SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

---

FORM 10-Q

QUARTERLY REPORT
   PURSUANT TO SECTION 13 OR SECTION 15 (d)

OF THE SECURITIES
   EXCHANGE ACT OF 1934

FOR THE QUARTERLY
   PERIOD ENDED JUNE 30, 1999

LOOMIS, FARGO & CO.

(Exact
   name of registrant as specified in its charter)

|Delaware                           | 333-24689                | 76-0521092                            
|---------------------------------- | ------------------------ | --------------------------------------
|(State or other
     jurisdiction) | (Commission File Number) | (IRS Employer
     Identification No.)

File
     No. 333-24689-01
   
   LFC Holding Corporation
   (Exact Name of Registrant
   
   as Specified in its Charter)
   File
     No. 333-24689-02
   
   Loomis, Fargo & Co.
   (Exact Name of Registrant
   
   as Specified in its Charter)
   File
     No. 333-24689-04
   
   Loomis, Fargo & Co. of Puerto Rico
   (Exact Name of Registrant
   
   as Specified in its Charter)


|Delaware                        | Texas                           | Tennessee                      
|------------------------------- | ------------------------------- | -------------------------------
|(State or other jurisdiction of | (State or other jurisdiction of | (State or other jurisdiction of
|incorporation or organization)  | incorporation or organization)  | incorporation or organization) 
|                                |                                 |                                
|75-2371825                      | 75-0117200                      | 66-0215016                     
|(I.R.S. Employer                | (I.R.S. Employer                | (I.R.S. Employer               
|Identification No.)             | Identification No.)             | Identification No.)            



|2500 CityWest Blvd., Suite 900                |           
|--------------------------------------------- | ----------
|Houston, Texas                                | 77042     
|(Address of principal executive
     offices) | (Zip Code)

Registrants' telephone number,
   including area code: (713) 435-6700

Indicate by check mark whether the
   registrants: (1) have 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
   [ ]

As of August 10, 1999, 10,000,000
   shares of the Common Stock, $0.01 par value, of Loomis, Fargo &
   Co.; 2,652,705 shares of the Class A Common Stock, $0.01 par value,
   of LFC Holding Corporation; 1,000 shares of the Common Stock, $10.00
   par value, of Loomis, Fargo & Co. (a Texas corporation); and 250
   shares of Common Stock, no par value, of Loomis, Fargo & Co. of
   Puerto Rico, were outstanding.





PART I - FINANCIAL
   INFORMATION

Item 1. Financial
   Statements

Loomis, Fargo & Co.

Consolidated Balance
   Sheets

(Unaudited, in
   thousands)





|                                                    | December 31, |   | June 30,  |  
|--------------------------------------------------- | ------------ | - | --------- | -
|                                                    | 1998         |   | 1999      |  
|Assets                                              |              |   |           |  
|Current
     assets:                                |              |   |           |  
|Cash and cash equivalents                           | $ 2,548      |   | $ 9,884   |  
|Accounts receivable, net                            | 30,261       |   | 26,091    |  
|Prepaid expenses and other current assets           | 3,965        |   | 5,848     |  
|                                                    |              |   |           |  
|Total current
     assets                           | 36,774       |   | 41,823    |  
|                                                    |              |   |           |  
|Property
     and equipment, net                    | 40,736       |   | 43,701    |  
|Deferred
     taxes, net                            | 3,608        |   | 4,116     |  
|Intangible assets, net                              | 105,943      |   | 102,942   |  
|Other
     assets, net                              | 3,975        |   | 3,493     |  
|                                                    |              |   |           |  
|Total
     Assets                                   | $ 191,036    |   | $ 196,075 |  
|                                                    |              |   |           |  
|Liabilities and stockholders' deficit               |              |   |           |  
|Current
     liabilities:                           |              |   |           |  
|Accounts payable                                    | $ 21,044     |   | $ 18,345  |  
|Accrued expenses and other current
     liabilities | 29,549       |   | 34,973    |  
|Current portion, long-term debt -
     affiliates   | 3,000        |   | 2,904     |  
|Current portion, capital lease obligations          | 411          |   | 330       |  
|                                                    |              |   |           |  
|Total current
     liabilities                      | 54,004       |   | 56,552    |  
|                                                    |              |   |           |  
|Long-term liabilities:                              |              |   |           |  
|Long-term debt - affiliates                         | 2,988        |   | -         |  
|Long-term debt - other                              | 130,100      |   | 133,000   |  
|Capital lease obligations                           | 318          |   | 178       |  
|Other long-term liabilities                         | 10,613       |   | 12,112    |  
|                                                    |              |   |           |  
|Total
      long-term liabilities                   | 144,019      |   | 145,290   |  
|                                                    |              |   |           |  
|Stockholders' deficit:                              |              |   |           |  
|Common stock                                        | 100          |   | 100       |  
|Additional paid-in capital                          | 24,755       |   | 24,755    |  
|Accumulated deficit                                 | (31,842      | ) | (30,622   | )
|                                                    |              |   |           |  
|Total
      stockholders' deficit                   | (6,987       | ) | (5,767    | )
|                                                    |              |   |           |  
|Total
      liabilities and stockholders' deficit   | $ 191,036    |   | $ 196,075 |  
|                                                    |              |   |           |  



