£100m wiped off funeral provider’s value

Funeral provider Dignity had £100m wiped off its value after investors took fright at its warning of competition pressures.

Shares closed down 8%, at 2262p, which reduced its market value to £1.13bn.

The Sutton Coldfield-based group had told the stock market that it expected to increase costs by up to £1.0m this year – and that those costs would recur and increase in future years.

It said: “Whilst our pre-arranged and crematorium businesses are performing strongly, we continue to see increasing price competition and new competitors in our funeral business.”

However it insisted that its overall expectations for the year are “positive and remain unchanged”.

Its third quarter figures revealed a 6% increase in revenues and a 5% uplift in underlying operating profit.
 
Dignity’s chief executive Mike McCollum said: “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.”