection (ii) shall apply to all Participants.

Page 1 of 2

For purposes of Section 3.1, Supplemental Elective Deferrals, Plan Compensation shall be determined on a pay period basis, with deferral elections being applied to any amount of pay period compensation that is projected, when annualized, to result in annual compensation in excess of $175,000.

For example, if a Participant earns $260,000 per year and there are 26 pay periods in a Plan Year, the Participant’s pay period compensation is $10,000. In such case, his Plan Compensation would be $3,269, which is the amount of his pay period compensation that exceeds $6,731 per pay period ($175,000 divided by 26). Any annual bonuses paid to an Eligible Employee during a pay period are deemed to represent Plan Compensation.

Executed in Jefferson, Louisiana, this 11th day of June, 2012.

WITNESSES:		STEWART ENTERPRISES, INC.
/s/ Lewis J. Derbes, Jr.		By:	/s/ Thomas M. Kitchen
Print Name	Lewis J. Derbes, Jr.		Thomas M. Kitchen
/s/ Lisa T. Winningkoff
Print Name	Lisa T. Winningkoff

Page 2 of 2

EX-10.2

Exhibit 10.2

AMENDED AND RESTATED

STEWART ENTERPRISES, INC.

RETENTION PLAN AND SUMMARY PLAN DESCRIPTION

In order to encourage the continued employment of key employees of Stewart Enterprises, Inc. (the “Company”), and to alleviate concerns about any possible loss of employment upon a change of control of the Company, the Company has adopted a Retention Plan (the “Plan”) having the following terms and conditions. This document also constitutes the Plan’s Summary Plan Description, as described in Section 102 of the Employee Retirement Income Security Act of 1974 (“ERISA”).

ARTICLE 1

DEFINITIONS

1.1 Affiliate. “Affiliate” or “affiliated companies” shall mean any company controlled by, controlling, or under common control with, the Company.

1.2 Board. “Board” shall mean the Board of Directors of the Company.

1.3 Cause. With respect to each Participant, “Cause” shall mean:

(a) the willful and continued failure of the Participant to perform substantially the Participant’s duties with the Company or its Affiliates (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Participant by the Board of the Company which specifically identifies the manner in which the Board believes that the Participant has not substantially performed the Participant’s duties;

(b) the willful engaging by the Participant in illegal conduct or gross misconduct;

(c) unauthorized acts or omissions that could reasonably be expected to cause material financial harm to the Company or materially disrupt Company operations;

(d) commission of an act of dishonesty (even if not a crime) resulting in the enrichment of the Participant at the expense of the Company; or

(e) knowing falsification or knowing attempted falsification of financial records of the Company in violation of SEC Rule 13b2-1.

For purposes of subparagraphs (a) and (b) above, no act or failure to act, on the part of the Participant, shall be considered “willful” unless it is done, or omitted to be done, by the Participant in bad faith or without reasonable belief that the Participant’s action or omission was in the best interests of the Company or its Affiliates. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions of a senior officer of the Company or based upon the advice of counsel for the Company or its Affiliates shall be conclusively presumed to be done, or omitted to be done, by the Participant in good faith and in the best interests of the Company or its Affiliates.

The cessation of employment of the Participant shall not be deemed to be for Cause unless and until there shall have been delivered to the Participant a copy of a resolution duly adopted by the

1

affirmative vote of not less than three-quarters of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Participant and the Participant is given an opportunity, together with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, the Participant is guilty of the conduct described in subparagraphs (a) through (e) above, and specifying the particulars thereof in detail.

1.4 Company. As used in this Plan, “Company” shall mean the Company as defined above and any successor to or assignee of (whether direct or indirect, by purchase, merger, consolidation or otherwise) all or substantially all of the assets or business of the Company.

1.5 Change of Control. “Change of Control” shall mean:

(a) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the “Exchange Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than 30% of the outstanding shares of the Company’s Class A Common Stock, no par value per share (the “Common Stock”); provided, however, that for purposes of this subsection (a), the following acquisitions shall not constitute a Change of Control:

(i) any acquisition of Common Stock directly from the Company,

(ii) any acquisition of Common Stock by the Company,

(iii) any acquisition of Common Stock by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or

(iv) any acquisition of Common Stock by any corporation pursuant to a transaction that complies with clauses (i), (ii) and (iii) of subsection (c) of this Section 1.5; or

(b) individuals who, as of the date this Plan is executed (the “Effective Date”) constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Effective Date whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered a member of the Incumbent Board, unless such individual’s initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Incumbent Board; or

(c) consummation of a reorganization, merger or consolidation, or sale or other disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless, following such Business Combination,

(i) all or substantially all of the individuals and entities who were the beneficial owners of the Company’s outstanding common stock and the Company’s voting securities entitled to vote generally in the election of directors immediately prior to such Business Combination have direct or indirect beneficial ownership, respectively, of 50% or more of the then outstanding shares of common stock, and 50% or more of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, of

2

the corporation resulting from such Business Combination (which, for purposes of this paragraph (i) and paragraphs (ii) and (iii), shall include a corporation which as a result of such transaction controls the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries), and

(ii) except to the extent that such ownership existed prior to the Business Combination, no person (excluding any corporation resulting from such Business Combination or any employee benefit plan or related trust of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of the then outstanding shares of common stock of the corporation resulting from such Business Combination or 20% or more of the combined voting power of the then outstanding voting securities of such corporation, and

(iii) at least 50% of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or

(d) approval by the shareholders of the Company of a complete liquidation or dissolution of the Company.

1.6 Disability. “Disability” shall mean a condition that would entitle the Participant to receive benefits under the Company’s long-term disability insurance policy in effect at the time either because he or she is Totally Disabled or Partially Disabled, as such terms are defined in the Company’s policy in effect as of the Effective Date or as similar terms are defined in any successor policy. If the Company has no long-term disability plan in effect, “Disability” shall occur if (a) the Participant is rendered incapable because of physical or mental illness of satisfactorily discharging his or her duties and responsibilities to the Company for a period of 90 consecutive days, (b) a duly qualified physician chosen by the Company and acceptable to the Participant or his legal representatives so certifies in writing, and (c) the Board determines that the Participant has become disabled.

1.7 Good Reason. “Good Reason” shall mean any action or inaction during the Employment Term that constitutes a material negative change in the service relationship between the Participant and the Company and a material breach by the Company of its obligations under the terms of this Plan, provided that, the Participant shall have provided written notice to the Company within 90 days of the initial existence of the condition described in this Section 1.7 and such event or condition continues uncured for a period of 30 days after written notice thereof is given by the Participant to the Company. A termination by a Participant with Good Reason shall constitute an involuntary termination for purposes of Section 409A of the Internal Revenue Code of 1986, as amended.

1.8 Participant. “Participant” shall mean those key employees of the Company who hold the positions listed on Schedule 1 hereto. Notwithstanding the provisions of this Section 1.8, any Participant entitled to receive benefits from the Company upon a Change of Control pursuant to the terms of an employment or change of control agreement between the Participant and the Company that are greater than those provided by this Plan shall not be a Participant in the Plan, and shall not be entitled to benefits under this Plan. Schedule 1 may be amended by the Compensation Committee of the Board from time to time in its sole discretion; except that no Participant can be removed from the Plan upon or after a Change of Control.

3

ARTICLE 2

CHANGE OF CONTROL BENEFIT

2.1 Employment Term and Capacity after Change of Control. (a) If a Change of Control occurs at a time that the Participant continues to be employed by the Company or a subsidiary, then the Participant’s employment shall continue on the terms provided in Sections 2.1 and 2.2 hereof through the first anniversary of the Change of Control, such one year period being referred to herein as the “Employment Term.” Upon any earlier termination of the Participant’s status as an employee by the Company without Cause or by the Participant for Good Reason during the Employment Term, the Participant shall be entitled to the payment and benefits provided in Section 2.3 hereof.

(b) After a Change of Control and during the Employment Term, (i) the Participant’s position, authority, duties and responsibilities shall be at least comparable in all material respects with the most significant of those held, exercised and assigned at any time during the 120-day period immediately preceding the Change of Control and (ii) the Participant’s service shall be performed during normal business hours at the location where the Participant was employed immediately preceding the Change of Control or any office or location less than 40 miles from such location.

2.2 Compensation and Benefits. During the Employment Term, the Participant shall be entitled to the following compensation and benefits:

(a) Base Salary. The Participant shall receive an annual base salary (“Base Salary”), which shall be paid at a monthly, semi-monthly or bi-weekly rate, at least equal to 12 times the highest monthly base salary paid or payable, including any base salary which has been earned but deferred by the Participant, by the Company and its affiliated companies in respect of the 12-month period immediately preceding the month in which the Change of Control occurs. During the Employment Term, the Base Salary of a Participant shall be reviewed no more than 12 months after the last salary increase awarded to the Participant prior to the Change of Control and shall be increased no more than 12 months after the last salary increase awarded to the Participant prior to the Change of Control in an amount equal to the percentage increase (excluding promotional increases) in base salary generally awarded to peer employees of the Company and its affiliated companies for the year of determination. Any increase in Base Salary shall not serve to limit or reduce any other obligation to the Participant under this Plan. Base Salary of a Participant shall not be reduced after any such increase and the term Base Salary as utilized in this Plan shall refer to Base Salary as so increased.

(b) Annual Bonus. In addition to Base Salary, a Participant shall be awarded, for the fiscal year ending during the Employment Term, an annual bonus (the “Bonus”) in cash at least equal to the greater of (i) the target Bonus to which the Participant was entitled for the fiscal year during which termination occurred, or (ii) the (A) average Bonus paid to the Participant for the last three completed fiscal years prior to the Change of Control, (B) average Bonus paid to the Participant for the last two completed fiscal years prior to the Change of Control, if the Participant has participated in a Company Bonus plan only for the last two fiscal years, or (C) the actual Bonus paid to the Participant for the last completed fiscal year prior to the Change of Control, if the Participant has participated in a Company Bonus plan only for the last completed fiscal year. Notwithstanding the foregoing, in calculating the minimum Bonus payment under this section 2.2(b), a Bonus amount for a prior fiscal year that was reduced pro rata because the Participant was not a participant in a Company Bonus plan for a full year shall

4

be annualized. Each such Bonus shall be paid no later than 2 ¹/₂ months following the end of the fiscal year for which the Bonus is awarded, unless the Participant shall have elected to defer the receipt of such Bonus in accordance with procedures established by the Company.

(c) Fringe Benefits. The Participant shall be entitled to fringe benefits in accordance with the most favorable agreements, plans, practices, programs and policies of the Company and its affiliated companies in effect for the Participant at any time during the 120-day period immediately preceding the Change of Control or, if more favorable to the Participant, as in effect generally at any time thereafter with respect to other peer employees of the Company and its affiliated companies.

(d) Expenses. The Participant shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Participant in accordance with the most favorable agreements, policies, practices and procedures of the Company and its affiliated companies in effect for the Participant at any time during the 120-day period immediately preceding the Change of Control or, if more favorable to the Participant, as in effect generally at any time thereafter with respect to other peer employees of the Company and its affiliated companies.

(e) Incentive, Savings and Retirement Plans. The Participant shall be entitled to participate in all equity incentive, savings and retirement plans, practices, policies and programs applicable generally to other peer employees of the Company and its affiliated companies, but in no event shall such plans, practices, policies and programs provide the Participant with equity grants (measured with respect to both regular and special equity incentive opportunities, to the extent, if any, that such distinction is applicable), savings opportunities and retirement benefit opportunities, in each case, less favorable than the most favorable of those provided by the Company and its affiliated companies for the Participant under any agreements, plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the Change of Control or, if more favorable to the Participant, those provided generally at any time after the Change of Control to other peer employees of the Company and its affiliated companies.

(f) Welfare Benefit Plans. The Participant and/or the Participant’s family, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs provided by the Company and its affiliated companies (including, without limitation, medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to other peer employees of the Company and its affiliated companies, but in no event shall such plans, practices, policies and programs provide the Participant with benefits, in each case, less favorable than the most favorable of any agreements, plans, practices, policies and programs in effect for the Participant at any time during the 120-day period immediately preceding the Change of Control or, if more favorable to the Participant, those provided generally at any time after the Change of Control to other peer employees of the Company and its affiliated companies.

(g) Vacation. The Participant shall be entitled to paid vacation in accordance with the most favorable agreements, plans, policies, programs and practices of the Company and its affiliated companies as in effect for the Participant at any time during the 120-day period immediately preceding the Change of Control or, if more favorable to the Participant, as in effect generally at any time thereafter with respect to other peer employees of the Company and its affiliated companies.

5

2.3 Obligations upon Termination after a Change of Control.

(a) Termination by Company for Reasons other than Death, Disability or Cause or by Participant for Good Reason. If, after a Change of Control and during the Employment Term, the Company terminates the Participant’s employment other than for Cause, death or Disability, or the Participant terminates employment for Good Reason,

(i) the Company shall pay to any Participant in a lump sum in cash within 30 days after the date of termination an amount equal to the sum of (x) the amount of Base Salary in effect at the date of termination, plus (y), an amount equal to the greater of (i) the target Bonus to which the Participant was entitled for the fiscal year during which termination occurred, or (ii) the (A) average Bonus paid to the Participant for the last three completed fiscal years, (B) average Bonus paid to the Participant for the last two completed fiscal years, if the Participant has participated in a Company Bonus plan only for the last two fiscal years, or (C) the actual Bonus paid to the Participant for the last completed fiscal year, if the Participant has participated in a Company Bonus plan only for the last completed fiscal year. Notwithstanding the foregoing, in calculating the Bonus payment under this section 2.3(a)(i), a Bonus amount for a prior fiscal year that was reduced pro rata because the Participant was not a participant in a Company Bonus plan for a full year shall be annualized; and

(ii) for a period of twelve (12) months following the date of termination of employment (the “Continuation Period”), the Company shall continue on behalf of the Participant and his or her dependents and beneficiaries the medical, dental and hospitalization benefits provided (x) to the Participant at any time during the 90-day period prior to the Change of Control or (y) to other similarly situated employees who continue in the employ of the Company during the Continuation Period. The coverage and benefits (including deductibles and costs) provided in this Section 2.3(a)(iii) during the Continuation Period shall be no less favorable to the Participant and his or her dependents and beneficiaries, than the most favorable of such coverages and benefits (including deductibles and percentage of cost paid by the Participant) during any of the periods referred to in clauses (x) or (y) above. The Company’s obligation hereunder with respect to the foregoing benefits shall be limited to the extent that the Participant obtains any such benefits pursuant to a subsequent employer’s benefit plans, in which case the Company may reduce the coverage of any benefits it is required to provide the Participant hereunder as long as the aggregate coverages and benefits of the combined benefit plans are no less favorable to the Participant than the coverages and benefits required to be provided hereunder. The coverage during the Continuation Period will run concurrently with the coverage provided under the Consolidated Omnibus Budget Reconciliation Act.

(b) Death. If, after a Change of Control and during the Employment Term, the Participant’s status as an employee is terminated by reason of the Participant’s death, there shall be no further obligation under this Plan to the Participant’s legal representatives (other than those already accrued to the Participant), other than the obligation to make any payments due pursuant to employee benefit plans maintained by the Company or its affiliated companies.

(c) Disability. If, after a Change of Control and during the Employment Term, Participant’s status as an employee is terminated by reason of Participant’s Disability, there shall be no further obligation under this Plan to the Participant (other than those already accrued to the Participant), other than the obligation to make any payments due pursuant to employee benefit plans maintained by the Company or its affiliated companies.

6

(d) Cause. If, after a Change of Control and during the Employment Term, the Participant’s status as an employee is terminated by the Company for Cause, there shall be no further obligation under this Plan to the Participant other than for obligations imposed by law and obligations imposed pursuant to any employee benefit plan maintained by the Company or its affiliated companies.

(e) Voluntary Termination. If, after a Change of Control and during the Employment Term, the Participant voluntarily terminates his or her employment with the Company other than for Good Reason, there shall be no further obligation under this Plan to the Participant other than for obligations imposed by law and obligations imposed pursuant to any employee benefit plan maintained by the Company or its affiliated companies.

2.4 Accrued Obligations and Other Benefits. It is the intent of this Plan that upon termination of employment for any reason the Participant be entitled to receive promptly, and in addition to any other benefits specifically provided, (a) the Participant’s Base Salary through the date of termination to the extent not theretofore paid, (b) any accrued vacation pay, to the extent not theretofore paid, and (c) any other amounts or benefits required to be paid or provided or which the Participant is entitled to receive under any plan, program, policy practice or agreement of the Company or by law.

2.5 Stock Options and Restricted Stock. The foregoing benefits are intended to be in addition to the value of any options to acquire Common Stock of the Company the exercisability of which is accelerated or shares of restricted stock or restricted stock units the vesting of which is accelerated pursuant to the terms of any stock incentive or other similar plan heretofore or hereafter adopted by the Company.

2.6 Legal Fees. Should a Participant prevail in any cause of action, suit, arbitration or other legal proceeding, which proceeding was initiated in whole or in part to enforce the provisions of the Plan, the Company shall reimburse the Participant for all costs, including reasonable attorneys’ fees, incurred by the Participant in connection with such cause of action, suit, arbitration or other legal proceeding.

2.7 Set-Off; Mitigation. After a Change of Control, the Company’s and its Affiliates’ obligations to make the payments provided for in this Plan and otherwise to perform their obligations hereunder shall not be affected by any set-off for compensation from new employment or otherwise, counterclaim, recoupment, defense or other claim, right or action which the Company or its Affiliates may have against the Participant or others; except that to the extent the Participant accepts other employment in connection with which he or she is provided medical, dental or hospitalization benefits, the Company shall only be required to provide such benefits as described in Section 2.3 (a)(ii). It is the intent of this Plan that in no event shall the Participant be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Participant under any of the provisions of this Plan.

ARTICLE 3

MISCELLANEOUS

3.1 Successors. (a) The Company shall require any successor to or assignee of (whether direct or indirect, by purchase, merger, consolidation or otherwise) all or substantially

7

all of the assets or businesses of the Company in writing (i) assume unconditionally and expressly this Plan and (ii) agree to perform or to cause to be performed all of the obligations under this Plan in the same manner and to the same extent as would have been required of the Company had no assignment or succession occurred.

(b) The Company shall also require all entities that control or that after the transaction will control (directly or indirectly) the Company or any such successor or assignee to agree in writing to cause to be performed all of the obligations under this Plan.

3.2 Funding. The Plan is funded solely through general assets of the Company or of any successor or assignee and no employee contributions are taken nor are any funds held in trust.

3.3 Plan Amendment or Termination. The Company reserves the right to amend or terminate this Plan at any time and without advance notice. An amendment shall be made in writing, executed by an officer of the Company, as authorized by the Compensation Committee of the Company’s Board of Directors. No benefits will be paid to anyone whose employment is terminated after the Plan is terminated or amended to exclude that Participant. Notwithstanding the foregoing, no amendment or termination of the Plan may be made following a Change of Control unless approved in writing by 80% of the Participants.

3.4 Applicable Laws. The Plan shall be governed by the laws of the State of Louisiana to the extent not preempted by the Employee Retirement Income Security Act of 1974 (“ERISA”).

3.5 Administration of the Plan. The Plan shall be administered by the Compensation Committee of the Board of Directors of Stewart Enterprises, Inc. (the “Plan Administrator”). The Plan Administrator’s address is: 1333 South Clearview Parkway, Jefferson, Louisiana 70121. The Plan Administrator shall have the exclusive right to interpret the Plan and all such interpretations shall be binding on all affected parties. The Stewart Enterprises, Inc. Retention Plan document is a legal document that controls the operation of the Plan. Its provisions cover all situations relating to benefits and its provisions will be final authority. The ERISA Plan Number is 505. The Company’s Employer Identification Number is 72-0693290.

3.6 Company’s Reservation of Rights. A Participant is employed at the pleasure of the Company and the Company has the right at any time to terminate the Participant’s status as an employee of the Company, to change or diminish his or her status during the Employment Term, subject to the rights of the Participant hereunder, and to add to or remove positions from the list of Participants set forth on Schedule 1. Only employees of the Company or its affiliated companies listed on Schedule 1 at the time of a Change of Control shall be entitled to claim the benefits conferred on Participants by the Plan.

3.7 Type of Plan. This Plan is intended to be a severance welfare benefit plan under ERISA. In no event shall benefits payable to any Participant under this Plan exceed twice the Participant’s “Annual Compensation” (as defined in ERISA regulation §2510.3-2(b)(2)) during the year immediately preceding the year of termination.

3.8 Section 409A. The benefits provided under this Plan are intended to satisfy the exception from Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations thereunder applicable to short-term deferrals and shall be construed accordingly.

8

ARTICLE 4

CLAIMS FOR BENEFITS

4.1 Claims Procedure. Claims for benefits may be made to the Plan Administrator at the above address. Payments of the amounts provided in this Plan shall ordinarily be made without the need for demand at the discretion of the Company. Nevertheless, a Participant who claims entitlement to a benefit can file a written claim for benefits with the Plan Administrator within 90 days after the Participant’s employment is terminated. The Plan Administrator shall accept or reject the claim within 30 days of its receipt. If the claim is denied, the Plan Administrator shall give the reason for denial in a written notice in plain English so as to be understood by the claimant, referring to the Plan provisions that provide the basis for the denial. If any additional information or material is necessary to perfect the claim, the Plan Administrator shall identify these items and explain why such additional material is necessary.

4.2 Claim Denial and Appeal. Upon denial of the claim, the claimant may file a written request for review of the denied claim to the Plan Administrator within 60 days of the denial. The claimant shall have the opportunity to be represented by counsel and may request to be heard at a hearing. The claimant shall have the opportunity to review the pertinent documents and the opportunity to submit written reasons opposing the denial. The decision upon the appeal will be made within 60 days of receipt of the requested review unless special circumstances (such as a need to hold a hearing) require an extension of time for processing, in which case a decision will be made as soon as possible, but no later than 120 days after receipt of a request for review. If such extension of time for review is required, because of special circumstances, written notice of the extension will be furnished to the claimant prior to the commencement of the extension. If the appeal is denied, the denial shall be in writing.

ARTICLE 5

ERISA RIGHTS

Participants are entitled to certain rights and protections under ERISA and regulations and rulings issued thereunder. Some of the benefits provided by the Plan may be subject to ERISA. ERISA provides that Participants shall be entitled to:

Receive information about Plan and benefits. Examine, without charge, at the Plan Administrator’s office and at other specified locations, such as work sites, all Plan documents, and a copy of the latest annual report (Form 5500 Series), available at the Public Disclosure Room of the Employee Benefits Security Administration, if such report is required to be filed.

Obtain copies of all Plan documents and other plan information upon written request to the Plan Administrator. The Plan Administrator may make a reasonable charge for the copies. (This document is the only Plan document and Summary Plan Description.)

Prudent actions by Plan fiduciaries. In addition to creating rights for Participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of Participants. No one, including the Company or any other person, may terminate a Participant’s employment or otherwise discriminate against a Participant in any way to prevent the Participant from obtaining a welfare benefit or exercising his or her rights under ERISA.

9

Enforce rights. If a claim for a benefit is denied or ignored, in whole or in part, the Participant has a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules.

Under ERISA, there are steps Participants can take to enforce the above rights. For instance, if a Participant requests a copy of Plan documents or the latest annual report from the Plan and does not receive them within 30 days, the Participant may file suit in a Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay the Participant up to $110 a day until he or she receives the materials, unless the materials were not sent because of reasons beyond the control of the administrator. If the Participant has a claim for benefits which is denied or ignored, in whole or in part, the Participant may file suit in a Federal court. If it should happen that Plan fiduciaries misuse plan assets, or if the Participant is discriminated against for asserting his or her rights, the Participant may seek assistance from the U.S. Department of Labor, or the Participant may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If the Participant is successful the court may order the person he or she has sued to pay these costs and fees. If the Participant loses, the court may order the Participant to pay these costs and fees, for example, if it finds the claim is frivolous.

Assistance with questions. If the Participant has any questions about this Plan, he or she should contact the Plan Administrator. If the Participant has any questions about this statement or about his or her rights under ERISA, or if he or she needs assistance in obtaining documents from the Plan Administrator, he or she should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in the telephone directory, or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210. The Participant may also obtain certain publications about his or her rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration.

10

This Plan, as amended and restated, is executed in Jefferson, Louisiana, this 11th day of June, 2012.

WITNESSES:		STEWART ENTERPRISES, INC.
/s/ Lewis J. Derbes, Jr.		By:	/s/ Thomas M. Kitchen
Name:	Lewis J. Derbes, Jr.	Name:	Thomas M. Kitchen
		Title:	President and Chief Executive Officer
/s/ Lisa T. Winningkoff
Name:	Lisa T. Winningkoff

11

EX-10.3

Exhibit 10.3

AMENDMENT NO. 3 TO THE

AMENDED AND RESTATED

STEWART ENTERPRISES, INC.

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

This Amendment No. 3 to the Amended and Restated Stewart Enterprises, Inc. Supplemental Executive Retirement Plan is effective as of June 20, 2012.

WHEREAS, the Compensation Committee of the Board of Directors of Stewart Enterprises, Inc. (the “Company”) approved an amendment to the Amended and Restated Supplemental Executive Retirement Plan (the “Plan”) revising the Plan’s vesting provisions at its meeting on June 20, 2012.

NOW THEREFORE, the Plan is hereby amended effective June 20, 2012, as follows:

I.

Article 3, Paragraph 7 Earliest Retirement Date, is amended to add a new paragraph to the end of the paragraph, as follows:

For Participants terminating employment with the Company on or after June 20, 2012, Earliest Retirement Date means, for a Class B Participant, the Participant’s completion of seven years of employment with the Employer. For Class A Participants, Earliest Retirement Date means the Participant’s 55^th birthday, regardless of the Participant’s termination date.

II.

Article 5, Paragraph 1, is restated to read in its entirety as follows:

1. A Class A or Class B Participant whose Termination of Employment occurs on or after his Earliest Retirement Date is entitled to an Early Retirement Benefit, commencing at the Participant’s Annuity Starting Date. The Early Retirement Benefit shall be determined in the same manner as a Normal Retirement Benefit, reduced, however, by 5% for each full year (and 1/26 of 5% for each full two-week pay period of a partial year) that the Termination of Employment precedes the Normal Retirement Date, but not below 10% of Final Average Pay. As a result, the percentage of Final Average Pay that will be paid to a Class A or Class B Participant whose Termination of Employment occurs on his birthday is as follows:

Age	Class A	Class B
50	N/A	10.0%
50	N/A	10.0%
51	N/A	12.0%
52	N/A	14.0%
53	N/A	16.0%
54	N/A	18.0%
55	25.0%	20.0%
56	27.5%	22.0%
57	30.0%	24.0%
58	32.5%	26.0%
59	35.0%	28.0%
60	37.5%	30.0%
61	40.0%	32.0%
62	42.5%	34.0%
63	45.0%	36.0%
64	47.5%	38.0%
65	50.0%	40.0%

Executed in Jefferson, Louisiana, this 31st day of July, 2012.

WITNESSES:		STEWART ENTERPRISES, INC.
/s/ Lewis J. Derbes, Jr.		By:	/s/ Thomas M. Kitchen
			Thomas M. Kitchen
Print Name:	Lewis J. Derbes, Jr.		President and Chief Executive Officer
/s/ Lisa T. Winningkoff
Print Name:	Lisa T. Winningkoff

EX-31.1

Exhibit 31.1

Certifications Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Thomas M. Kitchen, certify that:

1. I have reviewed this report on Form 10-Q of Stewart Enterprises, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 5, 2012

/s/ Thomas M. Kitchen

Thomas M. Kitchen

President and Chief Executive Officer

(Principal Executive Officer)

65

EX-31.2

Exhibit 31.2

Certifications Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Lewis J. Derbes, Jr., certify that:

1. I have reviewed this report on Form 10-Q of Stewart Enterprises, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 5, 2012

/s/ Lewis J. Derbes, Jr.

Lewis J. Derbes, Jr.

Senior Vice President, Chief Financial Officer and Treasurer

(Principal Financial Officer)

66

EX-32.1

Exhibit 32.1

Certification of Form 10-Q for the Quarter ended July 31, 2012, pursuant to Section 906 of the

Sarbanes-Oxley Act of 2002

The undersigned Chief Executive Officer and Chief Financial Officer of Stewart Enterprises, Inc. certify, pursuant to Section 906 of the Sarbanes-Oxley Act, that:

• the Quarterly Report on Form 10-Q for the quarter ended July 31, 2012 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and

• the information contained in the Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Stewart Enterprises, Inc.

This certification is being furnished solely to comply with the requirements of Section 906 of the Sarbanes-Oxley Act of 2002 and is not being filed as a part of the Form 10-Q.

A signed original of this written statement required by Section 906 has been provided to Stewart Enterprises, Inc. and will be retained by Stewart Enterprises, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Dated: September 5, 2012

/s/ Thomas M. Kitchen

Thomas M. Kitchen

President and

Chief Executive Officer

/s/ Lewis J. Derbes, Jr.

Lewis J. Derbes, Jr.

