Funeral provider avoids the worst

Funeral provider Dignity has achieved a better-than-expected performance as it begins a three-year transformational plan for the business.

The industry was disrupted by a new entrant to the market and Dignity’s warnings about its potential impact had seen its share price fall by 70% between November and February.

However the performance during the first half of the year – pre-tax profits were down 15% to £38.5m while revenues edged up 3% to £174.7m – has improved its mood.

Mike McCollum, chief executive of Dignity, said: “We are pleased with the strong and better than originally expected financial performance in the first half of this year.

“Strong cash generation will support planned investments and costs which form part of our plan for the funeral business. Our focus remains on building a new lower cost model in our funeral business which will provide more competitive prices and a superior, future ready proposition.”

It is beginning on a three-stage transformation where it plans to enhance the customer proposition, invest in and simplify the operating model, and streamline support to enable investment.

It has acknowledged there will be a “modest reduction” in staff which it hopes to achieve through natural turnover and over a number of years.