Dignity profit rises even as deaths broadly flat

Funeral services provider Dignity reported an increase in revenue and profit in the third quarter, even as the number of deaths was broadly flat.

In the 39 week period to 29 September, operating profit rose 5% to £79.4m on revenue of £243.9m, up from £229.3m, as the number of deaths ticked up just 1% to 440,000. The company said it continues to see significant competition across the business.

While Dignity’s pre-arranged and crematorium businesses are performing strongly, it noted increasing price competition and new competitors in the funeral business.

The group said it continues to expect incremental costs of up to £1m in 2017 as it looks to improve its digital presence. This is expected to be a recurring expense in future years, with costs likely to increase over time.

During the period, the company bought 20 funeral locations and one crematorium for an aggregate investment of £28.8m and has opened 12 satellite locations. Since the 29 September, it has acquired four funeral locations and opened one satellite location.

Chief executive Mike McCollum said: “Following the group's solid third quarter results expectations for the full year remain unchanged. The board recognises the increasingly competitive environment and the consequential challenges facing the group. Alongside the work being undertaken on the group's digital strategy and our continued call for regulation of our markets, we are assessing other initiatives to help the group build on its strong market position.”