See accompanying notes.



Loomis, Fargo &
    Co.

Consolidated
    Statements of Operations

(Unaudited, in
    thousands)





See accompanying notes.



Loomis, Fargo &
    Co.

Consolidated
    Statements of Cash Flows

(Unaudited, in
    thousands)







See accompanying notes



LOOMIS, FARGO &
    CO.

NOTES TO CONSOLIDATED
    FINANCIAL STATEMENTS



June 30, 1999



NOTE 1 BASIS OF PRESENTATION

The accompanying unaudited
    consolidated financial statements have been prepared in accordance
    with generally accepted accounting principles for interim financial
    information and with the instructions to Form 10-Q and Article 10
    of Regulation S-X. Accordingly, they do not include all of the
    information and footnotes required by generally accepted accounting
    principles for complete financial statements. The information
    included in this Form 10-Q should be read in conjunction with the
    audited consolidated financial statements of Loomis, Fargo &
    Co. (the "Company") as of December 31, 1998 included in
    the Form 10-K filed with the Securities and Exchange Commission on
    March 24, 1999. In the opinion of management, all adjustments
    (consisting only of normal recurring accruals) considered necessary
    for a fair presentation have been included. Operating results for
    the six months ended June 30, 1999 are not necessarily indicative
    of the results that may be expected for the full year.

Certain prior period amounts have
    been reclassified to conform with the 1999 presentation.

NOTE 2 RECENT PRONOUNCEMENTS

In June 1998, Statement of Financial
    Accounting Standards No. 133, Accounting for Derivative
    Instruments and Hedging Activities (SFAS 133) was issued. SFAS
    133 establishes a new model for accounting for derivatives and
    hedging activities and is effective for fiscal years beginning
    after June 15, 2000. Management believes the adoption will not have
    a material impact on the Company's financial statements.

NOTE 3 INCOME TAXES

The Company continually reviews the
    adequacy of the valuation allowance related to deferred tax assets
    and reduced the reserve by $1.6 million during the quarter ended
    June 30, 1999. The reduction resulted from a reassessment by the
    Company which indicates that it is more likely than not that
    additional benefits will be realized. As the reduction in valuation
    allowance was related to purchase accounting, a corresponding
    reduction in goodwill resulted.

NOTE 4 SIGNIFICANT CUSTOMER

One of the Company's customers
    accounts for approximately 13% of the Company's consolidated
    revenue for the second quarter of 1999.



