Death rate boosts funeral directors group Dignity

West Midlands funeral directors Dignity has seen revenue and profits increase following a rise in the number of deaths during 2016.

The Sutton Coldfield-based group reported annual revenue up 3% to £313.6m (2015: £305.3m), with pre-tax profit rising by a similar percentage to £71.2m (2015: £69m).

It said: “The number of deaths has been higher in 2016 than the group originally anticipated following a significant increase in the number of deaths in 2015. Historical data would suggest that deaths in 2017 could be significantly lower than 2015 and 2016.

“Trading in the first few weeks of 2017 has however continued to be strong. As a result, the board’s financial expectations are unchanged for the year ahead.”

However, the board said while it remained positive about the future prospects for the group, given the increased size of the business and increasing competition in each of its markets, it had revised its medium-term target underlying earnings per share growth rate to 8% per annum from the current 10%.

“As with the previous target, this objective includes the benefit of the reinvestment of cash generated by the business and the group’s ability to releverage its balance sheet either to fund acquisitions or return capital to shareholders,” it added.

Mike McCollum, chief executive of Dignity, said: “I am pleased with our financial and operational performance in the period. Our business has responded well to the needs of our customers, maintaining the high standards we set ourselves.

“Looking into the future, we anticipate further engagement with the Scottish and Westminster parliaments, as we believe regulation of the funeral and pre-arranged funeral markets is necessary to ensure every family receives minimum standards of care from appropriate facilities.

“We also expect to invest more in digital technologies that will help our clients and also act as a source of new business for the group.”