Dignity reported a further slide in revenues and profits on Wednesday, as the funeral specialist was hit by fewer deaths and rising costs.
Updating on trading, the firm said underlying revenues had fallen 14% in the 39 weeks to September end, to £204.7m, while underlying profits tumbled 68% to £14.1m.
The number of deaths this year has fluctuated, with a sharp decline in the first three months partially offset by higher numbers in the second and third quarters. In the year to date, the number of deaths was down 3% year-on-year, at 469,000.
Dignity – which operates 46 crematoria and 24 cemeteries alongside a network of 776 funeral directors – has cut prices and introduced a direct cremation service this year as it looks to boost market share.
Further weighing on profitability are higher costs, including salaries – as it struggles to recruit staff – coffin raw materials, fuel and the loss of rates relief.
As a result, the cost to deliver a funeral increased to £1,925 at 30 September, from £1,858 a year previously.
Kate Davidson, chief executive, said: “The third quarter continues to present some of the challenges we faced earlier this year, but with our new strategy well underway we are beginning to see positive indications of our market share growing.
“It is also promising to see tangible improvement to our workforce as we increase our headcount following the proactive steps we’ve taken.”
Looking to the current quarter, Dignity – which also sells pre-paid funeral plans – added that deaths in the first few weeks were around 19% higher than the five-year average. “The reason for this spike in the death rate is currently unknown,” it noted.
As at 1100 GMT, shares in Dignity were down 4% at 425p.
