Dignity first-quarter profit falls on low cost funeral services
Dignity reported an 11 per cent fall in first-quarter operating profit as customers chose lower-cost funeral services amid the coronavirus pandemic.
As part of lockdown measures, the goverment has provided guidance on how services should be conducted. This includes limiting the number of people present to immediate family members and close friends.
Dignity also said it had stopped providing church services or limousines, reducing the average charge for full service funerals to approximately £3,150. Additionally, the proportion of customers choosing a simple funeral over a full service funeral has “increased dramatically” to approximately 60 per cent compared to the 20 per cent seen in the first quarter.
“Combining these impacts means the Group is currently achieving an overall weighted average income per funeral before ancillary revenues of approximately £2,200 compared to £2,648 achieved in the first quarter of 2020,” Dignity said.
The group also said that as guidance on access to crematoria and cemetery grounds is “evolving”, memorial services activity will be lower than normal whilst broader lockdown measures are in place.
“Whilst this will be temporary, it is unclear what proportion of memorial activity that would have otherwise been sold will be able to be recovered later in the year once operations resume.”
Dignity said it would not speculate on future numbers of deaths, but said they had increased one per cent to 161,000 compared to last year.
“Should 2020 witness a large number of incremental deaths, beyond the 600,000 originally anticipated by the Office for National Statistics, then it is possible that 2021 and 2022 could experience a lower number of deaths than in 2019.”
Shares are up 2.99 per cent.
Get the news as it happens by following City A.M. on Twitter.