Forward-Looking Statements and Factors That May Affect Future Results Throughout this Form 10-Q, we make a number of "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. As the words imply, forward-looking statements are statements about our future plans, objectives, beliefs, and expectations that might or might not happen in the future, as contrasted with historical information. Our forward-looking statements are based on assumptions that we believe are reasonable, but by their very nature they are subject to a wide range of risks. Accordingly, in this Form 10-Q, we may say something like, "We anticipate that the burial rate will be flat to slightly declining in future years."
That is a forward-looking statement, as indicated by the word "anticipate" and by the clear meaning of the sentence.
Other words that could indicate we're making forward-looking statements include the following:

            intend     believe      plan       expect    may        goal
            become     pursue       estimate   will      forecast   continue
            targeted   anticipate   promise    improve   progress   potential

This isn't an exhaustive list but is simply intended to give you an idea of how we try to identify forward-looking statements. The absence of any of these words, however, does not mean that the statement is not forward-looking. Here's the key point: Forward-looking statements are not guarantees of future performance, and our actual results could differ materially from those set forth in any forward-looking statements. Any number of factors - many of which are beyond our control - could cause our performance to differ significantly from those described in the forward-looking statements.
For a discussion of factors that could cause actual results to differ from those contained in forward-looking statements, see the discussions under the heading "Risk Factors" in Item 1A of our Form 10-K filed with the Securities and Exchange Commission ("SEC") on December 9, 2008 and Part II, Item 1A of this Form 10-Q. We assume no obligation to update or revise any forward-looking statements.
Overview
In this section of the Form 10-Q, entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations," we attempt to give you a look at our Company "through the eyes of management" so that you can assess the financial condition and results of operations of our Company. The discussion that follows, when read in conjunction with Management's Discussion and Analysis included in our Form 10-K, should give you information that will help you understand our business and its performance. We intend for the discussion to be clear and to explain the drivers of our results so that you can assess the quality of our earnings and the predictability of our future results. Background, Death Care Industry Trends, and Strategy and Results Except as described below under "Recent Factors Impacting our Business," there have been no significant long-term changes to this information during the nine month period ended June 30, 2009, as outlined in our previously filed Form 10-K for the fiscal year ended September 30, 2008.

Recent Factors Impacting our Business
• The first three quarters of this fiscal year have been very volatile. While our first quarter revenues were reasonably in line with our expectations (up 2.2% over the same period last year), our second quarter results saw a significant decrease in our revenues (down 10.8% over the same period last year). Although a much milder pneumonia and influenza season played a role in the second quarter decrease in the number of deaths, we now believe that increased cremation rates are playing a larger role in reducing casketed deaths based upon information we have been able to gather in the marketplace. This estimated increase in the cremation rate may be a result of how consumers and our customers are responding to recessionary pressures. It should be noted, however, that the volatile economic environment is creating a higher degree of uncertainty about our ability to accurately estimate the rate at which consumers are choosing cremations and the impact that cremations are having on the number of burials. We believe these factors increased competition for the remaining casket volume causing our competitors to become more aggressive in their pricing actions, particularly in lower priced areas of our product offering. This market assessment and these competitive dynamics appear consistent with the recent public reports from our competitors and customers. We took and continue to take actions to protect our market position, including additional sales promotions, readjustment of our production capacity, and the use of our lean business expertise.

During the third quarter our revenues decreased $6.3 million, or 3.8%, over the same period last year. Despite the fact that the number of deaths is reported to be down over the same period last year, our responses to market conditions that developed during the second quarter appear to have successfully regained our market position. However, it is unclear whether the severity of the economic recession will have a long-term effect on the buying patterns of our customers or cremation rates. See our analysis of recent results of operations below for further discussion.

• We experienced cost decreases for commodities used in manufacturing during the three months ended June 30, 2009, over the same period last year. These cost decreases were largely attributable to reduced prices paid for carbon and stainless steel. While these commodity prices have come down from their highs during fiscal 2008, during the nine months ended June 30, 2009 we experienced higher prices for commodities over the same period last year due to the timing of when the prices we pay went into effect. Although it is difficult to predict with certainty where these prices will go over time, based on commodity prices we experienced during the last quarter, we expect full year commodity costs to be flat over last fiscal year. In addition we expect the favorable effects from diesel fuel prices we have experienced throughout fiscal 2009 as compared to fiscal 2008 to continue in the near term. See our analysis of recent results of operations below for further discussion.

• As previously reported, a self-styled consumer advocacy group, the Funeral Consumers Alliance, and several consumers who had purchased Batesville caskets had filed a consolidated purported class-action lawsuit against Batesville Casket Company, Hill-Rom Holdings, and three of Batesville's funeral home customers, alleging that the defendants violated antitrust laws. A related lawsuit was filed by four current and former independent casket retailers, alleging similar violations. On March 26, 2009, a United States District Judge in the Southern District of Texas (Houston), denied class certification in both lawsuits. After these rulings, the casket retailers dismissed their case with prejudice, while the Funeral Consumers Alliance plaintiffs filed a petition to appeal the ruling in their case. The Fifth Circuit's June 19, 2009 order denied that petition. On July 9, 2009, the FCA plaintiffs filed a request for reconsideration of the denial of their petition. On July 29, 2009, a three-judge panel of the Fifth Circuit denied the FCA plaintiffs' motion for reconsideration and their alternative motion for leave to file a petition for rehearing en banc (by the all of the judges sitting on the Fifth Circuit Court of appeals.)

In addition to the above, Batesville Casket Company is involved in a case in Arkansas, Garry Clayton v. Batesville Casket Company, Inc., in which the plaintiffs are asserting a number of claims related to Batesville's warranties related to our gasketed caskets. The plaintiffs were seeking to have a state-wide class certified as to the claims. On August 10, 2009, the District Court denied class certification in that matter.

For a full discussion of these significant developments, see Note 14 to our consolidated financial statements included in Part I, Item 1 of this Form 10-Q.

• During the three and nine months ended June 30, 2009, we recognized net losses of $1.2 million and $5.7 million from the limited partnership investments, respectively, that were transferred to us in connection with our separation from Hill-Rom last year. These losses resulted from decreases in the fair value of the investment portfolios of the partnerships. We believe their losses are being caused primarily by the current economic environment.

• During the nine months ended June 30, 2009, our pension assets declined in value by 9.4%, from $146.7 million to $132.9 million (prior to our current year discretionary contribution). During the three months ended June 30, 2009, we made a discretionary contribution to our pension plans in the amount of $7.8 million to improve our funding levels. This significantly reduced net cash provided by operating activities during this quarter.