ITEM 2

MANAGEMENT'S
    DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND
    RESULTS OF OPERATIONS

Loomis, Fargo & Co. (the "
    Company") provides armored car transport services to a variety
    of financial, commercial, industrial and retail establishments
    within the United States and Puerto Rico. The Company offers
    secure, expedited transportation and protection for valuable
    commodities, provides extensive automatic teller machine ("ATM
    ") services, cash management and related services to financial
    institutions and other commercial customers. The Company also
    provides contract security officers to patrol and control access to
    customer facilities in Puerto Rico.

FORWARD-LOOKING INFORMATION

Certain statements in this report
    including such terms as "believe", "estimate",
    "should", "may", "expect", "
    anticipate" and similar expressions which are not historical
    are forward-looking statements that involve risks and
    uncertainties. Such statements include, without limitation, the
    Company's expectation as to future performance. Such
    forward-looking statements are made pursuant to the safe harbor
    provisions of the Private Securities Litigation Reform Act of 1995.
    Important factors that could cause the actual results, performance
    or achievements of the Company to differ materially from the
    Company's expectations ("Cautionary Statements") are
    disclosed in this report. Investors are cautioned that all
    forward-looking statements involve risks and uncertainty. Factors
    that could cause or contribute to such differences include, but are
    not limited to, risks and uncertainties relating to leverage and
    debt service, changes in interest rates, risks inherent in the
    armored transport industry, general economic and business
    conditions, restrictions imposed by the bank credit facility, the
    ability to attract and retain qualified employees, timely
    identification and resolution of all Year 2000 issues,
    environmental and other regulatory matters and future legal
    proceedings. All written or oral forward-looking statements
    attributable to the Company are expressly qualified in their
    entirety by the Cautionary Statements.

RESULTS OF OPERATIONS

The following table sets forth the
    Company's consolidated results of operations expressed as a
    percentage of revenue.

|                                 | Six Months Ended
    
    June 30, | Three Months Ended
    
    June 30, |      
|-------------------------------- | ---------------------------------- | ------------------------------------ | -----
|                                
|                                 | 1998                               |                                      | 1999 
|                                 |                                    |                                      |      
|Revenues                         | 100.0                              | %                                    | 100.0
|Cost of operations:              |                                    |                                      |      
|Payroll and related expense      | 60.7                               |                                      | 61.6 
|Vehicle expense                  | 12.8                               |                                      | 11.6 
|Facilities expense               | 4.2                                |                                      | 4.3  
|Other operating expenses         | 19.0                               |                                      | 17.6 
|Operating income                 | 3.3                                |                                      | 4.9  
|Interest expense                 | 4.1                                |                                      | 3.7  
|Income (loss) before
      taxes | (0.8                               | )                                    | 1.2  
|Income taxes                     | 0.1                                |                                      | 0.6  
|Net income (loss)                | (0. 9                              | )%                                   | 0.6  







Revenues.Revenues decreased
    by approximately $4.5 million (2.3%) and $2.1 million (2.1%),
    respectively, for the six and three month periods ended June 30,
    1999 from last year's corresponding periods. During the last half
    of 1997, the Company continued its initiative to improve the
    quality of service and revenue on the contracts acquired in the
    January 1997 combination with Wells Fargo Armored Services
    Corporation. A majority of the acquired contracts were renegotiated
    with higher rates by the end of 1997. These rate increases, which
    also occurred during 1998 to a lesser extent, resulted in higher
    revenues from the acquired contracts for much of the first half of
    1998; however, they also resulted in the loss of certain customers.
    This revenue initiative also included a conscious decision by
    management to discontinue relationships with specific customers
    that were unprofitable or did not meet the Company's strategic
    objectives. These factors are the primary reason for the decreases
    in revenues.

