A soaring death rate has boosted profits at Dignity by nearly a quarter in a year that the company described as “extraordinary”.
Britain’s only listed funeral group said that pre-tax profit was £69 million in the year to the end of December, compared with a £67.7 million loss previously and on revenues of £305.3 million up 14 per cent on the year before.
Dignity said that its busy 12 months was a result of a 7 per cent rise in the deaths last year, “was a rate of change not seen for over 60 years”. Last month the Office for National Statistics reported that mortality rates had risen by 5.4 per cent last year, compared with 2014, equivalent to an extra near-27,000 deaths.
Mike McCollum, the chief executive of Dignity, said: “There is no doubt that the number of deaths significantly increased last year. It is the biggest year-on-year increase since 1952. As a result our financial performance was significantly ahead of where we expected it to be a year ago.”
He said that the group, whose predecessor companies carried out the funerals of Winston Churchill and one of the Kray twins, had carried out 73,500 funerals last year, up from 65,600.
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It owns 767 funeral homes in the UK and 39 crematoriums. Funeral services during the period were 15.3 per cent up at £212.6 million and sales from its crematoriums rose by 14 per cent to £63.1 million.
The group also sold 374,000 pre-arranged funeral plans, up from 348,000 the year before.
Mr McCollum said that a more normal death rate could mean that pre-tax profit for the coming year would be lower than last year’s but that the company expected to hit its target of a 30 per cent increase in earnings per share.
He said that the group could carry out further share buybacks if it could find no alternative use for excess cashflow.
Dignity will pay a final dividend of 14.31p, bringing the total payout for the year to 21.45p. The shares closed 6.1 per cent lower at £24.13.