Senior Vice President,

Chief Financial Officer and Treasurer

67

XML

Basis of Presentation (Details) (USD $)	9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011
Stock options and restricted stock granted to employees
Stock issued to independent of the board of directors	67,853	82,160
Stock options [Member]
Stock options and restricted stock granted to employees
Number of options granted	1,215,000
Weighted Average Price Per Share	6.26
Vesting Period	4 years
Vesting condition of stock options granted	Service condition
Restricted stock [Member]
Stock options and restricted stock granted to employees
Stock issued to independent of the board of directors	449,500
Weighted Average Price Per Share, Restricted stock	6.26
Vesting Period	3 years
Vesting condition of restricted shares granted	Market condition

XML

Preneed Cemetery Merchandise and Service Activities (Details 1) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Oct. 31, 2011
Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	$ 229,523		$ 229,991
Available for Sale Securities, Gross Unrealized Gains	2,626		1,934
Available-for-sale Securities, Gross Unrealized Losses	(39,127)		(42,892)
Available for Sale Securities, Fair Value	193,022		189,033
Market Value as a Percentage of Cost	84.10%		82.20%
Accrued investment income	688	645
Trust Assets	193,710		189,678
Master limited partnerships [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available-for-sale Securities, Gross Unrealized Losses	(132)		(2)
Cash, money market and other short- term investments [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	9,065		9,844
Available for Sale Securities, Fair Value	9,065		9,844
U.S. Government, agencies and municipalities [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	1,883		2,052
Available for Sale Securities, Gross Unrealized Gains	127		90
Available-for-sale Securities, Gross Unrealized Losses			(2)
Available for Sale Securities, Fair Value	2,010		2,140
Corporate bonds [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	2,006		2,596
Available for Sale Securities, Gross Unrealized Gains	143		131
Available-for-sale Securities, Gross Unrealized Losses	(3)		(3)
Available for Sale Securities, Fair Value	2,146		2,724
Preferred stocks [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	12,540		12,518
Available for Sale Securities, Gross Unrealized Gains	146		66
Available-for-sale Securities, Gross Unrealized Losses	(292)		(1,662)
Available for Sale Securities, Fair Value	12,394		10,922
Common Stocks [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	107,520		112,010
Available for Sale Securities, Gross Unrealized Gains	942		920
Available-for-sale Securities, Gross Unrealized Losses	(29,350)		(32,761)
Available for Sale Securities, Fair Value	79,112		80,169
Mutual Funds [Member] | Equity [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	23,526		25,374
Available for Sale Securities, Gross Unrealized Gains	108		348
Available-for-sale Securities, Gross Unrealized Losses	(7,068)		(6,791)
Available for Sale Securities, Fair Value	16,566		18,931
Mutual Funds [Member] | Fixed Income [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	53,870		46,258
Available for Sale Securities, Gross Unrealized Gains	1,106		305
Available-for-sale Securities, Gross Unrealized Losses	(312)		(586)
Available for Sale Securities, Fair Value	54,664		45,977
Mutual Funds [Member] | Commodity [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	8,693		8,780
Available-for-sale Securities, Gross Unrealized Losses	(1,970)		(892)
Available for Sale Securities, Fair Value	6,723		7,888
Mutual Funds [Member] | Real estate investment trusts [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	2,986		9,866
Available for Sale Securities, Gross Unrealized Gains	54		74
Available-for-sale Securities, Gross Unrealized Losses			(193)
Available for Sale Securities, Fair Value	3,040		9,747
Mutual Funds [Member] | Master limited partnerships [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	2,860
Available-for-sale Securities, Gross Unrealized Losses	56
Available for Sale Securities, Fair Value	2,804
Mutual Funds [Member] | Master limited partnerships [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	6,797		97
Available-for-sale Securities, Gross Unrealized Losses	(132)		(2)
Available for Sale Securities, Fair Value	6,665		95
Other long-term investments [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	637		596
Available for Sale Securities, Fair Value	$ 637		$ 596

XML

Preneed Funeral Activities (Details 3) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	$ 588,973
Preneed Funeral Activities [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	395,263	377,198
Quoted Market Prices in Active Markets (Level 1) [Member] | Preneed Funeral Activities [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	329,918	311,463
Significant Other Observable Inputs (Level 2) [Member] | Preneed Funeral Activities [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	58,268	58,648
Significant Unobservable Inputs (Level 3) [Member] | Preneed Funeral Activities [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	$ 5,762	$ 5,868

XML

Commitments and Contingencies (Details Textual) (USD $)	Jul. 31, 2012	Oct. 31, 2011
Commitments and Contingencies (Textual) [Abstract]
Estimated obligation to fund cemetery perpetual care trust	$ 12,064,000	$ 12,017,000
Net unrealized losses in the cemetery perpetual care trusts that could be subject to a future funding obligation	28,243,000
Estimated net liability for not in system and other contracts	300,000	2,000,000
Bond value to guarantee obligations	23,456,000
Land and Building [Member]
Commitments and Contingencies (Textual) [Abstract]
Purchase of land and building	$ 2,800,000

XML

Preneed Cemetery Merchandise and Service Activities (Details 2) (Preneed Cemetery Merchandise and Service Activities [Member], USD $) In Thousands, unless otherwise specified	Jul. 31, 2012
Preneed Cemetery Merchandise and Service Activities [Member]
Investments classified by contractual Maturity Date
Due in one year or less	$ 103
Due in one to five years	2,244
Due in five to ten years	1,397
Thereafter	412
Total	$ 4,156

XML

Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Revenues:
Funeral	$ 68,883	$ 68,761	$ 213,646	$ 215,601
Cemetery	60,356	55,596	173,015	167,685
Total Revenue	129,239	124,357	386,661	383,286
Costs and expenses:
Funeral	53,128	54,380	160,685	162,784
Cemetery	49,125	48,225	144,456	144,754
Total costs and expenses	102,253	102,605	305,141	307,538
Gross profit	26,986	21,752	81,520	75,748
Corporate general and administrative expenses	(7,326)	(6,704)	(20,264)	(19,548)
Restructuring and other charges	(305)		(2,852)
Hurricane related recoveries, net		12,349		12,245
Net gain (loss) on dispositions		11	332	(389)
Other operating income, net	191	512	773	1,193
Operating earnings	19,546	27,920	59,509	69,249
Interest expense	(5,873)	(5,500)	(17,544)	(16,968)
Loss on early extinguishment of debt		(73)		(1,884)
Investment and other income, net	57	30	148	394
Earnings from continuing operations before income taxes	13,730	22,377	42,113	50,791
Income tax expense (benefit)	3,834	10,146	13,773	20,262
Earnings from continuing operations	9,896	12,231	28,340	30,529
Discontinued operations:
Loss from discontinued operations before income taxes	(380)	(365)	(2,065)	(810)
Income tax benefit	(122)	(120)	(644)	(309)
Loss from discontinued operations	(258)	(245)	(1,421)	(501)
Net earnings	9,638	11,986	26,919	30,028
Total other comprehensive income (loss)	15	(3)	23	6
Total comprehensive income	9,653	11,983	26,942	30,034
Parent [Member]
Costs and expenses:
Corporate general and administrative expenses	(7,326)	(6,704)	(20,264)	(19,548)
Restructuring and other charges	(305)		(1,616)
Hurricane related recoveries, net		(4,174)		4,070
Other operating income, net	10	13	67	141
Operating earnings	(7,621)	2,517	(21,813)	(15,337)
Interest expense	(1,869)	(764)	(5,212)	(2,599)
Loss on early extinguishment of debt		(73)		(1,884)
Investment and other income, net	57	30	148	394
Equity in subsidiaries	15,417	12,156	42,487	36,718
Earnings from continuing operations before income taxes	5,984	8,832	15,610	17,292
Income tax expense (benefit)	(3,654)	(3,154)	(11,309)	(12,736)
Earnings from continuing operations	9,638	11,986	26,919	30,028
Discontinued operations:
Net earnings	9,638	11,986	26,919	30,028
Total other comprehensive income (loss)	15	(3)	23	6
Total comprehensive income	9,653	11,983	26,942	30,034
Guarantor Subsidiaries [Member]
Revenues:
Funeral	63,813	63,745	198,789	200,353
Cemetery	54,252	49,599	155,460	149,980
Total Revenue	118,065	113,344	354,249	350,333
Costs and expenses:
Funeral	49,452	51,102	150,421	152,849
Cemetery	44,372	43,764	131,144	131,239
Total costs and expenses	93,824	94,866	281,565	284,088
Gross profit	24,241	18,478	72,684	66,245
Restructuring and other charges			(1,071)
Hurricane related recoveries, net		6,683		6,683
Net gain (loss) on dispositions		11	332	(389)
Other operating income, net	126	419	529	853
Operating earnings	24,367	25,591	72,474	73,392
Interest expense	(3,669)	(4,247)	(11,296)	(12,968)
Equity in subsidiaries	607	218	1,161	605
Earnings from continuing operations before income taxes	21,305	21,562	62,339	61,029
Income tax expense (benefit)	6,411	11,605	22,224	26,458
Earnings from continuing operations	14,894	9,957	40,115	34,571
Discontinued operations:
Loss from discontinued operations before income taxes	(380)	(365)	(2,065)	(810)
Income tax benefit	(122)	(120)	(644)	(309)
Loss from discontinued operations	(258)	(245)	(1,421)	(501)
Net earnings	14,636	9,712	38,694	34,070
Total comprehensive income	14,636	9,712	38,694	34,070
Non-Guarantor Subsidiaries [Member]
Revenues:
Funeral	5,070	5,016	14,857	15,248
Cemetery	6,104	5,997	17,555	17,705
Total Revenue	11,174	11,013	32,412	32,953
Costs and expenses:
Funeral	3,676	3,278	10,264	9,935
Cemetery	4,753	4,461	13,312	13,515
Total costs and expenses	8,429	7,739	23,576	23,450
Gross profit	2,745	3,274	8,836	9,503
Restructuring and other charges			(165)
Hurricane related recoveries, net		1,492		1,492
Other operating income, net	55	80	177	199
Operating earnings	2,800	4,846	8,848	11,194
Interest expense	(335)	(489)	(1,036)	(1,401)
Earnings from continuing operations before income taxes	2,465	4,357	7,812	9,793
Income tax expense (benefit)	1,077	1,695	2,858	6,540
Earnings from continuing operations	1,388	2,662	4,954	3,253
Discontinued operations:
Net earnings	1,388	2,662	4,954	3,253
Total other comprehensive income (loss)	15	(3)	23	6
Total comprehensive income	1,403	2,659	4,977	3,259
Eliminations [Member]
Costs and expenses:
Equity in subsidiaries	(16,024)	(12,374)	(43,648)	(37,323)
Earnings from continuing operations before income taxes	(16,024)	(12,374)	(43,648)	(37,323)
Earnings from continuing operations	(16,024)	(12,374)	(43,648)	(37,323)
Discontinued operations:
Net earnings	(16,024)	(12,374)	(43,648)	(37,323)
Total other comprehensive income (loss)	(15)	3	(23)	(6)
Total comprehensive income	$ (16,039)	$ (12,371)	$ (43,671)	$ (37,329)

XML

Preneed Funeral Activities (Details 1) (USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Oct. 31, 2011	Jul. 31, 2012
Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	$ 436,138	$ 432,950
Available for Sale Securities, Gross Unrealized Gains	4,262	10,275
Available-for-sale Securities, Gross Unrealized Losses	(64,421)	(49,277)
Available for Sale Securities, Fair Value	375,979	393,948
Market Value as a Percentage of Cost	86.20%	91.00%
Accrued investment income	1,219	1,315
Trust Assets	377,198	395,263
Cash, money market and other short- term investments [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	30,714	23,131
Available for Sale Securities, Fair Value	30,714	23,131
U.S. Government, agencies and municipalities [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	2,094	1,658
Available for Sale Securities, Gross Unrealized Gains	60	87
Available-for-sale Securities, Gross Unrealized Losses	(2)
Available for Sale Securities, Fair Value	2,152	1,745
Corporate bonds [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	21,856	20,064
Available for Sale Securities, Gross Unrealized Gains	1,079	1,592
Available-for-sale Securities, Gross Unrealized Losses	(8)	(1)
Available for Sale Securities, Fair Value	22,927	21,655
Preferred stocks [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	36,382	34,896
Available for Sale Securities, Gross Unrealized Gains	362	641
Available-for-sale Securities, Gross Unrealized Losses	(3,358)	(671)
Available for Sale Securities, Fair Value	33,386	34,866
Common Stocks [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	202,451	200,896
Available for Sale Securities, Gross Unrealized Gains	791	3,152
Available-for-sale Securities, Gross Unrealized Losses	(55,830)	(43,071)
Available for Sale Securities, Fair Value	147,412	160,977
Mutual Funds [Member] | Equity [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	23,591	19,249
Available for Sale Securities, Gross Unrealized Gains	980	839
Available-for-sale Securities, Gross Unrealized Losses	(2,018)	(1,839)
Available for Sale Securities, Fair Value	22,553	18,249
Mutual Funds [Member] | Fixed Income [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	78,509	95,687
Available for Sale Securities, Gross Unrealized Gains	902	2,936
Available-for-sale Securities, Gross Unrealized Losses	(1,417)	(802)
Available for Sale Securities, Fair Value	77,994	97,821
Mutual Funds [Member] | Commodity [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	11,844	13,428
Available for Sale Securities, Gross Unrealized Gains	8
Available-for-sale Securities, Gross Unrealized Losses	(1,450)	(2,836)
Available for Sale Securities, Fair Value	10,402	10,592
Mutual Funds [Member] | Real estate investment trusts [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	15,075	8,737
Available for Sale Securities, Gross Unrealized Gains	37	813
Available-for-sale Securities, Gross Unrealized Losses	(338)	(1)
Available for Sale Securities, Fair Value	14,774	9,549
Mutual Funds [Member] | Master limited partnerships [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis		2,860
Available-for-sale Securities, Gross Unrealized Losses		56
Available for Sale Securities, Fair Value		2,804
Mutual Funds [Member] | Master limited partnerships [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	136
Available for Sale Securities, Gross Unrealized Gains	4
Available for Sale Securities, Fair Value	140
Other long-term investments [Member] | Preneed Funeral Activities [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	13,486	12,344
Available for Sale Securities, Gross Unrealized Gains	39	215
Available for Sale Securities, Fair Value	$ 13,525	$ 12,559

XML

Supplementary Information (Tables)

9 Months Ended

Jul. 31, 2012

Supplementary Information [Abstract]

Supplementary details of income statement accounts

	Three Months Ended July 31,				Nine Months Ended July 31,
	2012		2011		2012		2011
Service revenue
Funeral	$	47,688	$	47,078	$	146,675	$	146,096
Cemetery		14,459		14,642		45,706		45,266
		62,147		61,720		192,381		191,362
Merchandise revenue
Funeral		19,333		19,816		61,265		63,808
Cemetery		42,781		37,479		117,514		112,031
		62,114		57,295		178,779		175,839
Other revenue
Funeral		1,862		1,867		5,706		5,697
Cemetery		3,116		3,475		9,795		10,388
		4,978		5,342		15,501		16,085
Total revenue	$	129,239	$	124,357	$	386,661	$	383,286
Service costs
Funeral	$	16,535	$	16,722	$	50,032	$	48,838
Cemetery		11,024		11,313		31,891		32,084
		27,559		28,035		81,923		80,922
Merchandise costs
Funeral		13,292		13,414		41,216		41,650
Cemetery		24,181		23,197		70,266		69,981
		37,473		36,611		111,482		111,631
Facility expenses
Funeral		23,301		24,244		69,437		72,296
Cemetery		13,920		13,715		42,299		42,689
		37,221		37,959		111,736		114,985
Total costs	$	102,253	$	102,605	$	305,141	$	307,538

XML

Condensed Consolidated Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Details 1) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011	Jul. 31, 2011	Oct. 31, 2010
Current assets:
Cash and cash equivalents	$ 78,077	$ 65,688	$ 66,571	$ 56,060
Restricted cash and cash equivalents	6,250	6,250
Marketable securities	727	662
Receivables, net of allowances	50,379	49,146
Inventories	36,384	35,859
Prepaid expenses	6,220	5,055
Deferred income taxes, net	17,624	29,768
Total current assets	195,661	192,428
Receivables due beyond one year, net of allowances	70,929	67,979
Preneed funeral receivables and trust investments	428,604	409,296
Preneed cemetery receivables and trust investments	220,629	216,582
Goodwill	249,584	247,038
Cemetery property, at cost	400,697	396,014
Property and equipment, at cost	607,325	597,992
Less accumulated depreciation	318,258	305,708
Net property and equipment	289,067	292,284
Deferred income taxes, net	85,110	79,793
Cemetery perpetual care trust investments	259,440	240,392
Other assets	14,153	15,292
Total assets	2,213,874	2,157,098
Current liabilities:
Current maturities of long-term debt	6	5
Accounts payable, accrued expenses and other current liabilities	21,539	24,547
Total current liabilities	93,595	90,463
Long-term debt, less current maturities	320,850	317,821
Deferred income taxes, net	5,509	5,104
Deferred preneed funeral revenue	240,648	240,286
Deferred preneed cemetery revenue	265,635	259,237
Deferred preneed funeral and cemetery receipts held in trust	580,147	558,194
Perpetual care trusts' corpus	257,706	238,980
Other long-term liabilities	20,427	19,337
Total liabilities	1,784,517	1,729,422
Common stock	85,836	87,976
Other	343,480	339,682
Accumulated other comprehensive income	41	18
Total shareholders' equity	429,357	427,676
Total liabilities and shareholders' equity	2,213,874	2,157,098
Parent [Member]
Current assets:
Cash and cash equivalents	75,361	62,388	51,448	48,270
Restricted cash and cash equivalents	6,250	6,250
Receivables, net of allowances	1,838	2,040
Inventories	203	318
Prepaid expenses	1,569	1,214
Deferred income taxes, net	3,000	14,815
Intercompany receivables	1,457	1,762
Total current assets	89,678	88,787
Property and equipment, at cost	62,707	59,688
Less accumulated depreciation	49,459	45,705
Net property and equipment	13,248	13,983
Deferred income taxes, net	8,564	4,947
Other assets	8,566	9,539
Intercompany receivables	629,010	660,246
Equity in subsidiaries	38,062	15,812
Total assets	787,128	793,314
Current liabilities:
Current maturities of long-term debt	6	5
Accounts payable, accrued expenses and other current liabilities	17,974	14,320
Total current liabilities	17,980	14,325
Long-term debt, less current maturities	320,850	317,821
Other long-term liabilities	18,941	17,996
Negative equity in subsidiaries		15,496
Total liabilities	357,771	365,638
Common stock	85,836	87,976
Other	343,480	339,682
Accumulated other comprehensive income	41	18
Total shareholders' equity	429,357	427,676
Total liabilities and shareholders' equity	787,128	793,314
Guarantor Subsidiaries [Member]
Current assets:
Cash and cash equivalents	1,164	1,937	13,962	6,055
Receivables, net of allowances	41,770	40,405
Inventories	33,599	32,926
Prepaid expenses	2,983	2,289
Deferred income taxes, net	13,612	13,696
Total current assets	93,128	91,253
Receivables due beyond one year, net of allowances	59,314	55,847
Preneed funeral receivables and trust investments	419,159	399,731
Preneed cemetery receivables and trust investments	213,535	209,284
Goodwill	229,749	227,203
Cemetery property, at cost	364,886	359,678
Property and equipment, at cost	500,030	495,089
Less accumulated depreciation	248,300	240,906
Net property and equipment	251,730	254,183
Deferred income taxes, net	69,615	68,939
Cemetery perpetual care trust investments	245,639	227,428
Other assets	4,434	4,728
Equity in subsidiaries	11,141	9,980
Total assets	1,962,330	1,908,254
Current liabilities:
Accounts payable, accrued expenses and other current liabilities	71,312	71,505
Total current liabilities	71,312	71,505
Deferred income taxes, net	4,929	4,521
Intercompany payables	615,339	646,588
Deferred preneed funeral revenue	193,683	193,452
Deferred preneed cemetery revenue	236,478	230,291
Deferred preneed funeral and cemetery receipts held in trust	571,984	550,010
Perpetual care trusts' corpus	243,921	226,042
Other long-term liabilities	1,486	1,341
Total liabilities	1,939,132	1,923,750
Common stock	102	102
Other	23,096	(15,598)
Total shareholders' equity	23,198	(15,496)
Total liabilities and shareholders' equity	1,962,330	1,908,254
Non-Guarantor Subsidiaries [Member]
Current assets:
Cash and cash equivalents	1,552	1,363	1,161	1,735
Marketable securities	727	662
Receivables, net of allowances	6,771	6,701
Inventories	2,582	2,615
Prepaid expenses	1,668	1,552
Deferred income taxes, net	1,012	1,257
Total current assets	14,312	14,150
Receivables due beyond one year, net of allowances	11,615	12,132
Preneed funeral receivables and trust investments	9,445	9,565
Preneed cemetery receivables and trust investments	7,094	7,298
Goodwill	19,835	19,835
Cemetery property, at cost	35,811	36,336
Property and equipment, at cost	44,588	43,215
Less accumulated depreciation	20,499	19,097
Net property and equipment	24,089	24,118
Deferred income taxes, net	6,931	5,907
Cemetery perpetual care trust investments	13,801	12,964
Other assets	1,153	1,025
Total assets	144,086	143,330
Current liabilities:
Accounts payable, accrued expenses and other current liabilities	4,303	4,633
Intercompany payables	1,457	1,762
Total current liabilities	5,760	6,395
Deferred income taxes, net	580	583
Intercompany payables	13,671	13,658
Deferred preneed funeral revenue	46,965	46,834
Deferred preneed cemetery revenue	29,157	28,946
Deferred preneed funeral and cemetery receipts held in trust	8,163	8,184
Perpetual care trusts' corpus	13,785	12,938
Total liabilities	118,081	117,538
Common stock	376	376
Other	25,588	25,398
Accumulated other comprehensive income	41	18
Total shareholders' equity	26,005	25,792
Total liabilities and shareholders' equity	144,086	143,330
Eliminations [Member]
Current assets:
Cash and cash equivalents
Intercompany receivables	(1,457)	(1,762)
Total current assets	(1,457)	(1,762)
Intercompany receivables	(629,010)	(660,246)
Equity in subsidiaries	(49,203)	(25,792)
Total assets	(679,670)	(687,800)
Current liabilities:
Intercompany payables	(1,457)	(1,762)
Total current liabilities	(1,457)	(1,762)
Intercompany payables	(629,010)	(660,246)
Negative equity in subsidiaries		(15,496)
Total liabilities	(630,467)	(677,504)
Common stock	(478)	(478)
Other	(48,684)	(9,800)
Accumulated other comprehensive income	(41)	(18)
Total shareholders' equity	(49,203)	(10,296)
Total liabilities and shareholders' equity	$ (679,670)	$ (687,800)

XML

Segment Data (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Reported segments
Total Revenue	$ 129,239	$ 124,357	$ 386,661	$ 383,286
Total Gross Profit	26,986	21,752	81,520	75,748
Funeral [Member]
Reported segments
Total Revenue	65,468	64,846	201,960	203,254
Total Gross Profit	12,628	10,703	41,973	41,139
Cemetery [Member]
Reported segments
Total Revenue	57,918	53,544	165,809	161,370
Total Gross Profit	9,061	5,544	22,019	17,255
Corporate Trust Management [Member]
Reported segments
Total Revenue	5,853	5,967	18,892	18,662
Total Gross Profit	$ 5,297	$ 5,505	$ 17,528	$ 17,354

XML

Income Taxes (Details Textual) (USD $) In Thousands, unless otherwise specified	1 Months Ended	3 Months Ended		9 Months Ended
	Jan. 31, 2011 Rate	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Income Taxes (Textual) [Abstract]
Change in the tax valuation allowance		$ 1,125		$ 2,075
Valuation allowance remaining		2,900		2,900
Realized capital losses		6,905		6,905
Former corporate tax rate for Puerto Rico	39.00%
Current corporate tax rate for Puerto Rico	30.00%
Net noncash charge to income tax expense for change in corporate tax rates in Puerto Rico					2,915
Gross noncash charge to income tax expense for change in corporate tax rates in Puerto Rico					4,484
Federal tax benefit on gross noncash charge to income tax expense due to change in Puerto Rico corporate tax rates					1,569
Deferred tax asset balance for Puerto Rico under the former corporate tax rate					19,427
Deferred tax asset balance for Puerto Rico under the current corporate tax rate					14,943
Income tax reduction valuation allowance			$ 1,625		$ 1,812

XML

Preneed Cemetery Merchandise and Service Activities (Details 4) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Investment Related Activities
Realized gains from sales of investments	$ 2,633	$ 6,335	$ 12,207	$ 14,999
Realized losses from sales of investments and other	(2,744)	(2,065)	(5,992)	(3,732)
Preneed Cemetery Merchandise and Service Activities [Member]
Investment Related Activities
Purchases	17,953	27,460	29,186	79,354
Sales	5,480	27,557	31,144	75,330
Realized gains from sales of investments	653	2,165	3,001	5,488
Realized losses from sales of investments and other	(176)	(658)	(381)	(1,207)
Interest income, dividends and other ordinary income	1,978	1,897	6,285	5,307
Deposits	4,127	4,451	12,769	12,459
Withdrawals	$ 8,601	$ 5,341	$ 19,847	$ 14,813

XML

Segment Data (Details Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Segment Data (Textual) [Abstract]
Perpetual care trust earnings			$ 7,098	$ 5,981
Funeral [Member]
Segment Data (Textual) [Abstract]
Funeral trust management fees	1,335	1,201	3,993	3,614
Funeral trust earnings	2,080	2,714	7,693	8,733
Cemetery [Member]
Segment Data (Textual) [Abstract]
Cemetery trust management fees	1,555	1,349	4,649	4,000
Cemetery trust earnings	883	703	2,557	2,315
Perpetual care trust earnings	$ 1,815	$ 1,988	$ 7,098	$ 5,981

XML

Restructuring and Other Charges (Details Textual) (USD $) In Thousands, unless otherwise specified	1 Months Ended	3 Months Ended	9 Months Ended
	Apr. 30, 2012 Position	Jul. 31, 2012	Jul. 31, 2012
Restructuring and Other Charges (Textual) [Abstract]
Restructuring and other charges		$ (305)	$ (2,852)
Restructuring and Related Cost, Number of Positions Eliminated	60

XML

Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Details Textual)	9 Months Ended
	Jul. 31, 2012
Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Textual) [Abstract]
Percentage of direct or indirect ownership of guarantors by the entity	100.00%
Guarantor Subsidiaries [Member] | 6.50% senior notes [Member]
Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Textual) [Abstract]
Stated percentage rate	6.50%
Guarantor Subsidiaries [Member] | 3.125% senior convertible notes [Member]
Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Textual) [Abstract]
Stated percentage rate	3.125%
Guarantor Subsidiaries [Member] | 3.375% senior convertible notes [Member]
Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Textual) [Abstract]
Stated percentage rate	3.375%
Non-Guarantor Subsidiaries [Member] | 6.50% senior notes [Member]
Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Textual) [Abstract]
Stated percentage rate	6.50%
Non-Guarantor Subsidiaries [Member] | 3.125% senior convertible notes [Member]
Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Textual) [Abstract]
Stated percentage rate	3.125%
Non-Guarantor Subsidiaries [Member] | 3.375% senior convertible notes [Member]
Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Textual) [Abstract]
Stated percentage rate	3.375%

XML

Long-term Debt (Details) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Long-term debt
Total long-term debt	$ 320,856	$ 317,826
Less current maturities	6	5
Long-term debt	320,850	317,821
3.125% senior convertible notes due 2014 [Member] | Unsecured Debt [Member]
Long-term debt
Total long-term debt	80,932	78,805
3.375% senior convertible notes due 2016 [Member] | Unsecured Debt [Member]
Long-term debt
Total long-term debt	39,843	38,936
Senior secured revolving credit facility [Member]
Long-term debt
Total long-term debt
6.50% senior notes due 2019 [Member]
Long-term debt
Total long-term debt	200,000	200,000
Seller financing of acquired operations [Member]
Long-term debt
Total long-term debt	$ 81	$ 85

XML

Supplementary Information (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Supplementary details of income statement accounts
Service revenue	$ 62,147	$ 61,720	$ 192,381	$ 191,362
Merchandise revenue	62,114	57,295	178,779	175,839
Other revenue	4,978	5,342	15,501	16,085
Total Revenue	129,239	124,357	386,661	383,286
Service costs	27,559	28,035	81,923	80,922
Merchandise costs	37,473	36,611	111,482	111,631
Facility expenses	37,221	37,959	111,736	114,985
Total costs and expenses	102,253	102,605	305,141	307,538
Funeral [Member]
Supplementary details of income statement accounts
Service revenue	47,688	47,078	146,675	146,096
Merchandise revenue	19,333	19,816	61,265	63,808
Other revenue	1,862	1,867	5,706	5,697
Total Revenue	65,468	64,846	201,960	203,254
Service costs	16,535	16,722	50,032	48,838
Merchandise costs	13,292	13,414	41,216	41,650
Facility expenses	23,301	24,244	69,437	72,296
Cemetery [Member]
Supplementary details of income statement accounts
Service revenue	14,459	14,642	45,706	45,266
Merchandise revenue	42,781	37,479	117,514	112,031
Other revenue	3,116	3,475	9,795	10,388
Total Revenue	57,918	53,544	165,809	161,370
Service costs	11,024	11,313	31,891	32,084
Merchandise costs	24,181	23,197	70,266	69,981
Facility expenses	$ 13,920	$ 13,715	$ 42,299	$ 42,689

XML

Reconciliation of Basic and Diluted Per Share Data (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Reconciliation of basic and diluted per share data
Earnings from continuing operations	$ 9,896	$ 12,231	$ 28,340	$ 30,529
Allocation of earnings to nonvested restricted stock	(87)	(105)	251	267
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	9,809	12,126	28,089	30,262
Earnings from continuing operations available to common shareholders, Shares	85,798	90,182	86,295	90,497
Earnings from continuing operations available to common shareholders, Per Share	$ 0.11	$ 0.13	$ 0.32	$ 0.33
Effect of dilutive securities:
Stock options assumed exercised, Share	380	559	324	561
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised, Earnings	$ 9,809	$ 12,126	$ 28,089	$ 30,262
Earnings from continuing operations available to common shareholders plus stock options assumed exercised, Shares	86,178	90,741	86,619	91,058
Earnings from continuing operations available to common shareholders plus stock options assumed exercised, Per Share	$ 0.11	$ 0.13	$ 0.32	$ 0.33

XML

Basis of Presentation (Policies)

9 Months Ended

Jul. 31, 2012

Basis of Presentation [Abstract]

Principles of Consolidation

(b) Principles of Consolidation

The accompanying condensed consolidated financial statements include the Company and its subsidiaries. All significant intercompany balances and transactions have been eliminated.

Interim Disclosures

(c) Interim Disclosures

The information as of July 31, 2012, and for the three and nine months ended July 31, 2012 and 2011, is unaudited but, in the opinion of management, reflects all adjustments, which are of a normal recurring nature, necessary to a fair statement of the results for the interim periods. The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2011 (the “2011 Form 10-K”).

The October 31, 2011 condensed consolidated balance sheet data was derived from audited financial statements in the Company’s 2011 Form 10-K, but does not include all disclosures required by accounting principles generally accepted in the United States of America, which are presented in the Company’s 2011 Form 10-K.

The results of operations for the three and nine months ended July 31, 2012 are not necessarily indicative of the results to be expected for the fiscal year ending October 31, 2012.

Use of Estimates

(d) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s significant estimates are disclosed in Note 2 in the Company’s 2011 Form 10-K.

Share-Based Compensation

(e) Share-Based Compensation

The Company has share-based compensation plans, which are described in more detail in Note 18 to the consolidated financial statements in the Company’s 2011 Form 10-K. Stock option expense is reflected in corporate general and administrative expenses in the condensed consolidated statements of earnings and amounted to $358 and $281 for the three months ended July 31, 2012 and 2011, respectively, and $1,076 and $842 for the nine months ended July 31, 2012 and 2011, respectively. As of July 31, 2012, there was $3,305 of total unrecognized compensation costs related to stock options that is expected to be recognized over a weighted-average period of 2.8 years. Total stock option expense for fiscal year 2012 is expected to be $1,385. The expense related to restricted stock is reflected in corporate general and administrative expenses in the condensed consolidated statements of earnings and amounted to $385 and $333 for the three months ended July 31, 2012 and 2011, respectively, and $1,117 and $977 for the nine months ended July 31, 2012 and 2011, respectively. As of July 31, 2012, there was $1,311 of remaining future restricted stock expense to be recognized. Total restricted stock expense for fiscal year 2012 is expected to be $1,539.

During the nine months ended July 31, 2012, the Company issued 67,853 shares of Class A common stock and paid approximately $133 in cash to the independent directors of the Company. The expense related to this stock grant amounted to $437 and was recorded in corporate general and administrative expenses during the first quarter of fiscal year 2012. During the nine months ended July 31, 2011, the Company issued 82,160 shares of Class A common stock and paid approximately $114 in cash to the independent directors of the Company. The expense related to this stock grant amounted to $456 and was recorded in corporate general and administrative expenses during the first quarter of fiscal year 2011. Each of the shares issued has a restriction requiring each independent director to hold the respective shares until completion of service as a member of the Company’s Board of Directors.

The table below presents all stock options and restricted stock granted to employees during the nine months ended July 31, 2012:

Grant Type	Number of Shares Granted		Weighted Average Price per  Share		Vesting Period	Vesting Condition
Stock options		1,215,000	$	6.26	Equal one-fourth portions over 4 years		Service condition
Restricted stock		449,500	$	6.26	Equal one-third portions over 3 years		Market condition

The fair value of the Company’s service based stock options granted in fiscal year 2012 is the estimated present value at the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions for the nine months ended July 31, 2012: expected dividend yield of 2.2 percent; expected volatility of 37.8 percent; risk-free interest rate of 1.5 percent; and an expected term of 6.3 years. During the nine months ended July 31, 2012, the Company granted 449,500 shares of restricted stock with market conditions based on achieving certain specified target stock prices in the fiscal years 2012, 2013 and 2014. The Company records the expense over the requisite service period.

Purchase and Retirement of Common Stock

(f) Purchase and Retirement of Common Stock

Share repurchases are recorded at stated value with the amount in excess of stated value recorded as a reduction to additional paid-in capital. Share repurchases reduce the weighted average number of common shares outstanding during each period.

On September 19, 2007, the Company announced a stock repurchase program, authorizing the investment of up to $25,000 in the repurchase of the Company’s common stock. Repurchases under the program are limited to the Company’s Class A common stock, and can be made in the open market or in privately negotiated transactions at such times and in such amounts as management deems appropriate, depending upon market conditions and other factors. The program was increased by $25,000 in December 2007, June 2008, June 2011 and September 2011, resulting in a $125,000 program. During the nine months ended July 31, 2012, the Company repurchased 2,942,840 shares of its Class A common stock for $18,994 at an average price of $6.45 per share. As of July 31, 2012, the Company has repurchased 14,844,763 shares of its Class A common stock since the start of the program for $100,235 at an average price of $6.75 per share and has $24,765 still authorized under this program.