The following table analyzes revenues
    by type of service. The decrease in armored transport services
    results from the impacts of the revenue improvement initiative
    previously discussed. Management believes ATM services continue to
    represent a growth sector of the industry and related revenues
    increased during the first half of 1999 as compared to the
    respective period in 1998. The table also reflects a slight
    reduction in the cash management and related services, partially
    attributable to management's revenue initiative strategies.

|                                       | Six
      Months Ended
    
              June 30,
|-------------------------------------- | --------------------------------------------------
|                                      
|(in millions)                          | 1998                                              
|Traditional armored transport services | $114.9                                            
|ATM services                           | 58.3                                              
|Cash management and related services   | 20.2                                              
|Total Revenues                         | $193.4                                            

Payroll and related expense.
    Payroll and related expense decreased by approximately $1.0 million
    (0.8%) and $0.2 million (0.3%) for the respective six and three
    month periods ended June 30, 1999 from the corresponding periods in
    1998. As a percentage of revenue, payroll and related expense
    increased to 61.6% for both the six and three month periods ended
    June 30, 1999 from 60.7% and 60.5% for the comparative periods in
    1998. Slight decreases in routes being serviced and route
    efficiencies resulted in a reduction in the total expenses;
    however, other factors have increased these expenses as a
    percentage of revenue. These factors include the business strategy
    of improved wages and fringe benefits throughout the Company as
    well as increases in the number of crew operating certain higher
    risk routes.

Vehicle expense. Vehicle
    expense decreased by approximately $2.9 million (11.6%) and $1.6
    million (13.1%) for the respective six and three months ended June
    30, 1999 from the corresponding periods in 1998. Vehicle expense as
    a percent of revenues decreased to 11.6% and 11.5% for the
    respective six and three month periods of 1999 from 12.8% and 12.9%
    for the corresponding periods in 1998. The decreases were largely a
    result of the revenue improvement initiative as previously
    discussed. This resulted in a reduction in the number of truck
    hours required to service the remaining higher quality of revenue
    customers. The continuing consolidation of branches and the
    restructuring of routes have produced the majority of this
    favorable variance.

Facilities expense. Facilities
    expense and the expense as a percent of revenue, for the six and
    three month periods of 1999, remained relatively constant with the
    corresponding periods in 1998.

Other operating expenses.
    Other operating expenses decreased by approximately $3.5 million
    (9.5%) and $1.3 million (7.2%) for the respective six and three
    month periods ended June 30, 1999 from the corresponding periods in
    1998. Other operating expenses as a percent of revenues decreased
    to 17.6% and 17.5% for the respective six and three month periods
    ended June 30, 1999 from 19.0% and 18.5% for the corresponding
    periods in 1998. Other operating expenses include such expenses as
    cargo insurance premiums and retained losses, costs of a
    centralized dispatch center, subcontracting costs, bad debt
    expense, and the testing, recruiting and training of employees. The
    conscious decision by management to discontinue relationships with
    specific unprofitable customers and an emphasis on collections
    produced a decrease in bad debt expense of $3.1 million during the
    first six months of 1999 as compared to the same period in 1998.
    Combined cash-in-transit insurance premiums and cargo losses
    totaled approximately $5.1 million and $5.9 million for the first
    six months of 1999 and 1998, respectively.



Interest expense. Interest
    expense decreased by approximately $1.1 million (13.7%) and $0.5
    million (12.8%) for the respective six and three month periods
    ended June 30, 1999 from the corresponding periods in 1998. This is
    primarily a result of the daily average borrowings under the
    Company's credit facility being approximately $16.9 million (24.2%)
    and $11.0 million (19.3%) lower during the respective six and three
    month periods of 1999 as compared to the same periods last year.

Income taxes. Income tax
    expense as a percentage of pre-tax income increased for the six and
    three month periods ended June 30, 1999 from the corresponding
    periods in 1998. This is largely due to the fact that reductions in
    the deferred tax valuation allowance related to purchase accounting
    for prior acquisitions. This resulted in goodwill related to those
    acquisitions being reduced; whereas reductions in the valuation
    allowance related to other items would have result in a reduction
    in income tax expense.

