Batesville, a division of Hillenbrand Industries, reported their Fiscal Year 2nd Quarter during the first week of May. While the entire company revenue increased 11% year over year, Batesville, the funeral service side of the business, increased their revenue by over 20% to a quarterly volume of $166 million.
Here’s what was said in the FY 2Q 2021 report about the Batesville segment of Hillenbrand Industries:
“Revenue of $166 million increased 20% year over year driven by an increase in burial casket sales primarily due to an estimated increase in deaths due to the COVID-19 pandemic. The increase was partially offset by an estimated increase in the rate at which families opted for cremation. Adjusted EBITDA of $45 million increased 39% year over year, and adjusted EBITDA margin of 26.9% was 380 basis points higher than the prior year driven by higher burial volume and productivity initiatives, partially offset by incentive compensation, commodity inflation, and higher transportation and manufacturing costs required to respond to the surge in demand driven by the COVID-19 pandemic.”
When we reported on Matthews Internationals report last week we compared the traditional Matthews products of bronze with Batesville’s historic casket business and mentioned that both continue to reap benefits with sales and profits for their respective companies. We mentioned that Matthews “Memorialization” segment continues to be a bigger and bigger, percentage wise, driver to Matthews overall operations.
On the contrary, we believe that Hillenbrand leverages Batesville’s casket and funeral supply cash-flow to grow the other parts of its business. To that end, we see that Batesville’s $166 million in revenues is about 23% of the $722 million in quarterly revenue that Hillenbrand reported. We also noticed that in EBITDA margin, Batesville was third of three segments in contributing to the Hillenbrand Industry total Adjusted EBITDA for the quarter.
Batesville contributed about $44.6 million to the company’s $151.1 million EBIDTA prior to deductions for corporate and overhead expenses. That’s roughly 29.5% of the EBITDA contribution. . . . a sign that Batesville is more than pulling its own weight (over 29% contribution to EBITDA with only 23% of the company sales) at Hillenbrand.
It will be interesting to see what happens with Batesville as the emerging trends of higher cremation percentages mesh with a larger number of Baby Boomer deaths coming up in the future. Will Batesville, and its casket manufacturing, grow or continue its traditional non-Covid time period unit decline with those trends?
You can see the Hillenbrand Industries Fiscal 2nd Quarter 2021 Report here.
More news from the world of Death Care:
- “Sad it ended that way” — How the funeral industry dealt with the pandemic. Eastern Daily Press (Great Britain)
- Embalming is vital to the funeral industry, but a lack of skilled practitioners is causing concern. ABC News – Australia
- Letter: State of Eternal Hills Cemetery is a disgrace. Herald and News (OR)
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