Dividends

(g) Dividends

In March 2005, the Company announced that its Board of Directors approved the initiation of a quarterly cash dividend of two and one-half cents per share of Class A and B common stock. In September 2009, June 2011 and March 2012, the Company announced that it had increased its quarterly dividend rate by one half cent per share. Effective March 2012, the quarterly dividend rate is four cents per share of Class A and B common stock. Although the Company intends to pay regular quarterly cash dividends for the foreseeable future, the declaration and payment of future dividends are discretionary and will be subject to determination by the Board of Directors each quarter after its review of the Company’s financial performance. For the nine months ended July 31, 2012, and 2011, the Company paid $9,955 and $8,662, respectively, in dividends.

Receivables and Allowance for Doubtful Accounts

(h) Receivables and Allowance for Doubtful Accounts

The Company establishes an allowance for uncollectible installment contracts and trade accounts based on a range of percentages applied to accounts receivable aging categories. These percentages are based on an analysis of the Company’s historical collection and write-off experience. At-need funeral and other receivables are considered past due after 30 days. The Company records an allowance on its interest accruals similar to the corresponding principal aging categories. For accounts that are greater than 90 days past due, interest continues to be accrued, however, an allowance is established to fully reserve this interest receivable. Interest income on these receivables is recognized only to the extent the account becomes less than 90 days past due and then only on the non-reserved portion. Accounts are restored to normal accrual status only when interest and principal payments are brought current and future payments are reasonably assured.

As of July 31, 2012 and October 31, 2011, the Company’s receivables and related allowances were as follows:

	Receivables as of July 31, 2012		Receivables as of October 31, 2011
	Ending Balance Collectively Evaluated for Impairment		Ending Balance Collectively Evaluated for Impairment
Current receivables – at-need funeral	$	8,651	$	8,317
Current receivables – other		45,777		45,455
Receivables, due beyond one year – other		76,234		75,097
Preneed funeral receivables		44,069		43,457
Preneed cemetery receivables		29,057		30,270
Total	$	203,788	$	202,596
Total current receivables		54,428		53,772
Total noncurrent receivables		149,360		148,824
Total	$	203,788	$	202,596

Other receivables are comprised primarily of receivables related to the sale of preneed property interment rights but also include income tax receivables and trade and other receivables.

	Allowance for Doubtful Accounts and Cancellations as of July 31, 2012			Allowance for Doubtful Accounts and Cancellations as of October 31, 2011
	Ending Balance Collectively Evaluated for Impairment			Ending Balance Collectively Evaluated for Impairment
Current receivables – at-need funeral and other	$	(4,049	)	$	(4,626	)
Receivables, due beyond one year – other		(5,305	)		(7,118	)
Preneed funeral receivables		(10,728	)		(11,359	)
Preneed cemetery receivables		(2,138	)		(3,366	)
Total	$	(22,220	)	$	(26,469	)
Total current receivables		(4,049	)		(4,626	)
Total noncurrent receivables		(18,171	)		(21,843	)
Total	$	(22,220	)	$	(26,469	)

	Allowance for Doubtful Accounts and Cancellations Rollforward
	Balance – October 31, 2011		Charged to costs and expenses		Write-offs			Balance – July 31, 2012
Current receivables – at-need funeral and other	$	4,626		1,316		(1,893	)	$	4,049
Receivables, due beyond one year – other		7,118		1,725		(3,538	)		5,305
	$	11,744		3,041		(5,431	)	$	9,354

	Allowance for Doubtful Accounts and Cancellations Rollforward
	Balance – October 31, 2010		Charged to costs and expenses		Write-offs			Balance – July 31, 2011
Current receivables – at-need funeral and other	$	5,738		1,568		(2,013	)	$	5,293
Receivables, due beyond one year – other		8,324		2,291		(2,883	)		7,732
	$	14,062		3,859		(4,896	)	$	13,025

The Company establishes allowances for preneed funeral and cemetery merchandise and services trust receivables. Changes in these allowances have no effect on the condensed consolidated statement of earnings but are recorded as reductions in preneed receivables and preneed deferred revenue in the condensed consolidated balance sheet.

The following summarizes the Company’s receivables aging analysis:

	Receivables Aging Analysis as of July 31, 2012
	1 to 30 Days		31 to 60 Days		61 to 90 Days		Greater than 90  Days		Total
Receivables – at-need funeral	$	5,045	$	1,215	$	450	$	1,941	$	8,651
Receivables – other		104,096		4,156		2,147		11,612		122,011
Preneed funeral receivables		31,817		867		370		11,015		44,069
Preneed cemetery receivables		24,943		1,036		519		2,559		29,057
	$	165,901	$	7,274	$	3,486	$	27,127	$	203,788

Reclassifications

(i) Reclassifications

Certain reclassifications have been made to the 2011 condensed consolidated financial statements in order for these periods to be comparable due to the reclassification of discontinued operations. These reclassifications had no effect on the Company’s net earnings, total shareholders’ equity or cash flows.

XML

Preneed Funeral Activities (Details 5) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Investment Related Activities
Realized gains from sales of investments	$ 2,633	$ 6,335	$ 12,207	$ 14,999
Realized losses from sales of investments and other	(2,744)	(2,065)	(5,992)	(3,732)
Preneed Funeral Activities [Member]
Investment Related Activities
Purchases	22,182	45,026	56,092	117,074
Sales	14,587	48,397	51,669	119,026
Realized gains from sales of investments	1,320	3,058	4,491	7,467
Realized losses from sales of investments and other	(1,605)	(1,335)	(2,709)	(2,015)
Interest income, dividends and other ordinary income	2,952	3,107	10,914	9,920
Deposits	6,462	5,770	18,828	15,800
Withdrawals	$ 10,905	$ 10,017	$ 29,995	$ 32,332

XML

Basis of Presentation (Details 3) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011
Allowance for Doubtful Accounts and Cancellations Roll Forward Schedule
Allowance for Doubtful Accounts and Cancellations Roll Forward, Beginning Balance	$ 11,744	$ 14,062
Allowance for doubtful accounts and cancellations Roll Forward charged to costs and expenses	3,041	3,859
Write- offs	(5,431)	(4,896)
Allowance for Doubtful Accounts and Cancellations Roll Forward, Ending Balance	9,354	13,025
Current receivables at need funeral and other [Member]
Allowance for Doubtful Accounts and Cancellations Roll Forward Schedule
Allowance for Doubtful Accounts and Cancellations Roll Forward, Beginning Balance	4,626	5,738
Allowance for doubtful accounts and cancellations Roll Forward charged to costs and expenses	1,316	1,568
Write- offs	(1,893)	(2,013)
Allowance for Doubtful Accounts and Cancellations Roll Forward, Ending Balance	4,049	5,293
Receivables due beyond one year other [Member]
Allowance for Doubtful Accounts and Cancellations Roll Forward Schedule
Allowance for Doubtful Accounts and Cancellations Roll Forward, Beginning Balance	7,118	8,324
Allowance for doubtful accounts and cancellations Roll Forward charged to costs and expenses	1,725	2,291
Write- offs	(3,538)	(2,883)
Allowance for Doubtful Accounts and Cancellations Roll Forward, Ending Balance	$ 5,305	$ 7,732

XML

Segment Data (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Net preneed merchandise and service sales
Total Net Preneed Merchandise and Service Sales	$ 40,962	$ 39,445	$ 117,823	$ 107,667
Cemetery [Member]
Net preneed merchandise and service sales
Total net preneed cemetery merchandise and service sales	12,949	13,162	38,109	37,380
Funeral [Member]
Net preneed merchandise and service sales
Total net preneed funeral merchandise and service sales	$ 28,013	$ 26,283	$ 79,714	$ 70,287

XML

Restructuring and Other Charges (Table)

9 Months Ended

Jul. 31, 2012

Restructuring and Other Charges [Abstract]

Schedule of Activities Related to Restructuring and Other Charges

	Employee Termination Costs			Non-cash Asset Impairment and Other Costs			Total
Costs incurred	$	990		$	1,862		$	2,852
Cash payments		(990	)		(537	)		(1,527	)
Non-cash items		—			(1,236	)		(1,236	)
Restructuring liability as of July 31, 2012	$	—		$	89		$	89

XML

Preneed Funeral Activities (Details Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended			3 Months Ended			9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011	Oct. 31, 2011	Jul. 31, 2012 Preneed Funeral Activities [Member] Account	Jan. 31, 2012 Preneed Funeral Activities [Member]	Jan. 31, 2011 Preneed Funeral Activities [Member]	Jul. 31, 2012 Preneed Funeral Activities [Member]	Jul. 31, 2011 Preneed Funeral Activities [Member]	Oct. 31, 2011 Preneed Funeral Activities [Member]	Jul. 31, 2012 Preneed Funeral Activities [Member] Common Stocks [Member]	Oct. 31, 2011 Preneed Funeral Activities [Member] Common Stocks [Member]
Preneed funeral activities (Textual) [Abstract]
Number of trust and escrow accounts						3
Outstanding covered calls with market value	$ 152		$ 152		$ 0	$ 466			$ 466	$ 0
Available for Sale Securities Gross Realized Gain Loss Excluding Other Than Temporary Impairments	89	61	203	(69)			180	75	336	(152)
Appreciation of securities underlying call options										1,983
Total unrealized losses , In Percentage									87.00%
Total unrealized losses , In value						$ 49,277			$ 49,277		$ 64,421	$ 43,071	$ 55,830

XML

Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts' Corpus (Details) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012
Component of deferred preneed funeral and cemetery receipts held in trust
Trust Assets at Market Value	$ 588,973
Less:
Pending withdrawals	(12,091)
Pending deposits	3,265
Deferred receipts held in trust	580,147
Funeral [Member]
Component of deferred preneed funeral and cemetery receipts held in trust
Trust Assets at Market Value	395,263
Less:
Pending withdrawals	(6,290)
Pending deposits	2,059
Deferred preneed funeral receipts held in trust	391,032
Cemetery [Member]
Component of deferred preneed funeral and cemetery receipts held in trust
Trust Assets at Market Value	193,710
Less:
Pending withdrawals	(5,801)
Pending deposits	1,206
Deferred preneed cemetery receipts held in trust	$ 189,115

XML

Cemetery Interment Rights and Perpetual Care Trusts (Details 1) (Cemetery perpetual care trust [Member], USD $) In Thousands, unless otherwise specified	Jul. 31, 2012
Cemetery perpetual care trust [Member]
Investments classified by contractual Maturity Date
Due in one year or less	$ 4,689
Due in one to five years	14,339
Due in five to ten years	8,826
Thereafter	4,166
Total	$ 32,020

XML

Preneed Funeral Activities (Details 2) (Preneed Funeral Activities [Member], USD $) In Thousands, unless otherwise specified	Jul. 31, 2012
Preneed Funeral Activities [Member]
Investments classified by contractual Maturity Date
Due in one year or less	$ 5,657
Due in one to five years	14,367
Due in five to ten years	2,856
Thereafter	520
Total	$ 23,400

XML

New Accounting Principles

9 Months Ended

Jul. 31, 2012

New Accounting Principles [Abstract]

New Accounting Principles

(2) New Accounting Principles

In January 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-06, which requires additional fair value disclosures. This guidance requires reporting entities to disclose transfers in and out of Levels 1 and 2 and requires gross presentation of purchases, sales, issuances and settlements in the Level 3 reconciliation of the three-tier fair value hierarchy. The guidance on transfers in and out of Levels 1 and 2 was effective for interim and annual reporting periods beginning after December 15, 2009 and was adopted by the Company as of its second fiscal quarter ended April 30, 2010. The disclosures on gross presentation of Level 3 purchases, sales, issuances and settlements are effective for fiscal years beginning after December 15, 2010 and for interim periods within those fiscal years and was effective for the Company’s fiscal year beginning November 1, 2011. The adoption of this guidance by the Company had no impact on the Company’s consolidated financial statements.

In December 2010, the FASB issued ASU No. 2010-28 regarding the goodwill impairment test for reporting units with zero or negative carrying amounts. The guidance clarifies the steps to be performed to determine whether goodwill has been impaired and addresses the steps for reporting units with zero or negative carrying amounts. This guidance is effective for fiscal years (and interim periods within such years) beginning after December 15, 2010, which corresponds to the Company’s first fiscal quarter beginning November 1, 2011. The adoption of this guidance had no impact on the Company’s consolidated financial statements.

In May 2011, the FASB issued ASU No. 2011-04 regarding fair value measurements and disclosures. This new guidance clarifies the application of existing fair value measurement guidance and revises certain measurement and disclosure requirements to achieve convergence with International Financial Reporting Standards. This guidance is effective for the first interim or annual period beginning after December 15, 2011, which corresponded to the Company’s second fiscal quarter beginning February 1, 2012. The adoption of this guidance by the Company had no impact on its consolidated financial statements.

In June 2011, the FASB issued ASU No. 2011-05 regarding the presentation of comprehensive income. This new guidance amends the previous application of comprehensive income and the requirements regarding presentation in the financial statements. It requires the disclosure of the components of comprehensive income, which the Company currently discloses in other sections of its filings, to be presented as part of one statement of comprehensive income, or as a separate statement of comprehensive income following the statement of earnings. In December 2011, the FASB issued ASU No. 2011-12 which temporarily defers those changes in ASU No. 2011-05 that relate to the presentation of reclassification adjustments out of accumulated other comprehensive income. This guidance is effective for fiscal years (and interim periods within such years) beginning after December 15, 2011, which corresponds to the Company’s first fiscal quarter beginning November 1, 2012. The Company is currently evaluating the impact the adoption of this guidance will have on its consolidated financial statements.

In December 2011, the FASB issued ASU No. 2011-11 regarding disclosures about offsetting assets and liabilities. This new guidance requires an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. This guidance is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods, which corresponds to the Company’s first fiscal quarter beginning November 1, 2013. The Company is currently evaluating the impact the adoption of this guidance will have on its consolidated financial statements.

In July 2012, the FASB issued ASU No. 2012-02 regarding subsequent measurement guidance for long lived intangibles. This guidance is meant to reduce the cost and complexity of performing an impairment test for indefinite- lived intangible assets. This guidance is effective for annual and interim tests performed for fiscal years beginning after September 15, 2012, which corresponds to the Company’s first fiscal quarter beginning November 1, 2013. The Company is currently evaluating the impact the adoption of this guidance will have on its consolidated financial statements.

XML

Cemetery Interment Rights and Perpetual Care Trusts (Details 2) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	$ 588,973
Cemetery perpetual care trust [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	258,502	239,601
Quoted Market Prices in Active Markets (Level 1) [Member] | Cemetery perpetual care trust [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	195,140	173,317
Significant Other Observable Inputs (Level 2) [Member] | Cemetery perpetual care trust [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	63,315	66,236
Significant Unobservable Inputs (Level 3) [Member] | Cemetery perpetual care trust [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	$ 47	$ 48

XML

Basis of Presentation (Details 4) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012
Receivable Aging Analysis Schedule
Company's receivables, 1to30Days	$ 165,901
Company's receivables, 31to60Days	7,274
Company's receivables, 61to90Days	3,486
Company's receivables, Greater than 90 Days	27,127
Company's receivables, Total	203,788
Receivables - at need funeral [Member]
Receivable Aging Analysis Schedule
Company's receivables, 1to30Days	5,045
Company's receivables, 31to60Days	1,215
Company's receivables, 61to90Days	450
Company's receivables, Greater than 90 Days	1,941
Company's receivables, Total	8,651
Receivables - other [Member]
Receivable Aging Analysis Schedule
Company's receivables, 1to30Days	104,096
Company's receivables, 31to60Days	4,156
Company's receivables, 61to90Days	2,147
Company's receivables, Greater than 90 Days	11,612
Company's receivables, Total	122,011
Preneed funeral receivables [Member]
Receivable Aging Analysis Schedule
Company's receivables, 1to30Days	31,817
Company's receivables, 31to60Days	867
Company's receivables, 61to90Days	370
Company's receivables, Greater than 90 Days	11,015
Company's receivables, Total	44,069
Preneed cemetery receivables [Member]
Receivable Aging Analysis Schedule
Company's receivables, 1to30Days	24,943
Company's receivables, 31to60Days	1,036
Company's receivables, 61to90Days	519
Company's receivables, Greater than 90 Days	2,559
Company's receivables, Total	$ 29,057

XML

Cemetery Interment Rights and Perpetual Care Trusts (Tables)

9 Months Ended

Jul. 31, 2012

Schedule of Available-for-sale Securities [Line Items]

Fair Value Assets Measured on Recurring Basis Unobservable Input Reconciliation

	Three Months Ended July 31,					Nine Months Ended July 31,
	2012		2011			2012			2011
Fair market value, beginning balance	$	5,698	$	6,075		$	5,868		$	6,784
Total unrealized gains (losses) included in other comprehensive income (1)		56		(590	)		56			(590	)
Distributions and other, net		8		558			(162	)		(151	)
Fair market value, ending balance	$	5,762	$	6,043		$	5,762		$	6,043

⁽¹⁾  All gains (losses) recognized in other comprehensive income for funeral trust investments are attributable to the Company’s preneed customers and are offset by a corresponding increase (decrease) in deferred preneed funeral receipts held in trust.

Cemetery perpetual care trust [Member]

Schedule of Available-for-sale Securities [Line Items]

Schedule of Available for Sale Securities Reconciliation Table

	July 31, 2012
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	15,359	$	—	$	—		$	15,359
U.S. Government, agencies and municipalities		5,643		265		(63	)		5,845
Corporate bonds		25,837		1,212		(874	)		26,175
Preferred stocks		33,519		438		(2,662	)		31,295
Common stocks		91,967		2,894		(19,905	)		74,956
Mutual funds:
Equity		15,001		1,115		(583	)		15,533
Fixed income		73,758		1,768		(1,178	)		74,348
Commodity		5,727		4		(471	)		5,260
Real estate investment trusts		8,818		866		—			9,684
Other long-term investments		98		—		(51	)		47
Trust investments	$	275,727	$	8,562	$	(25,787	)	$	258,502
Market value as a percentage of cost										93.8	%
Accrued investment income									938
Trust assets								$	259,440

	October 31, 2011
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	20,654	$	—	$	—		$	20,654
U.S. Government, agencies and municipalities		6,928		375		(57	)		7,246
Corporate bonds		27,166		1,044		(876	)		27,334
Preferred stocks		38,211		155		(6,927	)		31,439
Common stocks		82,750		1,751		(24,410	)		60,091
Mutual funds:
Equity		13,478		601		(807	)		13,272
Fixed income		61,740		706		(1,990	)		60,456
Commodity		6		5		—			11
Real estate investment trusts		8,834		6		(210	)		8,630
Master limited partnerships		10,248		16		(61	)		10,203
Other long-term investments		277		—		(12	)		265
Trust investments	$	270,292	$	4,659	$	(35,350	)	$	239,601
Market value as a percentage of cost										88.6	%
Accrued investment income									791
Trust assets								$	240,392

Investments Classified by Contractual Maturity Date Table

	July 31, 2012
Due in one year or less	$	4,689
Due in one to five years		14,339
Due in five to ten years		8,826
Thereafter		4,166
	$	32,020

Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis Table

	Quoted Market Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Market Value
Trust investments—July 31, 2012	$	195,140	$	63,315	$	47	$	258,502
Trust investments—October 31, 2011	$	173,317	$	66,236	$	48	$	239,601

Investment Related Activities Table

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Purchases	$	19,529		$	29,705		$	83,809		$	110,949
Sales		18,313			27,560			75,211			80,094
Realized gains from sales of investments		660			1,112			4,715			2,044
Realized losses from sales of investments and other		(963	)		(72	)		(2,902	)		(510	)
Interest income, dividends and other ordinary income		2,523			2,171			7,958			7,495
Deposits		2,180			2,024			6,849			5,424
Withdrawals		2,299			1,374			7,211			5,018

Schedule of Unrealized Loss on Investments

	July 31, 2012
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	—	$	—		$	61	$	(63	)	$	61	$	(63	)
Corporate bonds		2,445		(173	)		1,674		(701	)		4,119		(874	)
Preferred stocks		2,255		(58	)		15,051		(2,604	)		17,306		(2,662	)
Common stocks		6,519		(184	)		38,021		(19,721	)		44,540		(19,905	)
Mutual funds:
Equity		1,011		(43	)		1,076		(540	)		2,087		(583	)
Fixed income		8,772		(224	)		16,745		(954	)		25,517		(1,178	)
Commodity		5,243		(471	)		—		—			5,243		(471	)
Other long-term investments		—		—			47		(51	)		47		(51	)
Total	$	26,245	$	(1,153	)	$	72,675	$	(24,634	)	$	98,920	$	(25,787	)

	October 31, 2011
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	213	$	(1	)	$	71	$	(56	)	$	284	$	(57	)
Corporate bonds		5,959		(150	)		1,341		(726	)		7,300		(876	)
Preferred stocks		3,611		(91	)		20,921		(6,836	)		24,532		(6,927	)
Common stocks		1,027		(108	)		50,539		(24,302	)		51,566		(24,410	)
Mutual funds:
Equity		106		(113	)		1,967		(694	)		2,073		(807	)
Fixed income		39,397		(1,742	)		1,606		(248	)		41,003		(1,990	)
Real estate investment trusts		7,659		(210	)		—		—			7,659		(210	)
Master limited partnerships		7,936		(61	)		—		—			7,936		(61	)
Other long-term investments		—		—			48		(12	)		48		(12	)
Total	$	65,908	$	(2,476	)	$	76,493	$	(32,874	)	$	142,401	$	(35,350	)

XML

Preneed Cemetery Merchandise and Service Activities (Tables) (Preneed Cemetery Merchandise and Service Activities [Member])

9 Months Ended

Jul. 31, 2012

Preneed Cemetery Merchandise and Service Activities [Member]

Schedule of Available-for-sale Securities [Line Items]

Long Term Receivable and Investment Components Table

	July 31, 2012			October 31, 2011
Trust assets	$	193,710		$	189,678
Receivables from customers		29,057			30,270
		222,767			219,948
Allowance for cancellations		(2,138	)		(3,366	)
Preneed cemetery receivables and trust investments	$	220,629		$	216,582

Schedule of Available for Sale Securities Reconciliation Table

	July 31, 2012
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	9,065	$	—	$	—		$	9,065
U.S. Government, agencies and municipalities		1,883		127		—			2,010
Corporate bonds		2,006		143		(3	)		2,146
Preferred stocks		12,540		146		(292	)		12,394
Common stocks		107,520		942		(29,350	)		79,112
Mutual funds:
Equity		23,526		108		(7,068	)		16,566
Fixed income		53,870		1,106		(312	)		54,664
Commodity		8,693		—		(1,970	)		6,723
Master limited partnerships		6,797		—		(132	)		6,665
Real estate investment trusts		2,986		54		—			3,040
Other long-term investments		637		—		—			637
Trust investments	$	229,523	$	2,626	$	(39,127	)	$	193,022
Market value as a percentage of cost										84.1	%
Accrued investment income									688
Trust assets								$	193,710

	October 31, 2011
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	9,844	$	—	$	—		$	9,844
U.S. Government, agencies and municipalities		2,052		90		(2	)		2,140
Corporate bonds		2,596		131		(3	)		2,724
Preferred stocks		12,518		66		(1,662	)		10,922
Common stocks		112,010		920		(32,761	)		80,169
Mutual funds:
Equity		25,374		348		(6,791	)		18,931
Fixed income		46,258		305		(586	)		45,977
Commodity		8,780		—		(892	)		7,888
Real estate investment trusts		9,866		74		(193	)		9,747
Master limited partnerships		97		—		(2	)		95
Other long-term investments		596		—		—			596
Trust investments	$	229,991	$	1,934	$	(42,892	)	$	189,033
Market value as a percentage of cost										82.2	%
Accrued investment income									645
Trust assets								$	189,678

Investments Classified by Contractual Maturity Date Table

	July 31, 2012
Due in one year or less	$	103
Due in one to five years		2,244
Due in five to ten years		1,397
Thereafter		412
	$	4,156

Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis Table

	Quoted Market Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Market Value
Trust investments—July 31, 2012	$	176,321	$	16,701	$	—	$	193,022
Trust investments—October 31, 2011	$	173,127	$	15,906	$	—	$	189,033

Investment Related Activities Table

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Purchases	$	17,953		$	27,460		$	29,186		$	79,354
Sales		5,480			27,557			31,144			75,330
Realized gains from sales of investments		653			2,165			3,001			5,488
Realized losses from sales of investments and other		(176	)		(658	)		(381	)		(1,207	)
Interest income, dividends and other ordinary income		1,978			1,897			6,285			5,307
Deposits		4,127			4,451			12,769			12,459
Withdrawals		8,601			5,341			19,847			14,813

Schedule of Unrealized Loss on Investments

	July 31, 2012
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
Corporate bonds	$	56	$	(3	)	$	—	$	—		$	56	$	(3	)
Preferred stocks		587		(13	)		5,889		(279	)		6,476		(292	)
Common stocks		13,197		(1,050	)		51,323		(28,300	)		64,520		(29,350	)
Mutual funds:
Equity		—		—			12,910		(7,068	)		12,910		(7,068	)
Fixed income		10,722		(311	)		1,590		(1	)		12,312		(312	)
Commodity		2,403		(285	)		4,320		(1,685	)		6,723		(1,970	)
Master limited partnerships		6,665		(132	)		—		—			6,665		(132	)
Total	$	33,630	$	(1,794	)	$	76,032	$	(37,333	)	$	109,662	$	(39,127	)

	October 31, 2011
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	313	$	(2	)	$	—	$	—		$	313	$	(2	)
Corporate bonds		117		(3	)		—		—			117		(3	)
Preferred stocks		—		—			7,609		(1,662	)		7,609		(1,662	)
Common stocks		5,385		(707	)		59,506		(32,054	)		64,891		(32,761	)
Mutual funds:
Equity		—		—			14,376		(6,791	)		14,376		(6,791	)
Fixed income		34,325		(586	)		—		—			34,325		(586	)
Commodity		7,887		(892	)		—		—			7,887		(892	)
Real estate investment trusts		5,775		(193	)		—		—			5,775		(193	)
Master limited partnerships		—		—			95		(2	)		95		(2	)
Total	$	53,802	$	(2,383	)	$	81,586	$	(40,509	)	$	135,388	$	(42,892	)

XML

Preneed Cemetery Merchandise and Service Activities (Details 3) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	$ 588,973
Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	193,710	189,678
Preneed Cemetery Merchandise and Service Activities [Member] | Quoted Market Prices in Active Markets (Level 1) [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	176,321	173,127
Preneed Cemetery Merchandise and Service Activities [Member] | Significant Other Observable Inputs (Level 2) [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments	16,701	15,906
Preneed Cemetery Merchandise and Service Activities [Member] | Significant Unobservable Inputs (Level 3) [Member]
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
Trust Investments

XML

Basis of Presentation (Details Textual) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	3 Months Ended				9 Months Ended
	Aug. 31, 2012	Jul. 31, 2012 Cemetery Funeral States	Jan. 31, 2012	Jul. 31, 2011	Jan. 31, 2011	Jul. 31, 2012 Rate Cemetery Funeral States	Jul. 31, 2011
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation						$ 2,630	$ 2,275
Stock compensation expense to independent members of the board of directors			437		456
Cash dividends per share		$ 0.040		$ 0.035		$ 0.115	$ 0.095
Basis of Presentation (Textual) [Abstract]
Number of funeral homes		217				217
Number of Cemeteries		141				141
Number of working states of entity		24				24
Restricted stock expense			437		456
Cash paid to independent members of the board of directors						133	114
Purchase of Shares, Value for the Period						18,994
Purchase Number of Shares						2,942,840
Repurchased Stock Average Cost Per Share						$ 6.45
Stock Repurchase Program, Additional Authorized Amount						25,000
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term						6 years 3 months 18 days
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate						1.50%
Amount Authorized Under Stock Repurchase Program						125,000
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate						37.80%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate						2.20%
Stock issued to independent of the board of directors						67,853	82,160
Share Repurchase Program, Total repurchased Shares		14,844,763				14,844,763
Share Repurchase Program, Total Value Repurchased shares		100,235				100,235
Repurchased Stocks Average Cost Per Share		$ 6.75				$ 6.75
Amount Remaining Available For Future Repurchases	21,543					24,765
Increase in Quarterly dividend rate per share						$ 0.005
Current Quarterly Common Stock Dividend Per Share Rate						$ 0.04
Dividends						(9,955)	(8,662)
Stock options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Current fiscal year expected stock option expenses						1,385
Total unrecognized compensation costs related to stock options		3,305				3,305
Weighted-average period						2 years 9 months 18 days
Stock compensation expense to independent members of the board of directors		358		281		1,076	842
Basis of Presentation (Textual) [Abstract]
Restricted stock expense		358		281		1,076	842
Restricted stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized compensation costs related to restricted stock		1,311				1,311
Stock compensation expense to independent members of the board of directors		385		333		1,117	977
Current fiscal year expected restricted stock expenses						1,539
Basis of Presentation (Textual) [Abstract]
Restricted stock expense		$ 385		$ 333		$ 1,117	$ 977
Stock issued to independent of the board of directors						449,500

XML

Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts' Corpus (Tables)

9 Months Ended

Jul. 31, 2012

Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts' Corpus [Abstract]

Component of deferred preneed funeral and cemetery receipts held in trust

	Deferred Receipts Held in Trust
	Preneed      Funeral			Preneed     Cemetery			Total
Trust assets at market value	$	395,263		$	193,710		$	588,973
Less:
Pending withdrawals		(6,290	)		(5,801	)		(12,091	)
Pending deposits		2,059			1,206			3,265
Deferred receipts held in trust	$	391,032		$	189,115		$	580,147

Components of perpetual care trusts' corpus

	Perpetual Care Trusts’ Corpus
Trust assets at market value	$	259,440
Less:
Pending withdrawals		(2,083	)
Pending deposits		349
Perpetual care trusts’ corpus	$	257,706

Investment and other income, net

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Realized gains from sales of investments	$	2,633		$	6,335		$	12,207		$	14,999
Realized losses from sales of investments and other		(2,744	)		(2,065	)		(5,992	)		(3,732	)
Interest income, dividends and other ordinary income		7,453			7,175			25,157			22,722
Trust expenses and income taxes		(2,966	)		(2,808	)		(8,792	)		(7,737	)
Net trust investment income		4,376			8,637			22,580			26,252
Reclassification to deferred preneed funeral and cemetery receipts held in trust		(3,112	)		(6,319	)		(15,802	)		(19,876	)
Reclassification to perpetual care trusts’ corpus		(1,264	)		(2,318	)		(6,778	)		(6,376	)
Total deferred preneed funeral and cemetery receipts held in trust and perpetual care trusts’ corpus		—			—			—			—
Investment and other income, net (1)		57			30			148			394
Total investment and other income, net	$	57		$	30		$	148		$	394

⁽¹⁾  Investment and other income, net generally consists of interest income primarily on the Company’s cash, cash equivalents and marketable securities not held in trust. For the nine months ended July 31, 2011, the balance includes approximately $327 of interest income related to the resolution of an audit by the Internal Revenue Service.

XML

Reconciliation of Basic and Diluted Per Share Data (Tables)

9 Months Ended

Jul. 31, 2012

Reconciliation of Basic and Diluted Per Share Data [Abstract]

Reconciliation of basic and diluted per share data

	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Three Months Ended July 31, 2012
Earnings from continuing operations	$	9,896
Allocation of earnings to nonvested restricted stock		(87	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	9,809			85,798	$	.11
Effect of dilutive securities:
Stock options assumed exercised					380
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	9,809			86,178	$	.11
	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Three Months Ended July 31, 2011
Earnings from continuing operations	$	12,231
Allocation of earnings to nonvested restricted stock		(105	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	12,126			90,182	$	.13
Effect of dilutive securities:
Stock options assumed exercised					559
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	12,126			90,741	$	.13
	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Nine Months Ended July 31, 2012
Earnings from continuing operations	$	28,340
Allocation of earnings to nonvested restricted stock		(251	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	28,089			86,295	$	.32
Effect of dilutive securities:
Stock options assumed exercised					324
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	28,089			86,619	$	.32

	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Nine Months Ended July 31, 2011
Earnings from continuing operations	$	30,529
Allocation of earnings to nonvested restricted stock		(267	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	30,262			90,497	$	.33
Effect of dilutive securities:
Stock options assumed exercised					561
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	30,262			91,058	$	.33

XML

Basis of Presentation

9 Months Ended

Jul. 31, 2012

Basis of Presentation [Abstract]

Basis of Presentation

(1) Basis of Presentation

(a) The Company

Stewart Enterprises, Inc. (the “Company”) is a provider of funeral and cemetery products and services in the death care industry in the United States and Puerto Rico. Through its subsidiaries, the Company offers a complete line of funeral and cremation merchandise and services, along with cemetery property, merchandise and services, both at the time of need and on a preneed basis. As of July 31, 2012, the Company owned and operated 217 funeral homes and 141 cemeteries in 24 states within the United States and Puerto Rico. The Company has three operating and reportable segments consisting of a funeral segment, a cemetery segment and a corporate trust management segment.