LIQUIDITY AND CAPITAL RESOURCES

Total cash and cash equivalents at
    June 30, 1999 and 1998 were $9.9 million and $5.1 million,
    respectively. Changes in cash and cash equivalents are described in
    the statements of cash flows, which are summarized below.

|                                                | Six Months Ended
    June 30 |  
|----------------------------------------------- | ---------------------------- | -
|                                               
|(In millions)                                   | 1998                         |  
|Net cash provided by operating activities       | $11.7                        |  
|Net cash used in investing activities           | (4.9                         | )
|Net cash used in financing activities           | (5.4                         | )
|Net increase in cash and cash
      equivalents | $1.4                         |  



Operating Activities

Net cash of $15.7 million was
    provided by operating activities during the first six months of
    1999. The largest item impacting the first six months of 1998 was
    the reduction to accrued expenses due to an $11.7 million payment
    to the Company's insurance carrier in January 1998 related to the
    recovery of a 1997 cargo loss. In addition, a greater reduction in
    accounts receivable was achieved in the first six months of 1998
    than in the corresponding period in 1999.

Investing Activities



In the first six months of 1999, cash
    of $8.0 million was used for acquisitions of property and
    equipment, which primarily relate to the enhancement of the
    Company's fleet.

Planned capital expenditures for the
    next twelve months are $16.0 million. The Company is purchasing
    more of its fixed assets rather than obtaining them through
    operating leases, which has increased capital expenditures.

Financing Activities



In connection with the utilization of
    certain net operating losses in the 1998 Federal Income Tax return,
    the Company was required to make a $3.1 million payment on the
    long-term debt to affiliates. This payment resulted in net
    borrowings of $2.9 million being made on the Company's bank credit
    facility during the first six months of 1999. The Company's average
    daily balance outstanding, however, was $16.9 million less during
    this period than the corresponding period in 1998. The primary
    reason the Company was able to reduce the level of debt has been
    due to improved collections.



The Company's balance sheet reflected
    a working capital deficit of $14.7 million at June 30, 1999, a
    decrease from the December 31, 1998 working capital deficit of
    $17.2 million. The Company is highly leveraged, with long-term
    liabilities comprising 74.1% of total liabilities and a common
    stockholders' deficit at June 30, 1999.

The Company's revolving bank credit
    facility provided aggregate commitments of $105.0 million at
    December 31, 1998. The credit facility agreement includes a
    step-down of the commitment over the final three years of the
    facility. The commitment is reduced by $3.75 million and $4.375
    million at the end of each quarter in 1999 and 2000, respectively.
    Therefore, a total commitment of $97.5 million remained at June 30,
    1999. The facility includes guarantees of letters of credit, of
    which approximately $18.8 million were outstanding at June 30,
    1999. The remaining commitment available under the facility at June
    30, 1999 was $30.7 million. Under the facility, funds can be
    borrowed either for unspecified periods of time at a base rate tied
    to the bank's prime rate, or for set periods of time under variable
    rates tied to LIBOR.

By December 1999, the total
    commitment under the bank credit facility will decrease to $90.0
    million. It is anticipated that letters of credit requirements,
    principally for casualty liabilities, should not exceed $20.0
    million by December 31, 1999, leaving $70.0 million in available
    borrowing capacity. Management believes that the operating cash
    flow and this remaining financing commitment will be more than
    adequate to fund future operating needs, capital expenditures, and
    any required repayments of debt.

IMPACT OF YEAR 2000

The Year 2000 computer issue is
    predominantly the result of many software programs categorizing the
    "year" in a two-digit format. Such programs may be unable
    to interpret dates beyond the year 1999, which could cause a system
    failure or other computer errors and a disruption in the operation
    of such systems. The Year 2000 issue creates potential risks for
    the Company in both the Information Technology ("IT") and
    non-IT systems that are depended on in various aspects of the
    business operations. The Company may also be exposed to risks from
    third parties with whom the Company interacts who fail to
    adequately address their own Year 2000 issues.

The Company has established an
    internally staffed Year 2000 Readiness Committee to address Year
    2000 issues. The objectives of this committee are to create
    awareness, conduct assessment, complete renovation of critical and
    important items, validate or test the success of the changes, and
    oversee implementation of those tested changes into the Company's
    business processes.

