Last Wednesday Hillenbrand Industries reported 4th quarter 2017 and full year 2017 results.  For both the quarter and the year the company reported that company’s overall revenue had grown about 3% overall.

For both the quarter and the year, however, revenue increased in the Process Equipment segment of their business and decreased in the Batesville segment of the business.  As a company, net income increased 12% to $126 million for the year and adjusted EBITDA increased 5% to $281 million.

For the 4th quarter of 2017 Process Equipment sales grew 7% over the same time period last year to $304 million for the quarter while the Batesville segment saw a decline in sales of 4% as compared to the same time period in 2016 with sales of $139 million for the quarter.

The company also noted that for the year Process Equipment sales grew 7% and Batesville sales decreased 2%.

Funeral Director Daily take:  It is interesting to note that Hillenbrand provided going-forward guidance on the company which estimates the Process Equipment Group to increase sales by 5-7% in 2018 while they estimate the Batesville revenue to decrease by 1-3%.  This estimate, in our opinion, continues to show that the company is fully aware of the consumer’s choice away from full service funerals and the revenue that they bring to the death care industry.

We’ve maintained all along that cremation, and especially low cost direct cremation, will be the rising choice of the American consumer.  We would not be surprised to see the Batesville division revenue erode at a faster than a 1-3% clip when you consider the last quarter of their fiscal year saw a 4% decline.  It is our opinion that movement to the choice of direct cremation is moving even faster than most of us think.

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