(b) Principles of Consolidation

The accompanying condensed consolidated financial statements include the Company and its subsidiaries. All significant intercompany balances and transactions have been eliminated.

(c) Interim Disclosures

The information as of July 31, 2012, and for the three and nine months ended July 31, 2012 and 2011, is unaudited but, in the opinion of management, reflects all adjustments, which are of a normal recurring nature, necessary to a fair statement of the results for the interim periods. The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2011 (the “2011 Form 10-K”).

The October 31, 2011 condensed consolidated balance sheet data was derived from audited financial statements in the Company’s 2011 Form 10-K, but does not include all disclosures required by accounting principles generally accepted in the United States of America, which are presented in the Company’s 2011 Form 10-K.

The results of operations for the three and nine months ended July 31, 2012 are not necessarily indicative of the results to be expected for the fiscal year ending October 31, 2012.

(d) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s significant estimates are disclosed in Note 2 in the Company’s 2011 Form 10-K.

(e) Share-Based Compensation

The Company has share-based compensation plans, which are described in more detail in Note 18 to the consolidated financial statements in the Company’s 2011 Form 10-K. Stock option expense is reflected in corporate general and administrative expenses in the condensed consolidated statements of earnings and amounted to $358 and $281 for the three months ended July 31, 2012 and 2011, respectively, and $1,076 and $842 for the nine months ended July 31, 2012 and 2011, respectively. As of July 31, 2012, there was $3,305 of total unrecognized compensation costs related to stock options that is expected to be recognized over a weighted-average period of 2.8 years. Total stock option expense for fiscal year 2012 is expected to be $1,385. The expense related to restricted stock is reflected in corporate general and administrative expenses in the condensed consolidated statements of earnings and amounted to $385 and $333 for the three months ended July 31, 2012 and 2011, respectively, and $1,117 and $977 for the nine months ended July 31, 2012 and 2011, respectively. As of July 31, 2012, there was $1,311 of remaining future restricted stock expense to be recognized. Total restricted stock expense for fiscal year 2012 is expected to be $1,539.

During the nine months ended July 31, 2012, the Company issued 67,853 shares of Class A common stock and paid approximately $133 in cash to the independent directors of the Company. The expense related to this stock grant amounted to $437 and was recorded in corporate general and administrative expenses during the first quarter of fiscal year 2012. During the nine months ended July 31, 2011, the Company issued 82,160 shares of Class A common stock and paid approximately $114 in cash to the independent directors of the Company. The expense related to this stock grant amounted to $456 and was recorded in corporate general and administrative expenses during the first quarter of fiscal year 2011. Each of the shares issued has a restriction requiring each independent director to hold the respective shares until completion of service as a member of the Company’s Board of Directors.

The table below presents all stock options and restricted stock granted to employees during the nine months ended July 31, 2012:

Grant Type	Number of Shares Granted		Weighted Average Price per  Share		Vesting Period	Vesting Condition
Stock options		1,215,000	$	6.26	Equal one-fourth portions over 4 years		Service condition
Restricted stock		449,500	$	6.26	Equal one-third portions over 3 years		Market condition

The fair value of the Company’s service based stock options granted in fiscal year 2012 is the estimated present value at the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions for the nine months ended July 31, 2012: expected dividend yield of 2.2 percent; expected volatility of 37.8 percent; risk-free interest rate of 1.5 percent; and an expected term of 6.3 years. During the nine months ended July 31, 2012, the Company granted 449,500 shares of restricted stock with market conditions based on achieving certain specified target stock prices in the fiscal years 2012, 2013 and 2014. The Company records the expense over the requisite service period.

(f) Purchase and Retirement of Common Stock

Share repurchases are recorded at stated value with the amount in excess of stated value recorded as a reduction to additional paid-in capital. Share repurchases reduce the weighted average number of common shares outstanding during each period.

On September 19, 2007, the Company announced a stock repurchase program, authorizing the investment of up to $25,000 in the repurchase of the Company’s common stock. Repurchases under the program are limited to the Company’s Class A common stock, and can be made in the open market or in privately negotiated transactions at such times and in such amounts as management deems appropriate, depending upon market conditions and other factors. The program was increased by $25,000 in December 2007, June 2008, June 2011 and September 2011, resulting in a $125,000 program. During the nine months ended July 31, 2012, the Company repurchased 2,942,840 shares of its Class A common stock for $18,994 at an average price of $6.45 per share. As of July 31, 2012, the Company has repurchased 14,844,763 shares of its Class A common stock since the start of the program for $100,235 at an average price of $6.75 per share and has $24,765 still authorized under this program.

(g) Dividends

In March 2005, the Company announced that its Board of Directors approved the initiation of a quarterly cash dividend of two and one-half cents per share of Class A and B common stock. In September 2009, June 2011 and March 2012, the Company announced that it had increased its quarterly dividend rate by one half cent per share. Effective March 2012, the quarterly dividend rate is four cents per share of Class A and B common stock. Although the Company intends to pay regular quarterly cash dividends for the foreseeable future, the declaration and payment of future dividends are discretionary and will be subject to determination by the Board of Directors each quarter after its review of the Company’s financial performance. For the nine months ended July 31, 2012, and 2011, the Company paid $9,955 and $8,662, respectively, in dividends.

(h) Receivables and Allowance for Doubtful Accounts

The Company establishes an allowance for uncollectible installment contracts and trade accounts based on a range of percentages applied to accounts receivable aging categories. These percentages are based on an analysis of the Company’s historical collection and write-off experience. At-need funeral and other receivables are considered past due after 30 days. The Company records an allowance on its interest accruals similar to the corresponding principal aging categories. For accounts that are greater than 90 days past due, interest continues to be accrued, however, an allowance is established to fully reserve this interest receivable. Interest income on these receivables is recognized only to the extent the account becomes less than 90 days past due and then only on the non-reserved portion. Accounts are restored to normal accrual status only when interest and principal payments are brought current and future payments are reasonably assured.

As of July 31, 2012 and October 31, 2011, the Company’s receivables and related allowances were as follows:

	Receivables as of July 31, 2012		Receivables as of October 31, 2011
	Ending Balance Collectively Evaluated for Impairment		Ending Balance Collectively Evaluated for Impairment
Current receivables – at-need funeral	$	8,651	$	8,317
Current receivables – other		45,777		45,455
Receivables, due beyond one year – other		76,234		75,097
Preneed funeral receivables		44,069		43,457
Preneed cemetery receivables		29,057		30,270
Total	$	203,788	$	202,596
Total current receivables		54,428		53,772
Total noncurrent receivables		149,360		148,824
Total	$	203,788	$	202,596

Other receivables are comprised primarily of receivables related to the sale of preneed property interment rights but also include income tax receivables and trade and other receivables.

	Allowance for Doubtful Accounts and Cancellations as of July 31, 2012			Allowance for Doubtful Accounts and Cancellations as of October 31, 2011
	Ending Balance Collectively Evaluated for Impairment			Ending Balance Collectively Evaluated for Impairment
Current receivables – at-need funeral and other	$	(4,049	)	$	(4,626	)
Receivables, due beyond one year – other		(5,305	)		(7,118	)
Preneed funeral receivables		(10,728	)		(11,359	)
Preneed cemetery receivables		(2,138	)		(3,366	)
Total	$	(22,220	)	$	(26,469	)
Total current receivables		(4,049	)		(4,626	)
Total noncurrent receivables		(18,171	)		(21,843	)
Total	$	(22,220	)	$	(26,469	)

	Allowance for Doubtful Accounts and Cancellations Rollforward
	Balance – October 31, 2011		Charged to costs and expenses		Write-offs			Balance – July 31, 2012
Current receivables – at-need funeral and other	$	4,626		1,316		(1,893	)	$	4,049
Receivables, due beyond one year – other		7,118		1,725		(3,538	)		5,305
	$	11,744		3,041		(5,431	)	$	9,354

	Allowance for Doubtful Accounts and Cancellations Rollforward
	Balance – October 31, 2010		Charged to costs and expenses		Write-offs			Balance – July 31, 2011
Current receivables – at-need funeral and other	$	5,738		1,568		(2,013	)	$	5,293
Receivables, due beyond one year – other		8,324		2,291		(2,883	)		7,732
	$	14,062		3,859		(4,896	)	$	13,025

The Company establishes allowances for preneed funeral and cemetery merchandise and services trust receivables. Changes in these allowances have no effect on the condensed consolidated statement of earnings but are recorded as reductions in preneed receivables and preneed deferred revenue in the condensed consolidated balance sheet.

The following summarizes the Company’s receivables aging analysis:

	Receivables Aging Analysis as of July 31, 2012
	1 to 30 Days		31 to 60 Days		61 to 90 Days		Greater than 90  Days		Total
Receivables – at-need funeral	$	5,045	$	1,215	$	450	$	1,941	$	8,651
Receivables – other		104,096		4,156		2,147		11,612		122,011
Preneed funeral receivables		31,817		867		370		11,015		44,069
Preneed cemetery receivables		24,943		1,036		519		2,559		29,057
	$	165,901	$	7,274	$	3,486	$	27,127	$	203,788

(i) Reclassifications

Certain reclassifications have been made to the 2011 condensed consolidated financial statements in order for these periods to be comparable due to the reclassification of discontinued operations. These reclassifications had no effect on the Company’s net earnings, total shareholders’ equity or cash flows.

XML

Segment Data (Tables)

9 Months Ended

Jul. 31, 2012

Segment Data [Abstract]

Reported segments

	Total Revenue				Total Revenue
	Three Months Ended July 31, 2012		Three Months Ended July 31, 2011		Nine Months Ended July 31, 2012		Nine Months Ended July  31, 2011
Funeral	$	65,468	$	64,846	$	201,960	$	203,254
Cemetery (1)		57,918		53,544		165,809		161,370
Corporate Trust Management (2)		5,853		5,967		18,892		18,662
Total	$	129,239	$	124,357	$	386,661	$	383,286

	Total Gross Profit				Total Gross Profit
	Three Months Ended July 31, 2012		Three Months Ended July 31, 2011		Nine Months Ended July 31, 2012		Nine Months Ended July  31, 2011
Funeral	$	12,628	$	10,703	$	41,973	$	41,139
Cemetery (1)		9,061		5,544		22,019		17,255
Corporate Trust Management (2)		5,297		5,505		17,528		17,354
Total	$	26,986	$	21,752	$	81,520	$	75,748

⁽¹⁾  Perpetual care trust earnings are included in the revenues and gross profit of the cemetery segment and amounted to $1,815 and $1,988 for the three months ended July 31, 2012 and 2011, respectively, and $7,098 and $5,981 for the nine months ended July 31, 2012 and 2011, respectively.

^{(2 )}  Corporate trust management consists of trust management fees and funeral and cemetery merchandise and service trust earnings recognized with respect to preneed contracts delivered during the period. Trust management fees are established by the Company at rates consistent with industry norms based on the fair market value of the assets managed and are paid by the trusts to the Company’s subsidiary, Investors Trust, Inc. The trust earnings represent the amount of distributable earnings as stipulated by the Company’s respective trust agreements that are generated by the trusts over the life of the preneed contracts and allocated to those products and services delivered during the relevant periods. Trust management fees included in funeral revenue for the three months ended July 31, 2012 and 2011 were $1,335 and $1,201, respectively, and funeral trust earnings recognized with respect to preneed contracts delivered included in funeral revenue for the three months ended July 31, 2012 and 2011 were $2,080 and $2,714, respectively. Trust management fees included in cemetery revenue for the three months ended July 31, 2012 and 2011 were $1,555 and $1,349, respectively, and cemetery trust earnings recognized with respect to preneed contracts delivered included in cemetery revenue for the three months ended July 31, 2012 and 2011 were $883 and $703, respectively.

Trust management fees included in funeral revenue for the nine months ended July 31, 2012 and 2011 were $3,993 and $3,614, respectively, and funeral trust earnings for the nine months ended July 31, 2012 and 2011 were $7,693 and $8,733, respectively. Trust management fees included in cemetery revenue for the nine months ended July 31, 2012 and 2011 were $4,649 and $4,000, respectively, and cemetery trust earnings for the nine months ended July 31, 2012 and 2011 were $2,557 and $2,315, respectively.

Reconciliation of total segment gross profit to total earnings before income taxes

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Gross profit for reportable segments	$	26,986		$	21,752		$	81,520		$	75,748
Corporate general and administrative expenses		(7,326	)		(6,704	)		(20,264	)		(19,548	)
Restructuring and other charges		(305	)		—			(2,852	)		—
Hurricane related recoveries, net		—			12,349			—			12,245
Net gain (loss) on dispositions		—			11			332			(389	)
Other operating income, net		191			512			773			1,193
Interest expense		(5,873	)		(5,500	)		(17,544	)		(16,968	)
Loss on early extinguishment of debt		—			(73	)		—			(1,884	)
Investment and other income, net		57			30			148			394
Earnings from continuing operations before income taxes	$	13,730		$	22,377		$	42,113		$	50,791

Net preneed merchandise and service sales

	Total Net Preneed Merchandise and Service Sales (1)				Total Net Preneed Merchandise and Service Sales (1)
	Three Months Ended July 31, 2012		Three Months Ended July 31, 2011		Nine Months Ended July 31, 2012		Nine Months Ended July 31, 2011
Funeral	$	28,013	$	26,283	$	79,714	$	70,287
Cemetery		12,949		13,162		38,109		37,380
Total	$	40,962	$	39,445	$	117,823	$	107,667

^{(1 )}  Preneed sales amounts represent total preneed funeral trust and insurance sales and cemetery service and merchandise trust sales generated in the applicable period, net of cancellations. Preneed funeral and cemetery merchandise and service sales are deferred until a future period and have no impact on current revenues.

XML

Acquisitions and Dispositions (Details Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Acquisitions and Dispositions (Textual) [Abstract]
Net gain (losses) on disposition			$ 332	$ (389)
Cost of acquired entity	3,013		3,013
Purchase price allocation of Goodwill	2,564		2,564
Purchase price allocation of Tangible Assets	670		670
Gain(Loss) on disposition of discontinued operation	31		871
Gain(Loss) on disposition of discontinued operation, before income taxes	380	365	2,065	810
Net gain on disposition due to the sale of a funeral home			$ 343

XML

Basis of Presentation (Details 1) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Schedule of Receivables
Current receivables - at - need funeral	$ 8,651	$ 8,317
Current receivables other	45,777	45,455
Receivables, due beyond one year - other	76,234	75,097
Preneed funeral receivables	44,069	43,457
Preneed cemetery receivables	29,057	30,270
Total current receivables	54,428	53,772
Total noncurrent receivables	149,360	148,824
Total	$ 203,788	$ 202,596

XML

Preneed Cemetery Merchandise and Service Activities (Details) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Long-Term Receivable and Investment Components
Trust Assets at Market Value	$ 588,973
Receivables from customers	149,360	148,824
Allowance for Cancellations	(18,171)	(21,843)
Preneed Cemetery Merchandise and Service Activities [Member]
Long-Term Receivable and Investment Components
Trust Assets at Market Value	193,710	189,678
Receivables from customers	29,057	30,270
Preneed cemetery receivables and trust investments, Gross	222,767	219,948
Allowance for Cancellations	(2,138)	(3,366)
Preneed Cemetery Receivables and Trust Investments, Net	$ 220,629	$ 216,582

XML

Reconciliation of Basic and Diluted Per Share Data (Details Textual) (USD $)	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Reconciliation of Basic and Diluted Per Share Data (Textual) [Abstract]
Number of antidulutive securities	390,290	435,253	877,683	500,573
Minimum Common Stock Price Per Share Of Antidilutive Options	$ 6.83	$ 7.57	$ 6.33	$ 7.31
Maximum Common Stock Price Per Share Of Antidilutive Options	$ 8.47	$ 8.47	$ 8.47	$ 8.47
Additional antidilutive options	2,140,192	1,086,000	1,936,384
Dilutive outstanding market based stock options	94,500	214,500	94,500	214,500
Maximum [Member]
Reconciliation of Basic and Diluted Per Share Data (Textual) [Abstract]
Date of expiration of anti dilutive stock options	May 05, 2022		Dec. 06, 2021
Minimum [Member]
Reconciliation of Basic and Diluted Per Share Data (Textual) [Abstract]
Date of expiration of anti dilutive stock options	Jan. 08, 2014		Jan. 08, 2014
Common Class A [Member]
Reconciliation of Basic and Diluted Per Share Data (Textual) [Abstract]
Number of antidulutive securities	13,153,500	13,153,500	10,637,882	10,522,798

XML

Condensed Consolidated Statements of Earnings (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Revenues:
Funeral	$ 68,883	$ 68,761	$ 213,646	$ 215,601
Cemetery	60,356	55,596	173,015	167,685
Total Revenue	129,239	124,357	386,661	383,286
Costs and expenses:
Funeral	53,128	54,380	160,685	162,784
Cemetery	49,125	48,225	144,456	144,754
Total costs and expenses	102,253	102,605	305,141	307,538
Gross profit	26,986	21,752	81,520	75,748
Corporate general and administrative expenses	(7,326)	(6,704)	(20,264)	(19,548)
Restructuring and other charges	(305)		(2,852)
Hurricane related recoveries, net		12,349		12,245
Net gain (loss) on dispositions		11	332	(389)
Other operating income, net	191	512	773	1,193
Operating earnings	19,546	27,920	59,509	69,249
Interest expense	(5,873)	(5,500)	(17,544)	(16,968)
Loss on early extinguishment of debt		(73)		(1,884)
Investment and other income, net	57	30	148	394
Earnings from continuing operations before income taxes	13,730	22,377	42,113	50,791
Income taxes	3,834	10,146	13,773	20,262
Earnings from continuing operations	9,896	12,231	28,340	30,529
Discontinued operations:
Loss from discontinued operations before income taxes	(380)	(365)	(2,065)	(810)
Income tax benefit	(122)	(120)	(644)	(309)
Loss from discontinued operations	(258)	(245)	(1,421)	(501)
Net earnings	$ 9,638	$ 11,986	$ 26,919	$ 30,028
Basic earnings per common share:
Earnings from continuing operations	$ 0.11	$ 0.13	$ 0.32	$ 0.33
Loss from discontinued operations			$ (0.01)
Net earnings	$ 0.11	$ 0.13	$ 0.31	$ 0.33
Diluted earnings per common share:
Earnings from continuing operations	$ 0.11	$ 0.13	$ 0.32	$ 0.33
Loss from discontinued operations			$ (0.01)
Net earnings	$ 0.11	$ 0.13	$ 0.31	$ 0.33
Weighted average common shares outstanding (in thousands):
Basic	85,798	90,182	86,295	90,497
Diluted	86,178	90,741	86,619	91,058
Dividends declared per common share	$ 0.040	$ 0.035	$ 0.115	$ 0.095

XML

Preneed Funeral Activities (Details) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Long-Term Receivable and Investment Components
Trust Assets at Market Value	$ 588,973
Receivables from customers	44,069	43,457
Allowance for Cancellations	(18,171)	(21,843)
Preneed Funeral Activities [Member]
Long-Term Receivable and Investment Components
Trust Assets at Market Value	395,263	377,198
Receivables from customers	44,069	43,457
Preneed Funeral Receivables and Trust Investments, Gross	439,332	420,655
Allowance for Cancellations	(10,728)	(11,359)
Preneed Funeral Receivables and Trust Investments, net	$ 428,604	$ 409,296

XML

Condensed Consolidated Statement of Shareholders' Equity (Unaudited) (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	9 Months Ended
	Jul. 31, 2012
Deferred Tax (Expense) Benefit on Investments	$ 13
Dividends declared per common share	$ 0.115
Common stock, shares	82,281,000
Common Class A
Common stock, stated value	$ 1.00
Common stock, shares	82,281,197
Common Class B
Common stock, stated value	$ 1.00
Common stock, shares	3,555,020,000
Additional Paid-in Capital
Dividends declared per common share	$ 0.115
Unrealized appreciation of investments, net of deferred tax expense of ($2)
Deferred Tax (Expense) Benefit on Investments	$ 13

XML

Preneed Cemetery Merchandise and Service Activities (Details Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011	Oct. 31, 2011
Preneed Cemetery Merchandise and Service Activities (Textual) [Abstract]
Outstanding covered calls with market value	$ 152		$ 152		$ 0
Available for Sale Securities Gross Realized Gain Loss Excluding Other Than Temporary Impairments	89	61	203	(69)
Preneed Cemetery Merchandise and Service Activities [Member]
Preneed Cemetery Merchandise and Service Activities (Textual) [Abstract]
Appreciation of securities underlying call options				732
Unrealized Losses of Investments Comprising Majority of total Unrealized Losses			$ 36,418
Total unrealized losses , In Percentage			93.00%

XML

Acquisitions and Dispositions (Tables)

9 Months Ended

Jul. 31, 2012

Acquisitions and Dispositions [Abstract]

Roll forward of Goodwill

	October 31, 2011		Changes			July 31, 2012
Funeral	$	198,317	$	2,546	(1)	$	200,863
Cemetery		48,721		—			48,721
Total	$	247,038	$	2,546		$	249,584

XML

Cemetery Interment Rights and Perpetual Care Trusts (Details 5) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Real estate investment trusts [Member] | Mutual Funds [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	$ 34
Real estate investment trusts [Member] | Mutual Funds [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	62
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(1)
Master limited partnerships [Member] | Mutual Funds [Member]
Schedule of Unrealized Loss on Investment Items
Total unrealized losses	(56)
Master limited partnerships [Member] | Mutual Funds [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	6,665
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(132)
Cemetery perpetual care trust [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	98,920	142,401
Total unrealized losses	25,787	35,350
Cemetery perpetual care trust [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	26,245	65,908
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(1,153)	(2,476)
Cemetery perpetual care trust [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	72,675	76,493
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(24,634)	(32,874)
Cemetery perpetual care trust [Member] | U.S. Government, agencies and municipalities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	61	284
Total unrealized losses	63	57
Cemetery perpetual care trust [Member] | U.S. Government, agencies and municipalities [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months		213
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months		(1)
Cemetery perpetual care trust [Member] | U.S. Government, agencies and municipalities [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	61	71
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(63)	(56)
Cemetery perpetual care trust [Member] | Corporate bonds [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	4,119	7,300
Total unrealized losses	874	876
Cemetery perpetual care trust [Member] | Corporate bonds [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	2,445	5,959
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(173)	(150)
Cemetery perpetual care trust [Member] | Corporate bonds [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	1,674	1,341
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(701)	(726)
Cemetery perpetual care trust [Member] | Preferred stocks [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	17,306	24,532
Total unrealized losses	2,662	6,927
Cemetery perpetual care trust [Member] | Preferred stocks [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	2,255	3,611
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(58)	(91)
Cemetery perpetual care trust [Member] | Preferred stocks [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	15,051	20,921
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(2,604)	(6,836)
Cemetery perpetual care trust [Member] | Common Stocks [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	44,540	51,566
Total unrealized losses	19,905	24,410
Cemetery perpetual care trust [Member] | Common Stocks [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	6,519	1,027
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(184)	(108)
Cemetery perpetual care trust [Member] | Common Stocks [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	38,021	50,539
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(19,721)	(24,302)
Cemetery perpetual care trust [Member] | Other long-term investments [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	47	48
Total unrealized losses	51	12
Cemetery perpetual care trust [Member] | Other long-term investments [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	47	48
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(51)	(12)
Cemetery perpetual care trust [Member] | Equity [Member] | Mutual Funds [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	2,087	2,073
Total unrealized losses	583	807
Cemetery perpetual care trust [Member] | Equity [Member] | Mutual Funds [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	1,011	106
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(43)	(113)
Cemetery perpetual care trust [Member] | Equity [Member] | Mutual Funds [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	1,076	1,967
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(540)	(694)
Cemetery perpetual care trust [Member] | Fixed Income Investments [Member] | Mutual Funds [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	25,517	41,003
Total unrealized losses	1,178	1,990
Cemetery perpetual care trust [Member] | Fixed Income Investments [Member] | Mutual Funds [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	8,772	39,397
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(224)	(1,742)
Cemetery perpetual care trust [Member] | Fixed Income Investments [Member] | Mutual Funds [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	16,745	1,606
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(954)	(248)
Cemetery perpetual care trust [Member] | Commodity [Member] | Mutual Funds [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	5,243
Total unrealized losses	471
Cemetery perpetual care trust [Member] | Commodity [Member] | Mutual Funds [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	5,243
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(471)
Cemetery perpetual care trust [Member] | Real estate investment trusts [Member] | Mutual Funds [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value		7,659
Total unrealized losses		210
Cemetery perpetual care trust [Member] | Real estate investment trusts [Member] | Mutual Funds [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months		7,659
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months		(210)
Cemetery perpetual care trust [Member] | Master limited partnerships [Member] | Mutual Funds [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value		7,936
Total unrealized losses		61
Cemetery perpetual care trust [Member] | Master limited partnerships [Member] | Mutual Funds [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months		7,936
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months		$ (61)

XML

Long-term Debt

9 Months Ended

Jul. 31, 2012

Long-term Debt [Abstract]

Long-term Debt

(15) Long-term Debt

	July 31, 2012		October 31, 2011
Long-term debt:
3.125% senior convertible notes due 2014, net of unamortized discount of $5,484 and $7,611 as of July 31, 2012 and October 31, 2011, respectively	$	80,932	$	78,805
3.375% senior convertible notes due 2016, net of unamortized discount of $5,276 and $6,183 as of July 31, 2012 and October 31, 2011, respectively		39,843		38,936
Senior secured revolving credit facility		—		—
6.50% senior notes due 2019		200,000		200,000
Other, principally seller financing of acquired operations or assumption upon acquisition, weighted average interest rate of 8.0% as of July 31, 2012 and October 31, 2011, partially secured by assets of subsidiaries, with maturities through 2022		81		85
Total long-term debt		320,856		317,826
Less current maturities		6		5
	$	320,850	$	317,821

Fair Value

As of July 31, 2012, the carrying values of the Company’s 3.125 percent senior convertible notes due 2014 (the “2014 Notes”) and 3.375 percent senior convertible notes due 2016 (the “2016 Notes”), including accrued interest, were $81,051 and $39,911, respectively, compared to fair values of $86,282 and $44,223, respectively. The aggregate principal amounts outstanding of the 2014 Notes and 2016 Notes as of July 31, 2012 were $86,416 and $45,119, respectively. As of July 31, 2012, the carrying value of the Company’s 6.50 percent senior notes, including accrued interest, was $203,792 compared to a fair value of $213,802. Fair values were determined using quoted market prices for those securities and are classified within Level 1 of the three-level valuation hierarchy.

XML

Consolidated Comprehensive Income (Tables)

9 Months Ended

Jul. 31, 2012

Consolidated Comprehensive Income [Abstract]

Consolidated comprehensive income

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Net earnings	$	9,638		$	11,986		$	26,919		$	30,028
Other comprehensive income (loss):
Unrealized appreciation (depreciation) of investments, net of deferred tax (expense) benefit of ($9), $2, ($13), and ($3), respectively		15			(3	)		23			6
(Increase) reduction in net unrealized losses associated with available-for-sale securities of the trusts		3,737			(31,772	)		39,080			11,209
Reclassification of the net unrealized losses activity attributable to the deferred preneed funeral and cemetery receipts held in trust and perpetual care trusts’ corpus		(3,737	)		31,772			(39,080	)		(11,209	)
Total other comprehensive income (loss)		15			(3	)		23			6
Total comprehensive income	$	9,653		$	11,983		$	26,942		$	30,034

XML

Subsequent Events

9 Months Ended

Jul. 31, 2012

Subsequent Events [Abstract]

Subsequent Events

(17) Subsequent Events

In August 2012, the Company received approval from the Internal Revenue Service for a change in tax accounting method resulting in the deferral of approximately $52,000 in revenue, thereby increasing the Company’s net operating loss carryforward. This increase in the net operating loss will result in approximately $21,000 of reduced future tax payments in 2012 and 2013.

On August 29, 2012, Hurricane Isaac made landfall in southern Louisiana. Although impacted by the event, the Company’s corporate headquarters building and its New Orleans funeral homes and cemeteries were able to restore operations shortly thereafter. The Company’s buildings and operations are insured against damages resulting from such events subject to standard deductibles.

As of August 31, 2012, the fair market value of the Company’s preneed funeral and cemetery merchandise and services trusts and cemetery perpetual care trusts increased 1.2 percent, or approximately $10,449, from July 31, 2012.

Subsequent to July 31, 2012 through August 31, 2012, the Company purchased an additional 465,499 shares of its Class A common stock for approximately $3,222 at an average price of $6.92 per share. As of August 31, 2012, there is a $21,543 remaining available under the Company’s $125,000 stock repurchase program.