State of Readiness

The Company is preparing for the
    impact of the arrival of the Year 2000 on its internal business
    systems and equipment, and on the services and equipment from its
    suppliers, business partners and customers. The systems potentially
    impacted include 1) information systems software and hardware (e.g.
    billing, route/productivity, accounting and associated systems,
    personal computers/software and various end-user developed
    applications) and 2) building facilities and operations equipment
    (e.g. national customer service center, locking devices,
    communications, vehicles and alarms).

Assessment

The assessment phase utilized a
    company-wide inventory of all hardware and software (including
    business and operational applications and operating systems) that
    may be at risk, and identification of key third-party businesses
    whose Year 2000 failures might also significantly impact the
    Company. The centralized IT system inventory process has been
    completed as well as the inventories of the branch offices and key
    third-party business relationships (to include all non-IT systems).



Once each at-risk system or item of
    equipment has been identified, the Year 2000 Committee will assess
    how critical the system is to business operations and the potential
    impact of failure, in order to establish priorities for repair or
    replacement. Systems are classified as "critical," "
    important" or "non-critical." A "critical"
    system is one that, if not operational, would cause the shutdown of
    all or a portion of a business immediately, while an "important
    " system is one that would likely cause such a shutdown within
    a short period of time. Once this process is completed for all
    systems, the resulting identification of business systems that are
    either "critical" or "important" will determine
    which items will be prioritized in our testing and certification
    program and the allocation of resources. The process of identifying
    any systems, equipment or services that may be impacted by date
    rollover vulnerability is nearly complete. Thus far, we have not
    received any indication of non-compliant status from any of our key
    vendors.

Assessment also involves the
    development of appropriate remedial strategies for both IT and
    non-IT systems. These strategies may include repairing, testing and
    certifying, replacing or abandoning particular systems. The
    strategy phase has been completed for all IT systems. The process
    of analysis, certification, replacement or "workaround"
    for embedded systems in the branch offices is expected to continue
    through the end of the third quarter of 1999.

The Company's core financial
    reporting and contract-billing systems were upgraded in July 1998.
    Additionally, the key system located at the centralized dispatch
    center was replaced during 1998. Confirmation was received from the
    vendors that these systems were Year 2000 ready prior to their
    being installed. Since the Company's core business relates to the
    transportation and handling of valuables, the truck fleet and its
    supporting infrastructure is being rigorously reviewed. To date,
    there have been no significant issues identified with the fleet
    viability as it pertains to Year 2000. In addition, confirmation
    has been received from the major truck supplier that the engines
    which have been supplied for the Company's use will not cease
    functioning because of the Year 2000 transition. Finally, the
    vendor that supplies the electronic locks that the Company installs
    on customers' ATMs for added security, has assured the Company that
    their product is Year 2000 ready.

Status of ATM Service (Customer
    Support Center)

Dispatching: All Year 2000 Compliance
    measures and testing have been accomplished for this operation and
    it's sub-systems. The Customer Support Center dispatching system,
    hardware and peripheral equipment have all been upgraded and passed
    an in-depth external Year 2000 review from a recognized and
    qualified consulting firm.

Emergency Power: The primary power
    source for our nation-wide Customer Support Center is commercial
    electricity provided by Baltimore Gas & Electric. Although they
    have given reasonable assurances that power will not be interrupted
    due to Y2K at this location, we will continue to maintain a backup
    power source. An auto-start "natural gas" powered
    generator, capable of running the operation in the event of an
    emergency, has been used successfully for years during blackouts.
    None of these power failures has ever resulted in a loss of natural
    gas pressure. The generator is however multi-fuel capable and could
    be run on liquid fuels in that event. The dispatching system is
    used for all First and Second Line Maintenance trouble calls and
    the issuance of encoded combinations for ATM safe access.

