Rising death rate boosts earnings at funerals firm

Funeral operator Dignity has reported rising sales and profit in the first quarter after an increase in the death rate boosted income.

Dignity bought Craigton Crematorium in Glasgow last year. Picture: Robert Perry

The group said revenue rose 15 per cent to £93.3 million in the 13 weeks to 31 March, while underlying profits grew 20 per cent to £37.4m. The death rate for the period was 167,000, up 7 per cent on a year earlier.

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Dignity said: “As anticipated at the time of the group’s 2016 preliminary results published in March, the number of deaths in the first quarter was higher than the previous year, but lower than in 2015.

“Data from previous years indicates that large variances in the number of deaths at the end of the first quarter tend to normalise by the end of the year. The group’s current assumption continues to be that the number of deaths in 2017 will be lower than 2016.”

Dignity, which acquired five crematoria from the Co-operative Group last year, said that acquisition activity in the period continued, with the group buying up 12 funeral locations and one small crematorium for a total of £20m.

Peel Hunt analyst Charles Hall said: “Dignity has demonstrated a strong long-term performance. Individual quarters can be volatile due to the death rate in that quarter, however, a longer viewpoint shows a pretty consistent track record.

“This has been delivered through consistent price rises and acquisitions, to offset loss of market share.”