New Zealand Markets close in 5 hrs 20 mins

Propel buoyant on 'record funeral volumes'

Alex Druce
Propel Funeral Partners says an increase in deaths has increased revenue

Propel Funeral Partners says a bounce-back in death numbers over the late winter and early spring has driven an improved financial performance.

The ASX-listed firm said record funeral volumes over the three months to September increased revenue by 19 per cent on the same period a year ago, when business had been dulled due an unexpected decline in deaths.

Propel managing director Albin Kurti said the $28.9 million in quarterly revenue was a positive start to the year, which should yield more deaths due to an ageing population.

"Propel has made a positive start to the new financial year and we expect death volumes will continue to revert to long term trends, given the unusual decline experienced last year, the partial recovery in recent months and the growing and ageing population," Mr Kurti said in a release.

Shares in the company were trading 3.01 per cent higher at $3.08 by 1515 AEDT, against a 0.7 per cent decline in the wider ASX/200.

Propel shares have now climbed 12.8 per cent higher from $2.73 a year ago, but are still shy of the $3.59 record set in the months following its November 2017 listing.

Propel, which calls itself the largest death services provider in Australia and New Zealand, swung to a net profit of $12.3 million for the year to June 30 from a loss of $14.3 million in the prior corresponding period.

It operates in 120 locations, including 28 cremation facilities and nine cemeteries, and said in its 2019 annual report demand for death care services is expected to grow "because of increasing death volumes due to population growth and ageing of the baby boomers."

Funeral volumes increased by 11.8 per cent to 11,304 for the year as the company added Newhaven Funerals, Manning Great Lakes Memorial Gardens, Martin Williams Funeral Directors, and the Waikanae Funeral Home and the Morleys Group to its stable.

It also entered binding legal documentation to acquire the Dils Group and, subsequent to year end, a deal to acquire Gregson and Weight Funeral Directors.

Rival firm InvoCare - which operates White Lady Funerals, Simplicity Funerals and Singapore Casket - almost doubled its profit for the half year to June 30 to $41.1 million, as it too integrated a number of acquisitions.