Status of Branch Operations

All of the manufacturers of the
    vehicles, currency counters, coin sorters and rollers, vaults
    locks, forklifts, scales, calculators and other non-PC equipment
    that we employ have indicated that these items do not perform, nor
    are they dependent upon, date calculations and are therefore not
    affected by the date rollover. The majority of our branches do not
    use an automated or PC-based system to provide services to our
    customers. Our program to bring all of our branch level PC-based
    management systems into compliance is progressing but will not
    affect our service.

Status of Vendors, Suppliers and
    Service Providers

We have reviewed the Year 2000
    Compliance of our key third party-vendors (e.g. alarm service,
    paging networks, PSTN and utilities) and are completing the process
    of documenting their Year 2000 compliance status. Thus far, we have
    not received any indication of non-compliance from a critical
    vendor or any status that would have a material adverse effect upon
    the Company or its operations. We expect to fully complete this
    process for all branches by the end of August 1999.





Remediation

The remediation phase involves
    creating plans, marshalling necessary resources and executing the
    strategies chosen. For any systems or equipment not expected to be
    reliably functional after January 1, 2000, detailed manual
    workaround plans will be developed prior to the end of 1999.

Testing and Certification

This phase includes establishing a
    test environment, performing systems testing (with third parties if
    necessary), and certifying the results. The Company expects all
    critical IT systems to be IT certified by the end of the third
    quarter 1999. Testing for non-IT systems has not yet been initiated
    and due to the reliance on many third-party vendors for these
    systems, the Company cannot estimate precisely when this phase will
    be completed. Our target for all critical and important non-IT
    systems is late-1999. We have initiated written and telephone
    communications with key third-party suppliers/vendors, as well as
    public and private providers of infrastructure services, to
    ascertain and evaluate their efforts in addressing Year 2000
    readiness. It is anticipated that the majority of testing and
    certification with these entities will occur in 1999. For many
    systems, services or items of equipment that are not proprietary
    and cannot be date tested we will continue to rely on the Year 2000
    Readiness claims of manufacturers and vendors.

Third-Party Exposure

The Company is tracking the Year 2000
    readiness status of its material vendors and suppliers via the
    Company's own internal vendor readiness effort. The Company is
    aggressively seeking Year 2000 certification from these companies,
    especially because of the dependent business relationships deemed
    critical by the Year 2000 Readiness Committee. Year 2000
    correspondence is being sent to critical vendors and suppliers,
    with continued follow-up for those who fail to respond. To date,
    the Company is not aware of any problems that would materially
    impact results of operations, liquidity or capital resources;
    however, the Company has no means of ensuring that these suppliers
    and vendors will be Year 2000 ready. The inability of those parties
    to complete their Year 2000 resolution process could materially
    impact the Company. In late-1999, the Company expects to implement
    additional procedures for assessing the Year 2000 readiness status
    of its most critical vendors and will modify its contingency plans
    accordingly.

Costs

The Company does not expect that the
    costs associated with its Year 2000 efforts will be material. The
    Company estimates aggregate expenditures of approximately $1.9
    million to address Year 2000 issues and is being funded through
    operating cash flows. These aggregate expenditures include $0.4
    million of costs that are being charged to expense and $1.5 million
    of costs, related to the accelerated replacement of non-compliant
    systems due to Year 2000 issues, which will be capitalized. The
    total amount expended through June 30, 1999 was approximately $0.5
    million, $0.2 million of which was expensed. These estimated costs
    do not include costs incurred by the Company as a result of the
    failure of any third parties, including suppliers, to become Year
    2000 compliant nor do they include any potential costs related to
    any customer or other claim or costs to implement any contingency
    plans. In addition, these cost estimates are based on current
    assessments of the ongoing activities described above, and are
    subject to changes as the Company continuously monitors these
    activities.

Risks

The following describes the Company's
    most reasonably likely worst-case scenario, given current
    uncertainties. If our renovated or replaced internal information
    technology systems fail the testing phase, or any software
    application or embedded microprocessors central to the Company's
    operations are overlooked in the assessment or remediation phases,
    significant problems including delays may be incurred in billing
    major customers for services performed. If our major customers'
    systems do not become Year 2000 ready on a timely basis, the
    Company will have problems and incur delays in receiving and
    processing correct reimbursement. If the vendors or suppliers fail
    to become Year 2000 ready, we may be unable to provide pickup and
    delivery services to our customers.