XML

Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts' Corpus (Details 1) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Less:
Trust Assets at Market Value	$ 588,973
Pending withdrawals	(12,091)
Pending deposits	3,265
Perpetual care trusts' corpus	257,706	238,980
Perpetual Care Trusts' Corpus [Member]
Less:
Trust Assets at Market Value	259,440
Pending withdrawals	(2,083)
Pending deposits	349
Perpetual care trusts' corpus	$ 257,706

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011
Cash flows from operating activities:
Net earnings	$ 26,919	$ 30,028
Adjustments to reconcile net earnings to net cash provided by operating activities:
Net loss on dispositions	539	389
Loss on early extinguishment of debt		(1,884)
Non-cash restructuring charge	1,236
Premiums paid on early extinguishment of debt		(850)
Depreciation and amortization	19,859	20,308
Non-cash interest and amortization of discount on senior convertible notes	4,127	3,957
Provision for doubtful accounts	3,041	3,859
Share-based compensation	2,630	2,275
Excess tax benefits from share-based payment arrangements	(23)	(154)
Provision for deferred income taxes	6,935	16,566
Estimated obligation to fund cemetery perpetual care trust	567	72
Other	90	(206)
Changes in assets and liabilities:
Increase in receivables	(7,380)	(14,014)
Increase in prepaid expenses	(1,165)	(1,359)
Increase in inventories and cemetery property	(5,636)	(2,844)
Federal income tax refunds		1,698
Increase (decrease) in accounts payable and accrued expenses	1,307	(2,029)
Net effect of preneed funeral production and maturities:
Decrease in preneed funeral receivables and trust investments	1,703	4,683
Increase (decrease) in deferred preneed funeral revenue	503	(4,082)
Decrease in deferred preneed funeral receipts held in trust	(2,959)	(1,098)
Net effect of preneed cemetery production and deliveries:
(Increase) decrease in preneed cemetery receivables and trust investments	409	(5,342)
Increase (decrease) in deferred preneed cemetery revenue	6,398	(1,503)
Increase (decrease) in deferred preneed cemetery receipts held in trust	(695)	8,959
Increase (decrease) in other	334	(730)
Net cash provided by operating activities	58,739	60,467
Cash flows from investing activities:
Proceeds from sales of certificates of deposit and marketable securities and release of restricted funds	2,006	10,000
Deposits of restricted funds and purchases of restricted cash equivalents and marketable securities	(2,036)	(6,912)
Proceeds from sale of assets	533	332
Purchase of subsidiaries and other investments, net of cash acquired	(3,113)	(9,110)
Additions to property and equipment	(16,215)	(15,688)
Other	87	103
Net cash used in investing activities	(18,738)	(21,275)
Cash flows from financing activities:
Proceeds from long term debt		200,000
Repayments of long-term debt	(4)	(200,004)
Debt refinancing costs	(34)	(5,933)
Issuance of common stock	1,433	1,386
Purchase and retirement of common stock	(19,075)	(15,622)
Dividends	(9,955)	(8,662)
Excess tax benefits from share-based payment arrangements	23	154
Net cash used in financing activities	(27,612)	(28,681)
Net increase in cash	12,389	10,511
Cash and cash equivalents, beginning of period	65,688	56,060
Cash and cash equivalents, end of period	78,077	66,571
Cash paid during the period for:
Income taxes, net	2,542	2,215
Interest	11,452	13,613
Non-cash investing and financing activities:
Issuance of common stock to directors	437	456
Issuance of restricted stock, net of forfeitures	$ 1,084	$ 924

XML

Condensed Consolidated Balance Sheets (Unaudited) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Current assets:
Cash and cash equivalents	$ 78,077	$ 65,688
Restricted cash and cash equivalents	6,250	6,250
Marketable securities	727	662
Receivables, net of allowances	50,379	49,146
Inventories	36,384	35,859
Prepaid expenses	6,220	5,055
Deferred income taxes, net	17,624	29,768
Total current assets	195,661	192,428
Receivables due beyond one year, net of allowances	70,929	67,979
Preneed funeral receivables and trust investments	428,604	409,296
Preneed cemetery receivables and trust investments	220,629	216,582
Goodwill	249,584	247,038
Cemetery property, at cost	400,697	396,014
Property and equipment, at cost:
Land	47,652	46,538
Buildings	356,651	353,688
Equipment and other	203,022	197,766
Total property and equipment, at cost	607,325	597,992
Less accumulated depreciation	318,258	305,708
Net property and equipment	289,067	292,284
Deferred income taxes, net	85,110	79,793
Cemetery perpetual care trust investments	259,440	240,392
Other assets	14,153	15,292
Total assets	2,213,874	2,157,098
Current liabilities:
Current maturities of long-term debt	6	5
Accounts payable and accrued expenses	21,539	24,547
Accrued payroll and other benefits	19,417	18,181
Accrued insurance	22,452	22,398
Accrued interest	4,310	2,129
Estimated obligation to fund cemetery perpetual care trust	12,064	12,017
Other current liabilities	9,733	10,013
Income taxes payable	4,074	1,173
Total current liabilities	93,595	90,463
Long-term debt, less current maturities	320,850	317,821
Deferred income taxes, net	5,509	5,104
Deferred preneed funeral revenue	240,648	240,286
Deferred preneed cemetery revenue	265,635	259,237
Deferred preneed funeral and cemetery receipts held in trust	580,147	558,194
Perpetual care trusts' corpus	257,706	238,980
Other long-term liabilities	20,427	19,337
Total liabilities	1,784,517	1,729,422
Commitments and contingencies
Shareholders' equity:
Preferred stock, $1.00 par value, 5,000,000 shares authorized; no shares issued
Common stock, $1.00 stated value:
Common stock, value	85,836	87,976
Additional paid-in capital	492,153	515,274
Accumulated deficit	(148,673)	(175,592)
Accumulated other comprehensive income:
Unrealized appreciation of investments	41	18
Total accumulated other comprehensive income	41	18
Total shareholders' equity	429,357	427,676
Total liabilities and shareholders' equity	2,213,874	2,157,098
Common Class A
Common stock, $1.00 stated value:
Common stock, value	82,281	84,421
Common Class B
Common stock, $1.00 stated value:
Common stock, value	$ 3,555	$ 3,555

XML

Supplementary Information

9 Months Ended

Jul. 31, 2012

Supplementary Information [Abstract]

Supplementary Information

(10) Supplementary Information

The detail of certain income statement accounts is as follows for the three and nine months ended July 31, 2012 and 2011.

	Three Months Ended July 31,				Nine Months Ended July 31,
	2012		2011		2012		2011
Service revenue
Funeral	$	47,688	$	47,078	$	146,675	$	146,096
Cemetery		14,459		14,642		45,706		45,266
		62,147		61,720		192,381		191,362
Merchandise revenue
Funeral		19,333		19,816		61,265		63,808
Cemetery		42,781		37,479		117,514		112,031
		62,114		57,295		178,779		175,839
Other revenue
Funeral		1,862		1,867		5,706		5,697
Cemetery		3,116		3,475		9,795		10,388
		4,978		5,342		15,501		16,085
Total revenue	$	129,239	$	124,357	$	386,661	$	383,286
Service costs
Funeral	$	16,535	$	16,722	$	50,032	$	48,838
Cemetery		11,024		11,313		31,891		32,084
		27,559		28,035		81,923		80,922
Merchandise costs
Funeral		13,292		13,414		41,216		41,650
Cemetery		24,181		23,197		70,266		69,981
		37,473		36,611		111,482		111,631
Facility expenses
Funeral		23,301		24,244		69,437		72,296
Cemetery		13,920		13,715		42,299		42,689
		37,221		37,959		111,736		114,985
Total costs	$	102,253	$	102,605	$	305,141	$	307,538

Service revenue includes funeral service revenue, funeral trust earnings, insurance commission revenue, burial site openings and closings and perpetual care trust earnings. Merchandise revenue includes funeral merchandise revenue, flower sales, cemetery property sales revenue, cemetery merchandise delivery revenue and merchandise trust earnings. Other revenue consists of finance charge revenue and trust management fees. Service costs include the direct costs associated with service revenue and preneed selling costs associated with preneed service sales. Merchandise costs include the direct costs associated with merchandise revenue and preneed selling costs associated with preneed merchandise sales.

XML

Document and Entity Information	9 Months Ended
	Jul. 31, 2012	Aug. 31, 2012 Common Class A	Aug. 31, 2012 Common Class B
Entity Registrant Name	STEWART ENTERPRISES INC
Entity Central Index Key	0000878522
Document Type	10-Q
Document Period End Date	Jul. 31, 2012
Amendment Flag	false
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--10-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		81,828,448	3,555,020

XML

Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes

9 Months Ended

Jul. 31, 2012

Guarantors of Senior Notes and Senior Convertible Notes [Abstract]

Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes

(11) Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes

The following tables present the condensed consolidating historical financial statements as of July 31, 2012 and October 31, 2011 and for the three and nine months ended July 31, 2012 and 2011, for the direct and indirect domestic subsidiaries of the Company that serve as guarantors of the Company’s 6.50 percent senior notes and its 3.125 percent and 3.375 percent senior convertible notes, and the financial results of the Company’s subsidiaries that do not serve as guarantors. Non-guarantor subsidiaries of the 6.50 percent senior notes and senior convertible notes include the Puerto Rican subsidiaries, Investors Trust, Inc. and certain immaterial domestic subsidiaries, which are not 100 percent owned, or are prohibited by law from guaranteeing the 6.50 percent senior notes and senior convertible notes. The guarantor subsidiaries of the 6.50 percent senior notes and senior convertible notes are 100 percent-owned directly or indirectly by the Company. The guarantees are full and unconditional and joint and several. In the condensed consolidating statements of earnings and other comprehensive income, corporate general and administrative expenses and interest expense of the parent are presented net of amounts charged to the guarantor and non-guarantor subsidiaries.

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Three Months Ended July 31, 2012
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	63,813		$	5,070		$	—		$	68,883
Cemetery		—			54,252			6,104			—			60,356
		—			118,065			11,174			—			129,239
Costs and expenses:
Funeral		—			49,452			3,676			—			53,128
Cemetery		—			44,372			4,753			—			49,125
		—			93,824			8,429			—			102,253
Gross profit		—			24,241			2,745			—			26,986
Corporate general and administrative expenses		(7,326	)		—			—			—			(7,326	)
Restructuring and other charges		(305	)		—			—			—			(305	)
Other operating income, net		10			126			55			—			191
Operating earnings (loss)		(7,621	)		24,367			2,800			—			19,546
Interest expense		(1,869	)		(3,669	)		(335	)		—			(5,873	)
Investment and other income, net		57			—			—			—			57
Equity in subsidiaries		15,417			607			—			(16,024	)		—
Earnings from continuing operations before income taxes		5,984			21,305			2,465			(16,024	)		13,730
Income tax expense (benefit)		(3,654	)		6,411			1,077			—			3,834
Earnings from continuing operations		9,638			14,894			1,388			(16,024	)		9,896
Discontinued operations:
Loss from discontinued operations before income taxes		—			(380	)		—			—			(380	)
Income tax benefit		—			(122	)		—			—			(122	)
Loss from discontinued operations		—			(258	)		—			—			(258	)
Net earnings		9,638			14,636			1,388			(16,024	)		9,638
Other comprehensive income, net		15			—			15			(15	)		15
Comprehensive income	$	9,653		$	14,636		$	1,403		$	(16,039	)	$	9,653

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Three Months Ended July 31, 2011
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	63,745		$	5,016		$	—		$	68,761
Cemetery		—			49,599			5,997			—			55,596
		—			113,344			11,013			—			124,357
Costs and expenses:
Funeral		—			51,102			3,278			—			54,380
Cemetery		—			43,764			4,461			—			48,225
		—			94,866			7,739			—			102,605
Gross profit		—			18,478			3,274			—			21,752
Corporate general and administrative expenses		(6,704	)		—			—			—			(6,704	)
Hurricane related recoveries, net		4,174			6,683			1,492			—			12,349
Net gain on dispositions		—			11			—			—			11
Other operating income, net		13			419			80			—			512
Operating earnings (loss)		(2,517	)		25,591			4,846			—			27,920
Interest expense		(764	)		(4,247	)		(489	)		—			(5,500	)
Loss on early extinguishment of debt		(73	)		—			—			—			(73	)
Investment and other income, net		30			—			—			—			30
Equity in subsidiaries		12,156			218			—			(12,374	)		—
Earnings from continuing operations before income taxes		8,832			21,562			4,357			(12,374	)		22,377
Income tax expense (benefit)		(3,154	)		11,605			1,695			—			10,146
Earnings from continuing operations		11,986			9,957			2,662			(12,374	)		12,231
Discontinued operations:
Loss from discontinued operations before income taxes		—			(365	)		—			—			(365	)
Income tax benefit		—			(120	)		—			—			(120	)
Loss from discontinued operations		—			(245	)		—			—			(245	)
Net earnings		11,986			9,712			2,662			(12,374	)		11,986
Other comprehensive loss, net		(3	)		—			(3	)		3			(3	)
Comprehensive income	$	11,983		$	9,712		$	2,659		$	(12,371	)	$	11,983

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Nine Months Ended July 31, 2012
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	198,789		$	14,857		$	—		$	213,646
Cemetery		—			155,460			17,555			—			173,015
		—			354,249			32,412			—			386,661
Costs and expenses:
Funeral		—			150,421			10,264			—			160,685
Cemetery		—			131,144			13,312			—			144,456
		—			281,565			23,576			—			305,141
Gross profit		—			72,684			8,836			—			81,520
Corporate general and administrative expenses		(20,264	)		—			—			—			(20,264	)
Restructuring and other charges		(1,616	)		(1,071	)		(165	)		—			(2,852	)
Net gain on dispositions		—			332			—			—			332
Other operating income, net		67			529			177			—			773
Operating earnings (loss)		(21,813	)		72,474			8,848			—			59,509
Interest expense		(5,212	)		(11,296	)		(1,036	)		—			(17,544	)
Investment and other income, net		148			—			—			—			148
Equity in subsidiaries		42,487			1,161			—			(43,648	)		—
Earnings from continuing operations before income taxes		15,610			62,339			7,812			(43,648	)		42,113
Income tax expense (benefit)		(11,309	)		22,224			2,858			—			13,773
Earnings from continuing operations		26,919			40,115			4,954			(43,648	)		28,340
Discontinued operations:
Loss from discontinued operations before income taxes		—			(2,065	)		—			—			(2,065	)
Income tax benefit		—			(644	)		—			—			(644	)
Loss from discontinued operations		—			(1,421	)		—			—			(1,421	)
Net earnings		26,919			38,694			4,954			(43,648	)		26,919
Other comprehensive income, net		23			—			23			(23	)		23
Comprehensive income	$	26,942		$	38,694		$	4,977		$	(43,671	)	$	26,942

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Nine Months Ended July 31, 2011
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	200,353		$	15,248		$	—		$	215,601
Cemetery		—			149,980			17,705			—			167,685
		—			350,333			32,953			—			383,286
Costs and expenses:
Funeral		—			152,849			9,935			—			162,784
Cemetery		—			131,239			13,515			—			144,754
		—			284,088			23,450			—			307,538
Gross profit		—			66,245			9,503			—			75,748
Corporate general and administrative expenses		(19,548	)		—			—			—			(19,548	)
Hurricane related recoveries, net		4,070			6,683			1,492			—			12,245
Net loss on dispositions		—			(389	)		—			—			(389	)
Other operating income, net		141			853			199			—			1,193
Operating earnings (loss)		(15,337	)		73,392			11,194			—			69,249
Interest expense		(2,599	)		(12,968	)		(1,401	)		—			(16,968	)
Loss on early extinguishment of debt		(1,884	)		—			—			—			(1,884	)
Investment and other income, net		394			—			—			—			394
Equity in subsidiaries		36,718			605			—			(37,323	)		—
Earnings from continuing operations before income taxes		17,292			61,029			9,793			(37,323	)		50,791
Income tax expense (benefit)		(12,736	)		26,458			6,540			—			20,262
Earnings from continuing operations		30,028			34,571			3,253			(37,323	)		30,529
Discontinued operations:
Loss from discontinued operations before income taxes		—			(810	)		—			—			(810	)
Income tax benefit		—			(309	)		—			—			(309	)
Loss from discontinued operations		—			(501	)		—			—			(501	)
Net earnings		30,028			34,070			3,253			(37,323	)		30,028
Other comprehensive income, net		6			—			6			(6	)		6
Comprehensive income	$	30,034		$	34,070		$	3,259		$	(37,329	)	$	30,034

Condensed Consolidating Balance Sheets

	July 31, 2012
	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	75,361	$	1,164	$	1,552	$	—		$	78,077
Restricted cash and cash equivalents		6,250		—		—		—			6,250
Marketable securities		—		—		727		—			727
Receivables, net of allowances		1,838		41,770		6,771		—			50,379
Inventories		203		33,599		2,582		—			36,384
Prepaid expenses		1,569		2,983		1,668		—			6,220
Deferred income taxes, net		3,000		13,612		1,012		—			17,624
Intercompany receivables		1,457		—		—		(1,457	)		—
Total current assets		89,678		93,128		14,312		(1,457	)		195,661
Receivables due beyond one year, net of allowances		—		59,314		11,615		—			70,929
Preneed funeral receivables and trust investments		—		419,159		9,445		—			428,604
Preneed cemetery receivables and trust investments		—		213,535		7,094		—			220,629
Goodwill		—		229,749		19,835		—			249,584
Cemetery property, at cost		—		364,886		35,811		—			400,697
Property and equipment, at cost		62,707		500,030		44,588		—			607,325
Less accumulated depreciation		49,459		248,300		20,499		—			318,258
Net property and equipment		13,248		251,730		24,089		—			289,067
Deferred income taxes, net		8,564		69,615		6,931		—			85,110
Cemetery perpetual care trust investments		—		245,639		13,801		—			259,440
Other assets		8,566		4,434		1,153		—			14,153
Intercompany receivables		629,010		—		—		(629,010	)		—
Equity in subsidiaries		38,062		11,141		—		(49,203	)		—
Total assets	$	787,128	$	1,962,330	$	144,086	$	(679,670	)	$	2,213,874
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current maturities of long-term debt	$	6	$	—	$	—	$	—		$	6
Accounts payable, accrued expenses and other current liabilities		17,974		71,312		4,303		—			93,589
Intercompany payables		—		—		1,457		(1,457	)		—
Total current liabilities		17,980		71,312		5,760		(1,457	)		93,595
Long-term debt, less current maturities		320,850		—		—		—			320,850
Deferred income taxes, net		—		4,929		580		—			5,509
Intercompany payables		—		615,339		13,671		(629,010	)		—
Deferred preneed funeral revenue		—		193,683		46,965		—			240,648
Deferred preneed cemetery revenue		—		236,478		29,157		—			265,635
Deferred preneed funeral and cemetery receipts held in trust		—		571,984		8,163		—			580,147
Perpetual care trusts’ corpus		—		243,921		13,785		—			257,706
Other long-term liabilities		18,941		1,486		—		—			20,427
Total liabilities		357,771		1,939,132		118,081		(630,467	)		1,784,517
Common stock		85,836		102		376		(478	)		85,836
Other		343,480		23,096		25,588		(48,684	)		343,480
Accumulated other comprehensive income		41		—		41		(41	)		41
Total shareholders’ equity		429,357		23,198		26,005		(49,203	)		429,357
Total liabilities and shareholders’ equity	$	787,128	$	1,962,330	$	144,086	$	(679,670	)	$	2,213,874

Condensed Consolidating Balance Sheets

	October 31, 2011
	Parent		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	62,388	$	1,937		$	1,363	$	—		$	65,688
Restricted cash and cash equivalents		6,250		—			—		—			6,250
Marketable securities		—		—			662		—			662
Receivables, net of allowances		2,040		40,405			6,701		—			49,146
Inventories		318		32,926			2,615		—			35,859
Prepaid expenses		1,214		2,289			1,552		—			5,055
Deferred income taxes, net		14,815		13,696			1,257		—			29,768
Intercompany receivables		1,762		—			—		(1,762	)		—
Total current assets		88,787		91,253			14,150		(1,762	)		192,428
Receivables due beyond one year, net of allowances		—		55,847			12,132		—			67,979
Preneed funeral receivables and trust investments		—		399,731			9,565		—			409,296
Preneed cemetery receivables and trust investments		—		209,284			7,298		—			216,582
Goodwill		—		227,203			19,835		—			247,038
Cemetery property, at cost		—		359,678			36,336		—			396,014
Property and equipment, at cost		59,688		495,089			43,215		—			597,992
Less accumulated depreciation		45,705		240,906			19,097		—			305,708
Net property and equipment		13,983		254,183			24,118		—			292,284
Deferred income taxes, net		4,947		68,939			5,907		—			79,793
Cemetery perpetual care trust investments		—		227,428			12,964		—			240,392
Other assets		9,539		4,728			1,025		—			15,292
Intercompany receivables		660,246		—			—		(660,246	)		—
Equity in subsidiaries		15,812		9,980			—		(25,792	)		—
Total assets	$	793,314	$	1,908,254		$	143,330	$	(687,800	)	$	2,157,098
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current maturities of long-term debt	$	5	$	—		$	—	$	—		$	5
Accounts payable, accrued expenses and other current liabilities		14,320		71,505			4,633		—			90,458
Intercompany payables		—		—			1,762		(1,762	)		—
Total current liabilities		14,325		71,505			6,395		(1,762	)		90,463
Long-term debt, less current maturities		317,821		—			—		—			317,821
Deferred income taxes, net		—		4,521			583		—			5,104
Intercompany payables		—		646,588			13,658		(660,246	)		—
Deferred preneed funeral revenue		—		193,452			46,834		—			240,286
Deferred preneed cemetery revenue		—		230,291			28,946		—			259,237
Deferred preneed funeral and cemetery receipts held in trust		—		550,010			8,184		—			558,194
Perpetual care trusts’ corpus		—		226,042			12,938		—			238,980
Other long-term liabilities		17,996		1,341			—		—			19,337
Negative equity in subsidiaries		15,496		—			—		(15,496	)		—
Total liabilities		365,638		1,923,750			117,538		(677,504	)		1,729,422
Common stock		87,976		102			376		(478	)		87,976
Other		339,682		(15,598	)		25,398		(9,800	)		339,682
Accumulated other comprehensive income		18		—			18		(18	)		18
Total shareholders’ equity		427,676		(15,496	)		25,792		(10,296	)		427,676
Total liabilities and shareholders’ equity	$	793,314	$	1,908,254		$	143,330	$	(687,800	)	$	2,157,098

Condensed Consolidating Statements of Cash Flows

	Nine Months Ended July 31, 2012
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Net cash provided by operating activities	$	7,049		$	45,188		$	6,502		$	—	$	58,739
Cash flows from investing activities:
Proceeds from sales of marketable securities and release of restricted funds		1,756			—			250			—		2,006
Deposits of restricted funds and purchases of marketable securities		(1,756	)		—			(280	)		—		(2,036	)
Proceeds from sale of assets		—			533			—			—		533
Purchase of subsidiaries and other investments, net of cash acquired		(100	)		(3,013	)		—			—		(3,113	)
Additions to property and equipment		(2,669	)		(12,319	)		(1,227	)		—		(16,215	)
Other		—			87			—			—		87
Net cash used in investing activities		(2,769	)		(14,712	)		(1,257	)		—		(18,738	)
Cash flows from financing activities:
Repayments of long-term debt		(4	)		—			—			—		(4	)
Intercompany receivables (payables)		36,305			(31,249	)		(5,056	)		—		—
Debt refinancing costs		(34	)		—			—			—		(34	)
Issuance of common stock		1,433			—			—			—		1,433
Purchase and retirement of common stock		(19,075	)		—			—			—		(19,075	)
Dividends		(9,955	)		—			—			—		(9,955	)
Excess tax benefits from share-based payment arrangements		23			—			—			—		23
Net cash provided by (used in) financing activities		8,693			(31,249	)		(5,056	)		—		(27,612	)
Net increase (decrease) in cash		12,973			(773	)		189			—		12,389
Cash and cash equivalents, beginning of period		62,388			1,937			1,363			—		65,688
Cash and cash equivalents, end of period	$	75,361		$	1,164		$	1,552		$	—	$	78,077

Condensed Consolidating Statements of Cash Flows

	Nine Months Ended July 31, 2011
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Net cash provided by operating activities	$	13,590		$	41,931		$	4,946		$	—	$	60,467
Cash flows from investing activities:
Proceeds from sales of certificates of deposit		10,000			—			—			—		10,000
Purchases of restricted cash equivalents and marketable securities		(6,250	)		—			(662	)		—		(6,912	)
Proceeds from sale of assets		—			332			—			—		332
Purchase of subsidiaries, net of cash acquired		—			(9,110	)		—			—		(9,110	)
Additions to property and equipment		(1,730	)		(12,920	)		(1,038	)		—		(15,688	)
Other		—			103			—			—		103
Net cash provided by (used in) investing activities		2,020			(21,595	)		(1,700	)		—		(21,275	)
Cash flows from financing activities:
Proceeds from long-term debt		200,000			—			—			—		200,000
Repayments of long-term debt		(200,004	)		—			—			—		(200,004	)
Intercompany receivables (payables)		16,249			(12,429	)		(3,820	)		—		—
Debt refinancing costs		(5,933	)		—			—			—		(5,933	)
Issuance of common stock		1,386			—			—			—		1,386
Purchase and retirement of common stock		(15,622	)		—			—			—		(15,622	)
Dividends		(8,662	)		—			—			—		(8,662	)
Excess tax benefits from share based payment arrangements		154			—			—			—		154
Net cash used in financing activities		(12,432	)		(12,429	)		(3,820	)		—		(28,681	)
Net increase (decrease) in cash		3,178			7,907			(574	)		—		10,511
Cash and cash equivalents, beginning of period		48,270			6,055			1,735			—		56,060
Cash and cash equivalents, end of period	$	51,448		$	13,962		$	1,161		$	—	$	66,571

XML

Condensed Consolidated Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Details 2) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011
Condensed Consolidated Statements of Cash Flows [Abstract]
Net cash provided by operating activities	$ 58,739	$ 60,467
Cash flows from investing activities:
Proceeds from sales of certificates of deposit and marketable securities and release of restricted funds	2,006	10,000
Deposits of restricted funds and purchases of restricted cash equivalents and marketable securities	(2,036)	(6,912)
Proceeds from sale of assets	533	332
Purchase of subsidiaries and other investments, net of cash acquired	(3,113)	(9,110)
Additions to property and equipment	(16,215)	(15,688)
Other	87	103
Net cash used in investing activities	(18,738)	(21,275)
Cash flows from financing activities:
Proceeds from long term debt		200,000
Repayments of long-term debt	(4)	(200,004)
Debt refinancing costs	(34)	(5,933)
Issuance of common stock	1,433	1,386
Purchase and retirement of common stock	(19,075)	(15,622)
Dividends	(9,955)	(8,662)
Excess tax benefits from share-based payment arrangements	23	154
Net cash used in financing activities	(27,612)	(28,681)
Net increase in cash	12,389	10,511
Cash and cash equivalents, beginning of period	65,688	56,060
Cash and cash equivalents, end of period	78,077	66,571
Parent [Member]
Condensed Consolidated Statements of Cash Flows [Abstract]
Net cash provided by operating activities	7,049	13,590
Cash flows from investing activities:
Proceeds from sales of certificates of deposit and marketable securities and release of restricted funds	1,756	10,000
Deposits of restricted funds and purchases of restricted cash equivalents and marketable securities	(1,756)	(6,250)
Purchase of subsidiaries and other investments, net of cash acquired	(100)
Additions to property and equipment	(2,669)	(1,730)
Net cash used in investing activities	(2,769)	2,020
Cash flows from financing activities:
Proceeds from long term debt		200,000
Repayments of long-term debt	(4)	(200,004)
Intercompany receivables (payables)	36,305	16,249
Debt refinancing costs	(34)	(5,933)
Issuance of common stock	1,433	1,386
Purchase and retirement of common stock	(19,075)	(15,622)
Dividends	(9,955)	(8,662)
Excess tax benefits from share-based payment arrangements	23	154
Net cash used in financing activities	8,693	(12,432)
Net increase in cash	12,973	3,178
Cash and cash equivalents, beginning of period	62,388	48,270
Cash and cash equivalents, end of period	75,361	51,448
Guarantor Subsidiaries [Member]
Condensed Consolidated Statements of Cash Flows [Abstract]
Net cash provided by operating activities	45,188	41,931
Cash flows from investing activities:
Proceeds from sale of assets	533	332
Purchase of subsidiaries and other investments, net of cash acquired	(3,013)	(9,110)
Additions to property and equipment	(12,319)	(12,920)
Other	(87)	(103)
Net cash used in investing activities	(14,712)	(21,595)
Cash flows from financing activities:
Intercompany receivables (payables)	(31,249)	(12,429)
Net cash used in financing activities	(31,249)	(12,429)
Net increase in cash	(773)	7,907
Cash and cash equivalents, beginning of period	1,937	6,055
Cash and cash equivalents, end of period	1,164	13,962
Non-Guarantor Subsidiaries [Member]
Condensed Consolidated Statements of Cash Flows [Abstract]
Net cash provided by operating activities	6,502	4,946
Cash flows from investing activities:
Proceeds from sales of certificates of deposit and marketable securities and release of restricted funds	250
Deposits of restricted funds and purchases of restricted cash equivalents and marketable securities	(280)	(662)
Additions to property and equipment	(1,227)	(1,038)
Net cash used in investing activities	(1,257)	(1,700)
Cash flows from financing activities:
Intercompany receivables (payables)	(5,056)	(3,820)
Net cash used in financing activities	(5,056)	(3,820)
Net increase in cash	189	(574)
Cash and cash equivalents, beginning of period	1,363	1,735
Cash and cash equivalents, end of period	1,552	1,161
Eliminations [Member]
Condensed Consolidated Statements of Cash Flows [Abstract]
Net cash provided by operating activities
Cash flows from investing activities:
Proceeds from sales of certificates of deposit and marketable securities and release of restricted funds
Deposits of restricted funds and purchases of restricted cash equivalents and marketable securities
Proceeds from sale of assets
Purchase of subsidiaries and other investments, net of cash acquired
Additions to property and equipment
Other
Net cash used in investing activities
Cash flows from financing activities:
Proceeds from long term debt
Repayments of long-term debt
Intercompany receivables (payables)
Debt refinancing costs
Issuance of common stock
Purchase and retirement of common stock
Dividends
Excess tax benefits from share-based payment arrangements
Net cash used in financing activities
Net increase in cash
Cash and cash equivalents, beginning of period
Cash and cash equivalents, end of period

XML

Subsequent Events (Details Textual) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	9 Months Ended
	Aug. 31, 2012	Jul. 31, 2012
Subsequent Events (Textual) [Abstract]
Change in Preneed Funeral and Cemetery Merchandise and Services Trusts and Cemetery Perpetual Care Trusts, in Percentage	1.20%
Fair market value of preneed funeral & cemetery merchandise & service trusts and perpetual care trusts	$ 10,449
Number of Shares Repurchased During the Period		2,942,840
Purchase of Shares, Value for the Period		18,994
Aggregate value of stock repurchase program	125,000
Remaining under stock repurchase program	21,543	24,765
Reduction in future tax payment	21,000
Deferred Revenue [Member]
Subsequent Events (Textual) [Abstract]
Deferred Revenue, due to change in tax accounting	52,000
Common Class A [Member]
Subsequent Events (Textual) [Abstract]
Number of Shares Repurchased During the Period	465,499
Average Price per Share	$ 6.92
Purchase of Shares, Value for the Period	$ 3,222

XML

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $)	Jul. 31, 2012	Oct. 31, 2011
Preferred stock, par value	$ 1.00	$ 1.00
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued
Common stock, shares issued	82,281,000	84,421,000
Common Class A
Common stock, stated value	$ 1.00	$ 1.00
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	82,281,197	84,421,416
Common stock, shares outstanding	82,281,197	84,421,416
Common Class B
Common stock, stated value	$ 1.00	$ 1.00
Common stock, shares authorized	5,000,000	5,000,000
Common stock, shares issued	3,555,020,000	3,555,020,000
Common stock, shares outstanding	3,555,020	3,555,020
Per share convertible into class A shares	10	10

XML

Cemetery Interment Rights and Perpetual Care Trusts

9 Months Ended

Jul. 31, 2012

Cemetery Interment Rights and Perpetual Care Trusts [Abstract]

Cemetery Interment Rights and Perpetual Care Trusts

(5) Cemetery Interment Rights and Perpetual Care Trusts

Earnings from cemetery perpetual care trust investments that the Company is legally permitted to withdraw are recognized as current cemetery revenues and are used to defray cemetery maintenance costs which are expensed as incurred. Recognized earnings related to these cemetery perpetual care trust investments were $1,815 and $1,988 for the three months ended July 31, 2012 and 2011, respectively, and $7,098 and $5,981 for the nine months ended July 31, 2012 and 2011, respectively.

The cost basis and market values of the trust investments held by the cemetery perpetual care trusts as of July 31, 2012 are detailed below.

	July 31, 2012
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	15,359	$	—	$	—		$	15,359
U.S. Government, agencies and municipalities		5,643		265		(63	)		5,845
Corporate bonds		25,837		1,212		(874	)		26,175
Preferred stocks		33,519		438		(2,662	)		31,295
Common stocks		91,967		2,894		(19,905	)		74,956
Mutual funds:
Equity		15,001		1,115		(583	)		15,533
Fixed income		73,758		1,768		(1,178	)		74,348
Commodity		5,727		4		(471	)		5,260
Real estate investment trusts		8,818		866		—			9,684
Other long-term investments		98		—		(51	)		47
Trust investments	$	275,727	$	8,562	$	(25,787	)	$	258,502
Market value as a percentage of cost										93.8	%
Accrued investment income									938
Trust assets								$	259,440

The estimated maturities and market values of debt securities included above are as follows:

	July 31, 2012
Due in one year or less	$	4,689
Due in one to five years		14,339
Due in five to ten years		8,826
Thereafter		4,166
	$	32,020

The cost basis and market values of the trust investments held by the cemetery perpetual care trusts as of October 31, 2011 are detailed below.

