Despite the awkwardness of a pandemic with death being talked about more than ever, Propel Funeral Partners (ASX: PFP) have been diligently handling the sensitivity of increasing death rates which has resulted in greater demand for funeral services.
For the Quarter ended 30 September 2021, Propel has reported a 13% increase in revenue compared to the previous corresponding quarter which was driven by a 10% increase in total funeral volume over the same period.
“Propel’s diversified network of funeral and related social infrastructure assets across Australia and in New Zealand has continued to deliver considerable financial resilience in the first quarter of FY22, despite COVID-19 impacts, and I thank our staff for their dedication to providing essential funeral and related services to local communities,” said Propel Managing Director, Albin Kurti.
“Hopefully extended lock downs, strict funeral attendee limits and travel restrictions will soon be behind us, enabling bereaved client families to grieve in a manner that they ordinarily would, surrounded by family and friends.”
While funerals in locked down States have been impacted by attendance limits, this has not impacted Propel’s operating EBITDA margins which were maintained at 28%, only slightly down on the 30% achieved across FY21.
Having reported $120.4m in revenue for FY21 with operating net profit after tax up 7.6% to $15.3m for the year, Propel has signalled their intent to expand via acquisitions.
Operating a mix of different brands in the fragmented funeral home industry, Propel is the second largest funeral service provider in Australia and New Zealand with 136 locations that includes 9 cemeteries.
Aging populations are expected to contribute to rising demand for Propel in its core markets where death volumes in Australia are expected to increase by 2.7% annually from 2019 to 2030 and 2% in New Zealand.
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