If any of these uncertainties were to
    occur, the Company's core business, financial condition and results
    of operations would be adversely affected. The Company is unable to
    assess the likelihood of such events occurring or the extent of the
    effect on its organization.

Based on the Company's current
    assessment efforts, management does not believe that Year 2000
    issues will have a material adverse effect on its financial
    condition or results of operations. However, the Company's Year
    2000 issues and any potential business interruptions, costs,
    damages or losses related thereto, are dependent, to a certain
    degree, upon the Year 2000 readiness of third parties such as
    customers, governmental agencies, vendors and suppliers.
    Consequently, the Company is unable to determine at this time
    whether Year 2000 failures will materially affect the Company. The
    Company believes that its readiness efforts have and will reduce
    the impact on the Company of any such failures.

Contingency Planning

This phase involves addressing any
    remaining open issues expected in 1999 and early 2000. As a
    precautionary measure, the Company is currently developing
    contingency plans for all systems that are not expected to be Year
    2000 ready.

The Company is working jointly with
    customers, strategic vendors and business partners to identify and
    resolve any Year 2000 issues that may impact the Company. However,
    there can be no assurance that the companies with which the Company
    does business will achieve a Year 2000 conversion in a timely
    fashion, or that such failure by another company to convert will
    not have a material adverse effect on the Company. Therefore, we
    have begun to develop a detailed and comprehensive "Business
    Contingency Plan" designed to address situations that may
    result if the Company or any of the third parties upon which we are
    dependent is unable to achieve Year 2000 readiness.

Year 2000 Forward-Looking Statements

The foregoing Year 2000 discussion
    contains "forward-looking statements" within the meaning
    of the Private Securities Litigation Reform Act of 1995. Such
    statements, including without limitation, anticipated costs and the
    dates by which the Company expects to complete certain actions, are
    based on management's best current estimates, which were derived
    utilizing numerous assumptions about future events, including the
    continued availability of certain resources, representations
    received from third parties and other factors. However, there can
    be no guarantee that these estimates will be achieved, and actual
    results could differ materially from those anticipated. Specific
    factors that might cause such material differences include, but are
    not limited to, the ability to identify and remediate all relevant
    IT and non-IT systems, results of Year 2000 testing, adequate
    resolution of Year 2000 issues by businesses and other third
    parties who are service providers, suppliers or customers of the
    Company, unanticipated system costs, the adequacy of and ability to
    develop and implement contingency plans and similar uncertainties.
    The "forward-looking statements" made in the foregoing
    Year 2000 discussion speak only as of the date on which such
    statements are made, and the Company undertakes no obligation to
    update any forward-looking statement to reflect events or
    circumstances after the date on which such statement is made or to
    reflect the occurrence of unanticipated events.



PART II OTHER INFORMATION

Item 6 Exhibits and Reports on
    Form 8-K





SIGNATURES

Pursuant to the requirements of the
    Securities Exchange Act of 1934, as amended, the co-registrants
    have duly caused this report to be signed on their behalf by the
    undersigned, thereunto duly authorized.



Loomis, Fargo & Co. (Delaware)
  
             
               
               
               
               
               
              LFC
    Holding Corporation
  
             
               
               
               
               
               
              Loomis,
     Fargo & Co. (Texas)
  
             
               
               
               
               
               
              Loomis,
    Fargo & Co. of Puerto Rico

Date: August 11, 1999  
               
               
              By:
      /s/ James K. Jennings, Jr.

James K. Jennings, Jr.
  
             
               
               
               
               
               
              Executive Vice President and
  
             
               
               
               
               
               
              Chief Financial Officer
  (Principal Financial and
  
             
               
               
               
               
               
              Accounting Officer of
   the
  
             
               
               
               
               
               
              Co-registrants)

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