	October 31, 2011
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	20,654	$	—	$	—		$	20,654
U.S. Government, agencies and municipalities		6,928		375		(57	)		7,246
Corporate bonds		27,166		1,044		(876	)		27,334
Preferred stocks		38,211		155		(6,927	)		31,439
Common stocks		82,750		1,751		(24,410	)		60,091
Mutual funds:
Equity		13,478		601		(807	)		13,272
Fixed income		61,740		706		(1,990	)		60,456
Commodity		6		5		—			11
Real estate investment trusts		8,834		6		(210	)		8,630
Master limited partnerships		10,248		16		(61	)		10,203
Other long-term investments		277		—		(12	)		265
Trust investments	$	270,292	$	4,659	$	(35,350	)	$	239,601
Market value as a percentage of cost										88.6	%
Accrued investment income									791
Trust assets								$	240,392

The Company periodically manages a covered call program on its equity securities within the cemetery perpetual care trust in order to provide an opportunity for additional income. As of July 31, 2012 and October 31, 2011, the Company had outstanding covered calls with a market value of $170 and $0, respectively. Covered calls are included at market value in the balance sheet line “cemetery perpetual care trust investments.” For the three months ended July 31, 2012 and 2011, the Company realized trust earnings of approximately $73 and $37, respectively, related to the covered call program. For the nine months ended July 31, 2012 and 2011, the Company realized trust earnings (losses) of approximately $147 and ($81), respectively, related to the covered call program. These trust earnings and losses are accounted for in the same manner as other cemetery perpetual care trust earnings and losses and flow through cemetery revenue in the condensed consolidated statements of earnings. Although the Company realized losses associated with the covered call program for the nine months ended July 31, 2011, it continued to hold the underlying securities against which these covered calls were issued; these underlying securities appreciated in value by $700 for the nine months ended July 31, 2011.

Where quoted prices are available in an active market, investments held by the trusts are classified as Level 1 investments pursuant to the three-level valuation hierarchy. The Company’s Level 1 investments include cash, money market and other short-term investments, common stocks and mutual funds.

Where quoted market prices are not available for the specific security, then fair values are estimated by using quoted prices of securities with similar characteristics. These investments are primarily U. S. Government, agencies and municipalities, corporate bonds, convertible bonds and preferred stocks, all of which are classified within Level 2 of the valuation hierarchy.

The Company’s Level 3 investments include an investment in a partnership. The valuation of partnership investments requires significant management judgment due to the absence of quoted prices, inherent lack of liquidity and the long-term nature of such assets. The fair market value of the partnership investment was determined by using its most recent audited financial statements and assessing the market value of the underlying securities within the partnership.

The inputs into the fair value of the Company’s cemetery perpetual care trust investments are categorized as follows:

	Quoted Market Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Market Value
Trust investments—July 31, 2012	$	195,140	$	63,315	$	47	$	258,502
Trust investments—October 31, 2011	$	173,317	$	66,236	$	48	$	239,601

The change in the Company’s preneed funeral merchandise and services trust investments with significant unobservable inputs (Level 3) is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Fair market value, beginning balance	$	48		$	88		$	48		$	88
Total unrealized losses included in other comprehensive income (1)		(1	)		(24	)		(1	)		(24	)
Fair market value, ending balance	$	47		$	64		$	47		$	64

⁽¹⁾  All gains (losses) recognized in other comprehensive income for perpetual care trust investments are attributable to the Company’s preneed customers and are offset by a corresponding increase (decrease) in perpetual care trusts’ corpus.

In states where the Company withdraws and recognizes capital gains in its cemetery perpetual care trusts, if it realizes subsequent net capital losses (i.e., losses in excess of capital gains in the trust) and the fair market value of the trust assets is less than the aggregate amounts required to be contributed to the trust, some states may require the Company to make cash deposits to the trusts or may require the Company to stop withdrawing earnings until future earnings restore the initial corpus. As of July 31, 2012 and October 31, 2011, the Company had a liability recorded for the estimated probable funding obligation to restore the net realized losses of $12,064 and $12,017, respectively. The Company recorded an additional $567 and $72 for the estimated probable funding obligation to restore the net realized losses in the cemetery perpetual care trust for the nine months ended July 31, 2012 and 2011, respectively. The additional funding obligation in fiscal year 2012 is related to the bankruptcy of Eastman Kodak. The Company had earnings of $520 and $918 for the nine months ended July 31, 2012 and 2011, within the trusts that it did not withdraw from the trusts in order to satisfy a portion of its estimated probable funding obligation. In those states where realized net capital gains have not been withdrawn, the Company believes it is reasonably possible but not probable that additional funding obligations may exist with an estimated amount of $2,006; no charge has been recorded for these amounts as of July 31, 2012.

Activity related to preneed cemetery perpetual care trust investments is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Purchases	$	19,529		$	29,705		$	83,809		$	110,949
Sales		18,313			27,560			75,211			80,094
Realized gains from sales of investments		660			1,112			4,715			2,044
Realized losses from sales of investments and other		(963	)		(72	)		(2,902	)		(510	)
Interest income, dividends and other ordinary income		2,523			2,171			7,958			7,495
Deposits		2,180			2,024			6,849			5,424
Withdrawals		2,299			1,374			7,211			5,018

During the three months ended July 31, 2012 and 2011, cemetery revenues were $60,356 and $55,596, respectively, of which $2,373 and $2,334, respectively, were required to be placed into perpetual care trusts and were recorded as revenues and expenses. During the nine months ended July 31, 2012 and 2011, cemetery revenues were $173,015 and $167,685, respectively, of which $6,701 and $6,640, respectively, were required to be placed into perpetual care trusts and were recorded as revenues and costs.

The following tables show the gross unrealized losses and fair value of the cemetery perpetual care trust investments with unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of July 31, 2012 and October 31, 2011.

	July 31, 2012
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	—	$	—		$	61	$	(63	)	$	61	$	(63	)
Corporate bonds		2,445		(173	)		1,674		(701	)		4,119		(874	)
Preferred stocks		2,255		(58	)		15,051		(2,604	)		17,306		(2,662	)
Common stocks		6,519		(184	)		38,021		(19,721	)		44,540		(19,905	)
Mutual funds:
Equity		1,011		(43	)		1,076		(540	)		2,087		(583	)
Fixed income		8,772		(224	)		16,745		(954	)		25,517		(1,178	)
Commodity		5,243		(471	)		—		—			5,243		(471	)
Other long-term investments		—		—			47		(51	)		47		(51	)
Total	$	26,245	$	(1,153	)	$	72,675	$	(24,634	)	$	98,920	$	(25,787	)

	October 31, 2011
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	213	$	(1	)	$	71	$	(56	)	$	284	$	(57	)
Corporate bonds		5,959		(150	)		1,341		(726	)		7,300		(876	)
Preferred stocks		3,611		(91	)		20,921		(6,836	)		24,532		(6,927	)
Common stocks		1,027		(108	)		50,539		(24,302	)		51,566		(24,410	)
Mutual funds:
Equity		106		(113	)		1,967		(694	)		2,073		(807	)
Fixed income		39,397		(1,742	)		1,606		(248	)		41,003		(1,990	)
Real estate investment trusts		7,659		(210	)		—		—			7,659		(210	)
Master limited partnerships		7,936		(61	)		—		—			7,936		(61	)
Other long-term investments		—		—			48		(12	)		48		(12	)
Total	$	65,908	$	(2,476	)	$	76,493	$	(32,874	)	$	142,401	$	(35,350	)

The unrealized losses in the cemetery perpetual care trust portfolio are not considered to be other than temporary. For a discussion of the Company’s policies for determining whether a security is other-than-temporarily impaired, see Note 2(k) to the consolidated financial statements in the Company’s 2011 Form 10-K. Of the total unrealized losses at July 31, 2012, 87 percent, or $22,567, were generated by common stock and preferred stock investments. Most of the common stock investments are part of the S&P 500 Index, and all preferred stocks had a rating of investment grade at the time of purchase. The Company generally expects its portfolio performance to improve if the performance of the overall financial market improves, but would also expect its performance to deteriorate if the overall financial market declines. The Company believes it has the intent and ability to hold these investments until they recover in value.

Cash flows from cemetery perpetual care contracts are presented as operating cash flows in the Company’s condensed consolidated statements of cash flows.

XML

Preneed Cemetery Merchandise and Service Activities

9 Months Ended

Jul. 31, 2012

Preneed Cemetery Merchandise and Service Activities [Abstract]

Preneed Cemetery Merchandise and Service Activities

(4) Preneed Cemetery Merchandise and Service Activities

Preneed Cemetery Receivables and Trust Investments

Preneed cemetery receivables and trust investments represent trust assets and customer receivables for contracts sold in advance of when the merchandise or service is needed. The receivables related to the sale of preneed property interment rights are included in the Company’s current and long-term receivables. The components of preneed cemetery receivables and trust investments in the condensed consolidated balance sheets as of July 31, 2012 and October 31, 2011 are as follows:

	July 31, 2012			October 31, 2011
Trust assets	$	193,710		$	189,678
Receivables from customers		29,057			30,270
		222,767			219,948
Allowance for cancellations		(2,138	)		(3,366	)
Preneed cemetery receivables and trust investments	$	220,629		$	216,582

The cost basis and market values associated with the preneed cemetery merchandise and services trust assets as of July 31, 2012 are detailed below.

	July 31, 2012
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	9,065	$	—	$	—		$	9,065
U.S. Government, agencies and municipalities		1,883		127		—			2,010
Corporate bonds		2,006		143		(3	)		2,146
Preferred stocks		12,540		146		(292	)		12,394
Common stocks		107,520		942		(29,350	)		79,112
Mutual funds:
Equity		23,526		108		(7,068	)		16,566
Fixed income		53,870		1,106		(312	)		54,664
Commodity		8,693		—		(1,970	)		6,723
Master limited partnerships		6,797		—		(132	)		6,665
Real estate investment trusts		2,986		54		—			3,040
Other long-term investments		637		—		—			637
Trust investments	$	229,523	$	2,626	$	(39,127	)	$	193,022
Market value as a percentage of cost										84.1	%
Accrued investment income									688
Trust assets								$	193,710

The estimated maturities and market values of debt securities included above are as follows:

	July 31, 2012
Due in one year or less	$	103
Due in one to five years		2,244
Due in five to ten years		1,397
Thereafter		412
	$	4,156

The cost basis and market values associated with the preneed cemetery merchandise and services trust assets as of October 31, 2011 are detailed below.

	October 31, 2011
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	9,844	$	—	$	—		$	9,844
U.S. Government, agencies and municipalities		2,052		90		(2	)		2,140
Corporate bonds		2,596		131		(3	)		2,724
Preferred stocks		12,518		66		(1,662	)		10,922
Common stocks		112,010		920		(32,761	)		80,169
Mutual funds:
Equity		25,374		348		(6,791	)		18,931
Fixed income		46,258		305		(586	)		45,977
Commodity		8,780		—		(892	)		7,888
Real estate investment trusts		9,866		74		(193	)		9,747
Master limited partnerships		97		—		(2	)		95
Other long-term investments		596		—		—			596
Trust investments	$	229,991	$	1,934	$	(42,892	)	$	189,033
Market value as a percentage of cost										82.2	%
Accrued investment income									645
Trust assets								$	189,678

The Company periodically manages a covered call program on its equity securities within the preneed cemetery merchandise and services trust in order to provide an opportunity for additional income. As of July 31, 2012 and October 31, 2011, the Company had outstanding covered calls with a market value of $152 and $0, respectively. Covered calls are included at market value in the balance sheet line “preneed cemetery receivables and trust investments.” For the three months ended July 31, 2012 and 2011, the Company realized trust earnings of approximately $89 and $61, respectively, related to the covered call program. For the nine months ended July 31, 2012 and 2011, the Company realized trust earnings (losses) of $203 and ($69), respectively, related to the covered call program. These trust earnings and losses are accounted for in the same manner as other cemetery merchandise and services trust earnings and losses and flow through cemetery revenue in the condensed consolidated statements of earnings. Although the Company realized losses associated with the covered call program for the nine months ended July 31, 2011, it continued to hold the underlying securities against which these covered calls were issued; these underlying securities appreciated in value by $732 for the nine months ended July 31, 2011.

Where quoted prices are available in an active market, investments held by the trusts are classified as Level 1 investments pursuant to the three-level valuation hierarchy. The Company’s Level 1 investments include cash, money market and other short-term investments, common stocks and mutual funds.

Where quoted market prices are not available for the specific security, then fair values are estimated by using quoted prices of securities with similar characteristics. These investments are U. S. Government, agencies and municipalities, corporate bonds, convertible bonds and preferred stocks, all of which are classified within Level 2 of the valuation hierarchy.

There are no Level 3 investments in the preneed cemetery merchandise and services trust investment portfolio.

The inputs into the fair value of the Company’s preneed cemetery merchandise and services trust investments are categorized as follows:

	Quoted Market Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Market Value
Trust investments—July 31, 2012	$	176,321	$	16,701	$	—	$	193,022
Trust investments—October 31, 2011	$	173,127	$	15,906	$	—	$	189,033

Activity related to preneed cemetery merchandise and services trust investments is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Purchases	$	17,953		$	27,460		$	29,186		$	79,354
Sales		5,480			27,557			31,144			75,330
Realized gains from sales of investments		653			2,165			3,001			5,488
Realized losses from sales of investments and other		(176	)		(658	)		(381	)		(1,207	)
Interest income, dividends and other ordinary income		1,978			1,897			6,285			5,307
Deposits		4,127			4,451			12,769			12,459
Withdrawals		8,601			5,341			19,847			14,813

The following tables show the gross unrealized losses and fair value of the preneed cemetery merchandise and services trust investments aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of July 31, 2012 and October 31, 2011.

	July 31, 2012
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
Corporate bonds	$	56	$	(3	)	$	—	$	—		$	56	$	(3	)
Preferred stocks		587		(13	)		5,889		(279	)		6,476		(292	)
Common stocks		13,197		(1,050	)		51,323		(28,300	)		64,520		(29,350	)
Mutual funds:
Equity		—		—			12,910		(7,068	)		12,910		(7,068	)
Fixed income		10,722		(311	)		1,590		(1	)		12,312		(312	)
Commodity		2,403		(285	)		4,320		(1,685	)		6,723		(1,970	)
Master limited partnerships		6,665		(132	)		—		—			6,665		(132	)
Total	$	33,630	$	(1,794	)	$	76,032	$	(37,333	)	$	109,662	$	(39,127	)

	October 31, 2011
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	313	$	(2	)	$	—	$	—		$	313	$	(2	)
Corporate bonds		117		(3	)		—		—			117		(3	)
Preferred stocks		—		—			7,609		(1,662	)		7,609		(1,662	)
Common stocks		5,385		(707	)		59,506		(32,054	)		64,891		(32,761	)
Mutual funds:
Equity		—		—			14,376		(6,791	)		14,376		(6,791	)
Fixed income		34,325		(586	)		—		—			34,325		(586	)
Commodity		7,887		(892	)		—		—			7,887		(892	)
Real estate investment trusts		5,775		(193	)		—		—			5,775		(193	)
Master limited partnerships		—		—			95		(2	)		95		(2	)
Total	$	53,802	$	(2,383	)	$	81,586	$	(40,509	)	$	135,388	$	(42,892	)

The unrealized losses in the preneed cemetery merchandise and services trust portfolio are not considered to be other than temporary. For a discussion of the Company’s policies for determining whether a security is other-than-temporarily impaired, see Note 2(k) to the consolidated financial statements in the Company’s 2011 Form 10-K. Of the total unrealized losses at July 31, 2012, 93 percent, or $36,418, were generated by common stock and mutual fund-equity investments. Most of the common stock investments are part of the S&P 500 Index, and the mutual fund-equity investments are invested in small-cap, mid-cap and international mutual funds that are highly diversified. The Company generally expects its portfolio performance to improve if the performance of the overall financial market improves, but would also expect its performance to deteriorate if the overall financial market declines. The Company believes it has the intent and ability to hold these investments until they recover in value.

The Company’s policy for recognizing trust income follows the allocation of trust earnings to individual contracts as stipulated in the Company’s respective trust agreements. In substantially all of the Company’s trusts, trust earnings, which include dividends and interest earned and net capital gains and losses (including losses from other-than-temporary impairments of securities) realized by preneed cemetery trust or escrow accounts net of fees, are allocated to individual contracts as earned or realized. In these trusts, unrealized gains and losses are not allocated to the underlying contracts. The trust earnings allocated to individual contracts are recognized as components of revenue along with the original contract sales price when the underlying service or merchandise is actually performed or delivered. Principal and earnings are withdrawn only as the merchandise or services are delivered or contracts are cancelled, except in jurisdictions that permit trust earnings to be withdrawn currently.

Cash flows from preneed cemetery merchandise and services contracts are presented as operating cash flows in the Company’s condensed consolidated statements of cash flows.

XML

Income Taxes

9 Months Ended

Jul. 31, 2012

Income Taxes [Abstract]

Income Taxes

(16) Income Taxes

Income tax expense for the three and nine months ended July 31, 2012 was positively impacted by $1,125 and $2,075, respectively, overall reductions in the tax valuation allowance due to the reduction of a portion of the valuation allowance related to capital losses associated with the Company’s trust portfolio, as a result of the positive performance of the portfolio during those periods. Realized capital losses in the trusts for which the Company is the grantor, in which insufficient offsetting capital gains are expected, can require the Company to record a valuation allowance against the related deferred tax asset (capital loss carryforward). Reductions in the valuation allowance result when the Company realizes capital gains, which has been the case for the three and nine months ended July 31, 2012. As of July 31, 2012, the Company had a $2,900 valuation allowance remaining on $6,905 of realized capital losses.

In January 2011, the government of Puerto Rico signed into law corporate tax rate changes that decreased the top tax rate for businesses from 39 percent to 30 percent. The Company will benefit from this reduced rate when paying taxes in the future. However, as a result of this change, the Company was required to revalue its previously recorded Puerto Rican-related deferred tax asset using the 30 percent current top tax rate. During the nine months ended July 31, 2011, the Company recorded a one-time, non-cash charge of $2,915 ($4,484 charge less a federal tax benefit of $1,569) in order to decrease the Puerto Rican deferred tax asset balance. The Puerto Rican deferred tax asset balance decreased from approximately $19,427 at the previously required 39 percent tax rate to approximately $14,943 at the newly-enacted 30 percent tax rate. This change in deferred tax assets increased the Company’s income tax expense for the nine months ended July 31, 2011 by $2,915. Income tax expense for the three months ended July 31, 2011 was impacted by a $1,625 increase in the tax valuation allowance for capital losses. Income tax expense for the nine months ended July 31, 2011 was also positively impacted by a $1,812 overall reduction in the tax valuation allowance primarily due to the reduction in the portion of the valuation allowance related to capital losses associated with the Company’s trust portfolio, as a result of the positive performance of the portfolio during that period.

XML

Acquisitions and Dispositions

9 Months Ended

Jul. 31, 2012

Acquisitions and Dispositions [Abstract]

Acquisitions and Dispositions

(12) Acquisitions and Dispositions

Acquisitions

During the nine months ended July 31, 2012, the Company acquired a new funeral business for approximately $3,013. This acquisition was accounted for under the purchase method, and the acquired assets and liabilities (primarily goodwill of approximately $2,564 and property, plant and equipment of approximately $670) were valued at their estimated fair values. The results of operations for this business, which are considered immaterial, have been included in consolidated results since the acquisition date.

Dispositions

During the nine months ended July 31, 2012 and 2011, the Company recorded net gains (losses) on dispositions of $332 and ($389), respectively. The amount recorded for the nine months ended July 31, 2012 includes a $343 net gain on disposition due to the sale of a funeral home.

In April 2012, the Company designated a business as held for sale, recorded impairment charges related to the business and classified its operations as discontinued operations for all periods presented. The Company recorded net losses on dispositions of $31 and $871 in discontinued operations during the three and nine months ended July 31, 2012, respectively. The loss from discontinued operations before income taxes for the three months ended July 31, 2012 and 2011 were $380 and $365, respectively, and for the nine months ended July 31, 2012 and 2011 were $2,065 and $810, respectively.

Goodwill and changes to goodwill by operating segment from October 31, 2011 to July 31, 2012 is presented below:

	October 31, 2011		Changes			July 31, 2012
Funeral	$	198,317	$	2,546	(1)	$	200,863
Cemetery		48,721		—			48,721
Total	$	247,038	$	2,546		$	249,584

^{(1 )}  The change is due to the purchase of a funeral home and the sale of a funeral home during the nine months ended July 31, 2012.

XML

Comprehensive Income (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Consolidated comprehensive income
Net earnings	$ 9,638	$ 11,986	$ 26,919	$ 30,028
Other comprehensive income (loss):
Unrealized appreciation (depreciation) of investments, net of deferred tax (expense) benefit of ($9),$2,($13) and ($3), respectively	15	(3)	23	6
(Increase) reduction in net unrealized losses associated with available-for-sale securities of the trusts	3,737	(31,772)	39,080	11,209
Reclassification of the net unrealized losses activity attributable to the deferred preneed funeral and cemetery receipts held in trust and perpetual care trusts' corpus	(3,737)	31,772	(39,080)	(11,209)
Total other comprehensive income (loss)	15	(3)	23	6
Total comprehensive income	9,653	11,983	26,942	30,034
Comprehensive Income (Textual) [Abstract]
Deferred Tax (Expense) Benefit on Investments	$ (9)	$ 2	$ 13	$ (3)

XML

Reconciliation of Basic and Diluted Per Share Data

9 Months Ended

Jul. 31, 2012

Reconciliation of Basic and Diluted Per Share Data [Abstract]

Reconciliation of Basic and Diluted Per Share Data

(8) Reconciliation of Basic and Diluted Per Share Data

	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Three Months Ended July 31, 2012
Earnings from continuing operations	$	9,896
Allocation of earnings to nonvested restricted stock		(87	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	9,809			85,798	$	.11
Effect of dilutive securities:
Stock options assumed exercised					380
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	9,809			86,178	$	.11
	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Three Months Ended July 31, 2011
Earnings from continuing operations	$	12,231
Allocation of earnings to nonvested restricted stock		(105	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	12,126			90,182	$	.13
Effect of dilutive securities:
Stock options assumed exercised					559
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	12,126			90,741	$	.13
	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Nine Months Ended July 31, 2012
Earnings from continuing operations	$	28,340
Allocation of earnings to nonvested restricted stock		(251	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	28,089			86,295	$	.32
Effect of dilutive securities:
Stock options assumed exercised					324
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	28,089			86,619	$	.32

	Earnings (Numerator)			Shares (Denominator)		Per Share Data
Nine Months Ended July 31, 2011
Earnings from continuing operations	$	30,529
Allocation of earnings to nonvested restricted stock		(267	)
Basic earnings per common share:
Earnings from continuing operations available to common shareholders	$	30,262			90,497	$	.33
Effect of dilutive securities:
Stock options assumed exercised					561
Diluted earnings per common share:
Earnings from continuing operations available to common shareholders plus stock options assumed exercised	$	30,262			91,058	$	.33

During the three months ended July 31, 2012, options to purchase 390,290 shares of common stock at prices ranging from $6.83 to $8.47 per share were outstanding but were not included in the computation of diluted earnings per share because the exercise prices of the options were greater than the average market price of the common shares for that period. Additionally, weighted-average shares outstanding for the three months ended July 31, 2012 exclude the effect of approximately 2,140,192 options because such options were not dilutive. These options expire between January 8, 2014 and May 5, 2022.

During the nine months ended July 31, 2012, options to purchase 877,683 shares of common stock at prices ranging from $6.33 to $8.47 per share were outstanding but were not included in the computation of diluted earnings per share because the exercise prices of the options were greater than the average market price of the common shares for that period. Additionally, weighted-average shares outstanding for the nine months ended July 31, 2012 exclude the effect of approximately 1,936,384 options because such options were not dilutive. These options expire between January 8, 2014 and December 6, 2021.

Options to purchase 435,253 shares of common stock at prices ranging from $7.57 to $8.47 per share for the three months ended July 31, 2011 and options to purchase 500,573 shares of common stock at prices ranging from $7.31 to $8.47 per share for the nine months ended July 31, 2011 were outstanding but were not included in the computation of diluted earnings per share because the exercise prices of the options were greater than the average market price of the common shares for those periods. Additionally, weighted average shares outstanding for the three months ended July 31, 2011 exclude the effect of approximately 1,086,000 options because such options were not dilutive.

For the three and nine months ended July 31, 2012, all of the outstanding 94,500 market based stock options were dilutive as the respective market conditions had been previously achieved. For the three and nine months ended July 31, 2011, all of the outstanding 214,500 market based stock options were dilutive as the respective market conditions had been previously achieved.

For the three and nine months ended July 31, 2012, a maximum of 13,153,500 shares of the Company’s Class A common stock related to the senior convertible notes and a maximum of 10,637,882 shares of Class A common stock under the common stock warrants associated with the June 2007 senior convertible debt transaction were not dilutive, as the average prices of the Company’s stock for the three and nine months ended July 31, 2012

were less than the conversion price of the senior convertible notes and the strike price of the warrants. For the three and nine months ended July 31, 2011, a maximum of 13,153,500 shares of the Company’s Class A common stock related to the senior convertible notes and a maximum of 10,522,798 shares of Class A common stock under the associated common stock warrants were also not dilutive.

The Company includes Class A and Class B common stock in its diluted shares calculation. As of July 31, 2012, the Company’s Chairman, Frank B. Stewart, Jr., was the record holder of all of the Company’s shares of Class B common stock. The Company’s Class A and B common stock are substantially identical, except that holders of Class A common stock are entitled to one vote per share, and holders of Class B common stock are entitled to ten votes per share. Each share of Class B common stock is automatically converted into one share of Class A common stock upon transfer to persons other than certain affiliates of Frank B. Stewart, Jr.

XML

Cemetery Interment Rights and Perpetual Care Trusts (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Oct. 31, 2011	Jul. 31, 2012
Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	$ 270,292	$ 275,727
Available for Sale Securities, Gross Unrealized Gains	4,659	8,562
Available-for-sale Securities, Gross Unrealized Losses	(35,350)	(25,787)
Available for Sale Securities, Fair Value	239,601	258,502
Market Value as a Percentage of Cost	88.60%	93.80%
Accrued investment income	791	938
Trust Assets	240,392	259,440
Cash, money market and other short- term investments [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	20,654	15,359
Available for Sale Securities, Fair Value	20,654	15,359
U.S. Government, agencies and municipalities [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	6,928	5,643
Available for Sale Securities, Gross Unrealized Gains	375	265
Available-for-sale Securities, Gross Unrealized Losses	(57)	(63)
Available for Sale Securities, Fair Value	7,246	5,845
Corporate bonds [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	27,166	25,837
Available for Sale Securities, Gross Unrealized Gains	1,044	1,212
Available-for-sale Securities, Gross Unrealized Losses	(876)	(874)
Available for Sale Securities, Fair Value	27,334	26,175
Preferred stocks [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	38,211	33,519
Available for Sale Securities, Gross Unrealized Gains	155	438
Available-for-sale Securities, Gross Unrealized Losses	(6,927)	(2,662)
Available for Sale Securities, Fair Value	31,439	31,295
Common Stocks [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	82,750	91,967
Available for Sale Securities, Gross Unrealized Gains	1,751	2,894
Available-for-sale Securities, Gross Unrealized Losses	(24,410)	(19,905)
Available for Sale Securities, Fair Value	60,091	74,956
Mutual Funds [Member] | Equity [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	13,478	15,001
Available for Sale Securities, Gross Unrealized Gains	601	1,115
Available-for-sale Securities, Gross Unrealized Losses	(807)	(583)
Available for Sale Securities, Fair Value	13,272	15,533
Mutual Funds [Member] | Fixed Income [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	61,740	73,758
Available for Sale Securities, Gross Unrealized Gains	706	1,768
Available-for-sale Securities, Gross Unrealized Losses	(1,990)	(1,178)
Available for Sale Securities, Fair Value	60,456	74,348
Mutual Funds [Member] | Commodity [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	6	5,727
Available for Sale Securities, Gross Unrealized Gains	5	4
Available-for-sale Securities, Gross Unrealized Losses		(471)
Available for Sale Securities, Fair Value	11	5,260
Mutual Funds [Member] | Real estate investment trusts [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	8,834	8,818
Available for Sale Securities, Gross Unrealized Gains	6	866
Available-for-sale Securities, Gross Unrealized Losses	(210)
Available for Sale Securities, Fair Value	8,630	9,684
Mutual Funds [Member] | Master limited partnerships [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis		2,860
Available-for-sale Securities, Gross Unrealized Losses		56
Available for Sale Securities, Fair Value		2,804
Mutual Funds [Member] | Master limited partnerships [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	10,248
Available for Sale Securities, Gross Unrealized Gains	16
Available-for-sale Securities, Gross Unrealized Losses	(61)
Available for Sale Securities, Fair Value	10,203
Other long-term investments [Member] | Cemetery perpetual care trust [Member]
Schedule of Available for Sale Securities
Available for Sale Securities, Amortized Cost Basis	277	98
Available-for-sale Securities, Gross Unrealized Losses	(12)	(51)
Available for Sale Securities, Fair Value	$ 265	$ 47

XML

Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts' Corpus

9 Months Ended

Jul. 31, 2012

Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts' Corpus [Abstract]

Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts' Corpus

(6) Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts’ Corpus

The components of deferred preneed funeral and cemetery receipts held in trust in the condensed consolidated balance sheet at July 31, 2012 are as follows:

	Deferred Receipts Held in Trust
	Preneed      Funeral			Preneed     Cemetery			Total
Trust assets at market value	$	395,263		$	193,710		$	588,973
Less:
Pending withdrawals		(6,290	)		(5,801	)		(12,091	)
Pending deposits		2,059			1,206			3,265
Deferred receipts held in trust	$	391,032		$	189,115		$	580,147

The components of perpetual care trusts’ corpus in the condensed consolidated balance sheet at July 31, 2012 are as follows:

	Perpetual Care Trusts’ Corpus
Trust assets at market value	$	259,440
Less:
Pending withdrawals		(2,083	)
Pending deposits		349
Perpetual care trusts’ corpus	$	257,706

Investment and other income, net

The components of investment and other income, net in the condensed consolidated statements of earnings for the three and nine months ended July 31, 2012 and 2011 are detailed below.

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Realized gains from sales of investments	$	2,633		$	6,335		$	12,207		$	14,999
Realized losses from sales of investments and other		(2,744	)		(2,065	)		(5,992	)		(3,732	)
Interest income, dividends and other ordinary income		7,453			7,175			25,157			22,722
Trust expenses and income taxes		(2,966	)		(2,808	)		(8,792	)		(7,737	)
Net trust investment income		4,376			8,637			22,580			26,252
Reclassification to deferred preneed funeral and cemetery receipts held in trust		(3,112	)		(6,319	)		(15,802	)		(19,876	)
Reclassification to perpetual care trusts’ corpus		(1,264	)		(2,318	)		(6,778	)		(6,376	)
Total deferred preneed funeral and cemetery receipts held in trust and perpetual care trusts’ corpus		—			—			—			—
Investment and other income, net (1)		57			30			148			394
Total investment and other income, net	$	57		$	30		$	148		$	394

⁽¹⁾  Investment and other income, net generally consists of interest income primarily on the Company’s cash, cash equivalents and marketable securities not held in trust. For the nine months ended July 31, 2011, the balance includes approximately $327 of interest income related to the resolution of an audit by the Internal Revenue Service.

XML

Commitments and Contingencies

9 Months Ended

Jul. 31, 2012

Commitments and Contingencies [Abstract]

Commitments and Contingencies

(7) Commitments and Contingencies

Litigation

The Company is a defendant in a variety of litigation matters that have arisen in the ordinary course of business, which are covered by insurance or otherwise not considered to be material. The Company carries insurance with coverages and coverage limits that it believes to be adequate.

Other Commitments and Contingencies

In those states where the Company has withdrawn realized net capital gains in the past from its cemetery perpetual care trusts, regulators may seek replenishment of subsequent realized net capital losses either by requiring a cash deposit to the trust or by prohibiting or restricting withdrawals of future earnings until they cover the loss. As of July 31, 2012, the Company had $12,064 recorded as a liability for the estimated probable funding obligation. As of July 31, 2012, the Company had net unrealized losses of approximately $28,243 in the cemetery perpetual care trusts in these states that could be subject to a future funding obligation. Because some of these trusts currently have assets with a fair market value less than the aggregate amounts required to be contributed to the trust, any additional realized net capital losses in these trusts may result in an additional corresponding funding liability and increase in cemetery costs.

