InvoCare’s Share Price Edged up after Acquisition of Hasting Funerals

  • Sep 25, 2018 AEST
  • Team Kalkine
InvoCare’s Share Price Edged up after Acquisition of Hasting Funerals

On 25 September 2018, InvoCare Limited’s (ASX:IVC) share price increased by 0.912% after company’s announcement stating that it has entered into a conditional sales agreement for acquisition of the business and assets of Hasting District Funeral & Cremation Service (Hasting Funerals) which is based in Port Macquarie, NSW.

Hasting Funerals was established in 1930 and it is currently operating from three locations which serves the Port Macquarie and surrounding region of NSW. It is one of the largest operator in Port Macquarie and the surrounding towns of Laurieton and Wauchope. The business generates revenue of approximately $2.7 million per annum and conducts around 400 funeral services annually. The Assets purchased by the InvoCare Limited includes a fully equipped funeral home with chapel, reception lounge, mortuary, offices and parking area. The company has also purchased a private Cremation facility, a motor vehicle fleet and prepaid contracts from Hasting Funerals.

On 19 September 2018, InvoCare acquired Harrison Funerals which is based in Ballarat, Victoria for the purpose of enhancing the business and continue the growth in Central highlands of Victoria. And before that on 16 September 2018, InvoCare also acquired Morrison funeral Directors for the purpose of enhancing the business.

On 24 September 2018, InvoCare announced Dividend Reinvestment Plan share price for the 2018 interim, fully franked dividend. The Dividend is inclusive of a 2% discount and it is payable on 5 October 2018. In the first half year result of FY2018, the total sales revenue of the company increased by 0.4% to $225.7 million due to realization of deferred memorial sales. The expenses of the company also grew by 0.3% to $172.9 million. The operating EBITDA of the company declined by 7.4% to $ 23.5 million. The operating margin of the company was down by 20 bps. Due to non-recurring project related costs, the cash conversion was adversely impacted.

The company is continuing to focus on acquisitions and capital management. The operating EBITDA for the full year is expected to show a small increase over the result for 2017 and mid-single digit decline in operating EPS.

IVC’s shares traded at $12.170 with a market capitalization of $1.33 billion as on 25 September 2018.

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