StockMarketWire.com - Funeral firm Dignity warned profits could undershoot its expectations after performance in the first quarter was below its expectations due to a 'significantly lower' than expected number of deaths.  

'Achievement of full year expectations will rely heavily on the number of deaths in the remainder of the year compared to 2018,' the company said. Historical data over the last 20 years indicated that the final volume was likely to be within 3% of the previous year.

'If deaths were 580,000 (approximately 3% lower), then all other matters being equal, underlying operating profits for the full year could be approximately £3m to £4m lower than originally anticipated.

In January, the company guided underlying operating profits of approximately £79m. 



For the three months period ended 31 March, underlying operating profits fell 42% to £21.7m, and revenue fell 15% to £81.8m.



The absolute number of deaths decreased by approximately 12% to 159,000 from 181,000 in the comparative period last year.

The group performed 19,200 funerals in the first 13 weeks of the year, down from 21,400 a year earlier, representing a market share of 12%, above the 11.7% a year earlier.

Average income per funeral was approximately £190 lower than the same period in 2018, slightly below the amount expected and previously guided by the Group. Average income for the remainder of the year was expected to be approximately £2,940, the company said.

'The year has started below the Board's expectations primarily as a result of the number of deaths so far in 2019. Achievement of full year expectations will rely heavily on the number of deaths in the remainder of the year compared to 2018. Historical data over the last 20 years indicates that the final volume is likely to be within three per cent of the previous year,' the company said.



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