From time to time, contracts are presented to the Company relating to contracts sold prior to the time the Company acquired certain businesses and for which the Company was previously unaware. In addition, from time to time, the Company has identified in its backlog, certain contracts in which services or merchandise have previously been delivered but the revenue was not yet recognized. Using historical trends and statistical analyses, the Company has recorded an estimated net debit (credit) for these items of approximately $0.3 million and ($2.0) million as of July 31, 2012 and October 31, 2011, respectively.

The Company is required to maintain a bond ($23,456 as of July 31, 2012) to guarantee its obligations relating to funds the Company withdrew in fiscal year 2001 from its preneed funeral trusts in Florida. This amount would become senior secured debt if the Company was required to borrow funds under the senior secured revolving credit facility and return to the trusts the amounts it previously withdrew that relate to the remaining undelivered preneed contracts in lieu of this bond.

During the second quarter of fiscal year 2012, the Company entered into an agreement to purchase within a year the land and building of an existing business that it currently leases for $2,800.

XML

Segment Data

9 Months Ended

Jul. 31, 2012

Segment Data [Abstract]

Segment Data

(9) Segment Data

The Company has determined that management’s approach to operating the business indicates that there are three operating and reportable segments: a funeral segment, a cemetery segment and a corporate trust management segment. The Company does not aggregate its operating segments. Therefore, its operating and reportable segments are the same. The tables below present information about reported segments for the three and nine months ended July 31, 2012 and 2011 for the Company’s continuing operations.

	Total Revenue				Total Revenue
	Three Months Ended July 31, 2012		Three Months Ended July 31, 2011		Nine Months Ended July 31, 2012		Nine Months Ended July  31, 2011
Funeral	$	65,468	$	64,846	$	201,960	$	203,254
Cemetery (1)		57,918		53,544		165,809		161,370
Corporate Trust Management (2)		5,853		5,967		18,892		18,662
Total	$	129,239	$	124,357	$	386,661	$	383,286

	Total Gross Profit				Total Gross Profit
	Three Months Ended July 31, 2012		Three Months Ended July 31, 2011		Nine Months Ended July 31, 2012		Nine Months Ended July  31, 2011
Funeral	$	12,628	$	10,703	$	41,973	$	41,139
Cemetery (1)		9,061		5,544		22,019		17,255
Corporate Trust Management (2)		5,297		5,505		17,528		17,354
Total	$	26,986	$	21,752	$	81,520	$	75,748

⁽¹⁾  Perpetual care trust earnings are included in the revenues and gross profit of the cemetery segment and amounted to $1,815 and $1,988 for the three months ended July 31, 2012 and 2011, respectively, and $7,098 and $5,981 for the nine months ended July 31, 2012 and 2011, respectively.

^{(2 )}  Corporate trust management consists of trust management fees and funeral and cemetery merchandise and service trust earnings recognized with respect to preneed contracts delivered during the period. Trust management fees are established by the Company at rates consistent with industry norms based on the fair market value of the assets managed and are paid by the trusts to the Company’s subsidiary, Investors Trust, Inc. The trust earnings represent the amount of distributable earnings as stipulated by the Company’s respective trust agreements that are generated by the trusts over the life of the preneed contracts and allocated to those products and services delivered during the relevant periods. Trust management fees included in funeral revenue for the three months ended July 31, 2012 and 2011 were $1,335 and $1,201, respectively, and funeral trust earnings recognized with respect to preneed contracts delivered included in funeral revenue for the three months ended July 31, 2012 and 2011 were $2,080 and $2,714, respectively. Trust management fees included in cemetery revenue for the three months ended July 31, 2012 and 2011 were $1,555 and $1,349, respectively, and cemetery trust earnings recognized with respect to preneed contracts delivered included in cemetery revenue for the three months ended July 31, 2012 and 2011 were $883 and $703, respectively.

Trust management fees included in funeral revenue for the nine months ended July 31, 2012 and 2011 were $3,993 and $3,614, respectively, and funeral trust earnings for the nine months ended July 31, 2012 and 2011 were $7,693 and $8,733, respectively. Trust management fees included in cemetery revenue for the nine months ended July 31, 2012 and 2011 were $4,649 and $4,000, respectively, and cemetery trust earnings for the nine months ended July 31, 2012 and 2011 were $2,557 and $2,315, respectively.

A reconciliation of total segment gross profit to total earnings from continuing operations before income taxes for the three and nine months ended July 31, 2012 and 2011 is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Gross profit for reportable segments	$	26,986		$	21,752		$	81,520		$	75,748
Corporate general and administrative expenses		(7,326	)		(6,704	)		(20,264	)		(19,548	)
Restructuring and other charges		(305	)		—			(2,852	)		—
Hurricane related recoveries, net		—			12,349			—			12,245
Net gain (loss) on dispositions		—			11			332			(389	)
Other operating income, net		191			512			773			1,193
Interest expense		(5,873	)		(5,500	)		(17,544	)		(16,968	)
Loss on early extinguishment of debt		—			(73	)		—			(1,884	)
Investment and other income, net		57			30			148			394
Earnings from continuing operations before income taxes	$	13,730		$	22,377		$	42,113		$	50,791

The table below presents total net preneed merchandise and services sales for the three and nine months ended July 31, 2012 and 2011.

	Total Net Preneed Merchandise and Service Sales (1)				Total Net Preneed Merchandise and Service Sales (1)
	Three Months Ended July 31, 2012		Three Months Ended July 31, 2011		Nine Months Ended July 31, 2012		Nine Months Ended July 31, 2011
Funeral	$	28,013	$	26,283	$	79,714	$	70,287
Cemetery		12,949		13,162		38,109		37,380
Total	$	40,962	$	39,445	$	117,823	$	107,667

^{(1 )}  Preneed sales amounts represent total preneed funeral trust and insurance sales and cemetery service and merchandise trust sales generated in the applicable period, net of cancellations. Preneed funeral and cemetery merchandise and service sales are deferred until a future period and have no impact on current revenues.

XML

Cemetery Interment Rights and Perpetual Care Trusts (Details 4) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Investment Related Activities
Realized gains from sales of investments	$ 2,633	$ 6,335	$ 12,207	$ 14,999
Realized losses from sales of investments and other	(2,744)	(2,065)	(5,992)	(3,732)
Cemetery Perpetual Care Trust [Member]
Investment Related Activities
Purchases	19,529	29,705	83,809	110,949
Sales	18,313	27,560	75,211	80,094
Realized gains from sales of investments	660	1,112	4,715	2,044
Realized losses from sales of investments and other	(963)	(72)	(2,902)	(510)
Interest income, dividends and other ordinary income	2,523	2,171	7,958	7,495
Deposits	2,180	2,024	6,849	5,424
Withdrawals	$ 2,299	$ 1,374	$ 7,211	$ 5,018

XML

Restructuring and Other Charges (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Jul. 31, 2012	Jul. 31, 2012
Restructuring Cost and Reserve [Line Items]
Costs incurred	$ (305)	$ (2,852)
Cash payments		(1,527)
Non-cash items		(1,236)
Restructuring Liability, Total	89	89
Employee Termination on Costs [Member]
Restructuring Cost and Reserve [Line Items]
Costs incurred		990
Cash payments		(990)
Restructuring Liability, Total
Non-cash Asset Impairment and Other Costs[Member]
Restructuring Cost and Reserve [Line Items]
Costs incurred		1,862
Cash payments		(537)
Non-cash items		(1,236)
Restructuring Liability, Total	$ 89	$ 89

XML

Cemetery Interment Rights and Perpetual Care Trusts (Details Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011	Oct. 31, 2011
Cemetery Interment Rights and Perpetual Care Trusts (Textual) [Abstract]
Perpetual care trust earnings			$ 7,098	$ 5,981
Outstanding covered calls with market value	152		152		0
Available for Sale Securities Gross Realized Gain Loss Excluding Other Than Temporary Impairments	89	61	203	(69)
Estimated obligation to fund cemetery perpetual care trust	12,064		12,064		12,017
Cemetery	60,356	55,596	173,015	167,685
Cemetery perpetual care trust [Member]
Cemetery Interment Rights and Perpetual Care Trusts (Textual) [Abstract]
Outstanding covered calls with market value	170		170		0
Available for Sale Securities Gross Realized Gain Loss Excluding Other Than Temporary Impairments	73	37	147	(81)
Appreciation of securities underlying call options				700
Estimated obligation to fund cemetery perpetual care trust	12,064		12,064		12,017
Additional Net Realized Loss on Obligation			567	72
Trust earnings not withdrawn from the perpetual care trusts			520	918
Additional estimated funding obligation	2,006		2,006
Cemetery	60,356	55,596
Total unrealized losses , In Percentage			87.00%
Unrealized Losses of Investments Comprising Majority of total Unrealized Losses			22,567
Cemetery perpetual care trust [Member] | Investment Income [Member]
Cemetery Interment Rights and Perpetual Care Trusts (Textual) [Abstract]
Perpetual care trust earnings	1,815	1,988
Cemetery perpetual care trust [Member] | Perpetual Care Trust [Member]
Cemetery Interment Rights and Perpetual Care Trusts (Textual) [Abstract]
Perpetual Care and Trust Revenue and Expenses	$ 2,373	$ 2,334	$ 6,701	$ 6,640

XML

Cemetery Interment Rights and Perpetual Care Trusts (Details 3) (Significant Unobservable Inputs (Level 3) [Member], Cemetery Perpetual Care Trust [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Significant Unobservable Inputs (Level 3) [Member] | Cemetery Perpetual Care Trust [Member]
Fair Value Assets Measured on Recurring Basis Unobservable Input Reconciliation Calculation Roll Forward
Fair market value, beginning balance	$ 48	$ 88	$ 48	$ 88
Total unrealized losses included in other comprehensive income (1)	(1)	(24)	(1)	(24)
Fair market value, ending balance	$ 47	$ 64	$ 47	$ 64

XML

Condensed Consolidating Financial Statements of Guarantors of Senior Notes and Senior Convertible Notes (Tables)

9 Months Ended

Jul. 31, 2012

Guarantors of Senior Notes and Senior Convertible Notes [Abstract]

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Three Months Ended July 31, 2012
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	63,813		$	5,070		$	—		$	68,883
Cemetery		—			54,252			6,104			—			60,356
		—			118,065			11,174			—			129,239
Costs and expenses:
Funeral		—			49,452			3,676			—			53,128
Cemetery		—			44,372			4,753			—			49,125
		—			93,824			8,429			—			102,253
Gross profit		—			24,241			2,745			—			26,986
Corporate general and administrative expenses		(7,326	)		—			—			—			(7,326	)
Restructuring and other charges		(305	)		—			—			—			(305	)
Other operating income, net		10			126			55			—			191
Operating earnings (loss)		(7,621	)		24,367			2,800			—			19,546
Interest expense		(1,869	)		(3,669	)		(335	)		—			(5,873	)
Investment and other income, net		57			—			—			—			57
Equity in subsidiaries		15,417			607			—			(16,024	)		—
Earnings from continuing operations before income taxes		5,984			21,305			2,465			(16,024	)		13,730
Income tax expense (benefit)		(3,654	)		6,411			1,077			—			3,834
Earnings from continuing operations		9,638			14,894			1,388			(16,024	)		9,896
Discontinued operations:
Loss from discontinued operations before income taxes		—			(380	)		—			—			(380	)
Income tax benefit		—			(122	)		—			—			(122	)
Loss from discontinued operations		—			(258	)		—			—			(258	)
Net earnings		9,638			14,636			1,388			(16,024	)		9,638
Other comprehensive income, net		15			—			15			(15	)		15
Comprehensive income	$	9,653		$	14,636		$	1,403		$	(16,039	)	$	9,653

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Three Months Ended July 31, 2011
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	63,745		$	5,016		$	—		$	68,761
Cemetery		—			49,599			5,997			—			55,596
		—			113,344			11,013			—			124,357
Costs and expenses:
Funeral		—			51,102			3,278			—			54,380
Cemetery		—			43,764			4,461			—			48,225
		—			94,866			7,739			—			102,605
Gross profit		—			18,478			3,274			—			21,752
Corporate general and administrative expenses		(6,704	)		—			—			—			(6,704	)
Hurricane related recoveries, net		4,174			6,683			1,492			—			12,349
Net gain on dispositions		—			11			—			—			11
Other operating income, net		13			419			80			—			512
Operating earnings (loss)		(2,517	)		25,591			4,846			—			27,920
Interest expense		(764	)		(4,247	)		(489	)		—			(5,500	)
Loss on early extinguishment of debt		(73	)		—			—			—			(73	)
Investment and other income, net		30			—			—			—			30
Equity in subsidiaries		12,156			218			—			(12,374	)		—
Earnings from continuing operations before income taxes		8,832			21,562			4,357			(12,374	)		22,377
Income tax expense (benefit)		(3,154	)		11,605			1,695			—			10,146
Earnings from continuing operations		11,986			9,957			2,662			(12,374	)		12,231
Discontinued operations:
Loss from discontinued operations before income taxes		—			(365	)		—			—			(365	)
Income tax benefit		—			(120	)		—			—			(120	)
Loss from discontinued operations		—			(245	)		—			—			(245	)
Net earnings		11,986			9,712			2,662			(12,374	)		11,986
Other comprehensive loss, net		(3	)		—			(3	)		3			(3	)
Comprehensive income	$	11,983		$	9,712		$	2,659		$	(12,371	)	$	11,983

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Nine Months Ended July 31, 2012
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	198,789		$	14,857		$	—		$	213,646
Cemetery		—			155,460			17,555			—			173,015
		—			354,249			32,412			—			386,661
Costs and expenses:
Funeral		—			150,421			10,264			—			160,685
Cemetery		—			131,144			13,312			—			144,456
		—			281,565			23,576			—			305,141
Gross profit		—			72,684			8,836			—			81,520
Corporate general and administrative expenses		(20,264	)		—			—			—			(20,264	)
Restructuring and other charges		(1,616	)		(1,071	)		(165	)		—			(2,852	)
Net gain on dispositions		—			332			—			—			332
Other operating income, net		67			529			177			—			773
Operating earnings (loss)		(21,813	)		72,474			8,848			—			59,509
Interest expense		(5,212	)		(11,296	)		(1,036	)		—			(17,544	)
Investment and other income, net		148			—			—			—			148
Equity in subsidiaries		42,487			1,161			—			(43,648	)		—
Earnings from continuing operations before income taxes		15,610			62,339			7,812			(43,648	)		42,113
Income tax expense (benefit)		(11,309	)		22,224			2,858			—			13,773
Earnings from continuing operations		26,919			40,115			4,954			(43,648	)		28,340
Discontinued operations:
Loss from discontinued operations before income taxes		—			(2,065	)		—			—			(2,065	)
Income tax benefit		—			(644	)		—			—			(644	)
Loss from discontinued operations		—			(1,421	)		—			—			(1,421	)
Net earnings		26,919			38,694			4,954			(43,648	)		26,919
Other comprehensive income, net		23			—			23			(23	)		23
Comprehensive income	$	26,942		$	38,694		$	4,977		$	(43,671	)	$	26,942

Condensed Consolidating Statements of Earnings and Other Comprehensive Income

	Nine Months Ended July 31, 2011
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Funeral	$	—		$	200,353		$	15,248		$	—		$	215,601
Cemetery		—			149,980			17,705			—			167,685
		—			350,333			32,953			—			383,286
Costs and expenses:
Funeral		—			152,849			9,935			—			162,784
Cemetery		—			131,239			13,515			—			144,754
		—			284,088			23,450			—			307,538
Gross profit		—			66,245			9,503			—			75,748
Corporate general and administrative expenses		(19,548	)		—			—			—			(19,548	)
Hurricane related recoveries, net		4,070			6,683			1,492			—			12,245
Net loss on dispositions		—			(389	)		—			—			(389	)
Other operating income, net		141			853			199			—			1,193
Operating earnings (loss)		(15,337	)		73,392			11,194			—			69,249
Interest expense		(2,599	)		(12,968	)		(1,401	)		—			(16,968	)
Loss on early extinguishment of debt		(1,884	)		—			—			—			(1,884	)
Investment and other income, net		394			—			—			—			394
Equity in subsidiaries		36,718			605			—			(37,323	)		—
Earnings from continuing operations before income taxes		17,292			61,029			9,793			(37,323	)		50,791
Income tax expense (benefit)		(12,736	)		26,458			6,540			—			20,262
Earnings from continuing operations		30,028			34,571			3,253			(37,323	)		30,529
Discontinued operations:
Loss from discontinued operations before income taxes		—			(810	)		—			—			(810	)
Income tax benefit		—			(309	)		—			—			(309	)
Loss from discontinued operations		—			(501	)		—			—			(501	)
Net earnings		30,028			34,070			3,253			(37,323	)		30,028
Other comprehensive income, net		6			—			6			(6	)		6
Comprehensive income	$	30,034		$	34,070		$	3,259		$	(37,329	)	$	30,034

Condensed Consolidating Balance Sheets

Condensed Consolidating Balance Sheets

	July 31, 2012
	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	75,361	$	1,164	$	1,552	$	—		$	78,077
Restricted cash and cash equivalents		6,250		—		—		—			6,250
Marketable securities		—		—		727		—			727
Receivables, net of allowances		1,838		41,770		6,771		—			50,379
Inventories		203		33,599		2,582		—			36,384
Prepaid expenses		1,569		2,983		1,668		—			6,220
Deferred income taxes, net		3,000		13,612		1,012		—			17,624
Intercompany receivables		1,457		—		—		(1,457	)		—
Total current assets		89,678		93,128		14,312		(1,457	)		195,661
Receivables due beyond one year, net of allowances		—		59,314		11,615		—			70,929
Preneed funeral receivables and trust investments		—		419,159		9,445		—			428,604
Preneed cemetery receivables and trust investments		—		213,535		7,094		—			220,629
Goodwill		—		229,749		19,835		—			249,584
Cemetery property, at cost		—		364,886		35,811		—			400,697
Property and equipment, at cost		62,707		500,030		44,588		—			607,325
Less accumulated depreciation		49,459		248,300		20,499		—			318,258
Net property and equipment		13,248		251,730		24,089		—			289,067
Deferred income taxes, net		8,564		69,615		6,931		—			85,110
Cemetery perpetual care trust investments		—		245,639		13,801		—			259,440
Other assets		8,566		4,434		1,153		—			14,153
Intercompany receivables		629,010		—		—		(629,010	)		—
Equity in subsidiaries		38,062		11,141		—		(49,203	)		—
Total assets	$	787,128	$	1,962,330	$	144,086	$	(679,670	)	$	2,213,874
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current maturities of long-term debt	$	6	$	—	$	—	$	—		$	6
Accounts payable, accrued expenses and other current liabilities		17,974		71,312		4,303		—			93,589
Intercompany payables		—		—		1,457		(1,457	)		—
Total current liabilities		17,980		71,312		5,760		(1,457	)		93,595
Long-term debt, less current maturities		320,850		—		—		—			320,850
Deferred income taxes, net		—		4,929		580		—			5,509
Intercompany payables		—		615,339		13,671		(629,010	)		—
Deferred preneed funeral revenue		—		193,683		46,965		—			240,648
Deferred preneed cemetery revenue		—		236,478		29,157		—			265,635
Deferred preneed funeral and cemetery receipts held in trust		—		571,984		8,163		—			580,147
Perpetual care trusts’ corpus		—		243,921		13,785		—			257,706
Other long-term liabilities		18,941		1,486		—		—			20,427
Total liabilities		357,771		1,939,132		118,081		(630,467	)		1,784,517
Common stock		85,836		102		376		(478	)		85,836
Other		343,480		23,096		25,588		(48,684	)		343,480
Accumulated other comprehensive income		41		—		41		(41	)		41
Total shareholders’ equity		429,357		23,198		26,005		(49,203	)		429,357
Total liabilities and shareholders’ equity	$	787,128	$	1,962,330	$	144,086	$	(679,670	)	$	2,213,874

Condensed Consolidating Balance Sheets

	October 31, 2011
	Parent		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	62,388	$	1,937		$	1,363	$	—		$	65,688
Restricted cash and cash equivalents		6,250		—			—		—			6,250
Marketable securities		—		—			662		—			662
Receivables, net of allowances		2,040		40,405			6,701		—			49,146
Inventories		318		32,926			2,615		—			35,859
Prepaid expenses		1,214		2,289			1,552		—			5,055
Deferred income taxes, net		14,815		13,696			1,257		—			29,768
Intercompany receivables		1,762		—			—		(1,762	)		—
Total current assets		88,787		91,253			14,150		(1,762	)		192,428
Receivables due beyond one year, net of allowances		—		55,847			12,132		—			67,979
Preneed funeral receivables and trust investments		—		399,731			9,565		—			409,296
Preneed cemetery receivables and trust investments		—		209,284			7,298		—			216,582
Goodwill		—		227,203			19,835		—			247,038
Cemetery property, at cost		—		359,678			36,336		—			396,014
Property and equipment, at cost		59,688		495,089			43,215		—			597,992
Less accumulated depreciation		45,705		240,906			19,097		—			305,708
Net property and equipment		13,983		254,183			24,118		—			292,284
Deferred income taxes, net		4,947		68,939			5,907		—			79,793
Cemetery perpetual care trust investments		—		227,428			12,964		—			240,392
Other assets		9,539		4,728			1,025		—			15,292
Intercompany receivables		660,246		—			—		(660,246	)		—
Equity in subsidiaries		15,812		9,980			—		(25,792	)		—
Total assets	$	793,314	$	1,908,254		$	143,330	$	(687,800	)	$	2,157,098
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current maturities of long-term debt	$	5	$	—		$	—	$	—		$	5
Accounts payable, accrued expenses and other current liabilities		14,320		71,505			4,633		—			90,458
Intercompany payables		—		—			1,762		(1,762	)		—
Total current liabilities		14,325		71,505			6,395		(1,762	)		90,463
Long-term debt, less current maturities		317,821		—			—		—			317,821
Deferred income taxes, net		—		4,521			583		—			5,104
Intercompany payables		—		646,588			13,658		(660,246	)		—
Deferred preneed funeral revenue		—		193,452			46,834		—			240,286
Deferred preneed cemetery revenue		—		230,291			28,946		—			259,237
Deferred preneed funeral and cemetery receipts held in trust		—		550,010			8,184		—			558,194
Perpetual care trusts’ corpus		—		226,042			12,938		—			238,980
Other long-term liabilities		17,996		1,341			—		—			19,337
Negative equity in subsidiaries		15,496		—			—		(15,496	)		—
Total liabilities		365,638		1,923,750			117,538		(677,504	)		1,729,422
Common stock		87,976		102			376		(478	)		87,976
Other		339,682		(15,598	)		25,398		(9,800	)		339,682
Accumulated other comprehensive income		18		—			18		(18	)		18
Total shareholders’ equity		427,676		(15,496	)		25,792		(10,296	)		427,676
Total liabilities and shareholders’ equity	$	793,314	$	1,908,254		$	143,330	$	(687,800	)	$	2,157,098

Condensed Consolidating Statements of Cash Flows

Condensed Consolidating Statements of Cash Flows

	Nine Months Ended July 31, 2012
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Net cash provided by operating activities	$	7,049		$	45,188		$	6,502		$	—	$	58,739
Cash flows from investing activities:
Proceeds from sales of marketable securities and release of restricted funds		1,756			—			250			—		2,006
Deposits of restricted funds and purchases of marketable securities		(1,756	)		—			(280	)		—		(2,036	)
Proceeds from sale of assets		—			533			—			—		533
Purchase of subsidiaries and other investments, net of cash acquired		(100	)		(3,013	)		—			—		(3,113	)
Additions to property and equipment		(2,669	)		(12,319	)		(1,227	)		—		(16,215	)
Other		—			87			—			—		87
Net cash used in investing activities		(2,769	)		(14,712	)		(1,257	)		—		(18,738	)
Cash flows from financing activities:
Repayments of long-term debt		(4	)		—			—			—		(4	)
Intercompany receivables (payables)		36,305			(31,249	)		(5,056	)		—		—
Debt refinancing costs		(34	)		—			—			—		(34	)
Issuance of common stock		1,433			—			—			—		1,433
Purchase and retirement of common stock		(19,075	)		—			—			—		(19,075	)
Dividends		(9,955	)		—			—			—		(9,955	)
Excess tax benefits from share-based payment arrangements		23			—			—			—		23
Net cash provided by (used in) financing activities		8,693			(31,249	)		(5,056	)		—		(27,612	)
Net increase (decrease) in cash		12,973			(773	)		189			—		12,389
Cash and cash equivalents, beginning of period		62,388			1,937			1,363			—		65,688
Cash and cash equivalents, end of period	$	75,361		$	1,164		$	1,552		$	—	$	78,077

Condensed Consolidating Statements of Cash Flows

	Nine Months Ended July 31, 2011
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Net cash provided by operating activities	$	13,590		$	41,931		$	4,946		$	—	$	60,467
Cash flows from investing activities:
Proceeds from sales of certificates of deposit		10,000			—			—			—		10,000
Purchases of restricted cash equivalents and marketable securities		(6,250	)		—			(662	)		—		(6,912	)
Proceeds from sale of assets		—			332			—			—		332
Purchase of subsidiaries, net of cash acquired		—			(9,110	)		—			—		(9,110	)
Additions to property and equipment		(1,730	)		(12,920	)		(1,038	)		—		(15,688	)
Other		—			103			—			—		103
Net cash provided by (used in) investing activities		2,020			(21,595	)		(1,700	)		—		(21,275	)
Cash flows from financing activities:
Proceeds from long-term debt		200,000			—			—			—		200,000
Repayments of long-term debt		(200,004	)		—			—			—		(200,004	)
Intercompany receivables (payables)		16,249			(12,429	)		(3,820	)		—		—
Debt refinancing costs		(5,933	)		—			—			—		(5,933	)
Issuance of common stock		1,386			—			—			—		1,386
Purchase and retirement of common stock		(15,622	)		—			—			—		(15,622	)
Dividends		(8,662	)		—			—			—		(8,662	)
Excess tax benefits from share based payment arrangements		154			—			—			—		154
Net cash used in financing activities		(12,432	)		(12,429	)		(3,820	)		—		(28,681	)
Net increase (decrease) in cash		3,178			7,907			(574	)		—		10,511
Cash and cash equivalents, beginning of period		48,270			6,055			1,735			—		56,060
Cash and cash equivalents, end of period	$	51,448		$	13,962		$	1,161		$	—	$	66,571

XML

Preneed Funeral Activities (Details 6) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	$ 161,715	$ 240,854
Available-for-sale Securities, Gross Unrealized Losses	(49,277)	(64,421)
Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	36,033	79,815
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(1,354)	(2,566)
12 Months or Greater [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	125,682	161,039
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(47,923)	(61,855)
U.S. Government, agencies and municipalities [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value		498
Available-for-sale Securities, Gross Unrealized Losses		(2)
U.S. Government, agencies and municipalities [Member] | Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months		498
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months		(2)
Corporate bonds [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	115	6,398
Available-for-sale Securities, Gross Unrealized Losses	(1)	(8)
Corporate bonds [Member] | Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	115	6,398
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(1)	(8)
Preferred stocks [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	15,578	19,613
Available-for-sale Securities, Gross Unrealized Losses	(671)	(3,358)
Preferred stocks [Member] | Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	1,424	548
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(32)	(2)
Preferred stocks [Member] | 12 Months or Greater [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	14,154	19,065
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(639)	(3,356)
Common Stocks [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	114,337	134,042
Available-for-sale Securities, Gross Unrealized Losses	(43,071)	(55,830)
Common Stocks [Member] | Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	16,734	5,564
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(349)	(58)
Common Stocks [Member] | 12 Months or Greater [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	97,603	128,478
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(42,722)	(55,772)
Mutual Funds [Member] | Equity [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	7,657	8,484
Available-for-sale Securities, Gross Unrealized Losses	(1,839)	(2,018)
Mutual Funds [Member] | Equity [Member] | Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	1,179	3
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(10)	(1)
Mutual Funds [Member] | Equity [Member] | 12 Months or Greater [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	6,478	8,481
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(1,829)	(2,017)
Mutual Funds [Member] | Fixed Income [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	10,537	48,703
Available-for-sale Securities, Gross Unrealized Losses	(802)	(1,417)
Mutual Funds [Member] | Fixed Income [Member] | Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	8,150	43,688
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(213)	(707)
Mutual Funds [Member] | Fixed Income [Member] | 12 Months or Greater [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	2,387	5,015
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(589)	(710)
Mutual Funds [Member] | Commodity [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	10,591	10,175
Available-for-sale Securities, Gross Unrealized Losses	(2,836)	(1,450)
Mutual Funds [Member] | Commodity [Member] | Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	5,593	10,175
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(693)	(1,450)
Mutual Funds [Member] | Commodity [Member] | 12 Months or Greater [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	4,998
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(2,143)
Mutual Funds [Member] | Real estate investment trusts [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	96	12,941
Available-for-sale Securities, Gross Unrealized Losses	(1)	(338)
Mutual Funds [Member] | Real estate investment trusts [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	34
Mutual Funds [Member] | Real estate investment trusts [Member] | Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months		12,941
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months		(338)
Mutual Funds [Member] | Real estate investment trusts [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	62
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(1)
Master limited partnerships [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	2,804
Available-for-sale Securities, Gross Unrealized Losses	(56)
Master limited partnerships [Member] | Less than 12 Months [Member] | Preneed Funeral Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	2,804
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	$ (56)

XML

Restructuring and Other Charges

9 Months Ended

Jul. 31, 2012

Restructuring and Other Charges [Abstract]

Restructuring and Other Charges

(14) Restructuring and Other Charges

In April 2012, the Company announced an organizational restructuring as well as a separate workforce reduction. The announcement was made following a comprehensive evaluation to identify Best-in-Class sales practices, additional opportunities to further integrate operations and sales and additional efficiencies realized from the Company’s ongoing continuous improvement initiative. The organizational changes include a restructure of the sales organization and realignment of the Company’s geographic regions and regional management. The new organization reduced the layers of sales management. As a result of the organizational changes the Company has made, as well as the investments made in technology over the last couple of years, the Company has been able to improve processes and procedures allowing for this restructuring and reorganization. As a result, the Company also eliminated approximately 60 positions in its corporate support services. The organizational change was made to improve customers’ experiences by strengthening the relationship between the operations and sales teams, and positioning management closer to the customer. Total expenses related to the organizational restructuring and workforce reduction consist primarily of separation pay and termination benefits and other non-cash asset impairments associated with the sales restructuring. The restructuring is expected to be completed during the Company’s fourth quarter of fiscal year 2012. The Company recorded $305 and $2,852 in charges related to the restructuring and workforce reduction during the three and nine months ended July 31, 2012, respectively. These charges are in the “restructuring and other charges” line in the condensed consolidated statements of earnings. As of July 31, 2012, the Company does not expect to incur any material additional costs related to the restructuring. The following table summarizes the activity related to the restructuring as of July 31, 2012:

	Employee Termination Costs			Non-cash Asset Impairment and Other Costs			Total
Costs incurred	$	990		$	1,862		$	2,852
Cash payments		(990	)		(537	)		(1,527	)
Non-cash items		—			(1,236	)		(1,236	)
Restructuring liability as of July 31, 2012	$	—		$	89		$	89

XML

Basis of Presentation (Tables)

9 Months Ended

Jul. 31, 2012

Basis of Presentation [Abstract]

Stock Options and Restricted Stock Granted to employees

Grant Type	Number of Shares Granted		Weighted Average Price per  Share		Vesting Period	Vesting Condition
Stock options		1,215,000	$	6.26	Equal one-fourth portions over 4 years		Service condition
Restricted stock		449,500	$	6.26	Equal one-third portions over 3 years		Market condition

Schedule of Receivables

	Receivables as of July 31, 2012		Receivables as of October 31, 2011
	Ending Balance Collectively Evaluated for Impairment		Ending Balance Collectively Evaluated for Impairment
Current receivables – at-need funeral	$	8,651	$	8,317
Current receivables – other		45,777		45,455
Receivables, due beyond one year – other		76,234		75,097
Preneed funeral receivables		44,069		43,457
Preneed cemetery receivables		29,057		30,270
Total	$	203,788	$	202,596
Total current receivables		54,428		53,772
Total noncurrent receivables		149,360		148,824
Total	$	203,788	$	202,596

