Alderwoods Group, Inc.
NASDAQ : AWGI

Alderwoods Group, Inc.

September 21, 2005 17:44 ET

Alderwoods Group Comments on Impact of Hurricane Katrina

CINCINNATI, OHIO--(CCNMatthews - Sept. 21, 2005) - Alderwoods Group, Inc. (NASDAQ:AWGI) today commented on the impact of Hurricane Katrina on its operations in the New Orleans and Mississippi Gulf Coast areas.

"Our primary concern over the past several weeks has been for the safety of our more than 250 employees in the affected areas of the Gulf Coast and for the families whose lives have been disrupted as a result of the disaster," said Mr. Paul Houston, President and CEO of Alderwoods Group. "Fortunately, all of our employees and their family members are accounted for, although many have suffered loss and damages to their homes and personal belongings. We are focused on supporting them through this difficult time as much as possible. We also appreciate the extraordinary dedication our people are demonstrating in continuing to serve families under the most difficult of conditions."

As of June 18, 2005, Alderwoods Group operated 623 funeral homes, 73 cemeteries and 60 combination funeral home and cemetery properties. Thirty funeral homes and four cemeteries are in the affected areas, representing approximately 4.3% of the Company's revenues. Alderwoods experienced damages and business interruption at most of these locations. Of the thirty-four locations, nine funeral homes experienced significant damage and are still not operational. In fiscal 2004, these nine funeral homes represented approximately 2.0% of the total funeral services performed by the Company. Alderwoods continues to serve families in the New Orleans and Mississippi Gulf Coast markets through locations that remain operational. Families from areas served by the Company's closed facilities are being redirected to these operational locations.

The Company's assessment of the damages to its facilities is ongoing. In the New Orleans area, the damage assessment is being hampered by a lack of accessibility to all sites. In accessible areas, Alderwoods is working with its insurance carriers to establish an estimate of damages and begin repairs. Based on a preliminary review of the Company's insurance coverage, Alderwoods expects to recover a substantial portion of the costs associated with the storm damage through insurance, including the capital costs of rebuilding and losses from business interruption. However, it remains too early to determine whether the Company will incur some losses as a result of the damage.

The Company's insurance subsidiary Mayflower National Life Insurance Company is also located in New Orleans. While the Mayflower offices were not damaged by the hurricane, the building site remains inaccessible. Mayflower has temporarily relocated to Alderwoods' offices in Cincinnati, Ohio where it is fully functional - issuing policies, paying claims, and providing service to its policyholders.

Company Overview

Alderwoods Group is the second largest operator of funeral homes and cemeteries in North America, based upon total revenue and number of locations. As of June 18, 2005, the Company operated 623 funeral homes, 73 cemeteries and 60 combination funeral home and cemetery locations throughout North America. The Company provides funeral and cemetery services and products on both an at-need and pre-need basis. In support of the pre-need business, the Company operates insurance subsidiaries that provide customers with a funding mechanism for the pre-arrangement of funerals.

Forward-Looking Statements

Certain statements contained in this press release, including, but not limited to, information regarding the status and progress of the Company's operating activities, the plans and objectives of the Company's management, assumptions regarding the Company's future performance and plans, and any financial guidance provided, as well as certain information in other filings with the SEC and elsewhere are forward-looking statements within the meaning of Section 27A(i) of the Securities Act of 1933 and Section 21E(i) of the Securities Exchange Act of 1934. The words "believe," "may," "will," "estimate," "continues," "anticipate," "intend," "expect" and similar expressions identify these forward-looking statements. These forward-looking statements are made subject to certain risks and uncertainties that could cause actual results to differ materially from those stated, including the following: uncertainties associated with future revenue and expenses; the impact of the Company's significant leverage on its operating plans; and various other uncertainties associated with the funeral service industry and the Company's operations in particular, which are referred to in the Company's periodic reports filed with the SEC, especially under the heading "Forward-Looking Statements and Risk Factors" in the Company's Quarterly Report on Form 10-Q for the 12 weeks ended June 18, 2005. The Company undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

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