One of Britain’s biggest undertakers has seen a tripling in the proportion of clients choosing lower cost funerals during the coronavirus pandemic.
Dignity, which operates more than 800 funeral locations across the UK, said that in April the proportion of clients choosing a “simple” funeral jumped to 60% of all services conducted, up from 20% between January and March.
The company charges up to £3,578 for a full service funeral and about £2,047 for a basic package.
It said the restrictions on funeral services meant that the average cost of its full service reduced by about £400 in April to £3,150, as it withdrew add-ons such as limousines. The company performed 20,000 funerals in the first quarter this year.
Overall, Dignity said the average income per funeral fell from £2,648 in the first quarter to £2,200 in April.
The company said the number of deaths in the first quarter rose by 1% year-on-year to 161,000, but had seen a dramatic rise since then as the virus spread throughout the UK.
“Sadly, since the end of the quarter, the UK has witnessed in excess of 20,000 deaths in a single week, the highest since the beginning of 2000,” said Clive Whiley, executive chairman of Dignity.
“Covid-19 is presenting a unique set of challenges for the UK as a whole and for Dignity”.
Whiley said Dignity would not be furloughing any staff or seeking any financial assistance from the government during the health emergency.
“The various government schemes designed to protect jobs and people’s livelihoods are intended for small businesses and sectors that are under threat more directly than Dignity,” he said.
Dignity said it had £57m in cash and that it would pass its next financial covenant test at the end of June. However, the public listed company said it would fail another test, called a restricted payment condition, which stops excess cash being transferred between group companies.
“Any cash not permitted to be transferred whilst the RPC is not achieved will be available to be transferred at a later date once the RPC requirement is achieved,” the company said. “In practical terms, failure of the RPC will not have a material impact on the day-to-day operation of the group.”