Allowance for Doubtful Accounts and Cancellations Schedule

	Allowance for Doubtful Accounts and Cancellations as of July 31, 2012			Allowance for Doubtful Accounts and Cancellations as of October 31, 2011
	Ending Balance Collectively Evaluated for Impairment			Ending Balance Collectively Evaluated for Impairment
Current receivables – at-need funeral and other	$	(4,049	)	$	(4,626	)
Receivables, due beyond one year – other		(5,305	)		(7,118	)
Preneed funeral receivables		(10,728	)		(11,359	)
Preneed cemetery receivables		(2,138	)		(3,366	)
Total	$	(22,220	)	$	(26,469	)
Total current receivables		(4,049	)		(4,626	)
Total noncurrent receivables		(18,171	)		(21,843	)
Total	$	(22,220	)	$	(26,469	)

Allowance for doubtful accounts and cancellations roll forward

	Allowance for Doubtful Accounts and Cancellations Rollforward
	Balance – October 31, 2011		Charged to costs and expenses		Write-offs			Balance – July 31, 2012
Current receivables – at-need funeral and other	$	4,626		1,316		(1,893	)	$	4,049
Receivables, due beyond one year – other		7,118		1,725		(3,538	)		5,305
	$	11,744		3,041		(5,431	)	$	9,354

	Allowance for Doubtful Accounts and Cancellations Rollforward
	Balance – October 31, 2010		Charged to costs and expenses		Write-offs			Balance – July 31, 2011
Current receivables – at-need funeral and other	$	5,738		1,568		(2,013	)	$	5,293
Receivables, due beyond one year – other		8,324		2,291		(2,883	)		7,732
	$	14,062		3,859		(4,896	)	$	13,025

Receivable Aging Analysis Schedule

	Receivables Aging Analysis as of July 31, 2012
	1 to 30 Days		31 to 60 Days		61 to 90 Days		Greater than 90  Days		Total
Receivables – at-need funeral	$	5,045	$	1,215	$	450	$	1,941	$	8,651
Receivables – other		104,096		4,156		2,147		11,612		122,011
Preneed funeral receivables		31,817		867		370		11,015		44,069
Preneed cemetery receivables		24,943		1,036		519		2,559		29,057
	$	165,901	$	7,274	$	3,486	$	27,127	$	203,788

XML

Preneed Funeral Activities (Details 4) (Significant Unobservable Inputs (Level 3) [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Fair Value Assets Measured on Recurring Basis Unobservable Input Reconciliation Calculation Roll Forward
Fair market value, ending balance	$ 5,762	$ 6,043	$ 5,762	$ 6,043
Preneed Funeral Activities [Member]
Fair Value Assets Measured on Recurring Basis Unobservable Input Reconciliation Calculation Roll Forward
Fair market value, beginning balance	5,698	6,075	5,868	6,784
Total unrealized gains (losses) included in other comprehensive income (1)	56	(590)	56	(590)
Distributions and other, net	$ 8	$ 558	$ (162)	$ (151)

XML

Basis of Presentation (Details 2) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011	Jan. 31, 2011
Allowance for Doubtful Accounts and Cancellations Schedule
Current receivables - at-need funeral and other	$ 4,049	$ 4,626
Receivables, due beyond one year - other	5,305	7,118
Preneed funeral receivables	10,728	11,359
Preneed cemetery receivables	2,138	3,366
Total current receivables	4,049	4,626
Total noncurrent receivables	18,171	21,843
Total	$ 22,220	$ 26,469	$ 26,469

XML

Condensed Consolidated Statement of Shareholders' Equity (Unaudited) (USD $) In Thousands, unless otherwise specified	Total	Common Stock		Additional Paid-in Capital	Accumulated Deficit	Unrealized Appreciation of Investments
Beginning Balance at October 31, 2011 at Oct. 31, 2011	$ 427,676	$ 87,976	[1]	$ 515,274	$ (175,592)	$ 18
Comprehensive income:
Net earnings	26,919				26,919
Other comprehensive income:
Unrealized appreciation of investments, net of deferred tax expense of ($13)	23					23
Total other comprehensive income	23					23
Total comprehensive income	26,942				26,919	23
Restricted stock activity	1,084	407	[1]	677
Issuance of common stock	654	109	[1]	545
Stock options exercised	1,216	287	[1]	929
Stock option expense	1,076			1,076
Tax benefit associated with stock activity	(261)			(261)
Purchase and retirement of common stock	(19,075)	(2,943)	[1]	(16,132)
Dividends ($.115 per share)	(9,955)			(9,955)
Ending Balance at July 31, 2012 at Jul. 31, 2012	$ 429,357	$ 85,836	[1]	$ 492,153	$ (148,673)	$ 41

[1] (1) Amount includes 82281 and 84,421 shares (in thousands) of Class A common stock with a stated value of $1 per share as of July 31, 2012 and October 31, 2011, respectively, and includes 3,555 shares (in thousands) of Class B common stock.

XML

Long-term Debt (Details Textual) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Jul. 31, 2012	Oct. 31, 2011
Long-term Debt (Textual) [Abstract]
Weighted average interest rate	8.00%
3.125% senior convertible notes due 2014 [Member]
Long-term Debt (Textual) [Abstract]
Stated percentage rate	3.125%
Debt Instrument Carrying Amount Including Accrued Interest	$ 81,051
Fair value of long term debt	86,282
Debt Instrument Face Amount	86,416
Debt Instrument, Unamortized Discount	5,484	7,611
Debt Instrument Maturity Date	Dec. 31, 2014
3.375% senior convertible notes due 2016 [Member]
Long-term Debt (Textual) [Abstract]
Stated percentage rate	3.375%
Debt Instrument Carrying Amount Including Accrued Interest	39,911
Fair value of long term debt	44,223
Debt Instrument Face Amount	45,119
Debt Instrument, Unamortized Discount	5,276	6,183
Debt Instrument Maturity Date	Dec. 31, 2016
6.50% senior notes due 2019 [Member]
Long-term Debt (Textual) [Abstract]
Stated percentage rate	6.50%
Debt Instrument Carrying Amount Including Accrued Interest	203,792
Fair value of long term debt	$ 213,802
Debt Instrument Maturity Date	Dec. 31, 2019
Seller financing of acquired operations [Member]
Long-term Debt (Textual) [Abstract]
Debt Instrument Maturity Date	Dec. 31, 2022

XML

Preneed Funeral Activities

9 Months Ended

Jul. 31, 2012

Preneed Funeral Activities [Abstract]

Preneed Funeral Activities

(3) Preneed Funeral Activities

The Company maintains three types of trust and escrow accounts: (1) preneed funeral merchandise and services, (2) preneed cemetery merchandise and services and (3) cemetery perpetual care. The activity of these trust and escrow accounts is detailed below and in Notes 4 and 5.

Preneed Funeral Receivables and Trust Investments

Preneed funeral receivables and trust investments represent trust assets and customer receivables related to unperformed, price-guaranteed trust-funded preneed funeral contracts. The components of preneed funeral receivables and trust investments in the condensed consolidated balance sheets as of July 31, 2012 and October 31, 2011 are as follows:

	July 31, 2012			October 31, 2011
Trust assets	$	395,263		$	377,198
Receivables from customers		44,069			43,457
		439,332			420,655
Allowance for cancellations		(10,728	)		(11,359	)
Preneed funeral receivables and trust investments	$	428,604		$	409,296

The cost basis and market values associated with preneed funeral merchandise and services trust assets as of July 31, 2012 are detailed below.

	July 31, 2012
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	23,131	$	—	$	—		$	23,131
U.S. Government, agencies and municipalities		1,658		87		—			1,745
Corporate bonds		20,064		1,592		(1	)		21,655
Preferred stocks		34,896		641		(671	)		34,866
Common stocks		200,896		3,152		(43,071	)		160,977
Mutual funds:
Equity		19,249		839		(1,839	)		18,249
Fixed income		95,687		2,936		(802	)		97,821
Commodity		13,428		—		(2,836	)		10,592
Real estate investment trusts		8,737		813		(1	)		9,549
Master limited partnerships		2,860		—		(56	)		2,804
Insurance contracts and other long-term investments		12,344		215		—			12,559
Trust investments	$	432,950	$	10,275	$	(49,277	)	$	393,948
Market value as a percentage of cost										91.0	%
Accrued investment income									1,315
Trust assets								$	395,263

The estimated maturities and market values of debt securities included above are as follows:

	July 31, 2012
Due in one year or less	$	5,657
Due in one to five years		14,367
Due in five to ten years		2,856
Thereafter		520
	$	23,400

The cost basis and market values associated with preneed funeral merchandise and services trust assets as of October 31, 2011 are detailed below.

	October 31, 2011
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	30,714	$	—	$	—		$	30,714
U.S. Government, agencies and municipalities		2,094		60		(2	)		2,152
Corporate bonds		21,856		1,079		(8	)		22,927
Preferred stocks		36,382		362		(3,358	)		33,386
Common stocks		202,451		791		(55,830	)		147,412
Mutual funds:
Equity		23,591		980		(2,018	)		22,553
Fixed income		78,509		902		(1,417	)		77,994
Commodity		11,844		8		(1,450	)		10,402
Real estate investment trusts		15,075		37		(338	)		14,774
Master limited partnerships		136		4		—			140
Insurance contracts and other long-term investments		13,486		39		—			13,525
Trust investments	$	436,138	$	4,262	$	(64,421	)	$	375,979
Market value as a percentage of cost										86.2	%
Accrued investment income									1,219
Trust assets								$	377,198

The Company periodically manages a covered call program on its equity securities within the preneed funeral merchandise and services trust in order to provide an opportunity for additional income. As of July 31, 2012 and October 31, 2011, the Company had outstanding covered calls with a market value of $466 and $0, respectively. Covered calls are included at market value in the balance sheet line “preneed funeral receivables and trust investments.” For the three months ended July 31, 2012 and 2011, the Company realized trust earnings of approximately $180 and $75, respectively, related to the covered call program. For the nine months ended July 31, 2012 and 2011, the Company realized trust earnings (losses) of $336 and ($152), respectively, related to the covered call program. These trust earnings and losses are accounted for in the same manner as other funeral merchandise and services trust earnings and losses and flow through funeral revenue in the condensed consolidated statements of earnings. Although the Company realized losses associated with the covered call program for the nine months ended July 31, 2011, it continued to hold the underlying securities against which these covered calls were issued; these underlying securities appreciated in value by $1,983 for the nine months ended July 31, 2011.

Where quoted prices are available in an active market, investments held by the trusts are classified as Level 1 investments pursuant to the three-level valuation hierarchy. The Company’s Level 1 investments include cash, money market and other short-term investments, common stocks and mutual funds.

Where quoted market prices are not available for the specific security, then fair values are estimated by using quoted prices of securities with similar characteristics. These investments are primarily U. S. Government, agencies and municipalities, corporate bonds, convertible bonds and preferred stocks, all of which are classified within Level 2 of the valuation hierarchy.

The Company’s Level 3 investments include insurance contracts and partnership investments purchased within the trusts. The valuation of insurance contracts and partnership investments requires significant management judgment due to the absence of quoted prices, inherent lack of liquidity and the long-term nature of such assets. The fair market value of the insurance contracts is based upon the current face value of the contracts according to the respective insurance carriers, which is deemed to approximate fair market value. The fair market value of the partnership investments was determined by using their most recent audited financial statements and assessing the market value of the underlying securities within the partnership.

The inputs into the fair value of the Company’s preneed funeral merchandise and services trust investments are categorized as follows:

	Quoted Market Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Market Value
Trust investments—July 31, 2012	$	329,918	$	58,268	$	5,762	$	393,948
Trust investments—October 31, 2011	$	311,463	$	58,648	$	5,868	$	375,979

The change in the Company’s preneed funeral merchandise and services trust investments with significant unobservable inputs (Level 3) is as follows:

	Three Months Ended July 31,					Nine Months Ended July 31,
	2012		2011			2012			2011
Fair market value, beginning balance	$	5,698	$	6,075		$	5,868		$	6,784
Total unrealized gains (losses) included in other comprehensive income (1)		56		(590	)		56			(590	)
Distributions and other, net		8		558			(162	)		(151	)
Fair market value, ending balance	$	5,762	$	6,043		$	5,762		$	6,043

⁽¹⁾  All gains (losses) recognized in other comprehensive income for funeral trust investments are attributable to the Company’s preneed customers and are offset by a corresponding increase (decrease) in deferred preneed funeral receipts held in trust.

Activity related to preneed funeral trust investments is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Purchases	$	22,182		$	45,026		$	56,092		$	117,074
Sales		14,587			48,397			51,669			119,026
Realized gains from sales of investments		1,320			3,058			4,491			7,467
Realized losses from sales of investments and other		(1,605	)		(1,335	)		(2,709	)		(2,015	)
Interest income, dividends and other ordinary income		2,952			3,107			10,914			9,920
Deposits (1)		6,462			5,770			18,828			15,800
Withdrawals (1)		10,905			10,017			29,995			32,332

⁽¹⁾  The Company historically sold a significant portion of its preneed funeral sales through trust-funded price-guaranteed contracts. Over time, the mix has shifted to a more significant portion being sold using insurance, particularly in states where the trusting requirements are high.

The following tables show the gross unrealized losses and fair value of the preneed funeral merchandise and services trust investments with unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of July 31, 2012 and October 31, 2011.

	July 31, 2012
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
Corporate bonds	$	115	$	(1	)	$	—	$	—		$	115	$	(1	)
Preferred stocks		1,424		(32	)		14,154		(639	)		15,578		(671	)
Common stocks		16,734		(349	)		97,603		(42,722	)		114,337		(43,071	)
Mutual funds:
Equity		1,179		(10	)		6,478		(1,829	)		7,657		(1,839	)
Fixed income		8,150		(213	)		2,387		(589	)		10,537		(802	)
Commodity		5,593		(693	)		4,998		(2,143	)		10,591		(2,836	)
Real estate investment trusts		34		—			62		(1	)		96		(1	)
Master limited partnerships		2,804		(56	)		—		—			2,804		(56	)
Total	$	36,033	$	(1,354	)	$	125,682	$	(47,923	)	$	161,715	$	(49,277	)

	October 31, 2011
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	498	$	(2	)	$	—	$	—		$	498	$	(2	)
Corporate bonds		6,398		(8	)		—		—			6,398		(8	)
Preferred stocks		548		(2	)		19,065		(3,356	)		19,613		(3,358	)
Common stocks		5,564		(58	)		128,478		(55,772	)		134,042		(55,830	)
Mutual funds:
Equity		3		(1	)		8,481		(2,017	)		8,484		(2,018	)
Fixed income		43,688		(707	)		5,015		(710	)		48,703		(1,417	)
Commodity		10,175		(1,450	)		—		—			10,175		(1,450	)
Real estate investment trusts		12,941		(338	)		—		—			12,941		(338	)
Total	$	79,815	$	(2,566	)	$	161,039	$	(61,855	)	$	240,854	$	(64,421	)

The unrealized losses in the preneed funeral merchandise and services trust portfolio are not considered to be other than temporary. For a discussion of the Company’s policies for determining whether a security is other-than-temporarily impaired, see Note 2(k) to the consolidated financial statements in the Company’s 2011 Form 10-K. Of the total unrealized losses at July 31, 2012, 87 percent, or $43,071, were generated by investments in common stock. Most of the common stock investments are part of the S&P 500 Index. The Company generally expects its portfolio performance to improve if the performance of the overall financial market improves, but would also expect its performance to deteriorate if the overall financial market declines. The Company believes it has the intent and ability to hold these investments until they recover in value.

The Company’s policy for recognizing trust income follows the allocation of trust earnings to individual contracts as stipulated in the Company’s respective trust agreements. In substantially all of the Company’s trusts, trust earnings, which include dividends and interest earned and net capital gains and losses (including losses from other-than-temporary impairments of securities) realized by preneed funeral trust or escrow accounts net of fees, are allocated to individual contracts as earned or realized. In these trusts, unrealized gains and losses are not allocated to the underlying contracts. The trust earnings allocated to individual contracts are recognized as components of revenue along with the original contract sales price when the underlying service or merchandise is actually performed or delivered. Principal and earnings are withdrawn only as the merchandise or services are delivered or contracts are cancelled, except in jurisdictions that permit trust earnings to be withdrawn currently.

Cash flows from preneed funeral contracts are presented as operating cash flows in the Company’s condensed consolidated statements of cash flows.

XML

Preneed Cemetery Merchandise and Service Activities (Details 5) (USD $) In Thousands, unless otherwise specified	Jul. 31, 2012	Oct. 31, 2011
Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	$ 109,662	$ 135,388
Available for Sale Securities, Fair Value	193,022	189,033
Available for Sale Securities, Gross Unrealized Losses	(39,127)	(42,892)
Less than 12 Months [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	33,630	53,802
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(1,794)	(2,383)
12 Months or Greater [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	76,032	81,586
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(37,333)	(40,509)
Master limited partnerships [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	6,665	95
Available for Sale Securities, Gross Unrealized Losses	(132)	(2)
Master limited partnerships [Member] | 12 Months or Greater [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More		95
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More		(2)
U.S. Government, agencies and municipalities [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value		313
Available for Sale Securities, Fair Value	2,010	2,140
Available for Sale Securities, Gross Unrealized Losses		(2)
U.S. Government, agencies and municipalities [Member] | Less than 12 Months [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months		313
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months		(2)
Corporate bonds [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	56	117
Available for Sale Securities, Fair Value	2,146	2,724
Available for Sale Securities, Gross Unrealized Losses	(3)	(3)
Corporate bonds [Member] | Less than 12 Months [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	56	117
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(3)	(3)
Preferred stocks [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	6,476	7,609
Available for Sale Securities, Fair Value	12,394	10,922
Available for Sale Securities, Gross Unrealized Losses	(292)	(1,662)
Preferred stocks [Member] | Less than 12 Months [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	587
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	13
Preferred stocks [Member] | 12 Months or Greater [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	5,889	7,609
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(279)	(1,662)
Common Stocks [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	64,520	64,891
Available for Sale Securities, Fair Value	79,112	80,169
Available for Sale Securities, Gross Unrealized Losses	(29,350)	(32,761)
Common Stocks [Member] | Less than 12 Months [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	13,197	5,385
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(1,050)	(707)
Common Stocks [Member] | 12 Months or Greater [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	51,323	59,506
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(28,300)	(32,054)
Mutual Funds [Member] | Equity [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	12,910	14,376
Available for Sale Securities, Fair Value	16,566	18,931
Available for Sale Securities, Gross Unrealized Losses	(7,068)	(6,791)
Mutual Funds [Member] | Equity [Member] | 12 Months or Greater [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	12,910	14,376
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(7,068)	(6,791)
Mutual Funds [Member] | Fixed Income [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	12,312	34,325
Available for Sale Securities, Fair Value	54,664	45,977
Available for Sale Securities, Gross Unrealized Losses	(312)	(586)
Mutual Funds [Member] | Fixed Income [Member] | Less than 12 Months [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	10,722	34,325
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(311)	(586)
Mutual Funds [Member] | Fixed Income [Member] | 12 Months or Greater [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	1,590
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	1
Mutual Funds [Member] | Commodity [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value	6,723	7,887
Available for Sale Securities, Fair Value	6,723	7,888
Available for Sale Securities, Gross Unrealized Losses	(1,970)	(892)
Mutual Funds [Member] | Commodity [Member] | Less than 12 Months [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	2,403	7,887
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	(285)	(892)
Mutual Funds [Member] | Commodity [Member] | 12 Months or Greater [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	4,320
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	1,685
Mutual Funds [Member] | Real estate investment trusts [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Total Market Value		5,775
Available for Sale Securities, Fair Value	3,040	9,747
Available for Sale Securities, Gross Unrealized Losses		(193)
Mutual Funds [Member] | Real estate investment trusts [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	34
Mutual Funds [Member] | Real estate investment trusts [Member] | Less than 12 Months [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months		5,775
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months		(193)
Mutual Funds [Member] | Real estate investment trusts [Member] | 12 Months or Greater [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for 12 Months or More	62
Unrealized Losses, Continuous Unrealized Loss Position for 12 Months or More	(1)
Mutual Funds [Member] | Master limited partnerships [Member]
Schedule of Unrealized Loss on Investment Items
Available for Sale Securities, Fair Value	2,804
Available for Sale Securities, Gross Unrealized Losses	56
Mutual Funds [Member] | Master limited partnerships [Member] | Preneed Cemetery Merchandise and Service Activities [Member]
Schedule of Unrealized Loss on Investment Items
Available for Sale Securities, Fair Value	6,665	95
Available for Sale Securities, Gross Unrealized Losses	(132)	(2)
Mutual Funds [Member] | Master limited partnerships [Member] | Less than 12 Months [Member]
Schedule of Unrealized Loss on Investment Items
Fair Value, Continuous Unrealized Loss Position for Less than 12 Months	6,665
Unrealized Losses, Continuous Unrealized Loss Position for Less than 12 Months	$ (132)

XML

Acquisitions and Dispositions (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Jul. 31, 2012	Oct. 31, 2011
Goodwill
Changes in Goodwill	$ 2,546
Goodwill	249,584	247,038
Funeral [Member]
Goodwill
Changes in Goodwill	2,546
Goodwill	200,863	198,317
Cemetery [Member]
Goodwill
Goodwill	$ 48,721	$ 48,721

XML

Deferred Preneed Funeral and Cemetery Receipts Held in Trust and Perpetual Care Trusts' Corpus (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Investment and other income, net
Realized gains from sales of investments	$ 2,633	$ 6,335	$ 12,207	$ 14,999
Realized losses from sales of investments and other	(2,744)	(2,065)	(5,992)	(3,732)
Interest income, dividends and other ordinary income	7,453	7,175	25,157	22,722
Trust expenses and income taxes	(2,966)	(2,808)	(8,792)	(7,737)
Net trust investment income	4,376	8,637	22,580	26,252
Reclassification to deferred preneed funeral and cemetery receipts held in trust	(3,112)	(6,319)	(15,802)	(19,876)
Reclassification to perpetual care trusts' corpus	(1,264)	(2,318)	(6,778)	(6,376)
Total deferred preneed funeral and cemetery receipts held in trust and perpetual care trusts' corpus
Investment and other income, net	57	30	148	394
Total investment and other income, net	57	30	148	394
Internal Revenue Service (IRS) [Member]
Component of Other Income, Nonoperating [Line Items]
Resolution Related Interest Income				$ 327

XML

Preneed Funeral Activities (Tables)

9 Months Ended

Jul. 31, 2012

Schedule of Available-for-sale Securities [Line Items]

Fair Value Assets Measured on Recurring Basis Unobservable Input Reconciliation

	Three Months Ended July 31,					Nine Months Ended July 31,
	2012		2011			2012			2011
Fair market value, beginning balance	$	5,698	$	6,075		$	5,868		$	6,784
Total unrealized gains (losses) included in other comprehensive income (1)		56		(590	)		56			(590	)
Distributions and other, net		8		558			(162	)		(151	)
Fair market value, ending balance	$	5,762	$	6,043		$	5,762		$	6,043

⁽¹⁾  All gains (losses) recognized in other comprehensive income for funeral trust investments are attributable to the Company’s preneed customers and are offset by a corresponding increase (decrease) in deferred preneed funeral receipts held in trust.

Preneed Funeral Activities [Member]

Schedule of Available-for-sale Securities [Line Items]

Long Term Receivable and Investment Components Table

	July 31, 2012			October 31, 2011
Trust assets	$	395,263		$	377,198
Receivables from customers		44,069			43,457
		439,332			420,655
Allowance for cancellations		(10,728	)		(11,359	)
Preneed funeral receivables and trust investments	$	428,604		$	409,296

Schedule of Available for Sale Securities Reconciliation Table

The cost basis and market values associated with preneed funeral merchandise and services trust assets as of July 31, 2012 are detailed below.

	July 31, 2012
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	23,131	$	—	$	—		$	23,131
U.S. Government, agencies and municipalities		1,658		87		—			1,745
Corporate bonds		20,064		1,592		(1	)		21,655
Preferred stocks		34,896		641		(671	)		34,866
Common stocks		200,896		3,152		(43,071	)		160,977
Mutual funds:
Equity		19,249		839		(1,839	)		18,249
Fixed income		95,687		2,936		(802	)		97,821
Commodity		13,428		—		(2,836	)		10,592
Real estate investment trusts		8,737		813		(1	)		9,549
Master limited partnerships		2,860		—		(56	)		2,804
Insurance contracts and other long-term investments		12,344		215		—			12,559
Trust investments	$	432,950	$	10,275	$	(49,277	)	$	393,948
Market value as a percentage of cost										91.0	%
Accrued investment income									1,315
Trust assets								$	395,263

The cost basis and market values associated with preneed funeral merchandise and services trust assets as of October 31, 2011 are detailed below.

	October 31, 2011
	Cost Basis		Unrealized Gains		Unrealized Losses			Market
Cash, money market and other short- term investments	$	30,714	$	—	$	—		$	30,714
U.S. Government, agencies and municipalities		2,094		60		(2	)		2,152
Corporate bonds		21,856		1,079		(8	)		22,927
Preferred stocks		36,382		362		(3,358	)		33,386
Common stocks		202,451		791		(55,830	)		147,412
Mutual funds:
Equity		23,591		980		(2,018	)		22,553
Fixed income		78,509		902		(1,417	)		77,994
Commodity		11,844		8		(1,450	)		10,402
Real estate investment trusts		15,075		37		(338	)		14,774
Master limited partnerships		136		4		—			140
Insurance contracts and other long-term investments		13,486		39		—			13,525
Trust investments	$	436,138	$	4,262	$	(64,421	)	$	375,979
Market value as a percentage of cost										86.2	%
Accrued investment income									1,219
Trust assets								$	377,198

Investments Classified by Contractual Maturity Date Table

	July 31, 2012
Due in one year or less	$	5,657
Due in one to five years		14,367
Due in five to ten years		2,856
Thereafter		520
	$	23,400

Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis Table

	Quoted Market Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Market Value
Trust investments—July 31, 2012	$	329,918	$	58,268	$	5,762	$	393,948
Trust investments—October 31, 2011	$	311,463	$	58,648	$	5,868	$	375,979

Fair Value Assets Measured on Recurring Basis Unobservable Input Reconciliation

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Fair market value, beginning balance	$	48		$	88		$	48		$	88
Total unrealized losses included in other comprehensive income (1)		(1	)		(24	)		(1	)		(24	)
Fair market value, ending balance	$	47		$	64		$	47		$	64

⁽¹⁾  All gains (losses) recognized in other comprehensive income for perpetual care trust investments are attributable to the Company’s preneed customers and are offset by a corresponding increase (decrease) in perpetual care trusts’ corpus.

Investment Related Activities Table

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Purchases	$	22,182		$	45,026		$	56,092		$	117,074
Sales		14,587			48,397			51,669			119,026
Realized gains from sales of investments		1,320			3,058			4,491			7,467
Realized losses from sales of investments and other		(1,605	)		(1,335	)		(2,709	)		(2,015	)
Interest income, dividends and other ordinary income		2,952			3,107			10,914			9,920
Deposits (1)		6,462			5,770			18,828			15,800
Withdrawals (1)		10,905			10,017			29,995			32,332

⁽¹⁾  The Company historically sold a significant portion of its preneed funeral sales through trust-funded price-guaranteed contracts. Over time, the mix has shifted to a more significant portion being sold using insurance, particularly in states where the trusting requirements are high.

Schedule of Unrealized Loss on Investments

	July 31, 2012
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
Corporate bonds	$	115	$	(1	)	$	—	$	—		$	115	$	(1	)
Preferred stocks		1,424		(32	)		14,154		(639	)		15,578		(671	)
Common stocks		16,734		(349	)		97,603		(42,722	)		114,337		(43,071	)
Mutual funds:
Equity		1,179		(10	)		6,478		(1,829	)		7,657		(1,839	)
Fixed income		8,150		(213	)		2,387		(589	)		10,537		(802	)
Commodity		5,593		(693	)		4,998		(2,143	)		10,591		(2,836	)
Real estate investment trusts		34		—			62		(1	)		96		(1	)
Master limited partnerships		2,804		(56	)		—		—			2,804		(56	)
Total	$	36,033	$	(1,354	)	$	125,682	$	(47,923	)	$	161,715	$	(49,277	)

	October 31, 2011
	Less than 12 Months					12 Months or Greater					Total
	Market Value		Unrealized Losses			Market Value		Unrealized Losses			Market Value		Unrealized Losses
U.S. Government, agencies and municipalities	$	498	$	(2	)	$	—	$	—		$	498	$	(2	)
Corporate bonds		6,398		(8	)		—		—			6,398		(8	)
Preferred stocks		548		(2	)		19,065		(3,356	)		19,613		(3,358	)
Common stocks		5,564		(58	)		128,478		(55,772	)		134,042		(55,830	)
Mutual funds:
Equity		3		(1	)		8,481		(2,017	)		8,484		(2,018	)
Fixed income		43,688		(707	)		5,015		(710	)		48,703		(1,417	)
Commodity		10,175		(1,450	)		—		—			10,175		(1,450	)
Real estate investment trusts		12,941		(338	)		—		—			12,941		(338	)
Total	$	79,815	$	(2,566	)	$	161,039	$	(61,855	)	$	240,854	$	(64,421	)

XML

Segment Data (Details 1) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Jul. 31, 2012	Jul. 31, 2011	Jul. 31, 2012	Jul. 31, 2011
Reconciliation of total segment gross profit to total earnings before income taxes
Gross profit for reportable segments	$ 26,986	$ 21,752	$ 81,520	$ 75,748
Corporate general and administrative expenses	(7,326)	(6,704)	(20,264)	(19,548)
Restructuring and other charges	(305)		(2,852)
Hurricane related recoveries, net		12,349		12,245
Net (loss) gain on dispositions		(11)	(332)	389
Other operating income, net	191	512	773	1,193
Interest expense	(5,873)	(5,500)	(17,544)	(16,968)
Loss on early extinguishment of debt		(73)		(1,884)
Investment and other income, net	57	30	148	394
Earnings from continuing operations before income taxes	$ 13,730	$ 22,377	$ 42,113	$ 50,791

XML

Long-term Debt (Tables)

9 Months Ended

Jul. 31, 2012

Long-term Debt [Abstract]

Long-term Debt

	July 31, 2012		October 31, 2011
Long-term debt:
3.125% senior convertible notes due 2014, net of unamortized discount of $5,484 and $7,611 as of July 31, 2012 and October 31, 2011, respectively	$	80,932	$	78,805
3.375% senior convertible notes due 2016, net of unamortized discount of $5,276 and $6,183 as of July 31, 2012 and October 31, 2011, respectively		39,843		38,936
Senior secured revolving credit facility		—		—
6.50% senior notes due 2019		200,000		200,000
Other, principally seller financing of acquired operations or assumption upon acquisition, weighted average interest rate of 8.0% as of July 31, 2012 and October 31, 2011, partially secured by assets of subsidiaries, with maturities through 2022		81		85
Total long-term debt		320,856		317,826
Less current maturities		6		5
	$	320,850	$	317,821

XML

Consolidated Comprehensive Income

9 Months Ended

Jul. 31, 2012

Consolidated Comprehensive Income [Abstract]

Consolidated Comprehensive Income

(13) Consolidated Comprehensive Income

Consolidated comprehensive income for the three and nine months ended July 31, 2012 and 2011 is as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2012			2011			2012			2011
Net earnings	$	9,638		$	11,986		$	26,919		$	30,028
Other comprehensive income (loss):
Unrealized appreciation (depreciation) of investments, net of deferred tax (expense) benefit of ($9), $2, ($13), and ($3), respectively		15			(3	)		23			6
(Increase) reduction in net unrealized losses associated with available-for-sale securities of the trusts		3,737			(31,772	)		39,080			11,209
Reclassification of the net unrealized losses activity attributable to the deferred preneed funeral and cemetery receipts held in trust and perpetual care trusts’ corpus		(3,737	)		31,772			(39,080	)		(11,209	)
Total other comprehensive income (loss)		15			(3	)		23			6
Total comprehensive income	$	9,653		$	11,983		$	26,942		$	30,034