InvoCare Limited, Australia’s largest private funeral, cemetery and crematorium operator announced today its results for the half year ended 30 June 2010.
Sales revenues grew 4.2% to $128.7 million. Better prevailing economic conditions during the half year helped increase sales of cemeteries and crematoria memorials. The average price per funeral also improved, including $0.6 million additional contribution from the prepaid funeral surplus.
These helped mitigate an estimated 1% decline in the number of deaths in its markets.
Reported profit after tax increased 16.0% to $16.6 million. Underlying operating profit after tax (that is, excluding the impacts of non-recurring asset sales, fair value movements in derivative financial instruments, investment allowance benefits, prior period tax adjustments and acquisition related expenses) increased by 18.5% to $15.8 million.
As a result of the solid performance, the Directors determined that an interim, fully franked, ordinary dividend of 13.0 cents per share will be payable on 8 October 2010, with a record date of 17 September 2010 and an ex dividend date of 13 September 2010. InvoCare has left activated its Dividend Reinvestment Plan (DRP) for this interim dividend. It is not intended that this DRP be underwritten nor will shares be issued at a discount.
InvoCare has continued its expansion program during the half year having previously announced the acquisition of Sydney funeral operator WN Bull Funerals. At this point in time, future acquisitions are likely to be smaller, “bolt on” businesses and InvoCare does not expect a material acquisition.
New financing facilities are expected to be in place from 1 September 2010 for $255 million (with ANZ, NAB and CBA), providing additional headroom to pursue further growth opportunities over the next five years.
Andrew Smith, InvoCare’s Chief Executive Officer said:
“The solid operating and financial results have again been underpinned by our dedicated employees who are committed to delivering outstanding customer service to our client families and supporting our local communities in Australia and Singapore. Despite continuing headwinds in the death rate, our employees have also responsibly managed costs during the half year to ensure we delivered operating leverage.
InvoCare remains well positioned with a proven, robust business model that gives confidence in our ability to identify opportunities and achieve long term growth objectives.”
For immediate Release
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