Propel Funeral Partners (ASX:PFP), the second-largest provider of death care services in Australia and New Zealand next to Invocare (ASX:IVC), has released a trading update ahead of its 2024 Annual General Meeting, which will be held later today.
The company operates 198 locations, including 38 cremation facilities and nine cemeteries, with a significant presence in both regional and metropolitan areas.
Chairman Brian Scullin highlights Propel’s continued growth, emphasising its successful acquisition strategy. Propel reported a 24.2% increase in revenue to $209.2 million for FY24, driven by a 20.1% rise in funeral volumes, supported by recent acquisitions. The company’s operating EBITDA rose by 20.5% to $55.4 million, and it posted a pro forma net profit after tax (NPAT) of $23.4 million, reflecting a 12.2% increase.
Propel’s Managing Director, Albin Kurti, outlined a robust start to FY25, with Q1 revenue up 16% year-on-year to $61.5 million and operating EBITDA climbing 15% to $16.5 million. The quarter saw Propel conduct approximately 6,150 funerals, representing a 13% volume increase compared to the prior year.
The company’s strategy remains focused on capitalising on a fragmented market by acquiring funeral homes and related infrastructure. The Board’s confidence in the company’s growth prospects was underscored by its fully franked FY24 dividends of 14.4 cents per share.
With $153 million in available funding, Propel is positioned to pursue further acquisitions to bolster its service network.
Propel’s leadership noted that while industry death volumes can fluctuate, the long-term demographic trends indicate steady growth, driven by an ageing population and rising death rates.